Environmental Economics

Here is a summary of an analysis of part of the Trump Administration energy policy from a new RFF working paper by Daniel Shawhan and Paul Picciano:

A leaked US government memo proposes preventing the scheduled retirement of coal and nuclear power plants for two years. Using a detailed simulation model, we estimate the effects of such a policy on emissions, mortality, and coal-mine jobs.

• We estimate the effects of a proposed US policy to delay retirement of coal and saveable nuclear power plants that have announced they will close by the end of 2020.
• The policy would cause 353 to 815 premature deaths in 2019-2020 from additional emissions of sulfur dioxide and nitrogen oxides.
• The policy would support 790 coal-mine jobs (1580 job-years), though it would be likely to reduce economy-wide employment.
• These results indicate that each year the policy would cause 1 death for each 2 to 4.5 coal-mine jobs that it supports.

If coal jobs earn $80,000 then the Trump administration is willing to trade 1 premature death for a mere $160,000 to $360,000 (and loud cheers at campaign rallies). My read of the literature says that the value of avoiding a premature death is actually larger than those numbers and so this policy is an inefficient allocation of scarce resources.