White House: Benefits of EPA rules vastly outweigh costs

A White House report on Environmental Protection Agency rules — especially air pollution policies — issued in fiscal 2010 and over the last decade finds that the regulations’ benefits greatly outweigh their costs.

The Office of Management and Budget tally, which is part of a much wider annual report to Congress on federal regulations – comes at a time when Capitol Hill Republicans and some Democrats hope to soften or delay several upcoming EPA rules, alleging they will hurt the economy.

The new report finds that between 2000 and 2010, 32 major EPA rules together will ultimately yield estimated annual benefits between $82 billion and $551 billion in 2001 dollars, with annual costs in the $23 billion to $29 billion range.

Both the benefits and costs estimates for EPA rules overall are far higher than regulations from other agencies surveyed.

The report finds that efforts to curb emissions of particulate matter have an outsized influence on the tally.

The report states:

It is important to emphasize that the large estimated benefits of EPA rules are mostly attributable to the reduction in public exposure to a single air pollutant: fine particulate matter. Of its 20 air rules, the rule with the highest estimated benefits is the Clean Air Fine Particle Implementation Rule, with benefits ranging from $19 billion to $167 billion per year. While the benefits of this rule far exceed the costs, the cost estimate for the Clean Air Fine Particle Implementation Rule is also the highest at $7.3 billion per year.

OMB also finds that EPA rules issued in fiscal year 2010 alone — such as new sulfur dioxide standards — fare well, with estimated annual benefits reaching the $11 billion to $61 billion range and costs in the $2 billion to $4 billion range.

The report also acknowledges considerable uncertainty, which is something that EPA critics could seize on as they prepare to move legislation through the House this summer that would mandate a new, multi-agency panel to review a suite of looming EPA rules. EPA is continuing to work in improving its analysis of rules, OMB states.

The report states:

With respect to many of these rules, there remains continuing uncertainty in benefits estimates. We note that EPA has invested substantial resources to quantify and reduce some aspects of that uncertainty over the last few years. Even so, significant uncertainty remains in this domain. For this reason, the ranges of benefits and costs presented ... should be treated with caution.