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A retrospective assessment of the costs of EPA’s 1998 Locomotive Emission Standards

Published online by Cambridge University Press:  17 April 2015

Elizabeth Kopits
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Abstract:

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While the need to update EPA benefit-cost analysis to reflect the most recent science is broadly acknowledged, little work has been done examining how well ex ante BCAs estimate the actual benefits and costs of regulations. This paper adds to the existing literature on ex post cost analyses by examining EPA’s analysis of the 1998 Locomotive Emission Standards. Due to data limitations and minimal ability to construct a reasonable counterfactual for each component of the cost analysis, the assessment relies mainly on industry expert opinion, augmented with ex post information from publicly available data sources when possible. The paper finds that the total cost of bringing line-haul locomotives into compliance with the 1998 Locomotive Emission Standards rule remains uncertain. Even though the initial per-unit locomotive compliance costs were higher than predicted by EPA, total costs also depend on the number of locomotives affected by the regulation. Over 2000–2009, the number of newly built line-haul locomotives was higher but the number of remanufactured line-haul locomotives was lower than EPA’s estimate.

Keywords

benefit-cost analysislocomotivesretrospective analysis
Type
Research Article
Information
Journal of Benefit-Cost Analysis , Volume 5 , Issue 2: Special Issue: Retrospective Analysis of the Costs of EPA Regulations , June 2014 , pp. 285 - 314
Copyright
Copyright © Society for Benefit-Cost Analysis 2014

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