Air Pollution Abatement Strategies

ABATE Case

          CASE NUMBER:    299
          CASE MNEMONIC:  ABATE
          CASE NAME:      Air Pollution and Abatement Strategies

A.        IDENTIFICATION

1.        The Issue

     Air pollution is a major global problem.  It exacerbates
existing health problems, produces health problems where there
otherwise would not be any and, in severe cases, causes death.  Air
pollution is also responsible for a wide variety of environmental
problems including damaged forests and crops, acid deposition (acid
rain) and widespread destruction of acid sensitive aquatic
environments  and organisms.  All these impacts entail significant
economic costs.   As these costs become widely known, pollution
abatement becomes  increasingly important.  There are a number of
different pollution  abatement techniques available to polluting
industries as well as a  number of different strategies to
encourage industry to implement those  techniques.  The four
strategies surveyed in this study include direct  regulation,
taxation, facilitation of private litigation, and a system of 
tradeable pollution permits.

2.        DESCRIPTION

     Air pollution is not a recent phenomena.  Contamination of the
atmosphere has been a constant side effect of industrialization. 
The severity of air pollution and the public's acute awareness of
it, however, is relatively recent.  As industrialization has taken
on a global dimension since the end of World War II, so has
pollution.  Although severe occurrences like the deadly 1952 London
"black fog" are relatively rare, they have served to highlight the
need for pollution abatement 

     Anthropogenic (man made) air pollution comes from many
sources, can have numerous components including various sulfurous
oxides (SOx), nitrous oxides (NOx), ozone, hydrocarbons,
Cloroflouro-carbons (CFCs), and heavy metals and is the subject of
this case study.  Specific concentrations and composition of
pollutants is tremendously location specific and would be an
appropriate component of a case study on a particular industry or
region.   Naturally occurring pollution, such as forest fires and
volcanic eruptions, can also cause significant deterioration in air
quality but cannot be controlled or mitigated by policy action and
are therefore outside the scope of this study.    

     Atmospheric pollution released from readily identifiable
sources is referred to as primary pollution while pollutants that
occur as a result of a chemical reaction with or in the atmosphere
are secondary pollutants.  The categories of primary pollution
sources are mobile or stationary, combustion or non-combustion,
area or point sources, direct or indirect.  Mobile sources include
automobiles, trains, and airplanes.  A point source is a stationary
source whose emissions have significant impact on air quality while
an area source is one which is not a significant polluter by itself
but contributes to air pollution as part of a group of relatively
small polluters. <1> 

     Not all forms of air pollution can be accounted for by
"traditional" gaseous and particulate matter. Non-traditional forms
of air pollution include noise, odor, heat, ionizing radiation, and
electromagnetic fields.  These forms of pollution are mentioned for
the sake of thoroughness but will not be examined in this study.  
Although internal combustion engines (particularly two stroke and
diesel engines which are prevalent in the developing world and in
former East Bloc countries) are the most publicly visible sources
of pollution, large quantities of pollutants are by-products  of
fossil-fuel burning industries - particularly coal fired power 
plants and metal smelters.  This case study will examine the
pollution  effects of and abatement strategies for fixed point
source polluters  such as power plants and metal smelters. 
           
                      The Costs of Pollution

     Air pollution has been linked to many negative impacts on
human health and on the health of the environment.  In addition to
the notorious episodes such as the London "black fog" of 1952 that
killed thousands, pollution causes serious, ongoing general health
hazards of a less conspicuous, but no less dangerous kind.  Pollu-
tion has also been identified as a causal factor in building
deterioration, lowered visibility, fish kills, global warming, and
widespread tree and plant damage, all of which have serious
economic consequences.   

     The costs of various forms of pollution abatement are
relatively easy to calculate.  Air "scrubbers" that reduce
particulate matter and other toxic output and higher quality coal
can be specifically priced out and their effects can be accurately
projected.  The costs of non-abatement - continued pollution - are
much more difficult to calculate and are subject to a far higher
degree of uncertainty.  Although less certain than pollution
abatement pricing, evidence on the real cost of pollution is
growing stronger and gaining wider acceptance among the public and
in government.
Health Costs

