Washington, DC – The Environmental Protection Agency Office of Inspector General is examining potential damaging effects of proposed air emission trading programs on poor and minority communities, according to documents released by Public Employees for Environmental Responsibility (PEER). A major unresolved concern about Bush Administration plans to expand trading is that emission “credit” purchasers will likely be concentrated in poor, urbanized areas, creating toxic hot spots of clustered polluters who have paid for the right to exceed air quality limits.

In a May 13 memo, the OIG announced that it would conduct “an evaluation of impacts of emission trading in potential environmental justice communities.” This new environmental justice inquiry is part of a larger OIG review of air pollution trading proposals now pending approval by EPA. The OIG memo states the review was prompted by a request from PEER.

This expanded OIG review comes at a time when Bush administration trading plans are at a crossroads. New Jersey’s proposal to conduct “open market” trading (i.e., trading between different pollution sources and between different economic sectors) has collapsed following the surrender of nearly all of the credits in the market as part of an enforcement action against the utility, PSEG Fossil, Inc. Last month, PEER revealed that the bulk of pollution credits generated in Michigan, another state seeking open market trading authority, were the result of plant closures, not improved pollution controls.

At the same time, the President’s “Clear Skies” initiative features a dramatic expansion of more traditional “cap and trade” activity. Last week, EPA also proposed new water pollution trading authority for states.

“The Bush administration’s romance with these supposedly ‘innovative’ market based schemes masks its distaste for old fashioned enforcement against pollution violators and verifiable public health protections,” commented PEER Executive Director Jeff Ruch. “The OIG review signals a growing concern that the communities already in peril from pollution will again be the losers in a new game of corporate emissions trading.”

Working with concerned EPA employees, PEER has disclosed the existence of continuing negative, internal assessments within the agency concerning lack of effectiveness, enforcement and comparability in emerging trading schemes.


See the OIG memo.

For more information about pollution trading deficiencies, see the PEER white paper, Trading Thin Air here

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