An article published in Science magazine finds deep flaws in the US Environmental Protection Agency (EPA)’s benefit-cost analysis in support of a proposed rule related to the regulation of hazardous air pollution from coal-burning power plants. The analysis forms part of the foundation for a regulatory proposal to roll back the legal underpinnings of its Mercury and Air Toxics Standards (MATS), which power plants have been complying with since 2016, leaving the standards vulnerable to legal challenges.
Researchers from Harvard, Yale, Claremont McKenna College, UC Berkeley, Georgetown, and Resources for the Future (RFF), claim that EPA “ignores scientific evidence, economic best practice, and its own guidance” in the new analysis. The authors assert that EPA “can and should do better.”
“The EPA’s new analysis of the cost and benefits of the MATS rule is clearly insufficient. It fails to account for advances in our understanding of the negative health impacts of mercury and changes in electricity generation since 2011, which have led to much lower compliance costs than were originally projected,” says RFF Senior Fellow Karen Palmer, a coauthor on the paper. “And, it dismisses an entire category of benefits.”
The authors highlight the following flaws in EPA’s analysis:
- It disregards economically significant but indirect public health benefits, or “co-benefits,” in a manner inconsistent with economic fundamentals. The expected benefits of reducing particulate matter pollution of $33-90 billion per year easily exceed the expected costs of $9.6 billion under EPA’s original 2011 analysis of the MATS rule.
- It fails to account for recent science that identifies important sources of direct health benefits from reducing mercury emissions, such as fewer heart attacks.
- It ignores transformative changes in the structure and operations of the electricity sector over the last decade. Shifts from coal to natural gas and renewable sources, including wind and solar power, for electricity generation have decreased the number of power plants that must install pollution control equipment. The investment in pollution control has been about half of what was projected in 2011.
“If finalized, the new rule will undermine continued implementation of MATS and set a concerning precedent for use of similarly inappropriate analyses in the evaluation of other regulations,” the authors state.