     The most severe episodes of air pollution have caused
significant loss of life.  Belgium's Meuse Valley was the sight of
60 air pollution related deaths in 1930.  Donora, Pennsylvania was
the scene of 20 deaths in 1948.  The infamous London "black fog"
claimed approximately 4000 lives in 1952 and has been linked to
increased mortality during "fogs" dating back as far as 1873.  In
these cases a persistent thermal inversion prevented atmospheric
dispersion resulting in excessively high pollution levels from coal
fired home furnaces (London) or from heavy industry (Meuse and
Donora). <2>        

     Widespread illness has also been linked to pollution including
half of the 14,000 people in the affected area of the afore-
mentioned  Donora, Pennsylvania incident. <3>  In the United
States, 150 million people live in regions with unfit air according
to the Environmental Protection Agency (EPA).  Greater Athens
experiences a sixfold increase in the number of deaths on heavy
pollution days; Hungary concluded  that every 17th death and every
24th disability is the result of air pollution; and in Bombay,
India, breathing the air is equivalent to smoking 10 cigarettes a
day. <4>  Some researchers believe the combination of sulfur
dioxide and water in the air allow people to breathe toxic metals
and gasses deep into their lungs causing as many as 50,000 deaths
in the Untied States every year - 2 percent of annual mortality.
<5>

     These examples may represent extreme cases.  Nonetheless, they
clearly demonstrate to some degree the deleterious health effects
of air pollution.  Exposure to levels of air pollution that do not
cause immediate acute illness or death are more difficult to
assess.  However, ambient air pollution has been implicated as a
causal factor in:
     1.  chronic respiratory and cardiovascular disease
     2.  alteration of body functions such as lung ventilation and 
                 oxygen transport
     3.  reduced work and athletic performance
     4.  sensory irritation of the eyes, nose, and throat
     5.  aggravation of existing disease such as asthma.
Air pollution may also result in the storage of harmful substances
in the body. <6> (See Godish, Chapter 5, and Webster, Table 3 for
a detailed analysis of the health effects of pollution.)  One study
determined that every ton of sulfur dioxide emitted into the
atmosphere causes over $3,000 of health-related damage in affected
communities which translates into a cost of $25 billion for the
emissions from midwestern coal-fired power plants alone. <7>      
Atmospheric pollutants also produce indirect health hazards.  Acid
"rain" (discussed in more detail below) makes dangerous metals like
aluminum, cadmium, lead, and mercury more soluble.  These metals
can be leached from soils and lake sediments into aquatic
environments where they contaminate water supplies and edible fish. 
Acidic water can also dissolve toxic metals from municipal and home
water systems thereby poisoning drinking water. <8>    

Environmental Costs

     While human health is the most important impact of pollution,
the environmental impact is significant as well.  Much of the
directly observable environmental impact is the result of acid
(sulfuric and nitric) deposition - more commonly known as "acid
rain." Pollutants can effect the frequency and quantity of
precipitation as well as the chemical content of raindrops and
other forms of acid deposition such as snow, frost, dew, and fog. 
Acid can be deposited in dry conditions on ground surfaces as well. 
Hence the term "acid deposition" is more accurately descriptive of
the overall phenomena.

     Acid deposition is created in the atmosphere by chemical
reactions of sulfur dioxide (SO2) or nitrogen oxides (NOx). In the
late 1960s, Swedish ecologists first connected acidity of rainfall
in affected watersheds with species composition in a number of
lakes.  The problem was not recognized in North America until the
mid-1970s <9> when investigations concluded that acid deposition
was indeed acidifying water and killing aquatic organisms. <10>   

    The precursors of acid deposition, sulfur and nitrogen oxides,
are emitted from fossil-fuel-fired power plants, industrial
boilers, metal smelters, and automobiles.  Acid deposition in the
United States is due primarily to sulfuric (65%) and nitric (30%)
acids and approximately 60-70% of the SOx emissions are reported to
be associated with large electric power plants which burn high-
sulfur coal. <11>  

     Acidification is a worldwide problem.  In addition to the
highly publicized acidification cases in North America,
particularly the American northeast and eastern Canada, much of
Europe, Africa, Asia and South America are also acid sensitive.   

    In some regions, biologists have extrapolated experimental
findings to conclude that more than half the sensitive species such
as mollusks, leeches, and crustaceans have been eliminated in
acidified areas. <12>  Acidification may also reduce total
phytoplankton biomass while increasing certain algae species.  In
severely acidified lakes, these algae species cover all surfaces
with thick mat (algae blooms) which inhibits the life and feeding
cycles of other aquatic organisms, contributing to the decrease in
species diversity.  Strong acidity leads to binding of nutrient
ions to minerals, preventing their absorption by phytoplankton -the
primary component of the food chain. <13>  Clearly,
acidification has drastic consequences on acidified watersheds.   

