The Recursive Cost Of Carbon

Guest Post by Willis Eschenbach

I see that Andrew Revkin continues to try to keep the climate pot bubbling. In this case, he’s issued dire warnings about reducing the so-called “Social Cost of Carbon” (SCC). He starts by defining the SCC

This value is the government’s best estimate of how much society gains over the long haul by cutting each ton of the heat-trapping carbon-dioxide emissions scientists have linked to global warming. balance-scale

Currently set at $36 per ton of carbon dioxide, the metric is produced using a complex, and contentious, set of models estimating a host of future costs to society related to rising temperatures and seas, then using a longstanding economic tool, a discount rate, to gauge how much it is worth today to limit those harms generations hence. (For context, the United States emitted about 5.1 billion tons of CO2 in 2015, out of a global total of 36 billion.)

Now that makes it all sound very scientific, but let’s be clear about these claimed “harms generations hence”.

The Social Cost of Carbon (SCC) is a GUESS about the unknown future economic effects that might or might not result from unknown future temperature changes that might or might not result from unknown future CO2 emissions changes that might or might not happen over the next century.

Now, why is this important? Again, Revkin discusses that:

The contention arises because the social cost of carbon underpins justifications for policies dealing with everything from power plants to car mileage to refrigerator efficiency. The carbon valuation has already helped shape 79 regulations.

The strongest sign of a coming challenge to the social cost calculation came in a post-election memorandum from Thomas Pyle, who was then president of the industry-funded American Energy Alliance and Institute for Energy Research and who now leads the Trump transition team for the Department of Energy. In the memo, he predicted policies resulting in “ending the use of the social cost of carbon in federal rule makings.”

I completely agree with Thomas Pyle. The SCC is a fatally flawed measure which has little resemblance to a traditional cost/benefit analysis. I certainly hope its use is ended completely. It is a chimera, a scientific mirage.

Now, as Revkin points out:

Outright elimination of such a calculation is highly unlikely, according to interviews with a range of experts. The practice of estimating the economic costs and benefits of most government regulations began under an executive order of President Ronald Reagan in 1981. It has continued ever since. Climate-related regulations are no different. Several court rulings have affirmed the process.

However, I think that makes it easier to get rid of. The fix seems easy, and fortunately, Revkin has revealed the way it can be done. Live by the pen and phone, die by the pen and phone … it was created by an Executive Order, and could disappear the same way.

Revkin continues:

But the Trump administration’s aim of lowering the operative “number,” possibly by a lot, is almost assured. In 2013, an economist from Pyle’s energy institute testified in a Senate hearing that under a proper calculation, the social cost of carbon “would probably be close to zero, or possibly even negative.”

In fact, for reasons I discuss below, almost any number could be justified as being the “true” SCC, because the uncertainties are enormous. Revkin goes on:

A deep cut would be both dangerous and unjustified, given the basics of both climate science and economics, said Gernot Wagner, a Harvard economist focused on climate risk and policy. In a phone interview on Tuesday, he said the interagency working group assembled by the White House in 2009 to create the social cost measurement was “a damn impressive exercise at assembling a lot of firepower and done in a way that was about as apolitical as things can go in Washington.”

I love this quote. A person who thinks the SCC is needed and who (coincidentally I’m sure) makes his living studying the SCC says yep, we sure need the SCC, it’s damn impressive …

It brings to mind another of my rules of thumb, which states:

Never ask your barber if you need a haircut.

Revkin goes on to favorably discuss a new paper from the National Academies of Sciences entitled Valuing Climate Changes: Updating Estimation of the Social Cost of Carbon Dioxide (2017) As you might imagine, it’s a plea to keep the imaginary cost of carbon as high as possible.

So … just what is wrong with the “Social Cost of Carbon” (SCC)? Let me renew my long-standing objections to this unscientific construct. Here are my reasons:

•  As the title “Social Cost of Carbon” implies, it is assumed from the onset that the costs exceed the benefits. I have seen no evidence that this is known or even knowable. As an example of this bias, the term “cost” appears about seventy times in the document … the term “benefit” only seven times. Thumb on the scales much?

