Our work has made a tangible impact, helping shape important policies at the federal, state, and local levels. Some of our key accomplishments are described below.
Swaying the Supreme Court?
Policy Integrity has helped support several major environmental rules that have faced challenges in the Supreme Court, and our legal briefs have received significant attention. In the UARG v. EPA case on greenhouse gas regulation, one of Justice Kagan’s questions restated the central argument of our amicus brief (not raised in any other brief) about the EPA’s consistent interpretation of the Clean Air Act over 30 years. The Court’s ruling affirmed the EPA’s authority to regulate greenhouse gases under the prevention of significant deterioration program, as our brief suggested it should.
In the Court’s case on the Cross-State Air Pollution Rule, EPA v. EME Homer City Generation, our brief argued that a lower court had essentially substituted its preferred policy for that of the EPA, acting inconsistently with core principles of administrative law. The Supreme Court upheld the Cross-State Air Pollution Rule, and Justice Ginsburg, who wrote the majority opinion, cited one of Richard Revesz’s articles in her opening paragraph.
In Michigan v. EPA, the Supreme Court’s 2015 review of the EPA’s Mercury and Air Toxics Standards, an argument put forward in our brief occupied roughly half of the discussion at oral argument. We claimed that the EPA cannot meaningfully assess compliance costs at the initial listing stage of its regulatory process, because costs inextricably depend on subsequent regulatory design choices. Justice Kagan’s dissent focused on this argument, and while the Court ruled 5-4 to remand the mercury rule to the D.C. Circuit Court, the rule is likely to be ultimately upheld.
Supporting the Social Cost of Carbon
An August 2016 federal court ruling helped pave the way for a new chapter in economically efficient U.S. climate policies, and our brief for the case was acknowledged in the judges’ opinion. The U.S. Court of Appeals for the Seventh Circuit sided with the Department of Energy (DOE) in a challenge to the agency’s energy efficiency standards for commercial refrigerators, and the judges upheld DOE’s use of the Social Cost of Carbon (SCC) in its analysis of the regulation. The SCC is the U.S. government’s official estimate of the economic damage caused by each ton of carbon pollution, and this marked first time that a court has ruled on the legality of an agency’s use of the tool. The judges acknowledged Policy Integrity’s brief and adopted reasoning consistent with many of our brief’s arguments about the SCC, while rejecting a host of arguments that are often used to challenge rules that reduce emissions. The government’s brief was limited by word count and needed to address a number of other topics, so Policy Integrity’s brief was the only one to address most SCC issues. As a result of this ruling, other federal agencies will likely be more confident in using the SCC, which could greatly increase the economic efficiency of rules that reduce carbon pollution. The case garnered considerable media attention, and Cass Sunstein, former head of the Office of Information and Regulatory Affairs, called the decision “one of the most important climate change rulings ever.”
Helping California Improve Energy Decisionmaking
California has long been a trendsetter in clean energy policy, and our input helped inform the state’s approach for evaluating distributed energy resources (DERs), such as rooftop solar installations. The state’s new approach, which will quantify the environmental benefits of DERs, could help influence other policies around the country, boosting the growth of clean energy sources. Our comments to the California Public Utilities Commission were heavily cited in a March 2018 administrative law judge ruling that was adopted by the Commission, requiring utilities to conduct a societal cost test to determine the cost-effectiveness of DERs. Having been “persuaded by the arguments of the Institute for Policy Integrity,” the ruling will require utilities to calculate the climate benefits of DERs by using the Social Cost of Carbon estimate developed by the Interagency Working Group. As we suggested further, California utilities will also quantify the air quality impacts of DERs. As a result of this decision, California will be able to create incentives encouraging DER installations that have the greatest benefit to the public.
Improving the Government’s Valuation of Natural Resources
Policy Integrity’s multi-year effort to improve federal natural resource leasing programs has made a significant impact. Since 2009, we have advocated that government leasing decisions account for “option value,” a common financial concept that places value on delaying irreversible decisions in order to gain more information. We have suggested policy changes through an academic article, a lawsuit, and numerous public comments, and the Department of the Interior has begun to listen. The offshore oil and gas leasing program proposed in early 2015 devotes 12 pages to option value and related resource valuation concepts, using language that closely resembles the arguments Policy Integrity has repeatedly made to the agency. Likely effects of this change include higher minimum bids for lease sales and delayed leasing of sensitive areas. We are continuing to push for additional improvements in government natural resource valuation at multiple federal agencies.
Modernizing Energy Policy in New York State
Our input is helping to improve energy policy decisionmaking in New York State, which in 2015 announced an ambitious mandate to boost clean energy. We have submitted numerous comments to the New York State Public Service Commission, suggesting several changes in the design of its Clean Energy Standard to ensure that the state’s policy goals can be met in the most-cost effective manner. In its final order, the Commission adopted several of our suggested changes. Most notably, the Commission relied on our comments in deciding to calculate zero-emission credit payments based on the Social Cost of Carbon. This marks a major success in our ongoing efforts to encourage government agencies to use the Social Cost of Carbon as a tool when designing policy.
Helping Save Lives in NYC
Our research helped spur New York City to adopt a major air pollution rule that has saved hundreds of lives. In 2008, Policy Integrity researchers began studying the likely effects of a proposed policy to require cleaner heating oil in New York City buildings. At the time, nearly 10,000 buildings used boilers that burned No. 4 or No. 6 oil—dirty fuels that emit high levels of sulfur, nickel, and other noxious pollutants. We released a report that quantified the health and economic benefits at stake: the policy could save a minimum of 73 to 188 mortalities each year and generate more than $5 billion in health benefits for city residents.
Studies like this often take years to complete, but Policy Integrity conducted this analysis quickly enough to affect the policy debate, while participating in stakeholder meetings and testifying at hearings on the issue. When an alternative version of the law with lower compliance costs was proposed, we updated our research and found that the new law would still generate most of the benefits. Our study helped convince other groups to support this version of the law, and our legal director, Jason Schwartz, was asked to speak at the ceremony when the bill was signed. The Commissioner of the Department of Environmental Protection later said of our efforts, “the Institute for Policy Integrity really helped push the ball over the line.” The law has since been cited as one of New York City’s greatest environmental success stories.
Reforming the Federal Petition Process
Individuals can petition federal agencies to issue, amend, or repeal regulations, but agencies lack a uniform process for handling these petitions. Our efforts have helped improve this system. In 2014, Policy Integrity worked with the Administrative Conference of the United States (ACUS), a federal agency dedicated to improving the administrative process, to create new guidelines for the petition process. In December 2014, ACUS adopted new recommendations for federal agencies, based on Policy Integrity’s research and suggestions. The new guidelines include recommendations on how agencies should track petitions, when they should solicit public comment on pending petitions, and how online resources can best be used to facilitate submissions and update petitioners and the public on petition status. This effort began in early 2014 when Policy Integrity proposed that ACUS update its investigation of petitions for rulemaking. The agency later retained Policy Integrity as a consultant.
Making New York’s Energy System More Resilient
In the wake of Superstorm Sandy, the New York State Public Service Commission sought a new framework for improving the resiliency of electric utility Con Edison. We made a series of policy recommendations, submitted as public comments to the Commission, and many of our suggestions were adopted in the Commission’s order. We suggested that the cost-benefit analysis used to evaluate resiliency investments be comprehensive, going beyond the scope of a traditional capital expenditure analysis. We also proposed that the utility evaluate both traditional and alternative approaches to resilience, quantify societal costs, and monetize impacts where possible. Each of these recommendations was adopted by the Commission, resulting in a stronger framework for protecting New York’s energy system.