How are the benefits of new climate policies weighed against the costs of their implementation? Climate economists and scientists have created a value called the social cost of carbon in order to better understand the cost/benefit relationship of climate policies and regulations.
Find out how the social cost of carbon is calculated, how it should, perhaps, be calculated, and why the effort to quantify this value is necessary despite its imperfections with the help of two climate experts, Dr. Tamma Carleton of UC Santa Barbara and Dr. Bob Kopp of Rutgers University.
William Pizer, Matthew Adler, Joseph Aldy, David Anthoff, Maureen Cropper, Kenneth Gillingham, Michael Greenstone, Brian Murray, Richard Newell, Richard Richels, Arden Rowell, Stephanie Waldhoff, Jonathan Wiener, “Using and improving the social cost of carbon,” Science,
The social cost of carbon (SCC) is a crucial tool for economic analysis of climate policies. The SCC estimates the dollar value of reduced climate change damages associated with a one-metric-ton reduction in carbon dioxide (CO2) emissions. Although the conceptual basis, challenges, and merits of the SCC are well established, its use in government cost-benefit analysis (CBA) is relatively new. In light of challenges in constructing the SCC, its newness in government regulation, and the importance of updating, we propose an institutional process for regular SCC review and revision when used in government policy-making and suggest how scientists might contribute to improved SCC estimates.