WASHINGTON (Reuters) - The White House on Friday announced a major change in how the federal government will calculate and weigh the cost of climate change in its permitting, investment and regulatory decisions with a move to restore the “social cost of greenhouse gases,” which had been slashed under the Trump administration.
Heather Boushey, a member of the Council of Economic Advisers said that the Biden administration will restore price estimates made before 2017 of about $50 per ton of greenhouse gases emitted from $10 or less per ton used by the Trump administration.
“This interim step will enable federal agencies to immediately and more appropriately account for climate impacts in their decision-making while we continue the process of bringing the best, most up-to-date science and economics to the estimation of the social costs of greenhouse gases,” Boushey wrote in a White House blog.
The Bush administration first implemented the “social cost of greenhouse gases” and the practice was standardized under former President Barack Obama.
It has been used in rule-making processes and permitting decisions to estimate the economic damages associated with a rise in greenhouse gas emissions in areas ranging from agricultural productivity and property damage from increased flood risk.
The Obama administration had created an Interagency Working Group of technical experts across the government to develop uniform estimates, subject to public comment. The group will work to develop a new estimate in months.
Richard Revesz, a professor at New York University School of Law, said restoring the previous calculation should provide a blueprint to calculate a new one that incorporates the latest” developments in science and economics”.
Economists Nicholas Stern and Joseph Stiglitz this week said that the Working Group should not “settle on anything much below $100 per ton by 2030 for the social cost of carbon” when it replaces the interim number to be able to achieve the goals of the Paris agreement, limiting the rise of global temperatures to no more than 1.5 degrees Celsius.
Reporting by Valerie Volcovici
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