10 December 2020

EPA Issues Clean Air Act Cost-Benefit Rule

On December 9, the U.S. Environmental Protection Agency (EPA) finalized its Clean Air Act (CAA) cost-benefit rule. The procedural rule sets requirements for evaluating the benefits and costs of regulatory decisions, which EPA believes is necessary to ensure transparency and consistency in the rulemaking process. The main requirements are as follows: 1) EPA must prepare a benefit-cost analysis (BCA) for all significant proposed and final regulations under the CAA; 2) BCAs are developed in accordance with best practices from the economic, engineering, physical, and biological sciences; and 3) EPA must increase transparency in the presentation of the benefits and costs resulting from significant CAA regulations. Critics of the final rule have argued that the requirements will restrict the ability to craft environmentally protective CAA regulations, and the Biden administration is expected to seek to reverse course. However, as the requirements are now codified in a final rule, a new administration will not be able to make any immediate changes and will need to abide by the requirements unless and until the rule is changed, absent a judicial stay of the rule or action by Congress under the Congressional Review Act.

Further information can be found in EPA’s announcement of the rule here.

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