On June 7, 2018, U.S. EPA issued an advance notice of proposed rulemaking (“ANPR”) aimed at developing a consistent and transparent interpretation of cost and benefits consideration in regulatory analyses, including regulations promulgated pursuant to the Clean Air Act, Clean Water Act, Safe Drinking Water Act and other statutes. EPA will accept comments on the ANPR for 30 days after it is published in the Federal Register.
Assessing costs and benefits has been a contentious part of EPA rulemakings. For instance, in the Mercury and Air Toxics (MATS) rulemaking, EPA determined that the monetized cost of the rule would be $9.6 billion annually whereas the monetized benefit would be $4-6 million annually. EPA determined that MATS was nevertheless “appropriate” regulation, but the Supreme Court reversed, ruling that the agency had improperly refused to consider costs. While EPA, during the Obama administration, subsequently modified its “appropriate” determination for the MATS rule, it has been speculated that the Trump administration might take some further action in that regard.
The proper use of “co-benefits” in assessing regulatory costs is also an issue that has led to controversy in EPA rulemakings. For instance, in the Clean Power Plan proceeding, EPA justified the rule not just for reducing carbon dioxide emissions but for achieving the “co-benefit” of reducing other pollutants as well. The social cost of carbon is another issue that has sparked discussion in a number of climate change rulemakings. EPA will take comment on these and other cost issues in this new docket.