The Cost of Reducing SO2 (It?s Higher Than You Think)

Fortnightly Magazine - May 15 1998
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LAST YEAR, IN JUSTIFYING THE PROPOSED NEW NATIONAL AMBIENT Air Quality Standards (NAAQS) for particulate matter and ozone, Environmental Protection Agency Administrator Carol Browner testified that: "During the 1990 debates on the Clean Air Act's acid rain program, industry initially projected the costs of an emission allowance¼ to be approximately $1,500¼ Today those allowances are selling for less than $100." %n1%n

Later in 1997, at the White House briefing announcing President Clinton's Global Climate Change Plan, Katie McGinty, chairwoman of the Council on Environmental Quality, said of the plan to reduce greenhouse gas emissions in the U.S.: "We've reduced the emissions that cause acid rain by more than 40 percent of what was required¼ for less than a tenth of the price that was predicted¼ We will put [the same] market forces to work to help us take on this [climate change] objective." %n2%n

Statements like these attempt to justify some of the most ambitious air quality initiatives ever considered. However, the initial cost projections never ran as high as those cited today by the White House or the EPA. Initial cost estimates for achieving the sulfur-dioxide emissions reductions envisioned under the fully implemented Phase II cap in the acid rain provisions of Title IV of the Clean Air Act ranged much lower (em from $225 to $500 per ton. Further, costs were projected even lower during the period preceding the date of full compliance with the Phase II cap, and we are still in that period.

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