EPA’s Sum Effect = Net Loss
My response to this week’s question on National Journal Energy & Environment Policy Experts Blog: The clean air rules put forward by the Environmental Protection Agency will have a profound impact on our struggling economy. EPA’s own data show that the CAA of 1990 have had a negative impact on GDP and growth see figures from EPA modeling here. The new rules are certain to add the uncertainty to the cost of electrical generation as well for other energy using and producing industries. Signs of the impact of uncertainty on the U.S. economy can be seen in the fact that gross private domestic investment is still $327 billion lower in the 3rd quarter of 2011 than in the 4th quarter of 2007 see chart. Each $1 billion loss in investment is associated with 15,000 to 22,000 fewer jobs. In my testimony from February 2011 to the House Energy and Power Subcommittee on the impact of EPA’s regulation of GHGs under the Clean Air Act, I highlight that if U.S. capital spending declines by $25 to $75 billion, in 2014 there would be an economy wide job loss of 476,000 to 1,400,000 when direct, indirect and induced effects are included. As a…