EPA’s climate rule withdrawal will include big changes to cost calculations
The Trump administration will consider fundamentally limiting the way the federal government counts benefits from curbing climate change and air pollution in an upcoming proposal to rescind former President Barack Obama’s signature climate regulation, according to multiple sources familiar with recent drafts.
In nixing the Clean Power Plan, EPA will suggest changing the benefits it counts, which would bolster its arguments that the rule’s economic burdens would outweigh its gains from cleaner air, reduced illnesses and greater energy efficiency.
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President Donald Trump has long vowed to erase Obama’s restrictions on coal plants, and then announced he was pulling out of the Paris climate accord, so it’s no surprise he plans to eliminate the rule. But the fine print will have big implications for the inevitable yearslong legal fights to come. It could anger environmental advocates while satisfying some industries and conservative states.
“It may seem like inside baseball, but this is going to set the tone,” said John Larsen, a director at the analysis firm Rhodium Group. “We haven’t seen the details of any sort of regulatory plan from this administration yet on climate.”
EPA could release its withdrawal proposal in the coming days, while leaving the door open to eventually replace the rule with one that would pose minimal costs but provide few climate benefits, as POLITICO reported last month.
Among other changes, Trump’s EPA will drastically alter how it uses the social cost of carbon, a metric for assigning a monetary value to curbing emissions. The agency will decline to consider any social or economic benefits the rule creates outside the United States — unlike the Obama administration, which included worldwide impacts in its calculations.
And it will count far fewer of the health benefits that might have come from reducing air pollutants that cause premature deaths, heart attacks and asthma hospitalizations.
Taken together, the sources say, the recalculations eliminate tens of billions of dollars of the rule’s benefits, which Obama’s EPA had contended would outweigh the costs of enforcing a faster shift away from coal-fired power. The new numbers could be meant to aid EPA Administrator Scott Pruitt’s legal case for scrapping the rule.
The rule’s supporters are already accusing Trump and Pruitt of promoting fake math. They say the administration is ignoring the reality that power companies are making the transition to green energy even faster than Obama anticipated.
“Like so many things, they seem to be completely ignoring what’s happening in the real world,” Janet McCabe, who led EPA’s air office under Obama, said of Trump’s team. “Every other story is about how costs are coming down, about how emissions are reducing, about how power companies are making choices to close their coal plants or run them less because they’re so expensive.”
David Doniger, climate director for the Natural Resources Defense Council, said that “the courts are going to look very, very hard at this kind of cooking of the books.”
“There are two kinds of ways to get the law wrong, to play fast and loose with science and facts or with the economics, and you can lose for either or both reasons,” he said.
But EPA spokeswoman Liz Bowman said that if anyone’s numbers were questionable, it was Obama’s.
“While it appears you are writing a piece based on rumors about CPP, the facts are that the Obama administration’s estimates and analysis of costs and benefits was, in multiple areas, highly uncertain and/or controversial,” she said in an email Thursday night.
The businesses and states that opposed Obama’s regulation say it’s about time EPA reconsidered the costs. For example, it’s reasonable to count only the rule’s U.S. benefits since Americans would be paying the costs, said Jeff Holmstead, an industry lawyer who was EPA’s air administrator under former President George W. Bush.
The math surrounding the rule has long been a political lightning rod.
The Obama-era EPA said the rule would be a net gain for society because shifting to cleaner energy sources would slow climate change and reduce pollution-related illnesses, among other benefits. In contrast, studies financed by conservative groups estimated that the regulation would cost the economy hundreds of billions of dollars during the same time frame.
The rule sought to cut the U.S. power industry’s carbon pollution 32 percent by 2030, compared with 2005 levels — and as of two years ago, the country was more than halfway there. The regulation was the centerpiece of Obama’s pledge that the U.S. would fulfill its part of the 2015 Paris climate agreement.
Trump has since announced he’s pulling the United States out of Paris, unless he can “negotiate” a more favorable deal, and he’s ordered EPA to undo a host of Obama-era regulations, chief among them the Clean Power Plan.