Policy Impacts

Supporting (and Defending) the Social Cost of Greenhouse Gases

The social cost of greenhouse gases (SC-GHG) quantifies the cost per unit of greenhouse gas emissions, and serves as a critical tool for decisionmakers to evaluate the climate impacts of policy choices. Policy Integrity has been a leader in pushing for improvements in SC-GHG calculations; defending the use of the metric in litigation; and encouraging proper use of the SC-GHG in relevant federal and state-level policy proceedings.

Our research shaped the Environmental Protection Agency's updated values for the metrics in 2023. The agency cited Policy Integrity publications dozens of times to support key decisions in the update, including its findings of average climate damage estimates, the global scope of damages to examine, and the need for lower discount rates.

On the federal level, Policy Integrity played a role in a critical court case supporting the use of the SC-GHG. Specifically, the U.S. Court of Appeals for the Seventh Circuit cited Policy Integrity’s amicus brief in upholding Department of Energy’s (DOE) use of the social cost of carbon in setting energy efficiency standards, marking the first time that a court had ruled on the legality of an agency’s use of the tool. The court adopted reasoning consistent with many of our brief’s arguments about the SC-GHG, while rejecting a host of arguments that are often used by opponents of robust climate regulation.

Policy Integrity has also defended the SC-GHG against attacks from the first and second Trump Administrations. Under the first Trump Administration, when agencies used arbitrary low SC-GHG values, Policy Integrity provided an influential amicus brief whose arguments the court adopted in rejecting those low as values irrational and arbitrary. And just days after the second Trump Administration announced that it would abandon the SC-GHG altogether, Policy Integrity published a report highlighting the many economic and legal flaws with this approach.

At the state level, a state court in 2019 affirmed New York’s reliance on the SC-GHG, specifically citing Policy Integrity’s brief and evidence showing that the SC-GHG is the “best tool to reflect the environmental monetary damages attributable to reduced carbon emissions.” The court ruling provides guidance for other states pursuing climate policies. Policy Integrity also tracks state usage of the SC-GHG.