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Social Cost of Carbon Comments

Did you ever want to write comments on an important  issue, but needed more information or motivation? Come to Wild Joes for a little of both, or use the online sites below.

Social Cost of Carbon: Due 1/27/2014

What is the Social Cost of Carbon?

The Social Cost of Carbon (SCC) estimates the monetary damages that result from carbon pollution – essentially putting a value on the effects of climate change that are already costing us today.  The Obama Administration requires agencies to factor in these damages when making new policies.

The EPA recently increased their estimate of SCC to $37 per metric ton of carbon pollution, but acknowledges they have not accounted for the most dangerous and costly possible effects of Climate Change and that their estimate of the Social Cost of Carbon is too low.  Meanwhile, Big Oil and Big Coal oppose this increase, attempting to reduce the social cost of carbon so that they can continue polluting without paying for the consequences.

Email the EPA: [masked]  (There is an underscore between OIRA and submission.), FAX # [masked] to submit comments, OR

Submit via the Climate Reality website:

Tell the EPA the new Social Cost of Carbon estimate is Too Low:

Dear Office of Management and Budget,

Each and every day, we are paying for the costs of carbon pollution. We’re paying with risks to our health, our livelihood, and the well being of future generations.

These real life costs need to be estimated using peer reviewed science on the risks and associated costs we face from continued burning of fossil fuels.  

The EPA’s proposed estimate of the Social Cost of Carbon of $37 per ton of carbon pollution is less than the mean peer reviewed SCC estimate of $43/ton CO2 in the 2007 4th report of the Intergovernmental Panel on Climate Change, and significantly less than the standard deviation of $83/ton in the same report. That standard deviation reflected the uncertainty of the mean estimate, recognizing that the costs could be nearly double.

Because the proposed SCC of $37/ton expressly does not account for the risks of the most expensive outcomes of climate change, the EPA should correct for this flaw by, at a minimum, using only the most conservative estimates in rule-making; i.e. the “3% 95th percentile” estimate. This would bring the cost estimate more in line with Sir Nicholas Sterns, former chief economist for the World Bank, SCC estimate of $85/ton.

I encourage the EPA to revise its SCC estimate to a higher, more protective level.  If not, the website and communications should explain the unaddressed risks to the public.


Background on Setting the Social Cost of Carbon

Economists can't put a price on what they don't know. Since scientists themselves don't know all the triggers or mechanisms for the most dangerous climate impacts, so-called low-probability, high-risk outcomes [1], economists don't know about them either. The existence of a particular climate risk, as well as its timing and probability of occurring are all essential in calculating the SCC. Since all these things are uncertain, it presents a very real challenge to economists. It is such a challenge, in fact, that economists don't use them when calculating the SCC, as the EPA's own fact sheet acknowledges:

“The models used to develop SCC estimates do not currently include all of the important physical, ecological, and economic impacts of climate change recognized in the climate change literature because of a lack of precise information on the nature of damages and because the science incorporated into these models naturally lags behind the most recent research.” [2]

Since their estimates of the SCC don't include the most dangerous and costly outcome of climate change, they are all necessarily conservative, and, also by their own admission, probably too low [1]. While economists are still learning how to quantify the true pervasive social cost of carbon, our policy planning needs to understand those most dangerous costs, in order to actually provide us with some national economic security into the future.

- Because the SCC expressly doesn't account for the risks of the most expensive outcomes of climate change, we think the EPA should correct for this flaw by, at a minimum, using only the most conservative estimates in rule-making; i.e. the “3% 95th percentile” estimate.

- In the face of such uncertainty, the EPA should use a more conservative approach in calculating the SCC to accurately reflect our low confidence in our ability to estimate the true SCC. As reported in the 4th IPCC assessment report, peer-reviewed estimates for the SCC have a mean value of US $43 per tonne of carbon with a standard deviation of US $83 per tonne [3]. It is unconscionable for the EPA to use a carbon price that is lower than the standard deviation of the mean of peer-reviewed research when it is known that there are such huge uncertainties in all the estimates.

- The EPA should do a better and more public job of stressing and explaining in its materials the uncertainty of both economists and scientists around this measure.

- Sir Nicholas Sterns, former chief economist for the World Bank places the SCC cost at $85/ton. 

Why is a higher SCC important?

The immediate pay-off is that a higher SCC changes the cost-benefit analysis the EPA uses, and many more carbon-reduction schemes will be justifiable, lowering our emissions. The longer term pay-off is that when we get a carbon tax, everyone will have a higher number in mind, so it will be easier to get to the high prices we need to properly address the problem.

How to tell the EPA?

As of this writing, only 26 comments had been submitted, so there is a real chance for your input to make a difference! CCL asks that you file a public comment via any of the methods below by January 27th, 2014. The Public Comment deadline is at midnight EST on this date.

·  [masked]  (There is an underscore between OIRA and submission.)

·   FAX # [masked] to submit comments.

· Direct comments to Docket ID OMB-OMB[masked] at this link!documentDetail;D=OMB[masked]

·  Email: [masked].

·  Mail: Office of Information and Regulatory Affairs, Office of Management and Budget, Attn: Mabel Echols, NEOB, Room 10202,[masked]th Street NW., Washington, DC 20503. To ensure that your comments are received, we recommend that comments be electronically submitted


[1] Julie M. Arblaster et al. “Chapter 12: Long-term Climate Change: Projections, Commitments and Irreversibility”. Table 12.4, Working Group I of the 5th Assessment Report of the IPCC. 2013. P. 78. URL:

[2] “Fact Sheet: Social Cost of Carbon”. November, 2013. The US Environmental Protection Agency. URL for pdf download:

[3] “Chapter 5.7: Costs, benefits and avoided climate impacts at global and regional levels”. Synthesis Report of the 4th Assessment Report of the IPCC. URL:

See Carbon Tax and the Social Cost of Carbon in the Pages section of the Bozeman Climate Alliance meetup site.

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