Repeal of the Clean Power Plan Report

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Introduction

The Clean Power Plan (CPP) is a meaningful document aimed at protecting the citizens of the United States from the ineffective use of resources, pollution, greenhouse gas emissions from fossil-fueled power plants, and a host of other harmful energy solutions. However, the Environmental Protection Agency (EPA) has identified certain flaws in the computations and procedures used to calculate the positive value of the plan. On the basis of a new Regulatory Impact Analysis (RIA), the agency has proposed revoking the CPP, threatening to undo the work of the previous administration. This would allow factories to further pollute the atmosphere and produce adverse effects on human health worldwide, incurring enormous healthcare costs.

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Main body

The repeal of the CPP is mainly associated with a directive from the new administration headed by Donald Trump, who is famous for his association with and support for oil extraction. In addition, Trump withdrew from the Paris Agreement and ordered the elimination of the Office of Environmental Justice (Zhang et al. 220). These actions and more mark the new administration’s tendency to distance itself and America from sustainable energy and resort to using the natural resources the country still possesses in abundance (Zhang et al. 220). The effects of these measures and the CPP repeal, in particular, are related more to economics than politics. By annulling the efforts aimed at reducing the pace of transitioning to renewable sources of energy, the government is increasing the long-term economic risk to the country.

The first economic risk resulting from the repeal of the CPP is a projected increase in health costs. Originally, the CPP proposed savings of 4.6 billion in healthcare costs, which, if the CPP is revoked, become foregone benefits (EPA, “Carbon Pollution Emission Guidelines” 92). These costs illustrate the money that people would potentially save on having to bear the consequences of respiratory diseases or cancer resulting from a degraded environment. However, these costs do not include the economic benefit that healthy people potentially generate by staying alive, earning money, and spending their earnings, thus investing in the U.S. economy.

For example, as a result of reduced greenhouse gas emissions and an improved environmental situation, a U.S. citizen might save $5,000 on asthma treatment. On a large scale, not only does this mean that those five thousand return to the economy of the United States as an investment in other sectors such as recreation, but it also means that there is a high probability that this U.S. citizen will be capable of earning another $5,000, paying income tax, and investing capital back into the country’s economy once more. While this benefit is not as evident and may be unpredictable, nonetheless, it is vital in understanding the long-term foregone benefits from repealing the CPP. Therefore, investment in the health of U.S. citizens produces a major economic benefit that is beyond the calculations presented in the new RIA.

In addition, repealing the CPP will lead to consequences that directly relate to the quality of life. A poor environmental situation in the cities along with the absence of new regulations affecting emissions as proposed by the CPP will most certainly affect the psychological well-being of citizens (Sandifer et al. 2). Fatigue, depression, mood swings, and other conditions related to poor air and water quality will take a heavy toll on work performance and, consequently, the economic impact on an individual. Therefore, the decision to vote down a viable solution to ecological problems is an indirect threat to the country’s economy. Despite the possible discrepancies in the calculations in the previous RIA, the adverse effects of non-adoption of the policy can invoke consequences far worse than can be justified by short-term economic gains. Again, the instruments used in the last RIA fail to assess the invisible and indirect economic losses.

The EPA’s decision to rescind the adoption of the CPP will also result in the continuation of a trend involving the use of fossil fuels. The mere fact that fossil fuels are a limited resource will make their economic viability decline over time. The limited nature of a resource will lead inevitably to an increase in its price as time passes, provided the demand stays relatively unchanged. For example, if ten people want to buy ten gallons of gasoline each, and a seller has 1,000 gallons in stock (and the buyers know it), he or she can easily sell it with a low margin while keeping competition and other factors in mind.

However, when both seller and buyers know that the stock has reached its limit, and a seller has only ten gallons in stock while the demand remains the same, the reasonable action for the seller would be to increase the price and sell the gasoline to the highest bidder. Such a situation would provoke an increase in the cost of use of any goods and services that rely on gasoline-powered vehicles. For instance, the cost of a Snickers chocolate bar will rise because the cost of overland shipping that is incorporated into the final price of the candy bar will have increased due to higher fuel prices. Thus, the end customer will find himself or herself paying more for all goods shipped by means of oil- or gasoline-powered vehicles. This simple example vividly illustrates the cost of long-term political and economic dependence on fossil fuels encouraged by the repeal of the CPP.

