A Regulatory Burden: The Compliance Dimension of Regulating CO2 as a Pollutant

September 2008

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Introduction

Estimates of the costs of restricting carbon dioxide (CO2) emissions have generally focused on the penalties arising from the associated direct or indirect increases in the cost of energy. Since hydrocarbons provide 85 percent of all U.S. energy, such fuel-cost penalties could be substantial and widespread. But generally missing from economic analyses to date is inclusion of the regulatory and bureaucratic costs from complying with and enforcing federal pollution laws should the U.S. Environmental Protection Agency regulate CO2 and other greenhouse gases under the Clean Air Act (CAA).