  In addition to this severe disruption of the food chain and the
ensuing ecological problems, acidification is more detrimental to
smaller and younger fish due to their large body and gill surface
per unit weight. Fish mortality is also caused by the toxic effects
of aluminum ions and heavy metals such as mercury which can be
mobilized from lake sediments through acidification. <14> Some
research suggests that coastal waters are at risk as well as fresh
water sources.

     Vegetation is also subject to damage destruction from acid
deposition.  Particularly severe damage is associated with the high
concentration of SO2 and heavy metal emissions from primary metal
smelters. <15>  Forest damage due to acid deposition first became
evident in West Germany where the first survey (1982) indicated
that 8 percent of German forest were damaged.  The following year,
34 percent were surveyed as damaged with the peak of 54 percent
occurring in 1986.  The percentage has decreased slightly (52
percent in 1988) but since dead trees are not included in the
survey, lower percentages do not necessarily constitute an
improvement. <16>

     In addition to the direct damage from acid deposition, the
mixture of acid deposition, ozone, and toxic metals makes
vegetation more vulnerable to naturally occurring stresses such as
drought, temperature extremes, and blight.  European surveys have
concluded that 50 million hectares - 35 percent of Europe's
forested area - have been damaged. <17>

     The economic costs of such widespread damage are equally
large.  Poland projects that it will lost $1.5 billion by 1992 due
to forest damage while Germany estimates that forest damage will
cost the country $3 billion to $5 billion annually over the next 70
years.  Additionally, crops are damaged by pollution (particularly
ozone) and are estimated to represent economic losses in the United
States of $5.4 billion per year from reduced crop yields. <18>    
Pollution, particularly the acid derivatives of SO2 emission,
corrode monuments and historical artifacts.  T.N. Skoulikidis, a
Greek expert on acid corrosion, estimates that pollution has caused
more deterioration of Athenian monuments in the last 20-25 years
than has occurred during the previous 2400 years. <19>  Air
pollution also effects paper and leather, significantly reducing
their usable life span.  Fabrics and textile dyes are also
adversely affected by air pollution.  Other problems include metal
corrosion, odor pollution, and rubber deterioration. 

     All of pollution's negative impacts have significant economic
effects - both direct and indirect.  Health costs, already
staggering in the United States, are placed in greater demand by
pollution related illnesses and exacerbations of existing medical
problems.  Damaged trees actually cost money in the form of lost
revenue in addition to tourism decline in heavily impacted areas. 
Regions impacted by pollution odor experience declines in property
value.  Farmers experience reductions in crop yield driving up
produce prices.  Clothes and paper products deteriorate faster and
require more frequent washing which also hastens their
deterioration and contributes to higher demand for textiles.  The
fishing and wilderness tourism industry is clearly a big loser and
we all lose a degree of visibility that threatens our enjoyment of
natural wonders like the Grand Canyon. (See TED
case: GRAND)   Given all these costs, it is no surprise that
the public and governments are accelerating their search for ways
to reduce toxic emissions.

                   Pollution Abatement Strategies

     Given the need to reduce pollution, the question becomes one
of finding the most effective pollution abatement techniques and
the best way to implement them.  This effort compounded by the
global nature of the problem and transboundary impacts of
particular pollution sources.  Several different abatement
strategies have been proposed including different forms of
taxation, direct regulation and monitoring, the allowance of
private litigation on environmental issues, and tradeable pollution
"permits."     

     The damage and attendant costs of air pollution are becoming
increasingly evident and increasingly large.  On the other side of
the coin, is the dependence of industrialized economies on fossil-
fuel based industrial, power, and transportation systems.  With the
exception of the United Arab Emirates, Europe and North America are
clearly the largest producers of energy on a per capita basis <20>
and have the highest concentration of automobiles.  

     There is clearly an economic expense attached to pollution
abatement measures.  The conflicting interests in the pollution
debate make the issue a political one.  Consequently, potential
pollution abatement strategies must not only be economically
feasible and effective at reducing pollution, they must also be
politically feasible AND sustainable over time.  Developing an
approach that meets all of these requirements is a world class
challenge.

