GAO launches social cost of carbon study

Source: Nick Sobczyk, E&E News reporter • Posted: Thursday, June 14, 2018

The government’s top watchdog has officially started its study of how the Trump administration uses the social cost of carbon metric to calculate the impact of federal actions on greenhouse gas emissions.

Sen. Sheldon Whitehouse (D-R.I.) and six other Democrats asked the Government Accountability Office in December to look into the Trump administration’s rationale for raising its default discount rate for climate regulations, a move that allowed EPA to vastly lower its cost-per-ton calculation for carbon.

They also asked GAO to look at the reasoning behind previous discount rates, as well as how states and other countries assess the social cost of carbon (E&E News PM, Dec. 5, 2017).

GAO agreed to take on the study soon after the request, and Whitehouse and GAO said today work had begun. A GAO spokesman said the independent watchdog did not yet have an estimated completion date for the study and is determining scope and methodology.

“Carbon pollution is triggering big changes. It’s threatening our homes and businesses with stronger storms and rising seas. It’s sparking bigger wildfires and longer droughts, and killing our crops. And it’s warming and acidifying our ocean waters, displacing our fisheries,” Whitehouse said in a statement. “These changes all come with a price tag — and we ought to know what that price will be.”

The Obama administration pegged the social cost of carbon at around $42 per ton by 2020. That calculation relied on a 3 percent discount rate, a number that helps measure how much society is willing to pay now to avoid future damages.

But EPA’s proposal to repeal the Clean Power Plan last year estimates the social cost of carbon between $1 and $6 per ton, with a 7 percent discount rate, which some experts feel is unreasonable (Climatewire, Oct. 25, 2017).

President Trump last year also disbanded an interagency working group charged with calculating the social cost of carbon.

“The president’s decision to undermine the social cost of carbon in our policymaking is a bad one,” Whitehouse said. “This report will help us learn just how bad, and show how states and other countries are using the social cost of carbon to measure the risks they see from climate change. I’m glad to see this study is moving forward.”