Nighttime Must-Read: Rob Stavins: What Are the Benefits and Costs of EPA’s Proposed CO2 Regulation?

Rob Stavins: What are the Benefits and Costs of EPA’s Proposed CO2 Regulation?: “There are surely ethical arguments (and possibly legal arguments) for employing a global damage estimate,..

…I leave it to legal scholars and lawyers to debate the law, and I defer to the philosophers among us to debate the ethics, but let’s at least ask what the consequences would be for EPA’s analysis if a U.S climate benefits number were used…. The combined U.S.-only estimates of annual climate impacts of CO2 ($3 billion) and health impacts of correlated pollutants ($45 billion) greatly exceed the estimated regulatory compliance costs of $9 billion/year, for positive net benefits amounting to $39 billion/year in 2030…. If EPA’s global estimate of climate benefits ($31 billion/year) is employed instead, then, of course, the rule looks even better, with total annual benefits of $76 billion, leading to EPA’s bottom-line estimate of positive net benefits of $67 billion per year…. The Obama Administration’s proposed regulation of existing power-sector sources of CO2 has the potential to be cost-effective, and… welfare-enhancing…