•  Once you start “monetizing” non-monetary costs and benefits there is no firm scientific guidance as to what you include, how you value it, who is considered as a stakeholder, whether various stakeholders receive preference, and a host of other choices. This means any result you might come up with will have very large uncertainties.

•  It is even worse when, as in this instance, we are doing a cost-benefit analysis that compares both present and future costs and benefits. This introduces a whole new host of uncertainties—how and when and even whether things will change on the input side (emissions), how and when and even whether things will change on the output side (temperatures), what discount rate we will use, whether that discount rate varies over time, and how these possible imagined future physical changes will affect both the real and the monetized future costs and benefits. At this point our uncertainties are what Steve McIntyre used to call “floor to ceiling”. The uncertainties swamp the data.

•  It is much, much worse when, as in this case, the imaginary future changes are based on an unproven scientific theorem which to date has produced nothing but an unending string of failed forecasts. Where are the coral atolls supposedly sunk in defiance of Charles Darwin? Where are the 50 million climate refugees we were supposed to have by 2010? Where is the massive threatening acceleration in sea level rise we’ve been promised for thirty years now? Given how wrong the climate models are to date, by the year 2050 they will be off the charts. This pushes the previous “floor-to-ceiling” SCC uncertainties to the level of “surface to tropopause” uncertainties. The signal to noise ratio is ludicrous. Richard Tol surveyed the field and found values from negative (net benefit) through zero to $1500/ per tonne of carbon … on my planet that is not science, that’s throwing darts.

•  To date we can show real, observable, measurable BENEFITS of increasing CO2. For example, we can see and measure clear benefits of CO2 through satellite-measured “greening” of the planet. In addition we can show that this has reduced atmospheric transpiration of water by plants, extending the yield of irrigation water. (And as an aside … how much is that worth? You see the problem with “monetizing”?).

But on the other side of the ledger, we have no real, observable, measurable COSTS of increasing CO2 even if we make the unlikely assumption that CO2 roolz temperature.

Where, for example, are the demonstrate climate costs of the ~ 2°C rise in land temperatures (Berkeley Earth data) over the last 200 years? Where are the climate tragedies? Where is the crop loss from that warming? Where are the deaths and the climate catastrophes? Heck, even Richard Tol puts that past temperature rise in the net benefit column. As a result, we are comparing real, known, measured present benefits to imaginary, calculated, unknown future costs based on an unproven theory.

•  Nowhere in any of this accounting do I find one of the largest and most important costs. This is how much it has cost us to date to fight CO2. There have been untold billions and billions of dollars wasted on Solyndras and useless studies and “Social Cost of Carbon” government boondoggles and all the rest of the money and human resources wasted. I say wasted because to date I don’t see any benefits from any of this. Green energy has not taken off, it has been a constant money drain. None of the expensive climate models have been able to do better than Phil the Groundhog at predicting the future evolution of the climate. Where are the costs of the endless IPCC quackathons? Where do those billions and billions and billions of wasted dollars go in this cockamamie “Social Cost of Carbon”? To date, fighting the fantasized evils of carbon has been all costs and no measurable benefits … can we get an accounting of that?

For all of these reasons and more, I find this entire “Social Cost of Carbon” enterprise to be a wholly unscientific effort to pretend that we can accurately monetize unknown results of an unknown misty future.

I implore Andrew Revkin and everyone involved in this scientific monstrosity to stop and consider what you are doing. The uncertainties are immense, as mentioned they go from surface to tropopause. The SCC is a transparent effort to justify throwing more taxpayer money down a rathole. And regardless of what value you think the SCC has or should have, you are adding the prestige of your name and reputation to a pseudo-scientific attempt to support and justify the imposition of new laws, restrictions, subsidies, cap-and-trade, carbon taxes, renewable mandates, and other ways to increase the cost of energy.

