The Environmental Protection Agency (EPA) this weekend took action that is expected to justify stricter climate regulations.
Releasing an updated rule aimed at cutting methane emissions from oil and gas, the agency also unveiled an updated estimate of the “social cost” of carbon dioxide.
This is an economic estimate that is used by the government to calculate the benefits of mitigating climate change — or the cost of not doing so — as more global warming means more storms, heatwaves and damage to the planet.
The new estimate nearly quadruples the estimated cost of carbon dioxide to the world — a change that experts expect will result in stronger climate rules going forward.
Michael Greenstone, who co-led the development of the climate metric under the Obama administration, called the Biden administration’s update a “BFD” — an acronym that stands for “big f—ing deal.”
He said the increased estimate will “unlock reductions in greenhouse gas emissions that will benefit us and benefit our children and benefit their children.”
“We now recognize the benefits of reducing greenhouse gases are four times larger,” Greenstone said. “That will justify more stringent regulations.”
He noted that this could show up in everything from “tiny rules” such as those concerning vending machines to more significant regulations.
“Most importantly,” he said, it “paves the path for stricter power plant rules and car rules and other major sources of greenhouse gases.”
The update is part of a years-long effort by the Biden administration to examine and possibly alter existing calculations for the costs of climate change.
The social cost of carbon dioxide was first adopted under the Obama administration, which estimated in 2016 that by 2020, each metric ton of carbon dioxide released would cost about $42 to society.
The Trump administration used much lower values, estimating that the damage done by that same ton would cost between $1 and $8. When he first came into office, President Biden temporarily readjusted the figure to $51.
When the White House first put forward that increase in 2021, it also reestablished an “interagency working group” that was supposed to set forth final numbers for the whole government by 2022; the group has yet to do so.
However, the EPA published its own numbers over the weekend.
Now, President Biden’s EPA is putting the societal cost of a metric ton of carbon dioxide at $190 for the year 2020. The figure also ratchets up over the years — a metric ton of carbon dioxide will be assumed to cost society $204 in 2023, $230 in 2030 and $308 in 2050.
Asked whether other agencies will adopt the EPA’s metric, an administration official told The Hill that it will be up to the agencies to make decisions about how best to analyze the climate impacts of their actions.
The official also said that the interagency group is still continuing its work.
Brian Prest, an economist with climate think tank Resources for the Future, said that these calculations allow us to measure the benefits of achieving global climate targets.
“On an annualized basis, we’re talking about $5 [trillion] to $6 trillion a year in benefits from achieving those goals,” Prest said
“That’s from reduced impacts globally from reducing premature mortality due to heat stress for example or avoiding damages to agricultural crops which pushes up food prices,” he added.
However, since the issue has ping-ponged back and forth between political administrations, it’s unclear how a future Republican president might handle the climate costs.
“When you look at the difference between $5 under Trump and $190 under Biden, it’s pretty clear that it has become politicized,” said Steve Cohen, director of the research program on sustainability policy and management at Columbia University, calling the drop in the cost estimate under Trump “ridiculous.”
Max Sarinsky, a senior attorney at New York University’s Institute for Policy Integrity, said that technically, a future president could prevent agencies from using the Biden administration’s social cost values “with the stroke of a pen.”
But he also said that doing so could make any rules issued by that administration legally vulnerable.
“Any rule that they issue based on different numbers could be vulnerable if they’re not based on the best science,” Sarinsky said.