Emission Reduction Techniques

     Pollution abatement technology is becoming big business. 
European pollution abatement generate $50 billion a year <21> while
US firms spent nearly $100 billion on pollution control in 1990 and
are expected to spend as much as $150 billion by the year 2000.
<22>  It has also become a major political issue in many regions,
most notably between the United States and Canada and within the
European Community.  While science and industry search for more
cost-effective solutions, it would be useful to note currently
available methods of pollution control.

     The most common method of removing particulate matter from
power plant emission has been the use of electrostatic and baghouse
filters.  This technology is required in most OECD countries. 
While this technology reduces direct particulate emission by as
much as 99.5 percent, it does not prevent gaseous emissions or
prevent them from forming acidic particles upon reaction with
outside elements. <23>

     Sulfur dioxide emission is most commonly controlled through
flue-gas desulfurization (FGD) devices known as "scrubbers" which
can remove up to 95 percent of SO2 emissions.  This technology is
becoming more widespread but its application is still far from
universal, especially in the United States where it is projected
that by the year 2000 only 30 percent of American power plants will
have installed "scrubbers." <24>

     Controlling nitrogen oxides (NO2) emissions has been pursued
through several different techniques.  A simple modification of its
combustion process has resulted in 30-50 percent decreases in NO2
output.  Selective catalytic reduction (SCR) can reduce emission by
80-90 percent but is far more expensive to implement.  This tech-
nology is likely to be more widely implemented in the future. <25> 

    "Clean coal" (see TED case: CHINCOAL) technologies are also
under development which lower SO2 and NOx emission while providing
more efficient combustion.  This technique employs fluidized bed
combustion technology which burns crushed coal on a bed of
limestone suspended by injected air or the integrated gasification-
combined cycle which turns coal into a gas to power a turbine and
uses excess heat from that process to power a second turbine. <26> 

        Another measure that industry can use to reduce emission is
to use lower-sulfur coal.  While this is technically easy to
implement, there are large political and economic ramifications for
local coal producers who are frequently subsidized, protected, or
otherwise guaranteed a market in many American states. <27>     
All these technologies are steps in the right direction.  We must
also note that many of them produce their own environmental
hazards.  Scrubbers, for instance, produce scrubber ash, a
hazardous waste.  Furthermore, these technologies do not reduce
carbon dioxide emissions and do not reduce industry's impact on the
problem of global warming. <28>

Pollution Abatement Implementation Strategies

     Balancing the needs of polluters (who provide many products
upon which industrial societies depend) with the public's need for
clean air calls for thoughtful policy instruments that take the
needs of all sides into account - not the least of which is the
political sustainability of any particular policy instrument over
time.  Four broad classes of policy instruments have been proposed
to reduce pollution:
     1.  direct regulation
     2.  taxation
     3.  provision of framework for private litigation
     4.  creation of a market of tradeable pollution "permits" 
These four strategies are not necessarily mutually exclusive
although there are positive and negative aspects of each which must
be considered when formulating effective policy. 

     Direct Regulation has been a mainstay of national policy
instruments.  Regulation provides transparency and certainty,
crucial factors for business decision making.   Transparency
provides interested parties with specific details on permissible
and impermissible actions.  Certainty is partially a function of
effective enforcement including efficient monitoring and reliable
prosecution/punishment provisions.

     However, the costs of creating, administering, and enforcing
regulations (including all the small print) can be an arduous task
even at the national level.  The job takes on a vastly more complex
and problematic dimension when the international arena is the
target community.  Differences in national interests are compounded
by different cultures, legal systems, and economies.

     International enforcement would also be difficult.  Without a
world body to impartially enforce the regulations (few countries
are willing to give up their sovereignty to an international
organization), enforcement would be left up to national
bureaucracies.  The differences between the operations of such
organizations would undermine the regulations since it would be
effectively impossible for the regulations to be equally enforced
in every country. <29>  Nonetheless, international agreement and
attempts at equivalent compliance are a major step above non-
agreement and should be vigorously pursued.

     Furthermore, regulations do not make allowances for local
variations in conditions.  This rigidity unduly punishes some and
unduly rewards others all while creating a potentially hostile
environment for new entries into the market that might employ more
environmentally sound practices. <30>     

     Taxation of various pollutants, per ton of SO2 emitted for
instance, is a second instrument for reducing toxic emissions.  
Taxes provide an incentive for polluters to reduce their emissions
and provide revenue to continue administration of the tax and to
promote other pollution abatement programs.  Governments are also
familiar with this instrument and would find easy to implement.   

