Recent Projects

Environmentalists, industry groups, and state governments have been vocal regarding their preferences for the shape of EPA’s forthcoming rule on greenhouse gas pollution from existing power plants. In this policy brief, Jack Lienke and Jason Schwartz survey 30 public letters, white papers, presentations, and reports from these stakeholders and outline their positions.

The Federal Communications Commission’s ability to protect the open Internet has been limited, due to recent court decisions. This report examines the regulatory options and recommends to FCC a course forward that will best promote the benefits of widespread Internet access.

The topic of this paper is the assumed growth of solar photovoltaic (PV) in current energy models, with a focus on information from Annual Energy Outlook (AEO) of the U.S. Energy Information Administration (EIA). EIA resolves the difficulty of modeling solar energy into the future by assuming its current growth will not continue. However, EIA’s assumptions on the future costs of solar PV are highly pessimistic, and its methodology would appear to bias its “Reference Case” projections toward lower growth of solar energy. Sure enough, past AEOs have systematically underestimated the future growth of solar PV. Energy modelers therefore may need to adjust the AEO forecast in order to reflect a most likely baseline trajectory for solar PV.

In Whitman v. American Trucking, the Supreme Court interpreted the Clean Air Act to require the EPA to set the National Ambient Air Quality Standards (NAAQS), without considering costs. Instead, the agency must rely exclusively on health-related criteria. The authors argue that such health-based standards are problematic because there is no coherent way to set the permissible level of pollution based on health considerations alone and, ironically, the NAAQS have generally been set at levels that are inefficiently lax from an economic perspective. The authors urge a reinterpretation of the American Trucking case that would allow the EPA to consider costs-benefit analysis when it would lead to more stringent standards, as it currently does for most regulated pollutants.

To overcome a stall out of “command-and-control” regulations for biofuels, EPA should move towards a flexible, market-based emissions trading system for the transportation sector.

Costs of carbon emissions are being underestimated, but current estimates are still valuable for setting mitigation policy, say Richard L. Revesz, Peter H. Howard, Kenneth Arrow, Lawrence H. Goulder, Robert E. Kopp, Michael A. Livermore, Michael Oppenheimer, and Thomas Sterner in Nature.

The social cost of carbon is an estimate of the economic damage done by each ton of carbon dioxide spewed into the air. Howard examines the Integrated Assessment Models used to produce the social cost of carbon estimate and gives a comprehensive review of what each model accounts for and what each model misses.

The author responds to an argument made by Cass Sunstein that administrative agencies should use breakeven analysis when unable to quantify benefits of a specific regulation. Breakeven analysis seeks to determine how high nonquantifiable benefits of a regulation would have to be for the benefits to justify the costs. In this Comment, the author argues that breakeven analysis can be useful but is always a second-best technique. The first-best approach is to quantify the benefit.

In “Cost-Benefit Analysis and Agency Independence,” Professor Michael A. Livermore argues that cost-benefit analysis provides a standard that constrains the exercise of OIRA’s power, helping to preserve the autonomy of government agencies in the face of White House review. This argument challenges the prevailing view that cost-benefit analysis is a tool for the President to impose authority over executive agencies.

This chapter, in Toxic Airs: Body, Place, Planet in Historical Perspective, assesses the development of the first international study to examine the atmospheric transport of pollutants that cause acid precipitation: the long-range transboundary air pollution project.