U.S. conservatives have a new climate political football. Twelve Republican attorneys general, led by Missouri’s attorney general, filed a dramatic lawsuit against the Biden administration on Monday challenging what is, essentially, a complex maths equation that has been in place for years.
The lawsuit deals with a concept called the social cost of carbon, which, very simply, is an approximation of the net harm caused by emitting one ton of carbon dioxide, set into a dollar amount. The lawsuit appears to challenge the very existence of the social cost of carbon, alleging that the Biden administration’s use of the calculation would be an “enormous expansion of federal regulatory power.” That’s quite literally not the case, according to experts.
“The legal argument is somewhat tortured, the idea that it’s unconstitutional for the executive branch to develop a way to account for the cost of impacts,” said Michael Gerrard, the founder and faculty director of the Sabin Centre for Climate Change Law at Columbia University. Gerrard pointed out that the use of the social cost of carbon is very routine in federal rulemaking. “There’s a lot of law running against the idea that the social cost of carbon is illegal.”
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For something that looks to be a lightning rod of controversy, the policies underpinning the social cost of carbon have a bipartisan history. The idea for federal agencies accounting for the impacts of their decisions was first mandated back in the 1980s.
“This was Reagan administration policy,” Gerrard said. “Their thought was to get the costs of [environmental] regulation brought into consideration. But then, the benefits of regulations also needed to be brought in.”
Those benefits under consideration include how many lives would be saved from not polluting waterways or how clear the air might be by regulating power plants and factories. Throughout the 1980s and 1990s, the government continued to refine its methods for making cost-benefit analyses for environmental regulations. A specific mandate for agencies to figure carbon emissions into their calculations, however, didn’t come until 2008, when a circuit court ordered the government to factor in the costs of carbon emissions into its fuel efficiency regulations.
While the suit says the social cost of carbon calculation “undermines the sovereignty of the States and tears at the fabric of liberty,” it’s not like the Biden administration invented the concept of assigning a cost to carbon pollution. It’s quite the opposite. The Trump administration, after all, also priced carbon to factor into its cost-benefit analyses, albeit at an incredibly low price that artificially offset the benefits of regulations and costs of increased fossil fuel development.
“I get where [the plaintiffs] are coming from — you don’t like what this implies, so you think the concept should be thrown out — but that’s not correct,” said Gernot Wagner, a climate economist at New York University.
Wagner said that the complex maths behind the current price has actually generated a “lowercase c, conservative” estimate of the actual cost of continuing to burn fossil fuels and emit carbon dioxide. Research has suggested that the dollar amount placed on a ton of carbon should actually be starting at around twice where both the Obama and Biden administrations estimates suggested it should be. Wagner pointed out that one outside group valued the human mortality risks alone from continuing to emit carbon at $US39 ($51) per ton, compared to the less than $US1.50 ($2) per ton mortality price of the Obama-era models calculated.
If the social cost of carbon is such an integral part of federal rulemaking, and if we’re already underestimating the real cost of continuing to burn fossil fuels, then what’s the reasoning behind the lawsuit from the 12 states? The answer seems pretty simple: politics. In February, Biden boosted the calculation of the social cost of carbon back up to an Obama-era price of around $US50 ($65) per ton. The administration said the number was temporary as it would continue to revisit calculations and bring them back up to speed following the Trump era. (The Trump administration priced the social cost of carbon at around $US1 ($1) to $US6 ($8) per ton.)
“There are many improvements that can be made [to the price],” Wagner, who is the coauthor of a recent paper that gives suggestions on improving the current calculation. “The Biden $US50 ($65) number isn’t given from heaven.”
But an “all-out assault over the very idea of using the social cost of carbon,” as Wagner called the lawsuit, is very different than critiques of how it’s priced. Attacking the social cost of carbon calculation has long been a target for deniers and special interest groups. Last week, the Heritage Foundation, a right-wing think tank with a long history of climate denial and funding from fossil fuel companies, released a blog post calling the social cost of carbon “the most useless number you’ve never heard of” and chronicled its long battles against the modelling used to calculate the cost.
The language in Monday’s lawsuit on the supposed benefits of fossil fuels is ripped straight from the same playbook Heritage and other groups have used. In the suit, the attorneys general allege fossil fuel use “lifts millions of people out of poverty and hunger, promotes economic development, creates millions of jobs, enables innovation and entrepreneurship, prevents international conflict, encourages industry and manufacturing, promotes America’s energy independence, and creates the economic conditions for liberty to Flourish.” The suit clearly echoes the “energy poverty” arguments made by think tanks like Heritage and other denialist institutions standing in the way of renewables.
It’s clear, then, that assaults on the very existence of the social cost of carbon are more political than based in any legal reality. Wagner said the “poorly done lawsuit” filed by mostly-Republican AGs is like “red meat for [their] constituents–you know, oh, we don’t like government, so this government idea must be bad.”
And the irony of a political football bouncing from Reagan to Obama to Trump to Biden over a rulemaking exercise isn’t lost on Gerrard.
“The value of a human life is how agencies go about deciding costs and benefits and making these decisions,” he said. “The push for this came from the Republican side. They wanted to put a value on something that may well be priceless in order to have it fit into a cost-benefit analysis. But now you have political entities on the right pushing against what really is just an econometric.”