Introduction

Abstract

The newly created U.S. Environmental Protection Agency (EPA) in the 1970s embarked on three different regulatory approaches for reducing pollution. The Clean Air Act of 1970 mandated that EPA set ambient-based standards that protect human health and welfare. These standards require existing industrial sources of air pollution to install pollution control equipment only to the extent necessary to meet ambient standards. The Clean Air Act also mandated that EPA in some circumstances set benefits-based¹ standards that trade off risks to society with the costs of risk reduction. These standards require existing industrial sources to install pollution control equipment only to the extent that there would be a reasonable balance between the benefits of pollution reduction and the costs of pollution control technology. The Clean Water Act of 1972, however, mandated that EPA set technology-based standards that reflect the availability and affordability of pollution control technology. These standards require existing industrial and municipal sources to meet uniform discharge limitations, even if the pollutants discharged did not result in violations of ambient standards.