The Obama climate move that nobody noticed

By David Roberts

The Obama administration just made a fairly significant move on climate change, and it flew right under the radar.

To explain, let me back up a bit...One thing Obama doesn’t get enough credit for is the Interagency Working Group on Social Cost of Carbon, which his administration convened to establish a social cost of carbon that OMB and other agencies can use in assessing carbon-related regulations. In 2010, the working group released its report (PDF)...Last week, the White House put up a blog post touting new energy-efficiency standards for microwave ovens. Thrilling, right? Halfway down, it mentions that “the underlying analysis of these standards includes an update to the social cost of carbon values.”

Oh?

Sure enough, over on OMB’s website we find a “Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis” [PDF], dated May 2013. It doesn’t change the basic mechanics of the earlier analysis — same discount rates, same emission scenarios, same climate sensitivity. All it does is update the climate impact models (the “Integrated Assessment Models”) to reflect the most recent versions used in the peer-reviewed literature.

Here’s the result:

The (social cost of carbon) estimates using the updated versions of the models are higher than those reported in the 2010 (report). By way of comparison, the four 2020 SCC estimates reported in the 2010 [report] were $7, $26, $42 and $81 (2007$). The corresponding four updated SCC estimates for 2020 are $12, $43, $65, and $129 (2007$).

You don’t have to be an economist to see that the second set of numbers is about 60 percent higher than the first. Why the big jump? It sounds like it mostly had to do with the models updating their estimates of damage from sea-level rise, though there are several other factors as well...Regardless, this is really something to pause and take note of:

The federal government just bumped up the cost of carbon by 60 percent. This will, all things being equal, increase by 60 percent the amount of carbon mitigation that can be economically justified. That’s a big deal, especially in light of the fact that EPA regulations are going to make (or break) Obama’s second-term climate legacy.

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http://grist.org/climate-energy/the-obama-climate-move-that-nobody-noticed/