And increasing the cost of energy, no matter how it is done, shafts the poor more than anyone. Increasing the cost of energy is one of the most regressive taxes imaginable, and there is no opt-out at the bottom of the economic ladder. Rising energy prices hit the poorest of the poor harder than anyone.

Perhaps some folks are willing to support that “Social Cost of Carbon” BS as part of the ongoing effort to screw poor people in the name of a possible distant imaginary idyllic green future in fifty years or so.

Me … not so much …

I invite you to read my previous posts on this subject. The first is from three years ago

Monetizing the Effects of Carbon  2013-01-11

I see that the New York Times (NYT) is going to close their environmental desk. Given that there still are actual environmental problems on the planet, I consider the closing as a sad commentary on the hijacking of the environmental movement by carbon alarmists. CO2 alarmism has done huge damage…

The other two are more recent:

The Bogus Cost Of Carbon 2016-12-15

[See update at the end] From the New York Times a while back: In 2010, 12 government agencies working in conjunction with economists, lawyers and scientists, agreed to work out what they considered a coherent standard for establishing the social cost of carbon. The idea was that, in calculating the costs and benefits of pending…


Monetizing Apples And Oranges  2016-12-25

Let me start by thanking Richard Tol, Marcel Crok, and everyone involved in the ongoing discussion at the post called “The Bogus Cost of Carbon”. In particular, Richard Tol has explained and defended his point of view, giving us an excellent example of science at work. In that post I discussed the “SCC”, the so-called “Social Cost of Carbon”. There…

In short, the SCC is not science. It compares imaginary future values up to a century out based on an unvalidated theory on the one hand, with measured observed actual present benefits on the other hand. This is scientific and accounting nonsense.

I say get rid of it. Nobody has ever shown one dollar’s worth of actual measurable damage from increases in atmospheric CO2. Given that we cannot point to current damages, we are lightyears away from being able to put any realistic number on the possible future damage from this unproven theory. That’s a sick joke.


Meanwhile, here on the northern California coast, we sit underneath the “Pineapple Express”, over ten inches (250 mm) in the last three days. This is the rain we were supposed to never see again, because “climate change”.

There’s a big tree down on the road I live on, and it brought down the power pole, so we’re running on the RV generator plus a bunch of extension cables. Hey, life is good … we’re not sitting in the dark, and although the gorgeous ex-fiancee had to walk a quarter mile (half a km) home after work today in the rain because the tree is still blocking the road, she’s here and we’re happy.

Best to all,


PLEASE, if you disagree with someone QUOTE THE EXACT WORDS YOU DISAGREE WITH, so we can all understand your subject.


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January 11, 2017 9:48 pm

I would rename it to the “Social Benefit of Precious Air Fertilizer.”
(And “Never ask your barber if you need a haircut” is going into my “quotes & aphorisms” file.)

Reply to  daveburton
January 11, 2017 11:33 pm

Yup. CO2 is a big part of the reason for this:comment image

Reply to  daveburton
January 12, 2017 8:07 am

If the benefit of a gallon of gasoline did not exceed its price, no one would buy it. The price of gasoline would then drop until the benefit was greater than the price.
Thus one can argue that the minimum benefit of a gallon of gasoline is equal to its retail price, which is somewhere around $2.50 a gallon. To produce a ton of carbon requires the burning of 110 gallons of gasoline. At $2.50 a gallon, those 110 gallons would thus deliver a minimum benefit of at least $275.00.
Thus at current process, $275.00 represents the minimum benefit provided by a ton of carbon equivalent for gasoline. This figure is not considered in the Social Cost of Carbon.

