Achieving Both Efficiency and Fairness in Risk-Based Cross-State Air Pollution Controls

Fine particulate matter (PM2.5) and its gaseous precursors travel long distances, crossing state boundaries. The “good neighbor” provisions of the Clean Air Act require the U.S. EPA and States to address the cross-state transport of air pollution that affects states’ ability to attain the National Ambient Air Quality Standards. While the Act does not explicitly consider the public health benefits of such plans, a socially desirable policy would address interstate transport while both maximizing benefits to public health and achieving a more equitable distribution of air pollution. However, designing such a policy is difficult. Analysts must evaluate a large number of emission control strategies, which is made time- and resource-intensive by computationally complex photochemical air quality models. I employed two reduced-form and spatially resolved models to develop a risk-based optimization method that achieves equity and efficiency. I applied this method to 4405 electric generating units regulated for their crossregional concerns by U.S. Environmental Protection Agency to explore alternative plans that maximize health benefits while reducing cross-state transport of air pollutants. A scenario considering only efficiency resulted in 30% less monetized health costs ($17B/yr) compared to the historical reductions. Alternative scenarios with cross-state controls produced 9–12% less health costs while reducing the largest transports by a factor of 4 to 14 and narrowing the distributions of cross-state health effects. The results suggest that policies reducing cross-state air regulations can achieve multiple policy goals, including both equity and efficiency.