Cost effectiveness of emission control

The U. S. Environmental Protection Agency (EPA) has launched a substantial control program aimed at significantly improving the nation's air quality by 1976. This paper attempts to assess the nationwide cost effectiveness of the program by relating costs of emission control to expected air quality improvements and thus to the economic-damage reductions or benefits. The annual cost of air pollution damage is estimated to be $23.5 billion by 1976 unless improved control measures are implemented. This $23.5 billion is allocated by a pollution index method to 20 major air pollution source categories. These damage allocations are compared to estimates of emission control costs published by the U. S. Environmental Protection Agency, and cost/benefit ratios (control cost/damage reduction) are presented as the measure of cost effectiveness. Steam electric power plants, gasoline motor vehicles, and industrial boilers have been identified as the largest sources of air pollution (50% of the nationwide total). In general, our study supports the EPA efforts toward control of these and other major stationary and mobile sources. Successful implementation of these EPA policies would reduce nationwide pollution damages by 1976 to roughly 56 percent of 1967 levels with an attractive cost/benefit ratio of only 0.39. The projections beyond 1976 are less satisfying since continuing controls for new automobiles, costing almost $4 billion/year would only reduce overall pollution levels an additional 10% at an uneconomic cost/benefit ratio of 1.6. Rather than nationwide stringent controls, traffic management may be a more desirable method for reducing pollution levels in congested urban areas. We suggest that, by reallocation of emission control expenditures, greater air quality improvements could be generated at lower overall cost.