Reforming Regulatory Impact Analysis

CHAPTER 3

The Technocratic and Democratic Functions ofthe CAIR Regulatory Analysis

NATHANIEL O. KEOHANE

Of the case studies considered in this report, the regulatory impact analysis for the Clean Air Interstate Rule (CAIR) provides particularly fertile ground for analysis and critique (EPA 2005a, henceforth “RIA”). The rule itself was far-reaching, mandating reductions of 60 to 70 percent in the emissions of two major criteria air pollutants—sulfur dioxide (SO2) and nitrogen oxides (NOx)— from power plants in the eastern United States. As a result, the stakes were very high. The annual costs of the controls proposed by the CAIR were projected to run into the billions of dollars—and yet they were dwarfed by estimated benefits of nearly $100 ...