MCCARTHY DEFENDS ADMINISTRATION’S ‘SOCIAL COST OF CARBON’ CHANGES

Tamar Hallerman
GHG Monitor
9/27/13

Environmental Protection Agency Administrator Gina McCarthy confirmed that the agency factored the Obama Administration’s recently-updated social cost of carbon (SCC) estimates into its retooled carbon standards for new coal plants and defended the controversial changes during a Sept. 20 press conference. “EPA’s job when we do rulemakings is to look at costs and benefits of our rules to the extent that we can identify those through peer-reviewed processes,” McCarthy said. She added that the SCC changes, tucked into microwave oven efficiency standards issued by the Department of Energy earlier this spring, were not increased arbitrarily, but were based on changes to the three peer-reviewed models that make up the foundation of the government’s SCC calculations. “We didn’t change any inputs to those models, we just listened to what peer-reviewed scientists and economists told us about what the real social cost of carbon is,” she said. 

McCarthy acknowledged that the SCC changes have caused some “anxiety.” However, she quickly disputed claims from Congressional Republicans and industry groups that the federal government has been opaque in its updates of the metric. “People are concerned that we weren’t transparent. It went through a rulemaking process twice. It’s in one now [the carbon standards]. If you’re concerned that we got that number wrong, put some comments in,” McCarthy said. She said the George W. Bush Administration was the first to examine the social costs of greenhouse gas emissions when it estimated the costs of methane emissions beginning in 2008. “This did not begin with this Administration,” she said.

GOP Cites Transparency Concerns

Congressional Republicans and groups representing high-emitting industries have banded together in recent months to oppose the SCC changes on the grounds that the government did not release the standards—which calculate the future social and economic costs associated with emitting a tonne of carbon—for public comment before being released. The House passed a bill last month that would bar EPA from using the SCC estimates until Congress reviews the issue. Meanwhile, half a dozen trade groups representing large emitters recently sent a petition of correction to the White House Office of Management and Budget calling on the Obama Administration to withdraw the estimates until it can kick off a “transparent, public process” to determine new figures. The conservative group the Landmark Legal Foundation also issued a formal petition summer requesting that DOE suspend implementation of its efficiency standards for microwave ovens to allow public comment on the SCC changes.

Obama Administration officials, however, have defended the SCC updates, arguing that they do not constitute a rulemaking and subsequently do not have to be open to public comment. The SCC is an “input into the rulemaking process,” White House Office of Information and Regulatory Affairs Administrator Howard Shelanski said during a House hearing this summer. “In those rulemaking processes, any rulemaking in which the social cost of carbon is used as part of the cost-benefit analysis will be subject to notice and comment and there will be an open opportunity for people to comment on all aspects of that rule, including the social cost of carbon.”