The Grand Experiment

A few weeks ago, I read an opinion piece in the Washington Post that praised the Acid Rain Program as an example of how people with different perspectives could come together to create a successful program to solve an important problem. Reading this article twenty years after I helped write the bill that created the Acid Rain Program, I couldn’t help but ask – How did we do it?

The Acid Rain Program is often called “the grand experiment” because it is the world’s first large-scale air emissions cap and trade program. Signed into law in 1990, it created a cap and trade program that requires power plants to reduce emissions of sulfur dioxide (SO2) in order to address acid rain.

We were breaking new ground on environmental policy but we also needed a strong, national solution to a multi-state problem with local impacts. Writing the legislation was a wild ride full of Washington intrigue but we knew we had to – and we did – create a carefully designed program that provided a firm environmental goal (the emission cap) while giving industry the flexibility to decide how to achieve their emission reductions.

We were looking for certainty, simplicity, accuracy and an approach that wouldn’t require a lot of people to run it. And the program has proven to be all of these things. Power plant SO2 emissions have fallen dramatically since the program began in 1995. Some sensitive ecosystems are starting to recover from the damages of acid rain. By making huge reductions in SO2, we achieved one of the largest improvements in public health. Compliance cost 70% less than originally expected. Monitors on smokestacks collect data, available online, providing transparency and confidence in results. We’ve seen the market flourish while achieving over 99 percent compliance every year.

Looking back after 20 successful years of the Acid Rain Program, the world now knows that cap and trade works. For the right pollution problem, we don’t have to control every action – just the emissions – and we can allow flexibility AND achieve high compliance. Most importantly, we have shown that a strong economy and a healthy environment CAN exist together.

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About the author: Brian McLean is the Director of the Office of Atmospheric Programs in the Office of Air and Radiation and EPA manager for the Acid Rain Program.

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