requires a monetization of the benefits—a typically controversial and difficult process (Croote 1999). Despite such difficulties, cost-benefit analysis is often used in government to evaluate the merit of environmental regulations. In fact, the 1990 CAA Amendments specifically require EPA to carry out periodic evaluations of the costs and benefits of the implementation of the act. Despite arguments by others identified above, most comprehensive cost-benefit analyses of the nation’s AQM system have suggested that the benefits of air pollution control have been equivalent to or exceeded the costs, albeit with significant uncertainties. For example, EPA estimated that the benefits of implementation of the CAA between 1970 and 1990 were $5–50 trillion greater than the costs (EPA 1997). Although others (Lutter and Belzer 2000; Brown et al. 2001) argue over whether EPA’s analysis overstates likely benefits and understates costs (also see Chapter 6), the White House Office of Management and Budget (OMB) recently reported that benefits of environmental regulations far outweigh the costs. OMB found monetary benefits over the years of regulation from 1992 to 2002 by EPA to range from roughly $121 billion to $193 billion and costs to range from $23 billion to $27 billion (OMB 2003a). A large fraction of aggregate benefits found by OMB pertain to rules limiting PM, NOx, and SO2. The SO2 provisions of the 1990 CAA Amendments alone account for $80 billion of the aggregate benefit estimate.


Despite the nation’s significant progress in improving air quality, the problems posed by pollutant emissions in the United States are by no means solved. For example, it is estimated that the demand for electrical power in the United States will increase by 40% over the next 20 years (DOE 2003), and a substantial amount of the increased demand will be met by the burning of fossil fuels (see Figure 1-5). Increases of over 50% in total vehicle miles traveled by light-duty vehicles on the nation’s roads and highways, as well as increases of off-road vehicular use, are also projected (DOE 2003). Thus, substantial improvements in cleaner power-generating and automotive technologies will be needed if the nation is to maintain the current level of air quality. Some of these improvements are already under way (for example, response to Tier II emission standards for automobiles [see Chapter 4]), and others are being considered (for example, multipollutant emission caps for power plants [see Chapter 5]).

However, even as additional emission reductions and new technologies are needed in the coming years just to maintain the current level of air quality, additional effort is likely to be deemed necessary to adequately protect human health and welfare. A number of major goals and requirements of the CAA Amendments of 1990 have yet to be met (Figure 1-6);

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