In 2012, EPA issued the Mercury and Air Toxics Standards (MATS), which limit coal- and oil-fired power plants’ emissions of mercury and other hazardous air pollutants. A number of states and industry groups claimed that the rule was unlawful because, among other reasons, EPA declined to consider regulatory costs when deciding whether it was “appropriate and necessary” to regulate power plants’ hazardous emissions under Section 112 of the Clean Air Act. The Supreme Court agreed with the challengers and instructed EPA to revisit its “appropriate and necessary” finding, this time taking into account costs.
In 2016, after considering costs under a preferred approach and an alternative approach, EPA issued a supplemental finding reaffirming the agency’s decision to regulate power plants’ emissions of mercury and other hazardous air pollutants. In particular, under its alternative approach, EPA looked to the results of a formal cost-benefit analysis it had prepared as part of the Regulatory Impact Analysis accompanying MATS, which showed that annual monetized benefits would outweigh costs by as much as nine to one.
In their new challenge, Petitioners seek to obscure the fact that regulating power plants’ emissions of hazardous air pollutants overwhelmingly benefits society by asking the U.S. Court of Appeals for the D.C. Circuit to ignore or discount large portions of EPA’s analysis—namely, its consideration of indirect benefits (sometimes called ancillary benefits or co-benefits) and unquantified benefits. But, as our amicus brief points out, EPA’s consideration of indirect benefits and unquantified direct benefits is consistent with the Clean Air Act, past court decisions, federal cost-benefit guidelines, economic best practices, and regulatory precedent. Overall, we argue that the agency’s cost-benefit analysis was properly conducted and more than satisfies its obligation to consider costs when determining whether regulation of power plants’ hazardous emissions is “appropriate and necessary.”