    Taxation becomes a problem at the international level.  Issues
of which currency tax is to be paid in and exchange rate problems
would abound.  More importantly would be the international
administration collecting the tax and how it would use the revenues
therefrom.  This would be a major sovereignty issue. <31>

     The European Community has proposed a tax of $3 per barrel of
oil to reduce carbon dioxide (CO2) emissions.  This tax would be
gradually raised to $10 a barrel by 2000.  To avoid trade and
competition inequities resulting from the tax, energy intensive
industries with significant foreign trade interests would be exempt
until competitor countries - Japan and the United States - adopt
similar measures. <32> 

     Private Litigation facility is a third option.   By allowing
private concerns (extra-national as well national) to sue violators
of international pollution agreements, regulatory costs would be
minimized since enforcement would be provided - perhaps 
sporadically - through litigation by interested/injured parties.  
The ability of wealthy polluters to stall legal proceedings, the
uncertainty of compliance with an international court and the
sovereignty issue such a body raises are obvious disadvantages to
this system.  It should be noted, however, that international law
relating to oil spills at sea and European transboundary pollution
treaties have established some legal precedents upon which to base
a greater role for private litigation. <33>  

     While private litigation may be insufficient to lower toxic
emissions and improve air quality, it may prove to be a valuable
addition to the other strategies by providing an additional
compliance incentive for polluters.          

     Tradeable Permits are a market based approach to pollution
abatement that combines financial incentives similar to taxation
but requires substantially less regulatory oversight.  Essentially,
polluters are given/sold pollution permits (see TED case CLEAN),
each of which allows a certain amount of a particular pollutant
such as one ton of SO2, according to a pre-calculated formula.  The
total number of permits distributed equals the total emissions
target thereby establishing a maximum pollution level.  This total
emission threshold would be lowered over time.

     The world's first example of a tradeable permit system was
launched in 1993.  The Chicago Board of Trade held the first
auction of tradeable permits for SO2 emissions on March 29, 1993
and the second on March 28, 1994.  The marginal interest in these
events suggest that market trading will not be a significant factor
in utilities' short term efforts to comply with Title IV of the
1990 Clean Air Act Amendments.  The lack of response may also
result from industry's unfamiliarity with the market concept and
relevant pricing strategies.  Also, an unknown number or permits
have been privately traded. <34>  Additionally, the instigation of
tradeable permits it sufficiently recent that it is too early to
determine the full range of its impact.

     The heart of the system would be the market for the pollution
permits in which permits could be freely traded.  The result would
be that polluters that could most easily/economically lower
emissions would do so and sell their unused permits to others. 
Since trading is an open market, environmental interests could
purchase the permits as easily as other polluters, driving up the
price and therefore the incentive to reduce emissions.  The price
would also increase over time as the cap on total emissions was
reduced. <35>

     This system would be very inexpensive for the government to
operate and also allow extra time - at a price - for those
polluters that need to postpone adoption of costly emission
reduction procedures and equipment.

     Since tradeable permits do not involve taxation per se, they
are relatively easy to sustain politically.  They also provide real
(and increasing) incentives to lower emissions.  By structuring the
costs of permits less than fines for non-compliance, they become an
attractive option, theoretically reducing detailed oversight
requirements.

     A system of tradeable permits also has some drawbacks.  Heavy
polluters may find it economical to purchase extra permits and
produce even more pollution that will predominantly affect another
state/country.   This problem could be addressed through the
initial permit allocation process.  The United States in particular
favors "grandfather" permits that allocate permits on the basis of
previous emission output. <36> In effect, the more pollution
produced in the past, the more permits that industry is entitled to
in the present and in the future.  Other options could be
allocating permits on a per unit population basis or by reducing
the price of permits for industries that produce less pollution per
kilowatt hour of energy produced.

     Lastly, there is a very basic concern, especially among
environmentalists, over essential property rights.  By allowing a
permit to pollute, polluting industries are effectively given
property rights to air resources - rights that are withheld from
private citizens who also are entitled to use of the air.  It also
legitimates the polluter's "right to pollute" at the expense of the 
public's right to enjoy a pollution free environment. <37>

                            Conclusion

     At the present time, there seems to be no "ideal" solution to
the pollution problem that simultaneously addresses the needs of
polluters, the public, and the politicians.  Direct regulation,
taxation, a greater role for private litigation, and tradeable
permits all have advantages and disadvantages.  For the immediate
future, the system of tradeable credits appears to be the most
feasible solution.  It infringes least upon the sovereignty issue,
provides real economic incentives to promote pollution abatement,
and is the least costly to operate.

