1. Regulation in Practice Objectives: 1. Discuss main U.S. environmental legislation and regulatory agencies. 2. Analyze effectiveness of regulation as a ‘solution’ to environmental issues.

2. Legislation Air Air Clean Air Act Clean Air Act Enacted 1963, amended 1970, 1977, 1990 Enacted 1963, amended 1970, 1977, 1990 Created National Ambient Air Quality Standards for ‘criteria’ pollutants Created National Ambient Air Quality Standards for ‘criteria’ pollutants Stationary sources Stationary sources Technology-based Technology-based Trading programs Trading programs Mobile sources Mobile sources Inspections Inspections Clean fuels and low-emission vehicles (LEVs) Clean fuels and low-emission vehicles (LEVs) Hazardous Pollutants Hazardous Pollutants Emissions standards (MACT) Emissions standards (MACT) Safety standard Safety standard

3. Legislation II Air, cont’d Air, cont’d “Clear Skies” “Clear Skies” Weakens targets for SO 2 and NO 2 Weakens targets for SO 2 and NO 2 Cap and trade program for Mercury Cap and trade program for Mercury Polluters get extra decade to clean up their acts Polluters get extra decade to clean up their acts Efficiency standard Efficiency standard Water Water Federal Water Pollution Control Act (1972) Federal Water Pollution Control Act (1972) Goal: Fishable and swimmable waters by 1983 Goal: Fishable and swimmable waters by 1983 Beyond Safety standard: zero discharge of pollutants Beyond Safety standard: zero discharge of pollutants Clean Water Act (1977) Clean Water Act (1977) Focus on stationary sources Focus on stationary sources Non-point water pollution (Farming and sewage) not covered. Non-point water pollution (Farming and sewage) not covered.

4. Legislation III Land Land Two biggies: Two biggies: Resource Conservation and Recovery Act (RCRA, 1976) Resource Conservation and Recovery Act (RCRA, 1976) Hazardous waste disposable Hazardous waste disposable Firms must prove safety Firms must prove safety Comprehensive Environmental Response, Compensation and Liability Act (Superfund, 1980) Comprehensive Environmental Response, Compensation and Liability Act (Superfund, 1980) Abandoned dump sites Abandoned dump sites Love Canal, NY: residential neighborhood built on toxic waste dump Love Canal, NY: residential neighborhood built on toxic waste dump “Superfund” site: abandoned dump with money for cleanup “Superfund” site: abandoned dump with money for cleanup

5. Legislation IV Substances Substances Three: Three: Federal Insecticide, Fungicide and Rodenticide Act (FIFRA, 1947) Federal Insecticide, Fungicide and Rodenticide Act (FIFRA, 1947) Toxic Substances Control Act (ToSCA, 1976) Toxic Substances Control Act (ToSCA, 1976) Both based on Efficiency standard Both based on Efficiency standard Bhopal disaster leads to Emergency Planning and Right-to-Know Act (1986): Bhopal disaster leads to Emergency Planning and Right-to-Know Act (1986): Toxic Release Inventory (TRI) Toxic Release Inventory (TRI)

6. Legislation V Critters Critters Endangered Species Act (1973) Endangered Species Act (1973) Lists animals and plants as endangered or threatened Lists animals and plants as endangered or threatened Protected habitat Protected habitat Standard: Ecological sustainability Standard: Ecological sustainability

7. Agencies Broad Spectrum: Broad Spectrum: Environmental Protection Agency (EPA) Environmental Protection Agency (EPA) Occupational Safety and Health Administration (OSHA) Occupational Safety and Health Administration (OSHA) Specific Industries Specific Industries Federal Power Commission (FPC): electric power Federal Power Commission (FPC): electric power Interstate Commerce Commission (ICC): transport, oil pipelines, highways Interstate Commerce Commission (ICC): transport, oil pipelines, highways Federal Communications Commission (FCC): telephones, TV transmission Federal Communications Commission (FCC): telephones, TV transmission Federal Aviation Administration (FAA): airlines Federal Aviation Administration (FAA): airlines Nuclear Regulatory Commission (NRC): nuclear power Nuclear Regulatory Commission (NRC): nuclear power

8. Progress Some issues Some issues How to assess progress: How to assess progress: Glass half-empty or half-full? Glass half-empty or half-full? Compared to what? Compared to what? Easiest targets first Easiest targets first High marginal benefits, low marginal cost High marginal benefits, low marginal cost Point-source pollution Point-source pollution Moving targets Moving targets New chemicals New chemicals Genetically modified organisms Genetically modified organisms Piecemeal: stop a leak here and it pops up somewhere else Piecemeal: stop a leak here and it pops up somewhere else

9. Effectiveness Command and Control Command and Control Emissions standards Emissions standards Critiques: Critiques: Need varies from place to place Need varies from place to place Costs vary from firm to firm Costs vary from firm to firm Mandated Technology Mandated Technology Critiques Critiques Need varies from place to place Need varies from place to place Vagueness of definition Vagueness of definition Incentives Incentives

10. Effectiveness II Right-to-know Right-to-know Toxic Release Inventory (TRI) Toxic Release Inventory (TRI) Requires companies to disclose releases of approx 450 toxics. Requires companies to disclose releases of approx 450 toxics. Penalties not for releases, but for covering up/falsifying info. Penalties not for releases, but for covering up/falsifying info. Information is a form of power. Information is a form of power. Recall PWSDR: Recall PWSDR: Information can raise the perceived MC of pollution and/or lower the perceived MB of not controlling pollution Information can raise the perceived MC of pollution and/or lower the perceived MB of not controlling pollution Imperfect information: Imperfect information: burden of proof. “Innocent until proven guilty” is widely seen as a sound principle in criminal law. burden of proof. “Innocent until proven guilty” is widely seen as a sound principle in criminal law.