Pruitt Adversaries Take His Accounting to Task Over Clean Power Plan

Adversaries to EPA Administrator Scott Pruitt’s calculations take issue with the way in which he measures certain financial figures to justify his proposal to roll back the Obama Administration’s Clean Power Plan.

They are particularly convinced that Pruitt has inflated costs while suppressing beneficial projections. On Wednesday, a news report by the Environmental Defense Fund mentioned four key issues for consideration:

  1. Pruitt ignores up to $34 billion in projected health benefits

The EPA determined that by advancing the Clean Power Plan, it would avoid thousands of premature deaths each year by reducing particulate matter pollution as a co-benefit of reducing carbon–yielding up to $34 billion in annual health benefits by 2030. Contrary to medical research, Pruitt’s proposal asserts there is zero health impact from reducing particulate matter pollution below certain threshold levels. His proposal is one dimensional by suggesting that the EPA can count only the climate benefits associated with carbon pollution, with no consideration for any other health benefits.

  1. Pruitt artificially inflates the Clean Power Plan’s costs by up to $25 billion

The EPA originally anticipated that the electricity sector would comply with the Clean Power Plan in part through investments in demand-side energy efficiency, which directly reduces electricity bills for consumers. Pruitt’s proposal adds those energy efficiency investments to the costs of the Clean Power Plan without deducting the electricity savings yielded by the investments. Pruitt relies on the higher discount rate of 7 percent rather than 3 percent for energy efficiency investments which further inflates costs by $6.2 billion without justification.

  1. Pruitt undervalues the true cost of carbon by nearly $20 billion

The social cost of carbon is the estimate of damages that climate pollution causes for families and communities. It factors in the cost from intense hurricanes, heat waves, wildfires, flooding and many other threats posed by climate change. The Clean Power Plan’s estimate of this factor was developed over several years by experts from more than a dozen federal agencies who scientific and public input. Pruitt uses a lower figure that heavily discounts the costs of climate change and understates the benefits of reducing carbon pollution under the Clean Power Plan.

  1. Pruitt ignores lower costs from the current trend of clean energy

Since the Obama Administration finalized the Clean Power Plan, its goals have become more achievable and cost-effective than originally projected. This is largely attributed to advanced technology and electricity-sector developments such as the sharply declining costs of renewable energy. Pruitt’s proposal to rescind the Clean Power Plan doesn’t include this important aspect in his economic analysis. In fact, Pruitt doesn’t acknowledge that recent studies of the plan have found compliance costs are now much lower than estimated by the EPA. Because these calculations work against his reason to roll back the Clean Power Plan, Pruitt ignores these lower costs and favorably slants the data in his favor by doing so.