New report finds near-term update to social cost of carbon unwarranted
WASHINGTON – There would not be sufficient benefit to updating estimates of the social cost of carbon (SCC) within a year based only on the revision of a specific climate parameter in the existing framework used by the government's interagency group to measure the SCC, says a new interim report from the National Academies of Sciences, Engineering, and Medicine. The committee that is conducting the study and wrote the report recommended ways to change federal technical support documents on the SCC to enhance the characterization of uncertainties associated with the estimates, including when used in regulatory impact analyses.
The committee considered whether a near-term change is warranted based on updating the probability distribution for equilibrium climate sensitivity (ECS) — a parameter that translates carbon dioxide emissions to global temperature change — and that was updated by the Intergovernmental Panel on Climate Change in its most recent Fifth Assessment Report (AR5). Because ECS is only one input to the detailed framework used to estimate the SCC, updating the ECS alone may not significantly improve the estimates.
The SCC estimates, in dollars, the net long-term damage to society caused by a 1-metric ton increase in carbon dioxide emissions in a given year. It is intended to be a comprehensive estimate of the costs associated with climate change, such as changes in net agricultural productivity, risks to human health, and property damage from increased flood risks. The federal Interagency Working Group on the Social Cost of Carbon (IWG) developed a methodology to estimate the SCC, which government agencies use to place a value on the carbon dioxide impacts of various regulations, including standards for vehicle emissions and fuel economy, air pollutants from industrial manufacturing, and emissions from power plants and solid waste incineration.
Rather than simply updating the ECS within models used in the current framework, the IWG could undertake efforts to develop a common representation of the relationship between carbon dioxide emissions and changes in temperature, its uncertainty, and its profile over time. The report outlines specific criteria that could be used to assess whether such a representation is consistent with the best available science.
Phase two of this study will examine the merits and challenges of potential approaches for a more comprehensive, longer-term update to the SCC estimates to ensure they continue to reflect the best available science. The final report will be released in early 2017.
The study was sponsored by the Interagency Working Group on the Social Cost of Carbon, which is co-chaired by the Council of Economic Advisers and Office of Management and Budget; the other members are the Council on Environmental Quality, Domestic Policy Council, U.S. Department of Agriculture, U.S. Department of Commerce, U.S. Department of Energy, U.S. Department of Transportation, U.S. Environmental Protection Agency, National Economic Council, Office of Science and Technology Policy, and U.S. Department of the Treasury. The National Academies of Sciences, Engineering, and Medicine are private, nonprofit institutions that provide independent, objective analysis and advice to the nation to solve complex problems and inform public policy decisions related to science, technology, and medicine. The Academies operate under an 1863 congressional charter to the National Academy of Sciences, signed by President Lincoln. For more information, visit http://national-academies.org. A committee roster follows.
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Copies of Assessment of Approaches to Updating the Social Cost of Carbon: Phase 1 Report on a Near-Term Update are available from the National Academies Press on the Internet at http://www.nap.edu or by calling 202-334-3313 or 1-800-624-6242. Reporters may obtain a copy from the Office of News and Public Information (contacts listed above).
THE NATIONAL ACADEMIES OF SCIENCES, ENGINEERING, AND MEDICINE Division of Behavioral and Social Sciences and Education Board on Environmental Change and Society
Committee on Assessing Approaches to Updating the Social Cost of Carbon
Maureen L. Cropper, Ph.D.* (co-chair) Distinguished University Professor and Chair Department of Economics University of Maryland College Park
Richard G. Newell, M.P.A., Ph.D. (co-chair) Gendell Professor of Energy and Environmental Economics Nicholas School of the Environment, and Director, Duke University Energy Initiative Duke University Durham, N.C.
Myles Allen, Ph.D. Professor of Geosystem Science Climate Dynamics Group Department of Physics University of Oxford England
Maximillian Auffhammer, Ph.D. Associate Dean of Interdisciplinary Studies, and Professor of International Sustainable Development Department of Agricultural and Resource Economics University of California Berkeley
Chris E. Forest, Ph.D. Associate Professor of Climate Dynamics Departments of Meteorology and of Geosciences; Associate Earth and Environmental Systems Institute; and Associate Director Network for Sustainable Climate Risk Management Pennsylvania State University State College
Inez Y. Fung, Sc.D.* Professor of Atmospheric Sciences Departments of Earth and Planetary Science and of Environmental Science, Policy, and Management University of California Berkeley
James K. Hammitt, Ph.D. Professor of Economics and Decision Sciences, and Director, Harvard Center for Risk Analysis Harvard T.H. Chan School of Public Health; and Affiliate Toulouse School of Economics Harvard University Boston
Henry D. Jacoby, Ph.D. William F. Pounds Professor of Management (emeritus) Sloan School of Management Massachusetts Institute of Technology Cambridge
Robert Kopp, Ph.D. Associate Director Rutgers Energy Institute, and Associate Professor Department of Earth and Planetary Sciences Rutgers University New Brunswick, N.J.
William Pizer, Ph.D. Professor Sanford School of Public Policy, and Faculty Fellow Nicholas Institute for Environmental Policy Solutions Duke University Durham, N.C.
Steven Rose, Ph.D. Senior Research Economist Energy and Environmental Analysis Research Group Electric Power Research Institute Washington, D.C.
Richard Schmalensee, Ph.D. Howard W. Johnson Professor of Management Emeritus and Professor of Economics Emeritus Sloan School of Management Massachusetts Institute of Technology Cambridge
John Weyant, Ph.D. Professor Department of Management Science and Engineering, Director of the Energy Modeling Forum, and Deputy Director Precourt Institute for Energy Efficiency Stanford University Stanford, Calif.
Jennifer Heimberg, Ph.D. Study Director
*Member, National Academy of Sciences