July 03--Life is full of trade-offs, even in matters of life and death. Automakers could make a vehicle that would make almost any crash survivable -- but only at a cost too high for most motorists to pay. So consumers and regulators settle for equipment that enhances safety at a reasonable price.
That's how the Environmental Protection Agency customarily operates. On Monday, though, the Supreme Court ruled 5-4 that it violated the federal Clean Air Act when it decided to put limits on certain hazardous emissions by power plants without first estimating the expense. "EPA refused to consider whether the cost of its decision outweighed the benefits," lamented Justice Antonin Scalia. "The agency must consider cost ... before deciding whether regulation is appropriate and necessary."
The court has a point. For regulators to ignore the costs of new rules -- much less whether the costs exceed the benefits -- would be irrational and unaffordable. But the EPA didn't do that.
What it did was make an initial judgment that the harms of these pollutants, including mercury, arsenic and chromium, were enough to justify reductions -- and then embark on devising ways to limit them at a reasonable price. At that first stage, the agency promised that "the effectiveness and costs of controls will be examined" and that it would look for "least-cost solutions."
The reason it didn't tote up the costs at that point was not that the standards it had in mind, which mostly affected coal-fired plants, were ridiculously expensive. (In fact, it eventually estimated the costs at less than $10 billion -- compared with direct and indirect benefits of between $37 billion and $90 billion.) The reason, as Justice Elena Kagan said in her dissent, is that "until EPA knows what standards it will establish, it cannot know what costs they will impose."
There is not much doubt that curbing these pollutants is a good idea. The agency figures the restrictions would save as many as 11,000 lives a year, while sparing 3,100 children with asthma from emergency room visits. When they came out in 2011, Mary Gade, a Chicago attorney who was regional administrator of the EPA under President George W. Bush, called them "a huge victory for public health."
What's more, the rules are already in operation, and most power companies have taken the necessary steps to comply. Few would jump at the chance to reverse course. One industry attorney told SNL Energy, an information provider for the sector, that the program "has already largely done what it's going to do."
Nor is it clear that the EPA will be forced to retreat. The Supreme Court, fortunately, didn't kill the regulation. It merely sent the case back to a lower court, which could ultimately decide to leave it in place -- on the eminently reasonable ground that in the end, the EPA did factor in costs and found that they were far less than the benefits.
At this point, it would make little sense, economically or environmentally, to force a do-over. The agency set out to find a way to improve health and save lives without breaking the bank, and it succeeded. Americans will be better off if it is allowed to proceed.
