Department of Economics

California has 28,000 leaking underground fuel tanks. Approximately 7,000 have been actively remediated at a cost of $1 billion. It will cost roughly $3 billion to actively remediate the remainder. This paper demonstrates that it is not worth incurring these costs. We show that passive, or intrinsic, bioremediation (“exploiting the metabolic activity of microorganisms to transform or destroy contaminants”) is the most cost-beneficial remediation technology to employ.