Thought piece by Stephen Heins

The most recent example of the manipulation of benefit/cost analysis by the Environmental Protection Agency (EPA) is an official finding by the EPA that “greenhouse gas emissions from aircraft cause or contribute to air pollution that may reasonably be anticipated to endanger public health and welfare.” Credit: Twenty20

 More regulatory magic from the EPA

August 8, 2016 |Benjamin Zycher The Hill

View related content: Economics, Environmental and Energy Economics

I wrote recently about the manipulation of benefit/cost analysis by the Environmental Protection Agency (EPA), and more generally about the adverse implications of the evolution of the federal bureaucracy into an interest group driven by both budget and ideological imperatives. This reality now emerges frequently, with little effort to hide it, the most recent example of which is an official finding by the EPA that “greenhouse gas emissions from aircraft cause or contribute to air pollution that may reasonably be anticipated to endanger public health and welfare.”

The most recent example of the manipulation of benefit/cost analysis by the Environmental Protection Agency (EPA) is an official finding by the EPA that “greenhouse gas emissions from aircraft cause or contribute to air pollution that may reasonably be anticipated to endanger public health and welfare.” Credit: Twenty20

As an aside, let us note at the outset that this description of carbon dioxide — the most important anthropogenic (manmade) greenhouse gas (GHG) — as “air pollution” is political propaganda. Carbon dioxide is a colorless, odorless gas a certain minimum atmospheric concentration of which is necessary for life itself. It is not a “pollutant,” and it certainly is not “carbon” or “carbon pollution,” the propaganda terms used more frequently in the debate over climate policy.

Far from being a colorless, odorless gas, “carbon” is soot, or in the language of environmental policy, particulate matter, which is a pollutant and the emissions of which are regulated by a series of other rules promulgated by the EPA. (The EPA seems to believe that the economically optimal emissions level for particulates approaches zero, a fundamental analytic error, and a topic for another day.)

By far the most important GHG in terms of the radiative properties of the troposphere is water vapor; does anyone call it a “pollutant”? Of course not; but the reason cannot be that ocean evaporation is a natural process while anthropogenic emissions of other GHG are not. After all, volcanic eruptions are natural phenomena, but no one claims that the massive resulting emissions of particulates, mercury and other toxins are not pollutants. The use of the phrase “air pollution” in this context is intended to cut off debate before it begins by assuming the answer to the underlying policy question. The term GHG has the virtue of being accurate scientifically without doing so.

Back to this new endangerment finding for GHG emitted by aircraft engines. Janet McCabe, the acting head of the EPA air and radiation office, argues that:

EPA has already set effective [greenhouse gas] standards for cars and trucks and any future aircraft engine standards will also provide important climate and public health benefits. [emphasis added]

Since the endangerment finding is only the beginning of the process leading to promulgation of an actual emissions regulation, which must incorporate a benefit/cost calculation even if utterly dishonest, it is not quite clear how McCabe knows ex ante that the “future aircraft engine standards will also provide important climate and public health benefits.” But since she draws an analogy between the forthcoming regulations for aircraft engines and those applicable to, say, trucks, let us review the EPA’s own assertions (p. 40,409) about the effects of the latter:

The results of the analysis, summarized in Table VII-37, demonstrate that relative to the reference case, by 2100 … global mean temperature is estimated to be reduced by 0.0026° to 0.0065° C, and sea-level rise is projected to be reduced by approximately 0.023 to 0.057 cm.

The EPA then arrives at the central benefit/cost conclusion (p. 40,169): “[We] estimate that the proposed standards would result in net economic benefits exceeding $100 billion, making this a highly beneficial rule.”

Wow. Let us put aside how it possibly can be that predicted reductions in temperatures and sea levels approximating zero could yield over $100 billion in net benefits. (I provide the magical answer here.) Instead, let us compare the GHG reductions asserted in the efficiency regulations for trucks with the data provided in the aircraft endangerment finding, and thus with the potential GHG reduction that might be engendered by a forthcoming rule. For the truck efficiency rule, EPA offers several scenarios and sets of assumptions, but a rough summary figure (Table VII-26) for the claimed reduction in GHG emissions in 2025 is 46.3 million metric tons (mmt). The aircraft endangerment finding lists (Table V.1) GHG emissions in 2014 from aircraft to be covered by a future regulation at 197 teragrams, or 197 mmt.

Let us assume the impossible: that the forthcoming regulation on aircraft engines will reduce GHG emissions by half of the 2014 figure, or about 99 mmt. As a first approximation, that is about double the asserted effect of the truck efficiency rule, for which the EPA claims a temperature effect in 2100 of 0.0026 degrees Celsius to 0.0065 degrees Celsius. So if we double that effect — this analysis is crude, but unbiased — we get a temperature effect in 2100 of thirteen one-thousandths of a degree, which, to state the obvious, would not be measurable. And even that is at the high end of the EPA range.

Another way to look at this is to take the EPA data on U.S. aircraft GHG emissions in 2010 (Table V.3) as a percent of total world GHG emissions. For U.S. aircraft to be covered by a future regulation, that figure is 0.4 percent. Suppose that by, say, 2025 that figure rises to 1 percent and that, again, the regulation cuts U.S. aircraft emissions by half. Let us apply the EPA climate model to that figure in terms of a predicted temperature effect in 2100, under a set of assumptions highly favorable in terms of the effectiveness of the GHG reduction. The predicted temperature effect would be six ten-thousandths of a degree.

And that is what Janet McCabe asserts will yield “important climate and public health benefits.” Welcome to the Beltway, where the bureaucracy is an interest group, where the bureaucrats have no shame, and where “science” increasingly is a synonym for the politics of wealth redistribution.

Zycher is the John G. Searle scholar at the American Enterprise