In the News

In one of his last acts in office, then-Administrator Andrew Wheeler denied CBD’s petition and other similar requests for GHG rulemakings under various sections of the air law. He rejected most of a February 2013 petition from New York University’s Institute for Policy Integrity that sought to regulate GHGs under the air law's section 115 that governs international air pollution, though Wheeler left in place portions of the petition asking EPA to regulate GHGs under section 111’s new source performance standards, the Title II mobile source program and the Title VI stratospheric ozone program.

The SEC announced that the new climate focus would not be limited to its Division of Corporate Finance—the SEC has created a new Climate and ESG Task Force in the Division of Enforcement. A recent report from the Institute for Policy Integrity at NYU and the Environmental Defense Fund contends that Corporate Finance has failed to use the review process to elicit more disclosure.

The Biden administration has reverted to an Obama-era method for calculating the social cost of greenhouse gases, which will be key in evaluating government actions affecting climate change. NYU Law Professor Richard L. Revesz examines the change and says some related actions, including updating the discount rate used to evaluate future consequences, need to happen in the coming months.

The cost of greenhouse gas emissions was calculated to be $1 per ton under the Trump administration. The Biden administration is increasing it to $51 per ton. Professor Richard Revesz explains what that could mean in practice and the rationale behind it (at 01:14:52).

In the last four years, that highly devalued, flawed SCC number was used in numerous regulatory processes. UCS worked closely with a coalition expertly led by the Institute for Policy Integrity at NYU to file comments in as many of these regulatory dockets as possible, getting on the record each time why the Trump admin SCC was so deeply flawed, so out of line with science, and how it needed to be fixed.

Private equity firms are spending billions of dollars buying coal-fired plants on the cheap - and getting paid even when they are not providing power. So-called capacity payments are given out in most U.S. power markets, and regulators tend to favor coal-fired generators that store heaps of coal on site when other power sources might be disrupted. "The capacity power market is a certain source of revenue for coal plants that might otherwise be uneconomical," said Sylvia Bialek, an economist at New York University's Institute for Policy Integrity.

While carrying out the cost-benefit analysis of different options to replace fossil fuels, these damages—also known as “externalities”—are often not taken into account or remain fuzzy. And that is where a tool like the SCC may help. As per the Institute for Policy Integrity, the SCC is “a metric designed to quantify and monetise climate damages, representing the net economic cost of carbon dioxide emissions.”

The White House on Friday announced a major change in how the federal government will calculate and weigh the cost of climate change in its permitting, investment and regulatory decisions with a move to restore the “social cost of greenhouse gases,” which had been slashed under the Trump administration. Richard Revesz, a professor at New York University School of Law, said restoring the previous calculation should provide a blueprint to calculate a new one that incorporates the latest "developments in science and economics."

Environmental experts hope Biden’s interim social cost of carbon is just an initial step toward a more aggressive policy next year. “The administration is taking a careful and legally sound approach in providing that a rigorous scientific process determine further updates,” said Richard Revesz. “A great deal of research suggests that these interim values are a lower bound for the damages of greenhouse gas emissions.”

Scientists have long used the social cost of carbon in their research, and several states have continued to use the Obama-era estimate in their policymaking. Richard Revesz said whatever comes out of the working group going forward will be reviewed by leading economists and other experts. "It sets forth a blueprint for the computation of final values, incorporating recent developments in science and economics and the input of the National Academies of Science, Engineering, and Medicine," he said.