Perhaps I'm just a hopeless policy wonk, but I was very excited to see the news that the EPA has proposed that major sources of carbon emissions should have to report what and how much they put out their smokestacks
Information is an undervalued but critically important regulatory tool. If information gathering and reporting programs are well-designed, they can drive powerful market forces at minimal costs, with maximum flexibility.
When policy pundits talk about regulating a pollutant like carbon emissions, what you hear most of the time are arguments for either "market-based" regulations (like cap-and-trade or carbon tax) or "command-and-control" regulations (like "best available control technology"
, where everyone is required to achieve the same performance with the same technology). But few talk about "information-based" regulations.
Yet back in the 1980s, Congress' implementation of the Toxics Release Inventory
as part of a "right to know" law turned out to be a very important illustration of the potential usefulness of information as a regulatory tool. The thinking was simple: Require companies that were putting toxic pollutants into the environment (even if at legally-allowed levels) to report it into a simple database that the public could get access to. If you want to see what the data looks like, check out Planet Hazard
, a great web-based interface.
The impacts were significant and immediate -- companies started reducing their emissions of toxics (with total reported emissions dropping 48% from 1988 to 2000
). In some cases companies were embarrassed by local news reports identifying the biggest polluters in certain regions. And in other cases I've seen, some CEOs had never been forced to acknowledge the amount of toxics being emitted out of their factories, and they recognized that pollution is very often a form of wasteful cost
, so TRI spurred waste-reduction efforts that improved profitability.
I emphasize that last point because it shows that not only was making the data available a relatively low-cost way to get significantly reduced emissions, the information also became a useful business tool for businesses that were looking to lower their costs and environmental impact.
TRI has come under attack for putting reporting burdens on companies, costs which have been measured in the hundreds of millions of dollars by some accounts. But of course, that misses the point entirely -- this is information these companies should be gathering anyway, if they're run by profit-maximizing businesspeople. And it's certainly a less-costly alternative to BACT standards or other more active regulations that could be placed on emitters of toxic waste, in any attempt to achieve the same reductions. So it was a great win to see Obama already signing legislation strengthening TRI reporting requirements.
So now we have the EPA proposing greenhouse gas emitters be put into a somewhat similar system. And I think it's a terrific idea.
Again, this is information that major GHG emitters should already be tracking. Because carbon out the smokestack represents some form of waste, potentially avoidable. Companies like eQuilibrium
have already been signing up corporate customers who want to use their carbon emissions tallies to help them identify places where they are wasting energy. There are efficient ways to gather this information now, it shouldn't be a huge administrative burden.
But as the example of TRI showed, such information gathering and reporting can have a major impact on corporate performance. Information is a powerful regulatory tool, and it's great to see it start to be deployed in the fight against climate change.
A TRI equivalent for carbon emissions could be a lot more important than most people realize.