DD More
Reply to  ferdberple
January 12, 2017 2:51 pm

Wiki on The Chicago Climate Exchange – Final Trading Position
The effective final CFI position was reached in November 2010 when the carbon credit price per metric ton of CO2 was between 10 and 5 US Cents, down from its highest value of 750 US Cents in May 2008. Trading reached zero monthly volume in February 2010 and remained at zero for the next 9 months when the decision to close the exchange was announced.
Market value is under $0.05, even with inflation. Can you still trade a 5 cent ton for 36$?

Reply to  daveburton
January 14, 2017 1:08 pm

What smart people replying on this article. So impressed. Here’s something that I don’t hear mentioned. Knowing that climate has changed for billions of years why is the present temperature so perfect that it has to remain at all costs. There might be better temperatures and there might be worse temperatures. Either way the world will continue to do what it’s been doing for eons more.

January 11, 2017 10:08 pm

Someone should use the same methodology to calculate the social cost of the personal vehicle. We already know how many people are directly killed by personal vehicles each year. Not only are there lives lost but so are all their future children, grandchildren, and so on. All that lost human life and productivity has got to be a huge cost. Personal vehicles should be outlawed. /sarc (as if needed)

Reply to  MJPenny
January 12, 2017 6:04 am

Unfortunately, many people believe any productivity gain has an ensuing social cost. Utopia for these folks is sitting in a circle outside our yurts eating vegan and watching each other starve or freeze today in a fossil free world. As Obi-Wan would say, “the farce is strong in these ones.”

Chris Schoneveld
Reply to  MJPenny
January 12, 2017 6:05 am

I remember reading somewhere that traffic accidents have a fatality rate of some one million/year. Equivalent to 10,000 Chernobyls or 100,000 Fukushima accidents (in casualties).Yet we allow cars to be used enthousisatically while Chernobyl and Fukushima disasters have caused the use of nuclear energy to loose their popularity.

Tom O
Reply to  MJPenny
January 12, 2017 7:37 am

Perhaps the best “study” on “social costs” would be if someone did a legitimate study on “the social cost of government.” Imagine the extra money you would have in your pay check if we could discount this “cost” from the taxes you have to pay.

Reply to  MJPenny
January 12, 2017 8:13 am

the social cost of the personal vehicle
More people are killed by bathtubs than any other item in the house. Clearly we need to establish to social cost of bathtubs and the threat they pose to future generations. We owe it to the future of the human race to outlaw this fiendish device.

January 11, 2017 10:18 pm

“The SCC is a transparent effort to justify throwing more taxpayer money down a rathole.”
But the rats will be plumper. King Rat?

Malcolm Carter
Reply to  lee
January 12, 2017 5:35 am

Are any of these tax swallowing rat holes ear marked for climate change amelioration or is this just a convenient way of raising new taxes while keeping the moral high ground?

January 11, 2017 10:19 pm

It is a crisis! If you want your great great great grandkids to know what snow is- give up your money NOW!
Help Climate Electrolytes and SAVE THE PLANET!

Reply to  gnomish
January 11, 2017 11:31 pm

Who needs CO2 when Big Brother provides Brawndo the Thirst Mutilator- it’s got the electrolytes that plants crave…

John F. Hultquist
January 11, 2017 10:32 pm

“Social” — as in social justice — as in snowflake.
I’m 1,000 miles away or I’d stop by and get that tree into firewood for Y’all.
That might be illegal in CA.

Reply to  Willis Eschenbach
January 11, 2017 11:22 pm

Interesting thing I learned about wood smoke is that it produces so called karrikinolides (comes from an Aboriginal word for smoke water), which in concentrations as low as pbb can promote germination of seeds. One wonders if this is true around the world or some sort of adaptation from Aboriginal peoples using fire to maintain the lands down here for tens of thousands of years.

Reply to  Willis Eschenbach
January 11, 2017 11:33 pm

Problem with wood smoke is that its not just H2O and CO2 that are the end products.
All sorts of other chemicals, depending on wood type, that are actual REAL pollutants, plus the particulate matter which can also be hazardous.
New modern fully filtered and scrubbed, high efficiency. multi-cycle, coal or gas are the best, most reliable and cheapest option, iff allowed to operate 24/7 at a regular output.

