All News Releases By Date

 

USE OF ECONOMIC INCENTIVES INCREASES; KEY SHIFT IN POLLUTION CONTROL APPROACH OUTLINED IN EPA REPORT

Release Date: 01/18/2001
Contact Information:

Over the last 20 years, and particularly during the last decade, economic incentives are being increasingly used to control pollution and improve environmental and health protection---for example, acid rain trading and energy-saving volunteer programs.

The 20-year assessment is contained in a new EPA report, “The United States Experience with Economic Incentives for Protecting the Environment.” The diverse cost-saving inducements are used as a substitute for or supplement to traditional “command and control” regulations and the trend is occurring at all government levels.

Congress still requires, under laws EPA administers, reliance on regulations to reduce pollution and to improve environmental and health protection. However, the Agency has increasingly used a wide variety of economic incentive mechanisms in recent years. In addition, state and local governments are applying numerous and diverse economic incentives to the same efforts.

Economic incentives are expected to be particularly useful in reducing pollution not subject to regulation. For instance, citizens can be encouraged to reduce curbside garbage by composting and other means, if there is a disposal charge based on the volume of garbage. Other examples in the report include:

• trading of sulfur dioxide allowances in dealing with acid rain pollution which allows facilities to find less costly ways to reduce emissions;
• basing air emissions permits fees on the quantity of emissions and charging for the disposal of industrial effluents in water treatment plants;
• requiring a deposit on beverage containers to encourage recycling, which now occurs in 10 states; many states have a similar system for lead acid batteries;
• imposing liability for natural resource damages caused by oil and hazardous material spills, an incentive to encourage pollution prevention;
• encouraging toxic emissions reductions by broadly disseminating information about emissions in communities in the annual Toxics Release Inventory; and,
• promoting voluntary programs such as the Energy Star, Waste Wise and XL which reduce pollution by assisting and rewarding voluntary actions to reduce energy use and limit pollution.

Economic incentives can provide unusual environmental management opportunities, for instance, by using them where traditional regulations might not be possible, particularly for small or geographically dispersed facilities.

The report is available at: www.epa.gov/economics under Our Publications, then Environmental Economics Report Inventory, then New Downloads

R-16 # # #