Economists Implore Biden to Get Key Climate Number Right

(Bloomberg) -- Four prominent economists are imploring the White House to rethink a critical lever for policymaking that they call “insufficient to deliver the climate targets set in the Paris Agreement and by the Biden administration.” The tool in question, called the social cost of carbon, is an estimate in dollars of how much damage every metric ton of greenhouse gas pollution inflicts. By using traditional methods, the economists say President Joe Biden is potentially endangering his own climate goals.

On his first day in office, Biden directed his administration to update the social cost of carbon, which is used to shape dozens of energy regulations. Launched under the Obama administration, the social cost of carbon is a tool that economists use to build damage estimates into prices. The Trump administration shrunk it nearly to zero. The Biden administration published interim calculations early last year and the final updated values are due this month.

In a new note released today by the Roosevelt Institute, an economics and social policy think tank, economists argue that the administration’s initial estimate released last year—$62 per metric ton of CO₂ by 2030—is way too low. Joseph Stiglitz, a Columbia University economist and 2001 Nobel laureate; Lord Nicholas Stern, chair of the London School of Economics’ Grantham Research Institute; and two colleagues criticize the White House for using dated, subpar methods to estimate the social cost of carbon.