Seeking Comment on the Social Cost of Carbon Open Access
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The Obama Administration published a notice in the Federal Register today seeking comment on its approach to estimating the social cost of carbon (SCC) for use in regulatory impact analysis. The premise of the SCC, and public policies aimed at reducing carbon dioxide (CO2) emissions, is that the social cost of burning carbon is greater than the private cost, because the long-term effects of CO2 emissions on the climate are not included in the costs of the goods and services that generate the emissions. The SCC is intended to reflect this “external cost” associated with CO2 emissions. There is certainly room to debate the merits of the Administration’s climate agenda as a whole; but, as we have noted in previous analyses, if the U.S. is going to constrain CO2 emissions, the use of a unified SCC makes sense. The SCC summarizes into one metric a vast array of information derived from scientific and economic research and modeling. To the climate, all CO2 molecules look alike, so use of a consistent SCC can bring some coherence to the vast portfolio of emissions regulations, energy efficiency standards, renewable fuel mandates, technology subsidies, and other policies intended to mitigate global warming.