Environmental Improvement Through Business Incentives assesses incentives that have worked in government and in the private sector to encourage companies to go beyond compliance. The report includes tables of environmental objectives that might be achieved through the use of incentives, and provides a menu of incentives that could help achieve those objectives.
Environmental Improvement
Through Business Incentives contains
2 tables of environmental objectives. The first of these tables identifies and
summarizes several environmental objectives that can be advanced through the
use of incentives. The second table identifies and summarizes several options
for voluntary environmental incentives. Both of the tables are intended to give
policymakers ideas on the type of incentive mechanisms that can be deployed and
the type of environmental improvements that can be achieved through the use of
such incentives. In order to achieve the
desired result, an incentive must match a business’ needs (or those of other regulated
entities, such as a publicly owned treatment works). Because the needs of
businesses vary, it is crucial that there be a variety of incentives available.
For some types of businesses, speed to market is critical. For example, they
need a way to avoid the delays associated with environmental administrative
processes. Others may be most driven by costs and need a way to achieve
savings. In cyclical businesses, an incentive that is not attractive at one
point in the business cycle may well be attractive at a later date. Smaller
businesses may need different incentives than large companies. The key point is
that a wide range of incentives is needed to address the incredible variety of
industries and even companies within industries that are affected by today’s
sweeping environmental rules. The development and
implementation of many types of incentive options will both need and benefit
from the active involvement of a broad spectrum of stakeholders. In particular,
those incentive options that modify existing regulatory requirements for a
company or facility will necessarily demand such stakeholder participation.
This report focuses specifically on addressing community or stakeholder
involvement in describing potential incentives options. However, we assume that
transparency in process and genuine opportunities for stakeholder involvement
are givens in any incentive program. The “Environmental
Benefits Through the Use of Incentives” table identifies several environmental
program objectives that can be achieved through the use of incentives. These
program objectives range from encouraging the reduction in specified pollutants
to improving the deployment of program resources within an environmental
regulatory program. Note that it will always be up to the governmental
decision-maker (with input from stakeholders of all kinds) to decide the amount
of program benefit that is needed to balance the benefit to the company
receiving an incentive. As with companies, different programs, different areas
or different times may change this balance. In some cases, a regulator may want
to use incentives to address the most pressing problems (e.g., air, water) in
the area in question. In other cases, freeing up enforcement or permitting
resources to be used in more productive activities may be a critical
consideration. How much of a given benefit the agency (or the environment) must
receive to warrant granting a given incentive will be very much a case-by-case
determination. The “Environmental
Incentive Options” table provides a listing of various incentive options. Once
again, it is important to bear in mind that a menu of incentives is needed to
address the wide variety of businesses (or other regulated entities) with their
varying and changing needs. Incentive
options are divided into five categories: permit incentives; product review and
approval incentives; other regulatory incentives; tax incentives; and capital
incentives. For each incentive
option information is provided on who would grant or enact the incentive and if
and how such an incentive mechanism is being used today. It is important to
note that these options are not necessarily mutually exclusive. For example, a
permit incentive program might include automatic permit extensions, expedited
review time and consolidation.
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