In the NewsE&E NewsFebruary 17, 2021

Carbon was $1 under Trump. It’s about to skyrocket

Economist Michael Greenstone, who co-chaired the interagency working group that formulated the social cost of carbon figures under Obama, said in a report last month that the 3% central discount rate used in the process is no longer appropriate. The discount rate can radically alter the value of CO2 by raising or lowering the estimated future benefits of reducing emissions today. Greenstone recommended that a 2% rate should be used with this week's interim figure. That would raise the social cost of carbon to $125 a ton — substantially changing the balance of costs and benefits in many federal rules.