San Diego Journal of Climate & Energy Law
Abstract
The United States has long required administrative agencies to conduct Cost-Benefit Analyses (“CBA”) in their rulemaking. By conducting CBA, agencies “show their work” to Congress, courts, and constituencies as to why the agency wishes to regulate a certain way and what it would cost to do so.
This Article will focus on co-benefits, an increasingly divisive component of CBA. Co-benefits, or benefits occurring secondary to the targeted purpose of statutory authority, assist agencies like the Environmental Protection Agency (“EPA”) in painting a holistic picture of everything the public has to gain from a rule’s passage. In recognizing that value, the Office of Management and Budget (“OMB”) and the EPA have included co-benefits, and their counterpart, indirect costs, in their CBA for decades.
However, recent trends present a new challenge to co-benefit accounting in CBA, spurred mainly by a Supreme Court with conflicting attitudes toward co-benefits and cost-focused administrations. Although there has been no official prohibition on their inclusion, co-benefits face considerable skepticism in current jurisprudence. This skepticism is not limited to the judiciary. Multiple practitioners, organizations, and industry leaders have cited the Court’s doubts as support for eliminating the EPA’s inclusion of co-benefits. This erosion in public trust threatens confusion, inaction, and underinvestment in a time-sensitive era for climate policy.
This Article will first detail a background analysis of how CBA came to be, then focus on the turning point in the EPA’s rulemaking, health and economic co-benefits, and finally the leading policy considerations on both sides of the inclusion argument. Ultimately, the analysis will show that co-benefit inclusion in rulemaking is consistent with years of EPA practice and guidance, is a logical counterpart to widely accepted indirect cost inclusion, and presents significant and accountable gains to public health.
Recommended Citation
Riley Jacobs,
Climate Regulation and Co-Benefits: The Reality of Co-Benefits in Climate Policy and the Reality We Face Without Them,
15
San Diego J. Climate & Energy L.
131
(2024)
Available at:
https://digital.sandiego.edu/jcel/vol15/iss0/6