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Report: Business Groups Say Clean Air Act Has Been a "Very Good Investment"

Economic benefits of clean-air reforms have outweighed costs by up to 40 to 1

By Stacy Feldman

Oct 8, 2010

U.S. businesses large and small have seen economic gains from EPA's use of the 40-year-old federal , according to an analysis released this week that aims to counter arguments by industry groups that the law is anti-business.

The financial benefits of clean-air reforms have outweighed their costs by a margin of up to 40 to 1, according to commissioned by the and the .

The report, carried out by environmental consulting firm , is based on data from previous EPA and independent calculations on the costs and benefits of Clean Air Act compliance.

It cites from global firm that 1.3 million jobs were created in pollution-control industries between 1977 and 1991 as a direct result of the rules.

"The Clean Air Act has proven to be a very good investment," the authors concluded.

John Arensmeyer, founder and CEO of Small Business Majority, a small business advocacy group, said he felt it was time to air the figures, now that Congress has failed to pass a climate bill and attention has turned to the EPA to use its power to slow global warming.

"The focus of the [climate change] debate has moved to the EPA enforcement of the Clean Air Act," Arensmeyer told SolveClimate News. "We felt it was important to get some information out about that."

The Sausalito, Ca.–based Small Business Majority, which has no membership and is foundation-funded, claims it is focused on solving the problems of the nation's 28 million small businesses.

Arensmeyer, a former tech entrepreneur, said "the enforcement of the act creates a whole bunch of economic opportunities for small business" at a time of fiscal distress.

"We need to be focused on clean energy," he said. "That's really where the economy is going." And opponents "don't really have a lot of evidence" that clean-air rules are bad for bottom lines.

Clean Air Act Under Attack

The report comes at a time when the Clean Air Act, the crown jewel of U.S. environmental and health law, is under heightened attack by industry groups and conservatives on both sides of the aisle.

The law, passed in 1970, directs EPA to create and enforce rules on a range of air pollution problems, from acid rain to smog, motor vehicle efficiency and ozone layer protection.

EPA conducted two of the act at the end of the 1990s. The results revealed that between 1970 and 1990, the price tag of cutting air pollutants was a massive $523 billion. The costs, however, were offset by $22 trillion worth of benefits to human health and worker productivity, the agency said, returning $42 in benefits for every dollar spent to comply.

The agency predicted that economic benefits from 1990 through 2010 would total $690 billion in 1990 dollars, compared with compliance costs of $180 billion—for a margin of 4 to 1.

But opponents are hardly convinced. With EPA in the midst of unleashing a flurry of new Clean Air Act rulemaking to control almost every source of air pollution—including heat-trapping gases—adversaries are cautioning against government overreach.

In recent months, EPA announced stricter standards for and and unveiled new regulations for smog-causing pollutants. In November, it is expected to release ambitious—and potentially expensive—standards for ground-level ozone.

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