NCPA - National Center for Policy Analysis

The EPA's New Air Quality Regulations: All Pain, No Gain (Part Two)

August 11, 2011

The U.S. Environmental Protection Agency (EPA) continues to expand its reach, creating a host of new regulations at a high cost to the economy.  This is especially true of two new initiatives: a proposed revision to the national ground-level ozone standard and the attempt to regulate greenhouse gas emissions under the Clean Air Act, says Kennedy Meier, an intern with the National Center for Policy Analysis.

The EPA is proposing a new, more restrictive primary ozone standard under the National Ambient Air Quality Standards program, which regulates air pollutants the EPA deems unhealthy.  Estimates vary, but researchers agree that complying with a new ozone standard will be costly:

  • Compliance costs could reach $19 billion to $25 billion for a 0.070 parts per million (ppm) standard and $52 billion to $90 billion (in 2006 dollars) for a 0.060 ppm standard by 2020.
  • Roughly 7.3 million jobs could be lost by 2020 with a 0.060 ppm standard and the present value of the cost of attaining a 0.070 ppm primary standard could exceed $1 trillion.

The benefits of a stricter ozone standard are questionable.  Studies have found that exposure to levels up to 0.1275 ppm are safe.  Thus, for a person to actually be exposed to a harmful level, ambient ozone would have to be far above the 2009 national average concentration of 0.069 ppm.

Under the Clean Air Act, the EPA is now required to regulate greenhouse gas emissions.  Studies have found that regulation of greenhouse gases would be very costly:

  • Up to 2.5 million jobs could be lost, the average annual household income could be decreased by $1,200, and gasoline and residential electricity prices would increase by 50 percent by 2030, estimates Management Information Services, Inc.
  • Nearly $7 trillion (in 2008 dollars) in economic output would be lost by 2029, reports the Heritage Foundation.

Unfortunately, the EPA's efforts will be futile.  Even if the entire Western Hemisphere suddenly eliminated all carbon dioxide emissions, the effect on global emissions would likely be offset within a decade by the growth of China's emissions alone.

Affordable energy is a key component of a prosperous economy.  Higher energy prices and the loss of over 7 million jobs and billions of dollars of gross domestic product over the next two decades will make present and future generations worse, not better, off, says Meier.

Source: Kennedy Meier, "The EPA's New Air Quality Regulations:  All Pain, No Gain (Part Two)," National Center for Policy Analysis, August 11, 2011.

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