Mick In The Hills
Reply to  Willis Eschenbach
January 12, 2017 12:54 am

In my area in winter, we need wood smoke coming from chimneys to know our neighbours up and down the roads are ok.
What would be the social cost of this wood smoke?
What would be the social cost WITHOUT this wood smoke?

Reply to  Willis Eschenbach
January 12, 2017 4:21 am

Willis, I did some consulting for a company that builds wood (and gas) fireplaces. They had to develop new designs to meet these new EPA particulate standards. They did do some work to modify their designs but most of the effort centered around setting up the test they had to pass. Perfectly arranged stacks of 2×4 and 4×4 pieces of varying moisture content such that they met the average moisture content, but preferentially burned at different times to minimise total particulate over the test period. All this of course means there is 0% chance of it being met by the end user.

Crispin in Waterloo
Reply to  Willis Eschenbach
January 12, 2017 5:57 am

Those things you describe other than water vapour and CO2 are all the products of incomplete combustion. PIC
Both wood and more particularly coal can be burned with extremely low emissions of PIC’s.
Unfortunately the idea that fuels have ‘inherent emissions’ related to their composition has confused real and inherent elemental content like mercury and PIC’s. This is particularly a problem in Europe where it is still taught in universities.
Wood contains mercury and all other elements so the correct question is whether or not the concentration or emission rate is important, significant, dangerous, damaging.
It is frequently and incorrectly claimed that ‘smoke’ is an inherent emission rather than the result of a mismatch between a particular fuel and a particular device (stove).
I am presently working with domestic scale coal gasifiers that once ignited, produce no PM at all above PM0.1 for hours and hours. That doesn’t mean there are no inherent emissions of mercury, Cr6, SO2 and so on. When it comes to combustion emissions, ie incomplete combustion, that is a different matter.
Kerosene is often criticized as a ‘smokey dirty fuel’ yet that is what commercial aircraft run on. The source of the deliberate aspects of the misinformation are rooted in the war on coal. Key to the fake claims is the confabulation of inherent emissions and those resulting from not burning the burnable well.
I have tested two wood pellet stoves that produce less PM than a propane stove because they are so well crafted. The cleanest burning wood fired devices in the US are probably recent models of ‘fireplaces’ made by the Masonry Heaters Association. They have a great website. The fabulous performance of pellet stoves is because the fuel is so predictable. This is often the case for coal stoves that are top lit or crossdraft. Generally speaking Central Asia is miles ahead of the rest of the world on these designs.

Reply to  Willis Eschenbach
January 12, 2017 4:45 pm

Willis look up Wiseway pellet stoves they are highly efficient and don’t require electricity

Reply to  Willis Eschenbach
January 12, 2017 7:29 pm

Yeah, wood smoke can be a problem, especially in low lying valleys. But if you live high up, out in the boonies, who cares? I run 4 cords a year through a 1976 Vermont Castings Vigilant. Recently discovered Prest Logs ( made from compressed sawdust (under pressure the lignite liquefies and acts as a binder). Stuff is incredible. Burns down to ash with no noticeable smoke. 8 million btu in a 4×10 inch log. Pellets on steroids without all the hassle (well you do have to store them in a dry place…).
BTW, I’ve been told by several stove dealers who sell stoves/pellets – Don’t Buy a Pellet Stove!
Reason being, the latest versions are too complicated and require a trained tech to maintain and fix.
If you can get a simple one over 5 – 10 years old, then go for it.
Stay warm!

Reply to  Willis Eschenbach
January 13, 2017 9:02 am

Yirgach that is why I recommend looking at the wiseway stove it is not electric so no complicated motors they sell a bi-metal fan for them too

Reply to  Willis Eschenbach
January 14, 2017 10:18 pm

What on earth do they do about campfires? 😮

January 11, 2017 11:14 pm

Carbon-based lifeforms calculate “social cost of carbon”?
This type of societal scale human experiments populate history books. If there are any public civil servants involved, the governments must liberate these individuals back to the open job market immediately.

