Guest essay by Eric Worrall
President Biden has raised the social cost of carbon from Trump’s $ 8 / tonne to the Obama level of $ 51 / tonne. The real benefit, however, is the price of methane ($ 1,500 / ton) and nitrous oxide from fertilizers ($ 18,000 / ton). And the price can go up – this price increase is considered a temporary measure.
Biden increases carbon costs and thus eases the path for new climate rules
The social cost of carbon could have an impact across industry.
By LORRAINE WOELLERT and ZACK COLMAN
02/26/2021 4:57 PM EST
President Joe Biden on Friday restored a calculation of the economic cost of greenhouse gases from the Obama era. This will make it easier for its agencies to approve aggressive measures to combat climate change.
The intermediate figure – $ 51 for every ton of carbon released into the atmosphere – is well above the $ 8 cost used under former President Donald Trump, who refused to take into account the global effects of climate pollution to include its calculation. This equates to a price based on analysis conducted between 2010 and 2016 under former President Barack Obama, whose administration was the first to calculate the figures known as the social cost of carbon.
The price is temporary. A new interagency working group on the social costs of greenhouse gases has to issue a final issue by January.
The Interagency Working Group, led by the Council of Economic Advisers, the Office of Management and Budget, and the Office of Science and Technology Policy, is required to make recommendations on including costs in government decision-making and budgeting by September and a final figure by January.
The working group said in Friday’s statement that it was “appropriate” for federal agencies to revert to Obama-era values, although “new data and evidence strongly suggest that the discount rate that is appropriate for intergenerational analysis is considered to be lower “.
The group set costs of $ 1,500 per ton for methane emissions and $ 18,000 for nitrous oxide.
Read more: https://www.politico.com/news/2021/02/26/biden-carbon-price-climate-change-471787
Please visit the White House website for full information on the new pricing.
The social cost of carbon is not a carbon tax, it is used as a reference number to inform regulatory decisions about new pipelines and can be used in good time to “justify” a new carbon tax.
The $ 1,500 / ton methane emissions cost may pave the way for huge fines the next pipeline failure, but we already knew Biden plans to cut domestic fossil fuel production.
The $ 18,000 / tonne of nitrous oxide could mean significant new costs for farmers.
We live in a time of abundance of food because farmers apply 10 kilograms of nitrate fertilizer to their land every morning. If farmers are pressured by increased costs or regulations to reduce the use of nitrate fertilizers, this could lead to a lower frequency.
There is no doubt that climate change is blamed for the resulting food or energy shortages.