VALUING CLIMATE DAMAGES

Updating Estimation of the
Social Cost of Carbon Dioxide

Committee on Assessing Approaches to
Updating the Social Cost of Carbon

Board on Environmental Change and Society

Division of Behavioral and Social Sciences and Education

A Report of

THE NATIONAL ACADEMIES PRESS 500 Fifth Street, NW Washington, DC 20001

This activity was supported by Contract/Grant No. DE-PI0000010, task DE-DT0009404 between the National Academy of Sciences and the Department of Energy. Any opinions, findings, conclusions, or recommendations expressed in this publication do not necessarily reflect the views of any organization or agency that provided support for the project.

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COMMITTEE ON ASSESSING APPROACHES TO UPDATING THE SOCIAL COST OF CARBON

MAUREEN L. CROPPER (Cochair), Department of Economics, University of Maryland

RICHARD G. NEWELL (Cochair), Resources for the Future, Washington, DC

MYLES R. ALLEN, Environmental Change Institute, School of Geography, and the Environment and Department of Physics, University of Oxford, United Kingdom

MAXIMILIAN AUFFHAMMER, Department of Agricultural & Resource Economics, University of California, Berkeley

CHRIS E. FOREST, Departments of Meteorology and Atmospheric Science & Geosciences, Earth and Environmental Systems Institute, Pennsylvania State University

INEZ Y. FUNG, Department of Earth & Planetary Science and Department of Environmental Science, Policy and Management, University of California, Berkeley

JAMES K. HAMMITT, Department of Health Policy and Management, T.H. Chan School of Public Health, Harvard University

HENRY D. JACOBY, Sloan School of Management (emeritus), Massachusetts Institute of Technology

ROBERT E. KOPP, Rutgers Energy Institute and Department of Earth and Planetary Sciences, Rutgers University

WILLIAM PIZER, Sanford School of Public Policy, Duke University, North Carolina

STEVEN K. ROSE, Energy and Environmental Analysis Research Group, Electric Power Research Institute, Washington, DC

RICHARD SCHMALENSEE, Sloan School of Management (emeritus), Massachusetts Institute of Technology

JOHN P. WEYANT, Department of Management Science and Engineering, Stanford University

JENNIFER HEIMBERG,Study Director

CASEY J. WICHMAN,Technical Consultant, Resources for the Future, Washington, DC

MARY GHITELMAN,Senior Program Assistant

BOARD ON ENVIRONMENTAL CHANGE AND SOCIETY 2016-2017

RICHARD H. MOSS (Chair), Senior Research Scientist, Joint Global Change Research Institute, College Park, Maryland

JOSEPH ARVAI, Max McGraw Professor of Sustainable Enterprise, School of Natural Resources and Environment, Ross School of Business, University of Michigan

ANTHONY J. BEBBINGTON, Higgins Professor of Environment and Society and Graduate School of Geography, Clark University

WILLIAM U. CHANDLER, Transition Energy, Annapolis, Maryland

F. STUART CHAPIN, III, Institute of Arctic Biology, University of Alaska–Fairbanks

RUTH DEFRIES, Department of Ecology, Evolution, and Environmental Biology, Columbia University

HALLIE C. EAKIN, School of Sustainability, Arizona State University

RICHARD G. NEWELL, Resources for the Future, Washington, DC

JONATHAN OVERPECK, Institute of the Environment, University of Arizona

STEPHEN POLASKY, Department of Applied Economics, University of Minnesota

J. TIMMONS ROBERTS, Institute at Brown for Environment and Society, Brown University

MAXINE L. SAVITZ, Technology Partnerships, Honeywell, Inc. (retired)

ROBYN S. WILSON, School of Environment and Natural Resources, Ohio State University

MARY ELLEN O’CONNELL,Interim Board Director (to November 2016)

TOBY WARDEN,Interim Board Director (since November 2016)

Acknowledgments

A number of individuals and organizations contributed to the successful completion of this report. We wish to thank the Interagency Working Group for the Social Cost of Greenhouse Gases for initiating this study and for the study’s sponsor, the U.S. Department of Energy, for supporting our work.

Casey Wichman, Resources for the Future, was the study’s technical consultant. We wish to thank Casey for the many contributions he made to both Phase 1 and this final report and throughout the course of the study. Casey’s expertise and attention to detail improved the quality of both reports.

Thanks are also due to the National Academies of Sciences, Engineering, and Medicine project staff and staff of the Division of Behavioral and Social Sciences and Education (DBASSE). Jennifer (Jenny) Heimberg directed the study and played a key role in project management, report drafting, and the review process. Mary Ghitelman managed the study’s logistical and administrative needs, making sure meetings ran efficiently and smoothly. Kirsten Sampson-Snyder guided the report through the National Academies review process, and Eugenia Grohman provided editorial direction. Toby Warden, interim director of the Board on Environmental Change and Society (after November 2016), assisted with the report release, and Jenell Walsh-Thomas, Christine Mirzayan Science and Technology Fellow, stepped in to support final report production activities. Finally, Mary Ellen O’Connell, executive director of DBASSE and interim director of the Board on Environmental Change and Society (through November 2016), helped us from the study’s initiation to its completion; we are thankful for her guidance throughout.

This report has been reviewed in draft form by individuals chosen for their diverse perspectives and technical expertise. The purpose of this independent review is to provide candid and critical comments that will assist the institution in making its published report as sound as possible and to ensure that the report meets institutional standards for objectivity, evidence, and responsiveness to the study charge. The review comments and draft manuscript remain confidential to protect the integrity of the deliberative process.

We thank the following individuals for their participation in the review of this report: Hadi Dowlatabadi, Institute for Resources Environment and Sustainability, University of British Columbia; James (Jae) Edmonds, Joint Global Change Research Institute, Pacific Northwest National Laboratory; Karen Fisher-Vanden, Environmental and Resource Economics, The Pennsylvania State University; Michael Greenstone, Energy Policy Institute at Chicago and Department of Economics, University of Chicago; Anthony C. Janetos, The Frederick S. Pardee Center for the Study of the Longer-Range Future, Boston University; Peter B. Kelemen, Department of Earth and Environmental Sciences, Columbia University, and Lamont-Doherty Earth Observatory; Bryan K. Mignone, Corporate Strategic Research, ExxonMobil Research and Engineering Company; Richard H. Moss, Joint Global Change Research Institute, University of Maryland; Elisabeth Moyer, Department of Geophysical Sciences, University of Chicago; Richard L. Revesz, New York University School of Law; David A. Weisbach, Law School and Computation Institute, University of Chicago, and Argonne National Laboratories; Jonathan B. Wiener, Law, Environmental Policy, and Public Policy Law School, Nicholas School of the Environment, and Sanford School of Public Policy, Duke University;

and Gary W. Yohe, Economics and Environmental Studies, Wesleyan University.

Although the reviewers listed above have provided many constructive comments and suggestions, they were not asked to endorse the conclusions nor did they see the final draft of the report before its release. The review of this report was overseen by Elisabeth M. Drake, Energy Laboratory emerita, Massachusetts Institute of Technology, and Charles F. Manski, Department of Economics, Northwestern University, who were responsible for making certain that an independent examination of this report was carried out in accordance with institutional procedures and that all review comments were carefully considered. Responsibility for the final content of this report rests entirely with the authoring committee and the institution.

Finally, the dedication, collegiality, and hard work of the committee are especially appreciated. We recognize that the committee members have demanding positions outside of this study. We thank them for their time and commitment to this report.

Maureen L. Cropper, Cochair
Richard G. Newell, Cochair

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Contents

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Acronyms

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