Clean Air Means Big Benefits for the Economy Too

A new report under development at the U.S. Environmental Protection Agency (EPA) shows that the public benefits of clean air standards far outweigh the costs of compliance. The report estimates that regulation under the Clean Air Act benefits the economy to the tune of $175 billion per year since 1990, BNA news service (subscription) reports. Controls cost regulated industries $45 billion per year.

Clean air regulation saves lives and makes lives better: particulate matter regulation can prevent heart attacks; benzene emissions controls can prevent leukemia; ozone standards lessen the number and severity of asthma attacks. Environmental benefits, both ecological and emotional, exist as well.

Many of these public health and environmental benefits bring with them economic implications. Clean Air Act regulations benefit an array of economic sectors, the report finds. BNA looked at ozone, a.k.a. smog, regulation, and reports:

EPA's efforts to reduce ozone pollution since 1990 have resulted in $34.3 billion in annual health benefits in 2010, according to the draft report. EPA estimates the pollution controls have also resulted in $40 billion in benefits from improved visibility, as well as $100.5 billion less in property and ecological damage had those controls not been in place. EPA's estimates of agricultural and forest productivity benefits of the controls were not available. 

A preliminary draft of the report, The Benefits and Costs of the Clean Air Act: 1990 to 2020, is available on EPA’s website. EPA is still developing the report, and will include more benefits measures in its next draft, at which point the discrepancy between benefits and compliance costs should be even greater.

Clean air and public protection advocates should exercise caution when employing the information in EPA’s report. Clean air regulation – any regulation, in fact – mustn’t be decided on a ledger. Health and safety concerns drive the missions of agencies like the EPA. Other values, such as equity, fairness, and the public good, merit top consideration despite the inherent difficulty of assigning a dollar value to them.

At the same time, it is another arrow in the quiver. Data like this can be used to make a compelling economic case for clean air regulation and to counter the arguments of clean air fear mongers who claim, erroneously, that stricter regulation leads to economic ruin.

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