EPA’s Return to Rigorous Cost-Benefit Analysis Continues with Impending Methane-Rule Revision

EPA-LogoThe Environmental Protection Agency (EPA) is set to propose changes to the regulation of mercury emissions that can recalibrate the balance between the costs of such controls and the benefits they confer. This action would be consistent with other administrative agency moves, which we have discussed recently here, to elevate the level and quality of economic analysis that past and future regulations must undergo.

The proposal EPA recently sent to the White House’s Office of Management and Budget characterizes the Mercury and Air Toxics Standards Rule for Power Plants (“MATS rule”) as a needlessly expensive mandate and recommends that its costs and benefits should be recalculated. The MATS rule was aimed at reducing toxic power-plant emissions, but utilities have spent an estimated $9.6 billion a year to comply with the new standards, while the mercury emissions reductions have led to a comparatively small estimated annual benefit of $4 million to $6 million. When signing the Energy Independence Executive Order, the President singled out MATS, stating, “Perhaps no single regulation threatens our miners, energy workers, and companies more than this crushing attack on American industry.” Continue reading “EPA’s Return to Rigorous Cost-Benefit Analysis Continues with Impending Methane-Rule Revision”