New Report: EPA’s Effective Track Record Forecasting Technological Progress Allows for Stronger Air Pollution Policies

April 11, 2024 /3BL/ - Despite regularly facing skepticism, the U.S. Environmental Protection Agency has a strong track record of forecasting technological progress that allows for stronger air pollution policies, according to a new analysis.

Under the federal Clean Air Act, the EPA must consider the feasibility and cost of emerging technologies necessary to meet its proposed emissions standards. Almost invariably during a rule-making process, the EPA’s projections for these technologies are met with concerns from industry and other stakeholders. Through public comments, lawsuits, and advertising campaigns, opponents argue the technology is not ready, is not affordable, or cannot be implemented by the EPA’s proposed deadline without making electricity or transportation too expensive and unreliable for families and businesses.

But as the EPA works to finalize several new emission standards, a new analysis published today by Ceres and Environmental Strategies Group, Inc, shows that the EPA has been highly effective throughout its history at forecasting the pace of technological innovation, deployment, and adoption and that it builds in flexibility to address legitimate industry concerns. From the catalytic converter to power plant pollution control equipment, technological progress that industry stakeholders quickly dismissed as unrealistic has consistently taken hold quickly and cost-effectively to meet the EPA standards. In fact, the regulatory certainty from the standards themselves often helps drive technological innovation and other solutions necessary to achieve them, while improving public health, reducing costs, and growing the economy.

“Our research shows that the EPA has had a successful track record in forecasting the feasibility of pollution control,” said Dan Bakal, senior program director for climate and energy at Ceres. “It also provides greater evidence that regulatory certainty spurs innovation in technology and business operations and shows that the EPA is responsive to industry concerns as it designs its standards. As the EPA takes action to address harmful pollution, we hope our research provides a greater level of confidence among all stakeholders that the public and private sectors can work together to achieve the goals that benefit public health, the planet, and the economy.”

The analysis — titled “A Historic Review of the Environmental Protection Agency’s Market Readiness Projections of Compliance Technologies” — provides four case studies stretching over a nearly 50-year period of EPA standards, technology projections, and criticism. The case studies include 1970s federal vehicle emission standards that gave rise to the three-way catalytic converter, mercury and air toxics standards that yielded massive progress in improving activated carbon injection and dry sorbent injection technologies, and more.

All four cases either saw the EPA provide reasonable timelines for nascent technology to become widely available and cost-effective, for unexpected alternative solutions to take hold to allow compliance by the deadline, or for sectors to become more proficient at using and deploying existing technology to effectively meet the standards.

This research has several important implications for policymakers, regulated industries, business groups, and other stakeholders. Among them:

• The EPA works closely with industry and stakeholder groups and includes flexibility in its standards to address legitimate industry concerns.
• Regulatory certainty spurs technological innovation that enables compliance.
• Regulatory design and incentives can lead to novel technological innovations.
• Unpredicted economic changes can shift the feasibility of compliance.
• Projections based on new technologies often fail to capture operational efficiencies that businesses will adopt over time.

Ceres is a nonprofit organization working with the most influential capital market leaders to solve the world’s greatest sustainability challenges. Through our powerful networks and global collaborations of investors, companies, and nonprofits, we drive action and inspire equitable market-based and policy solutions throughout the economy to build a just and sustainable future. For more information, visit ceres.org and follow @CeresNews.

Media Contact: Helen Booth-Tobin, booth-tobin@ceres.org, 617-247-0700 ext. 214