In the News

One the same day that the US Senate announced its version of climate change legislation the EPA announced new action limiting greenhouse gases by big emitters. Mike Livermore, the executive director of the Institute for Policy Integrity at New York University’s School of Law and Bill Snape, the senior counsel for the Center for Biological Diversity, connects the dots for national, and international, action. Host Daphne Wysham wrote an editorial on this issues at Alternet.

Since EPA is legally bound to regulate vehicle fuel emissions, their new standards are a reasonable step. But it is an example of the kinds of command-and-control regulations that should be used only sparingly to address climate change.

The Washington Post ran an interesting editorial yesterday on regulating carbon—interesting, but ultimately wrong. The Post is correct that putting a price on carbon is the surest way to reduce greenhouse-gas emissions, and that it would be preferable for Congress to do this through legislation. But the editorial was wrong to say the EPA could not efficiently regulate carbon on its own. In fact, if Congress can’t pass a climate bill this year, this is exactly what the Obama administration should do.

A dissenting view comes from NYU Law School’s Institute for Policy Integrity, which says in an “informal analysis” that the benefits of the House bill “could likely exceed the costs by as much as nine-to-one or more” — although the authors admit that any benefits would be global while the [sic] would be borne by Americans. One EPA estimate found a “$98 to $140 average annual cost per household.”

Recently, the Wall Street Journal reported that the benefits of Waxman-Markey greatly outweigh the costs. The Journal highlights a new cost-benefit analysis of the House bill by the New York University Law School’s Institute for Policy Integrity. The NYU study finds that finds that the benefits outweigh the costs by 9:1 Based on a middle-of-the road estimate, potential benefits add up to about $1.5 trillion over the next 40 years.

Tucked into that estimate is a calculation that represents the first time the agency has put a dollar amount on the cost of greenhouse gas emissions, according to New York University’s Institute for Policy Integrity. Edna Ishayik, a spokeswoman for the institute, said EPA chose figures on the lower end of an already “conservative” range of $5 to $55 per ton of carbon. “These are very conservative estimates, which is problematic because the range will be applied to every significant regulation with a climate impact,” she said in an e-mail.

A new analysis of clean energy legislation finds that it will produce likely economic benefits of $1.5 trillion. The finding by the New York University School of Law’s Institute for Policy Integrity explains that the Waxman-Markey American Clean Energy and Security Act (H.R. 2454) is “cost‐benefit justified under most reasonable assumptions about the likely ’social cost of carbon.’”

While reducing greenhouse gases will have costs, so will the results of climate change. That may seem obvious, but up until now the debate over climate legislation has only focused on the costs, without looking at the benefits. Last week, a federal interagency taskforce released preliminary findings that began to set a dollar value for the negative effects of climate change. Often referred to as “the social cost of carbon,” this estimate is key to exposing the hidden costs of a high-carbon economy. If we only focus on the costs of cutting greenhouse gas emissions, we are seeing only half the story—inaction on global warming will lead to a greater economic hit than the price tag on the Waxman-Markey bill.

The Institute for Policy Integrity on Sept. 8, however, released The Other Side of the Coin: The Economic Benefits of Climate Legislation, an analysis that the group says uses EPA’s current cost estimates of the House climate bill and the interagency estimates to draw conclusions about the net benefit from the legislation. The analysis states that the break even point for the social cost of carbon—beyond which the legislation passes a cost-benefit test—ranges from $7.70 to $8.97 per ton of carbon dioxide.

In what’s sure to be an important study at this crucial juncture of the future of climate legislation, researchers have discovered that the economic benefits of such a bill absolutely dwarf the costs—by a stunning margin of 9 to 1. Hopefully, the new findings will help silence persistent critics who claim climate action would devastate the US economy