Cost-Benefit Analysis and the Environment

February 17, 2021 11:00 am — 12:30 pm
Webinar Only

An ELI Public Webinar

For decades, administrative agencies in the United States have used cost-benefit analysis to evaluate and improve regulatory decisions. However, recent changes regarding which costs and benefits to account for have become somewhat controversial.

This is aptly seen with the Environmental Protection Agency’s (EPA) April 2020 final rule to no longer account for co-benefits. Co-benefits are benefits that are not directly related to the regulatory goal, but nevertheless produce beneficial outcomes. For instance, EPA’s cost-benefit analysis for its Mercury and Air Toxics Standards rule accounted for reductions in mercury pollution from power plants required by the rule, but also the indirect benefits from reductions in particulate matter that the agency expected from enforcing the rule.

In announcing the new rule on co-benefits, EPA stated that these changes are key to more accurately accounting for a projects’ costs and benefits, while critics argue this change in methodology can artificially tip the scale against regulation by discounting the potential benefits. Thus, critiques contend, a proposed environmental regulation is less likely to be seen as cost-beneficial as not all benefits are accounted for.

In their new book Reviving Rationality: Saving Cost-Benefit Analysis for the Sake of the Environment and Our Health, Michael A. Livermore and Richard L. Revesz examine the use of cost-benefit analysis during the Obama and Trump administrations, exploring the changes in the norms concerning the role of analysis, evidence, and expertise in regulatory decision-making and how future administrations will treat co-benefits. Join the Environmental Law Institute and expert panelists to explore how cost-benefit analysis has changed in recent years, the impact on environmental projects, and what to expect in the future.

Caroline Cecot, Assistant Professor of Law, Antonin Scalia Law School, George Mason University, Moderator
Michael A. Livermore, Edward F. Howrey Professor of Law, University of Virginia School of Law
Richard L. Revesz, Dean Emeritus, New York University
Kathryn M. Schroeder, Associate Attorney, Keleher & McLeod, P.A.

People Places Planet Podcast: Reviving Regulatory Rationality

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