What deregulation means for business, safety, and the environment

Deregulation efforts, particularly in environmental policy, have accelerated during the second Trump administration. Both the Environmental Protection Agency (EPA) and the Occupational Safety and Health Administration (OSHA) have deemphasized enforcement activity. These actions aim to reduce the regulatory burden and facilitate industrial development. But what are the trade-offs? Will short-term economic gains come at the expense of worker safety, public health, and environmental protection? And for businesses, will the uncertainty of future policy shifts outweigh current cost savings?

Impacts on industry and workers

EPA deregulation is aimed at easing compliance burdens and facilitating industrial growth. By relaxing certain requirements, businesses may spend fewer manhours on recordkeeping and reporting and see reduced operational and compliance costs. In addition, EPA efforts to streamline the permitting process seek to facilitate new and expanding industrial operations.

At the same time, both EPA and OSHA are reducing staff and deemphasizing enforcement, leading to fewer facility inspections. Most EHS managers will not miss the stress and disruption of agency inspectors arriving at their facilities unannounced, but inspections play a key role in maintaining safety and compliance standards. Studies suggest that reduced enforcement leads to higher workplace injury and fatality rates. Additionally, the lack of regulatory oversight may cultivate complacency and negligence, increasing the risk of accidents that harm employees and the people and environment of the surrounding neighborhoods.

Such events have a significant negative effect on business, including operational downtime and damage to the company’s reputation and brand. In addition, workplace injuries and subsequent absences lead to higher operational and insurance costs and lower productivity. Companies that maintain a strong, positive culture and recognize the value of workplace safety, environmental stewardship, and good corporate citizenship are better positioned to avoid these risks.

Impacts on human health and the environment

The EPA is reconsidering or rolling back numerous existing regulations, prompting debate over how to balance environmental and health protections with the goals of industrial development.

PM-2.5 National Ambient Air Quality Standard (NAAQS)

The EPA is reconsidering the PM-2.5 NAAQS because the agency believes it to be a major obstacle to permitting new facilities and expansions of existing facilities. However, a reconsideration of the standard will result in increased exposure to PM-2.5 pollution, which, according to the EPA’s website, “can affect both your lungs and your heart. Numerous scientific studies have linked particle pollution exposure to a variety of problems, including:

• Premature death in people with heart or lung disease
• Nonfatal heart attacks
• Irregular heartbeat
• Aggravated asthma
• Decreased lung function
• Increased respiratory symptoms, such as irritation of the airways, coughing or difficulty breathing.”

National Emissions Standards for Hazardous Air Pollutants (NESHAP)

The NESHAPs regulate industries emitting hazardous air pollutants (HAPs), which are “pollutants that are known or suspected to cause cancer or other serious health effects, such as reproductive effects or birth defects, or adverse environmental effects.” The EPA is reconsidering numerous NESHAP standards and may grant these industries a 2-year compliance exemption, which will likely expose the public to higher levels of HAP emissions known to be harmful to human health.

For example, per EPA’s website, the HAP emissions regulated by integrated iron and steel manufacturing facilities include metals such as manganese and lead, and trace amounts of organic HAP such as polycyclic organic matter, benzene, and carbon disulfide. If a compliance exemption is granted, higher levels of these pollutants will likely be emitted, and “exposure to these substances has been demonstrated to cause adverse health effects, including chronic and acute disorders of the blood, heart, kidneys, reproductive system, and central nervous system.”

Climate change

The EPA has announced numerous actions to undo regulatory requirements addressing climate change and greenhouse gas (GHG) emissions. The agency recently proposed to repeal all GHG emissions standards for fossil fuel-fired power plants, and in doing so, proposed “to make a finding that GHG emissions from fossil fuel-fired power plants do not contribute significantly to dangerous air pollution.” This would be one of the first steps in attempting to undo the GHG endangerment finding, that if successful, would undermine all GHG emissions regulations and could lead to an increase in GHG emissions, depending on how industry responds to the relaxed standards. According to overwhelming scientific evidence, GHG emissions drive climate change, which is causing significant environmental impacts, including:

• More frequent, intense, and longer lasting heat waves causing more severe droughts and increased likelihood of wildfires;
• More intense storms, with more intense rainfall leading to more frequent and more severe flooding;
• Shrinking ice sheets and glaciers resulting in global sea level rise;
• Warmer oceans becoming more acidic and harming coral reefs, while holding less oxygen and adversely impacting marine life;
• Changing and more widespread diseases due to changing temperatures and precipitation patterns; and
• More severe floods and droughts impacting crop yields.

Short-term benefits vs. uncertain future

Deregulation may bring welcomed short-term cost savings, but these benefits may be short-lived. The overwhelming scientific consensus on the dangers of GHGs and other air pollutants targeted for deregulation suggests that more stringent regulations are likely to return under future administrations. Frequent regulatory changes can create planning challenges for businesses trying to invest in long-term strategies. Predictability is coveted by most businesses as it reduces risk and allows for confident long-term planning, investment, innovation, and growth.

Companies doing the minimum to comply with current rules may find themselves repeatedly modifying their operations and equipment to maximize the immediate economic benefits as rules shift, which may actually impede growth and cost more in the long run. In contrast, companies going beyond compliance— those that treat compliance as the baseline rather than the goal—are less susceptible to the shifting priorities of changing administrations and can mitigate the uncertainty of the future and build long-term resilience.