WASHINGTON—Historically, US government agencies have been required to use the social cost of carbon as a tool to assess the impacts of CO2 emissions on climate change when they analyze regulations that affect CO2emissions. Recently, however, the social cost of carbon as it has been historically applied was jeopardized by an executive order from the Trump administration. Today a new blog posted by Resources for the Future (RFF) looks at how the social cost of carbon still might be restored to productive use.
In A Path Forward for the Social Cost of Carbon, RFF Fellow Casey J. Wichman writes: “The Trump administration’s recent Executive Order on Promoting Energy Independence and Economic Growth … disbands the Interagency Working Group (IWG), the group of top economists and scientists within the federal government responsible for developing estimates of the social cost of carbon and updating them over time. … [T]he move on the social cost of carbon seems to indicate that the Trump administration is disengaging from scientific questions related to the benefits of emissions reductions.”
Even in the face of the executive order, however, the author still lays out a path forward that will allow for development of a scientifically derived estimate of the social cost of carbon—a dollar cost per ton of carbon emissions based on best available data on how such emissions can harm people and the environment. Having such a monetary figure allows for traditional benefit–cost analyses of regulatory proposals by government.
According to Wichman, the road to regaining a credible estimate of the social cost of carbon began in 2015, when the IWG asked the National Academy of Sciences (NAS): How could the methodology for estimating the social cost of carbon be updated to reflect the best available scientific and economic research?
The NAS committee, co-chaired by RFF President Richard Newell and Senior Fellow Maureen Cropper, issued two reports: an interim report on the impact of CO2 emissions on global temperature change and, most recently (in January), a comprehensive report that put forth a recommended methodological framework for estimating the social cost of carbon.
Wichman ends by asking, “So, what does this mean for the future of the social cost of carbon—and therefore the related assessments of the effect of CO2 emissions on climate change and resulting impacts to society? With the dissolution of the IWG, one thing is clear: implementing a methodological framework for the social cost of carbon that reflects the best available science will require significant effort from the broader research community, including RFF.”
Read the full post: A Path Forward for the Social Cost of Carbon.