The nonprofit group Environmental Defense has released a new analysis showing that a one-year delay in the implementation of a diesel emissions reduction rule could result in 1,400 premature deaths, 3,000 heart attacks, and 24,000 asthma attacks.

The regulatory process is often slowed to a halt under the weight of analytical burdens and political pressure from top agency officials or the White House. Environmental Defense's analysis proves regulatory delay is not just a government management issue — it's a public health issue.

According to Environmental Defense, the rule has been in development since at least 2004:

In 2004, EPA announced plans to put in place new standards for the nation's fleet of diesel locomotives and ships by mid-2006, but missed the deadline. In March 2007, EPA Administrator Stephen Johnson issued draft federal standards that would reduce particulate pollution and smog-forming nitrogen oxides from each engine by 80 percent or greater when fully phased in.

The analysis uses EPA's own data to prove that implementing the rule in 2008 would yield substantially greater public health benefits than implementing the rule in 2009. (See Environmental Defense's PowerPoint slides for side-by-side comparisons.)

EPA plans to issue the final rule in March. However, the rule is currently being reviewed by the White House Office of Information and Regulatory Affairs which could water down the regulation or impose further delay if it so chooses.

Yesterday, The New York Times published an article on new electricity producer regulations in Hong Kong which would tie electricity prices to a producer's emission levels:

The 10-year agreement reached this week between the Hong Kong government and the territory's two companies — Hong Kong Electric and CLP — authorizes the companies to charge electricity rates that will give them a 9.99 percent return on assets.

If either company exceeds regulatory limits for any pollutant, however, it would be required to charge customers less, reducing its allowed rate of return by 0.2 to 0.4 percentage point.

If the companies manage to cut their pollution more than required, then they are allowed to raise prices to the point where they effectively earn bonuses of 0.05 to 0.1 percentage point on their rate of return.

Like most pollution regulations in the U.S., this one creates an economic incentive for industry to comply. But the U.S. usually uses government-imposed financial penalties or, in the case of sulfur dioxide (and possibly greenhouse gases in the future), a cap-and-trade system.

In those regulatory schemes, polluters wind up paying the federal government. In Hong Kong, polluters would be penalized by having their revenue reduced when prices are lowered. This puts money directly back into the pockets of consumers. When electricity producers meet or exceed compliance requirements, consumers pay a little more.

Here's the interesting part: In the U.S., when the federal government collects fines Americans benefit in the form of improved government services, lower taxes, or both; but those benefits may not be realized for years and the average person likely would not even notice them.

Moreover, if a government-imposed fine leads to lower taxes, that disproportionately benefits the top 50 percent of income earners (who contribute 97 percent of tax revenue). In Hong Kong's scheme, the money goes back to all consumers based on consumption levels, which would disproportionately improve the marginal utility of low-income earners.

Oh yeah, and those low-income earners, they're the ones disproportionately affected by pollution in the first place.

When producers are in compliance with the regulations, consumers — regardless of wealth status — pay a little more for the benefits of cleaner air and water.

Reg•Watch isn't sure this would ever work in the U.S., but it could be a more equitable alternative to the kinds of regulations we usually turn to.