     Direct regulation, private litigation, and taxation would take
a tremendous amount of coordination.  While feasible at the
national and sub-national level, initiation of such measures in an
international context takes on nearly insurmountable problems.  It
will be very difficult to achieve consensus among even a majority
nations, let alone near unanimity.  Any provision that all
governments would find acceptable are highly likely to be effective
at actually reducing emissions.  The more governments that are
involved, the more diluted the agreement is likely to be.
Additionally, governments have widely disparate domestic political
situations and constituencies as well as widely diverging
objectives in the international arena.  

     Tradeable permits would certainly have to overcome these same
problems.  However, their cost efficient and free market nature
make them much more palatable.  Many industrialized countries,
notably the United States and the European Union are already
considering or implementing such measures.  The global availability
of such permits could drive the price of such permits down relative
to smaller national or regional permit systems making the largest
polluters - and thus potential opponents - also interested in
lobbying for a global permit system.  Many Third World nations
might also be willing to join a global system of tradable pollution
permits.  Since most Third World countries pollute far less than
the industrialized nations, a system of tradeable permits would
effectively become a resource transfer between "North" and "South"
that would increase available development resources which would be
highly welcome during the current decline in aid allocations.     
Much of the current literature barely touches or ignores several
other alternatives that would complement all of these measures. 
Greater education, particularly combined with the availability of
information regarding polluter's emission levels, about pollution
would promote awareness and greater citizen oversight of pollution
sources.  As public awareness increases, its interest in
environmentally sound products increases leading to competitive
advantage for firms able to advertise their goods as
environmentally friendly as in the proposed European eco-labeling 
program. <38>

     While this paper my not constitute a "case study" per se, its
content provides a useful context for future work on air pollution. 
The "case" of this paper addresses the currently available
strategies for reducing air pollution.  Other studies can
concentrate on specifics without reiterating the options for such
reduction.  It also provides valuable background reference material
for those interested in air pollution and its effects.  Similar
studies on the scope of alternatives regarding water pollution
(surface and ground water, fresh and salt), ground pollution
(organic and toxic, surface longevity and seepage to water table),
and mobile sources of air pollution would be useful as well.      
Future studies may find it useful to compare and contrast TED cases
at levels other than the obvious comparisons such as
geography, standing, habitat, etc. readily offered by the TED
coding format.  One level that comes from this study is a
comparison of strategies used in various locations/countries and
the consequences and costs of implementation.  Other comparisons
could be between regulatory structures such as similar taxation
plans, between comparable climatic air regions with similar
polluter profiles and densities, public awareness and response to
similar circumstances, policy response and enforcement, industry
response to regulation and public articulation.  Other interesting
comparisons would involve the transparency of regulation, public
availability of pollution data, and the economics and politics
involved in creating and enforcing regulation.  

     Other cases, more akin to policy recommendations, could argue
for establishing particular abatement strategies in particular
locations and within existing political contexts since pollution
solutions are not equally feasible in a political sense across
countries or regions (or even localities).  Policy recommendation
cases could also involve a search for sponsors and prospective
allies that would support the recommendation and identification of
those groups most likely to oppose it and the opponent's avenues of
contesting the recommendation.   Another interesting case would be
to examine the environmental impact of pollution abatement equip-
ment manufacturing. 

3.        Related Cases  

     
Go to CLEAN
     
Go to CO2TRADE
     
Go to CHINCOAL 
     
Go to ECCARBON
     
Go to ECCO2
     
Go to MONTREAL
     
Go to CFCTRADE
     
Go to SULFUR
     
Go to GRAND
     
Go to CHILEAIR
     
Go to JAPANAIR
     
Go to KORPOLL
     
Go to POLWASTE


     Keyword Clusters

     (1):  Trade Product           = MANY
     (2):  Bio-geography           = GLOBAL
     (3):  Environmental Problem   = Air Pollution [POLA]

