social cost of carbon

Curbing Climate Change Has a Dollar Value — Here’s How and Why We Measure It

Ambulance and cars surrounded by Hurricane Sandy flood waters in Hoboken, New Jersey.

By , Harvard University

President Trump is expected to issue an executive order soon to reverse Obama-era rules to cut carbon pollution, including a moratorium on leasing public lands for coal mining and a plan to reduce carbon emissions from power plants.

Trump and his appointees argue that these steps will bring coal miners’ jobs back (although coal industry job losses reflect competition from cheap natural gas, not regulations that have yet to take effect). But they ignore the fact that mitigating climate change will produce large economic gains.

Calculating the Price of Climate Change: How Much Is the Crisis Costing Us?

This is a guest post by Emily Logan of Care2.

When activists talk about climate change, we often focus on impacts. We show how Superstorm Sandy mangled the Jersey Shore, how the severe California drought reduced reservoirs to puddles, and introduce people to children suffering from asthma. We tell folks that climate change makes all of these impacts more likely, more frequent and more severe.
 
But for people skeptical of climate change—either of its science or, like the Chris Christies of the world, of the need for humanity to do anything about it—sometimes these stories aren’t enough. When facing the choice of spending our country’s limited resources on drastically reducing our fossil fuel production and fortifying our cities against sea level rise or investing in economic stimulus or tax cuts, it helps to speak the opposition’s language: dollars.

Social Cost Of Carbon Drastically Underestimated: Report

The U.S. government could be drastically underestimating how much climate change is going to cost us, according to a study published by Stanford researchers in the journal Nature Climate Change.

The researchers concluded that the Obama Administration is using a Social Cost of Carbon estimate that may be just one-sixth of the true cost—and that the true cost is high enough to justify aggressive measures for lowering emissions enough to limit global temperature rise to the 2 degrees Celsius that scientists tell us is the threshold for averting catastrophic climate change.

The Social Cost of Carbon is an official estimate of how much economic damage will be caused per metric ton of carbon emitted into our atmosphere—damages like lower crop yields and higher healthcare costs. It is used by the EPA and other federal agencies to calculate the benefits of policies intended to improve energy efficiency, lower emissions, and combat climate change. It is also often used to justify not taking action if the proposed action would cost more than the damage it is intended to mitigate.

The Obama Administration raised its official estimate of the economic cost of a metric ton of CO2 from $21 to $37 in November 2013. Even back then, however, many experts challenged that estimate as far too low.

According to the team at Stanford, that estimate was way too low—they calculate the true Social Cost of Carbon as $220 per metric ton.

Legal Case: White House Argues Against Considering Climate Change on Energy Projects

Just over a month before the United Nations convenes on September 23 in New York City to discuss climate change and activists gather for a week of action, the Obama White House Council on Environmental Quality (CEQ) argued it does not have to offer guidance to federal agencies it coordinates with to consider climate change impacts for energy decisions.

It came just a few weeks before a leaked draft copy of the Intergovernmental Panel on Climate Change's (IPCC) latest assessment said climate disruption could cause “severe, pervasive and irreversible impacts for people and ecosystems.”

Initially filed as a February 2008 petition to CEQ by the International Center for Technology Assessment, the Sierra Club and the Natural Resources Defense Council (NRDC) when George W. Bush still served as President, it had been stalled for years. 

Six and a half years later and another term into the Obama Administration, however, things have finally moved forward. Or backwards, depending on who you ask. 

NEPA and CEQ

The initial February 2008 legal petition issued by the plaintiffs was rather simple: the White House's Council for Environmental Quality (CEQ) should provide guidance to federal agencies it coordinates with to weigh climate change impacts when utilizing the National Environmental Policy Act (NEPA) on energy policy decisions. 

A legal process completely skirted in recent prominent tar sands pipeline cases by both TransCanada and Enbridge, NEPA is referred to by legal scholars as the “Magna Carta” of environmental law.

Magna Carta; Photo Credit: Wikimedia Commons

CEQ oversees major tenets of environmental, energy and climate policy. It often serves as the final arbiter on many major legislative pushes proposed by Congress and federal agencies much in the same way the White House's Office of Information and Regulatory Affairs (OIRA) does for regulatory policy. 

Rejection of Colorado Coal Mine on Global Warming Grounds Could Be Game-Changer

A U.S. District Court judge ruled on June 27 that the Bureau of Land Management (BLM) and Forest Service both wrongly approved expansion of the West Elk coal mine in Somerset, Colo., because they failed to take into account the economic impacts greenhouse gas emissions from the mining would have.
 
The federal agencies said it was impossible to quantify such impacts, but the court pointed out a tool is available to quantify the effects of emissions and the agencies chose to ignore it. The tool, the “social cost of carbon protocol,” puts a price on the damanges from drought, flood, storm, fire and disease caused by global warming. 
 
“It is arbitrary to offer detailed projections of a project's upside while omitting a feasible projection of the project's costs,” U.S. District Judge R. Brooke Jackson ruled.
 
Arch Coal, Inc. planned to bulldoze vegetation to build about six miles of roads and drill up to 48 exploratory holes in the scenic backcountry of western Colorado's North Fork Valley to vent methane and determine whether a coal seam actually lies beneath the area.
 
The federal agencies' final report on the West Elk Mine expansion listed the economic benefits of modifying public lands leases to allow the project, but failed to quantify the social or economic costs of carbon emissions from the project.  
 
The ruling could be game-changing because if the judge's reasoning holds up in other challenges to federal agency decisions, it could change the calculus on dozens of other major projects, such as the proposed Keystone XL tar sands pipeline.
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