Howard Shalenski (Credit: University of Florida)

At their worst, critics of the move have characterized it as an environmentalist con or an undemocratic power grab, thus setting the stage for last Thursday's hearing before a subcommittee of the House Committee on Oversight and Government Reform. But Howard Shelanski, the White House Office of Management Budget's Administrator for the Office of Information and Regulatory Affairs, and the sole witness, laid out point by point why objections to both the science and the estimate process are unfounded. And to his credit, Subcommittee Chairman Rep. James Lankford (R-OK) stuck to substantive questions about that process and concerns with the optics of the release, while eschewing any overheated climate denier rhetoric.

To explain: the SCC is the government's estimate of how much carbon emissions harm the economy. It helps determine regulations and rule-making for everything from energy efficiency for new federal buildings to the Obama Administration's proposal to use Environmental Protection Agency powers to cut carbon emissions from power plants. The first estimate was made in 2010 and then revised this past June, from approximately $26 per ton of carbon dioxide in 2020 to $43 per ton. (That's actually the mid-range number, as the full estimate covers a range of possibilities.) European governments have produced their own very similar SCC estimates, but even this new range is really quite moderate. The relevant science has put together studies pegging the SCC at anything from $55 per ton, to $100 per ton, to as much as $900 per ton.

As Shalenski pointed out, the U.S. government's SCC estimate actually came from combined calculations by three different climate and econometric computer models, and the technical support documents behind the release are all publicly available. The source code for these models is all public, their results are constantly being tested in peer-reviewed literature, and none of the scientists and economists who maintain and update them are employed by the federal government. Instead, the government makes use of the models for its SCC estimate, and simply choses certain inputs such as estimates of future population growth, economic growth, etc. — and none of those parameters changed between the 2010 and 2013 estimate.

The primary criticism in the hearing revolved around what Lankford and others saw as a lack of opportunity for comment on the estimation process, by either lawmakers or the public. That the updated estimate was attached to a release of new efficiency standards for microwaves — a seemingly innocuous context for something as important as the SCC — was also brought up repeatedly. But Shalenski noted that the SCC is referenced every time a new rule-making decision by a government agency makes use of it. So it is, in essence, being released to the public over and over again, with every rule-making operating as an opportunity for public comment and feedback. The people involved in the SCC estimate always understood it would be updated again and again over time. Indeed, the 2013 update was due in large part to a flood of criticism from scientists and experts that the initial 2010 estimate was far too low.

In other words, the increase in the social cost of carbon was not some one-off event driven by a shadowy process closed to the public, but rather one milestone in a perpetual and ongoing effort of public comment, review, and revision.

So setting aside the objections of climate deniers, the disagreement seemed to boil down to Republicans' feeling that the updated SCC was released with insufficient fanfare, given the political prominence of climate issues and President Obama's efforts to cut carbon emissions. It was an objection to the optics of the move, rather than the substance of it — on that latter score, both the science and transparency of the SCC process appear to be sound.

In fairness, the optics do matter, for diplomatic reasons if nothing else. While the transparency is there, it could possibly be packaged better. To that end, the Union of Concerned Scientists offered some suggestions in the run-up to the hearing to make the public comment and input process better organized and more prominent. They also noted that the three models used to estimate the SCC are always being updated, added to, and adjusted. They can fail to properly account for all factors, involve bad assumptions about future economic productivity, and leave out some of the relevant risks. Improvement there is always a possibility.

Of course, all of those changes are as likely to result in an even higher SCC estimate as a lower one — indeed, the general trend has been that as the models become more sophisticated, the projected cost of carbon goes up.

Tags:

• Carbon Emissions
• Climate Change
• Climate Economics
• House of Representatives

7 Responses to How Last Week's Hearing On The Social Cost Of Carbon Put Right-Wing Objections To Bed

1. Leland Palmer says:
   July 23, 2013 at 4:23 pm

   Yes, this social cost of carbon will certainly increase, at least in the short term, I think.

   The fossil fuel multiplier effect, in which the useful heat of combustion is on the order of 100,000 times less than the cumulative greenhouse heating side effect, pretty much guarantees that this cost will go up.

   Each year, another yearly increment of heating for all past years' emissions occurs, minus the amount of carbon that went into natural carbon sinks.

   This is an exercise in how to come up with a number by attempting to model a very unpredictable future, very dense with positive and negative feedback loops – in principle, something next to impossible to model, in my opinion.

   Of course, if we set off massive dissociation of the methane hydrates, and tip over the entire climate system, the cost of carbon could be infinite dollars per ton.

   Still, it's a good effort, and better than nothing.

   Only if we are able to develop cheap technology to put carbon back underground or take CO2 out of the air and turn it back into a combustion fuel will the true social cost of carbon fall, I think. Alternative energy development could help bring down this cost as well, I guess.

   I've seen papers that say that the cost of getting down to 350 ppm CO2 again approaches infinity without some carbon negative technology such as Biomass Energy with Carbon Capture and Storage (BECCS) added to the energy mix.

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   • fj says:
     July 23, 2013 at 6:24 pm

     The world's oceans sequester about forty percent of atmospheric CO2 also with extremely large scale energy potential to convert massive amounts of CO2 to benign and even useful forms of matter and energy that could ultimately offset costs.

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     • FrankD says:
       July 23, 2013 at 10:05 pm

       An article in this weeks New Scientist suggests that forty pecent figure is falling. The Southern Ocean, at least, has continued to seqester the same amount of carbon, but since emissions are still rising, this constant amount represents a smaller fraction of the total.

       The article attributes this to temperature-driven increases in wind speeds causing deeper mixing of the ocean bringing deeper water (richer in dissolved carbon) to the upper layers which decreases the gradient across which carbon is absorbed from the atmosphere.

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     • Leland Palmer says:
       July 24, 2013 at 3:34 pm

       Maybe, but in the long term, hot water can absorb less CO2 than cold water. So, after a while, the CO2 will start to come back out of the oceans- a potentially huge, huge problem.

       Think of hot soda pop.

       Just about all natural carbon sinks are saturating, these days, I think.

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2. fj says:
   July 23, 2013 at 6:12 pm

   The structural (indirect) violence of our civilization based on fossil fuels is extremely high; many times higher than this fossil fuel civilization's direct violence also very high.

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   • fj says:
     July 23, 2013 at 6:55 pm

     The directly violent four trillion dollar Iraq War — as estimated by economist Joe Stiglitz — is likely a small portion of the direct violence of a fossil fuel industry continuing quite literally to pave paradise to put in parking lots.

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3. Solar Jim says:
   July 24, 2013 at 1:05 pm

   These temporary yet increasing figures (SCC) are determining capital expenditures for decades of locked-in equipment and design configurations. This means that those expenditures are always obsolete, and are therefore very poor planning.

   In order to get ahead of a rapidly developing non-linear condition (Anthropogenic Global Warming) the SCC should be bumped up by at least an order of magnitude. (This assumes our civilization actually cares about the future more than our existing economic paradigm and it's financial "special" interests.)