4.   Draft author:  David Field

B.        LEGAL Filters

5.   Discourse and Status:    [DIS]agree and [ALLEGE]

6.   Forum and Scope:         [GLOBAL] and [MULTI]

7.   Decision Breadth:        175+

8.   Legal Standing:          SUBLAW

     Although the 1992 Rio de Janeiro (Earth) Summit addressed
issues of pollution, few substantive global agreements were
reached.  The United States has some of the most stringent internal
laws on mobile pollution sources (mostly automobiles) and has made
progress on industrial pollution through the Clean Air Act
Amendments of 1990.  NAFTA also attempts to address issues of
transboundary pollution.  The EC is working to set up a European
environmental agency that will help unify environmental regulation
and compliance and probably represents the most ambitious effort to
date to draft multi-national regional environmental regulations. C. 

C.   GEOGRAPHIC Clusters     

9.   Geographic Domain

     a.       Geographic Domain:     GLOBAL
     b.       Geographic Impact:     GLOBAL
     b.       Geographic Site:       GLOBAL

     Air pollution freely crosses political boundaries making it an
issue of multi-national importance.  Most of the pollution problem
experienced by Norway originates in Germany and Central Europe. 
Sweden, Poland, the Baltic States and Belarus are seriously
impacted by pollution from Ukraine, most notably radiation from the
Cherynobl nuclear power plant.  Not all countries are equally
affected by pollution, equal producers of pollution, or equally
concerned about the problem.  Nonetheless, the transboundary nature
of air pollution makes it a problem of global dimensions.

10.  Sub-National Factors     YES

11.  Type of Habitat:         MANY

D.   TRADE Clusters

12.  Type of Measure:         MANY

13.  Direct vs. Indirect Impacts: BOTH

     Air pollution causes many direct impacts on health
(respiratory problems) and on the environment (cost to timber
industry) as well as numerous indirect effects such as decreased
tourism, food chain disruption, higher lumber prices, and
environmental activism.

14.  Relation of Measure to Environmental Impact

     a.  Directly related:    YES  MANY
     b.  Indirectly related:  YES  MANY
     c.  Not Related:         YES  RETALiation
     d.  Process Related:     YES  MANY

15.  Trade Product Identification:  MANY

16.  Economic Data

     Industry output (pollution abatement)
          United States - $100 billion
          European Community - $50 billion

     These figures only include funds spent directly on pollution
abatement equipment/processes and do not include cost of
regulation enforcement or other material inputs such as coal or
oil.
     Health Costs (air pollution caused)

     United States (areas impacted by coal-burning midwest plants) 
     $25 billion per year. 
     United States - 50,000 deaths per year.

     This category is very difficult to measure accurately and has
therefore been subject to a great deal of debate.  It is
increasingly evident that pollution does have a negative influence
on health so the debate is currently centered on how much influence
and no longer on whether there are harmful effects or not.

     Environmental Costs
  United States - $5.4 billion per year crop reduction
  Poland        - $1.5 billion per year lost timber
  Germany       - $3 - $5 billion per year lost timber

      It should also be noted that dollar losses simply reflect
cost of  not harvesting damaged trees and as such only represent
the value of trees used as commodity.  The figures do not represent
all damaged trees and do not reflect the myriad other effects that
stem from such damage such as higher timber prices, higher
construction prices, fewer timber industry workers, higher fire
threat to damaged forests, and reduced tourism.                  

17.  Impact of Measure on Trade Competitiveness:  LOW

     This impact status is likely to increase.  As more
environmental agreements are reached, nationally, regionally, and
globally, coordination of regulations will become increasingly
important because of the transboundary nature of the problem.  The
likely result will be the imposition of overt tariffs for goods
produced in countries without compatible environmental regulation
as well as non-tariff barriers on particular non-complying products
and services.

18.  Industry Sector:  MANY

     The combination of direct and indirect effects of pollution
from numerous sources and industries on an even greater array of
health concerns, environments, and products defies any attempt to
limit air pollution to one sector.

19.  Exporter and Importer:  MANY

E.        ENVIRONMENT Clusters

20.  Environmental Problem Type:  MANY

21.  Species Information

22.  Impact and Effect:  HIGH and MANY

23.  Urgency and Lifetime:  MEDIUM and 100s of years

24.  Substitutes: NA

F.        OTHER Factors

25.  Culture:   NO

26.  Trans-border:  YES

27.  Rights:        YES

     The right to clean air has not been granted by specific
statute.  At some point, people's right to life is terminally
infringed upon by pollution.  At that point, the right to clean air
is a human right.
 
