The EPA has put too much emphasis on the word “global” when justifying the economic benefits of recent regulations aimed at combatting global warming, according to the US Chamber of Commerce.
The agency argues that its proposed carbon regulations on existing power plants will offer $30 billion in climate benefits by 2030 with only $7.3 billion in costs.
But according to a white paper published by think-tank the Brookings Institution, that figure includes global climate benefits, not just those advantages garnered by the US, the Chamber says.
The populations that referenced in a cost-benefit analysis should correspond to the political jurisdiction that is bearing the cost, according to Ted Gayer, vice president and director, Economic Studies at the Brookings Institution and Kip Viscusi, law professor at Vanderbilt University, authors of the white paper, titled Determining the Proper Scope of Climate Change Benefits.
In other words, a cost-benefit analysis of regulations affecting Wisconsin dairy farmers should not include any affect it had on farmers in Florida, the Chamber says.
The last time the EPA used a global benefit for a US-based regulation was in 1980, according to the white paper.
In a paper explaining its cost-benefit analysis, the EPA said, “The SCC estimates represent global measures because of the distinctive nature of the climate change problem.”
“Emissions of greenhouse gases contribute to damages around the world, even when they are released in the United States, and the world’s economies are now highly interconnected,” it said. “Therefore, the SCC estimates incorporate the worldwide damages caused by carbon dioxide emissions in order to reflect the global nature of the problem, and we expect other governments to consider the global consequences of their greenhouse gas emissions when setting their own domestic policies.”
The regulations, which would cut carbon emissions from existing power plants by 30 percent by 2030 compared to 2005 levels, were announced on June 2.
For an analysis of the regulations by Jon Elliott, president of Touchstone Environmental, click here.
