by David Schoenbrod
Most Americans breath dirty air—in
many places, levels of pollutants like nitrogen dioxide and ozone are in violation
of federal air quality standards. And now,
those standards are getting even stronger, which will put even more of the
country out of compliance: EPA recently upped standards for nitrogen dioxide
and is working on strengthening limits for other pollutants. But to make real improvements in air quality without
breaking the bank, what is called for is not another round of top-down
regulation, but an update of the Clean Air Act to allow strong market-based
solutions.
Progress on cleaning our nation’s
air pollution has slowed because of the Clean Air Act’s structure. The law was adopted in 1970 and hasn’t been
updated since 1990. It worked well
in the past when there was plenty of low hanging fruit-cheap reductions that
achieved big benefits. But now its format,
which relies on each state to create detailed plans to meet national air
quality goals, has become unbearably cumbersome.
The state plans must specify who
cuts emissions and how much, but to decide that local regulators need to understand the details of production processes and
engineering options for all factories, power plants, and other polluters in
their jurisdictions. Regulators are ill-equipped
to dig into the nitty-gritty of each company’s practices to find the most
cost-effective cuts. And under top down
regulation, businesses have little incentive to provide the information to
regulators—so further progress is tough.
Even though there are likely to be smart, cheap ways to reduce emissions,
no one has both the incentive and know-how to find them.
Switching from top-down
regulation to a cap-and-trade system would allow for progress without
regulators needing information they can’t get about how pollution can be reduced.
Cap-and-trade sets a declining cap on
total emissions and allowances to emit are limited by this cap. The declining
cap would drive up the price of an allowance, which gives companies a
profit-based incentive to figure out how to cut emissions. It’s a win-win solution
where more reductions are made at a smaller cost to businesses. And in this down-turned economy, that’s
important both to reduce economic harm and to sell stronger environmental
controls to a skeptical public.
As Barack Obama said during his
campaign, cap-and-trade is “a smarter way of controlling pollution,” because
the government doesn’t dictate “every single rule that a company has to abide
by, which creates a lot of bureaucracy and red tape and often-times is less
efficient.”
Congress should amend the Clean
Air Act to reflect this reality: a
national cap-and-trade system should cover the “major” emitters in the most
polluting industries, plus new vehicles and vehicle fuels. By bringing most air pollution under the same
system of caps, we will see major efficiency gains that allow us to get much
cleaner air with much less cost. This
system need apply to only 6 percent of the major stationary sources and none of the
hundreds of thousands of minor ones, but would still capture the lion’s share
of pollution subject to national goals. States should be freed from these plan
requirements in dealing with the rest of the sources, but subject to fallback
federal safeguards.
Congress has not revised the
Clean Air Act or any of the nation’s other major environmental statutes since
1990—this is an irresponsible omission because the pollution problem and our
understanding of how to deal with it have changed radically since the early
1970s when most of these statutes were originally structured. New national caps
that cover carbon as well as a range of other air pollutants are a good place
to start. We explain how Congress can overhaul its outdated environmental
statutes in Breaking the Logjam:
Environmental Protection That Will Work.
Related Links:
Policy fixes to unleash clean energy, part 6
ConocoPhillips, BP America, and Caterpillar quit climate coalition
Obama administration celebrates clean energy investments, reaffirms support for cap-and-trade