28.       Relevant Literature

Bertram, Geoffrey.  "Tradeable Emission Permits and the Control of 
     Greenhouse Gases."  The Journal of Development Studies 28/3  
     (April 1992): 423-446.
Bryner, Gary C.  Blue Skies, Green Politics:  The Clean Air Act of 
     1990.  Washington DC: Congressional Quarterly Press, 1993.
Godish, Thad.  Air Quality, second edition. Chelsea, Michigan:   
     Lewis Publishers, Inc., 1991.
Koutstaal, Paul and Nentjes, Andries.  "Tradable Carbon Permits in 
     Europe: Feasibility and Comparison with Taxes."  Journal of  
     Common Market Studies 33/2 (June 1995): 219-233.
Mostaghel, Deborah M.  "State Reactions to the Trading of Emissions 
     Allowances Under Title IV of the Clean Air Act Amendments of 
     1990."  Boston College Environmental Affairs Law Review 22/2 
     (Winter 1995): 201-224.
Rehbinder, Eckard and Stewart, Richard.  Environmental Protection 
     Policy, Volume 2.  Berlin: Walter de Gruyter, 1985.
Vial, Catherine.  "Why EC Environmental Policy Will Affect American 
     Business."  Business America (March 8, 1993): 24-27.
Webster, David B.  "The Free Market for Clean Air."  Business and 
     Society Review (Summer 1994): 34-37.
World Resources Institute.  World Resources 1994-95.  New York:  
     Oxford University Press, 1994.
World Watch Institute.  "Cleaning the Air:  A Global Agenda." 
     World Watch Paper #94 (January 1994): 5-53.
Related TED cases 

                            References

     <1>  Thad Godish.  Air Quality (Chelsea, Michigan: Lewis
Publishers, 1991), 26-27.
     <2>  Ibid, 131.
     <3>  Ibid, 131.
     <4>  World Watch Institute.  Cleaning the Air: A Global Agenda
(World Watch Paper #94) (New York:  W.W. Norton, 1994) 5.
     <5>  Ibid, 12.
     <6>  Godish. op.cit. 132.
     <7>  David B. Webster, "The Free Market for Clean Air,"
Business and Society Review (Summer 1994), 34-35.
     <8>  World Watch Institute. op cit, 12.
     <9>  Godish. op. cit. 104.
     <10>  World Watch Institute. op cit, 17.
     <11> Godish. op. cit. 104-105.
     <12> World Watch Institute. op cit, 18-19.
     <13> Godish. op. cit. 107-108.
     <14> Ibid, 107.
     <15> Ibid, 173.
     <16> World Watch Institute. op cit, 19.
     <17> Ibid, 20.
     <18> Ibid, 22.
     <19> Ibid, 23.
     <20> World Resources Institute.  World Resources 1994-95 (NY:
Oxford University Press): Table 21.2, 334-335.
     <21> Catherine Vial.  "Why EC Environmental Policy Will Affect
American Business," Business America (March 8, 1993), 27.
     <22> Gary C. Bryner.  Blue Skies, Green Politics: The Clean
Air Act of 1990 (Washington DC: Congressional Quarterly): 9.     
<23> World Watch Institute. op cit, 25.
     <24> Ibid, 25.
     <25> Ibid, 26.
     <26> Ibid, 26.
     <27> Bryner. op. cit. 69.
     <28> World Watch Institute, op. cit. 26.
     <29> Geoffrey Bertram. "Tradeable Emission Permits and the
Control of Greenhouse Gases," The Journal of Development Studies
(April 1992): 431-432.
     <30> Bryner. op. cit. 21.
     <31> Bertram. op. cit. 433.
     <32> Vial. op. cit. 24-25.
     <33> Bertram. op. cit. 434-435.
     <34> Deborah M. Mostaghel. "State Reactions to the Trading of
Emissions Allowances Under Title IV of the Clean Air Act Amendments
of 1990," Boston College Environmental Affairs Law Review (Winter
1995): 202-203.
     <35> Ibid, 207.     
     <36> Paul Koutstaal and Andries Nentjes. "Tradable Carbon
Permits in Europe: Feasibility and Comparison with Taxes," Journal
of Common Market Studies (June 1995): 224-225.
     <37> Bertram. op. cit. 436.
     <38> Vial. op. cit. 24.