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Another argument against the repeal of the CPP involves the lost benefit from a decelerated transition to sustainable energy (Frazier). The imposition of new, stricter regulations on fossil fuel use has the effect of intensifying the search for new environmentally-friendly solutions. Opposition to the CPP undoes that work, hindering the development of sustainable energy (Frazier). Adoption of the CPP would lead to growth in the renewable energy industry, setting the U.S. economy on a sustainable economic path. One way to make this possible would be through forced indirect investment in the research and development of new sources of energy. Having to comply with stricter CO2 and greenhouse gas emissions would mean car companies, factories, and power plants would have to seek solutions to allow them to curb the increased maintenance costs resulting from the installation of new filtering equipment.

The simple yet unlawful, immoral, and financially detrimental solution is to pass costs on to customers or cut costs in terms of workers. Volkswagen recently demonstrated this approach. In a desperate attempt to decrease the costs of compliance with CO2 emission regulations, the company falsified its CO2 emission tests, selling their cars as “green” vehicles. As a result of the company’s fraud becoming known, Volkswagen lost and is still losing billions in legal suits and sales (Kollewe).

In light of such a precedent, companies are more likely to honor the new regulations imposed by the CPP if the document is adopted. As a result of compliance, investments in research and the development of new sustainable solutions can be expected to mark an increase in the number and equity of companies that design and sell such solutions. For example, the long-term benefits of sustainable energy use will become more solid. The cost of solar panels will drop dramatically as supply follows demand, increasing competition. In addition, more technological solutions will become available, which will also benefit the end customer.

The country’s energy profile will also change due to the informed use of resources. Sweden, for example, uses energy from waste incineration to heat citizens’ houses. Having maximized the volume of this recycling process, Sweden sells excess heat energy to neighboring Norway, generating a surplus from foreign sales.

Conclusion

All these options and development opportunities, including the economic gains they generate, are now considered foregone profits. The decision to repeal the CPP may be economically viable in the short term, allowing the U.S. government to economize on the legal and technical side of CPP implementation, but in the long run, the repeal incurs only losses. While progressive European countries can demonstrate the profits found in sustainable solutions, the U.S. economy continues to cling to the cheap, short-term benefits of fossil fuels. According to the latest RIA, the CPP’s calculations may be wrong in certain instances (EPA, “Regulatory Impact Analysis” 4). The procedural flaws have also become evident, and in addition, the time factor over the course of three years has influenced the relevance of the data. Nevertheless, the true nature and aim of the document remain unchanged, offering long-term stability and prosperity over a short-term economic decline. Thus, revocation appears to be a grave mistake.

Works Cited

Energy Protection Agency (EPA). Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generating Units. 2013, Web.

Regulatory Impact Analysis for the Review of the Clean Power Plan: Proposal. 2017, Web.

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Frazier, Reid. “How Revoking the Clean Power Plan Will Impact Pennsylvania.” 2017, Web.

Kollewe, Julia. “VW Profits down 20% after Diesel Emissions Scandal.” The Guardian,2016. Web.

Sandifer, Paul A., et al. “Exploring Connections among Nature, Biodiversity, Ecosystem Services, and Human Health and Well-Being: Opportunities to Enhance Health and Biodiversity Conservation.” Ecosystem Services, vol. 12, 2015, pp. 1–15.

Zhang, Hai-Bin, et al. “U.S. Withdrawal from the Paris Agreement: Reasons, Impacts, and China’s Response.” Advances in Climate Change Research, vol. 8, no. 4, 2017, pp. 220–225.

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IvyPanda. 2022. "Repeal of the Clean Power Plan." February 20, 2022. https://ivypanda.com/essays/repeal-of-the-clean-power-plan/.

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IvyPanda. "Repeal of the Clean Power Plan." February 20, 2022. https://ivypanda.com/essays/repeal-of-the-clean-power-plan/.

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