January 11, 2017 11:15 pm

The “social cost of carbon is a totally fabricated term they invented to generate revenue. There is no such thing as a “social cost of carbon”. And in this case, they’re talking about CO2, not carbon.

January 11, 2017 11:21 pm

The burning of carbon is responsible for nearly all the development in the civilised world.
CO2 with H2O and some minor trace elements provides ALL FOOD for ALL LIFE on this planet.
There is NO SOCIAL COST, only a massive BENEFIT !
We ought to be PAID to release CO2.

Chris in oz
January 11, 2017 11:39 pm

The simple riposte is that guessing future economic impacts like this – 100 years out – is like standing on the western front in 1916 guessing what the economy of today would look like. Any sane person immediately knows that this is impossible and, in fact, is afoolish thing to even try.

Lance Wallace
January 11, 2017 11:40 pm

The NAS had a webinar today with some of the authors of the report to present the conclusions. I watched much of it and asked a couple of questions, one on the greening of the earth and the other on the 17-fold ratio of deaths from cold to deaths from heat waves. The co-chair of the Committee agreed that greening would be a benefit of CO2. The second question didn’t get answered, but no doubt he would have agreed with that as well. The basic approach of the report was NOT to arrive at a specific cost of carbon. Rather it was recommended that four different modules be studied, including land use, discount rate, etc., then integrated in one analysis, with uncertainties of each module propagated throughout. The 12 or so Agencies involved in this exercise would of course need to have their work reviewed by an independent group of scientists (no doubt rounded up by the NAS again for one of their 3-year study panels). A nice question at the end was just how much was this going to cost, and to give him credit, the co-chair did not try to hide the fact that it would cost a lot. One slide showed some cost distributions assuming 5%, 3.5% and 2.5% discount rages. The cost ranged from 12$ a tone to 120$ a ton at the two extremes of the range.
The report is freely available. I downloaded it. 395 pages. It will be utterly unimportant in the long run.

Reply to  Lance Wallace
January 12, 2017 3:35 am

It doesn’t matter how wrong you are, just writing the report is success in itself. People should have to pay the taxpayer to do junk like this.

January 11, 2017 11:44 pm

One guy who thinks “carbon” is a serious problem is Rex Tillerson, whose performance today was NOT reassuring. The Sec of State nominee today confirmed that his belief that climate change is a serious problem is his own, not Exxon’s. Further, and most disturbing, Tillerson said he hopes to influence Trump on climate change.

Tillerson said: “I think it’s important that the United States maintain its seat at the [Paris & climate change] table on the conversations around how to address the threats of climate change, which do require a global response.”

We won this election. If we lose the next one we will have a climate change shill as Sec of State. Let’s not do the same thing. Say NO to Tillerson!

Joe Crawford
Reply to  Eric Simpson
January 12, 2017 9:09 am

Think I have more of a wait-and-see attitude toward Tillerson. As CEO of ExxonMobil he has to have been beaten up way to much and way too often to say anything negative on ‘Climate Change’. His current job requires that he maximise profits for the company within the current environment of government regulations and public opinion. As a CEO his personal opinions can’t be known either way until he is no longer associated with the industry.

January 11, 2017 11:47 pm

Two things that need to be considered in calculating the SCC, is the benefits of fossil fuels. The other is the cost to replace fossil fuels.
A quick look at the benefits of using fossil fuels, is imagining that all fossil fuel usage stopped today. In only 6 months, there would be 6 billion or more dead, from a lack of food production and transport.
If one wanted an orderly transfer away from fossil fuels, to prevent that mass starvation, one needs to calculate the cost of replacement. This will cost 10s of trillions of dollars.
It seems to me that the the people wanting a SCC, can’t seem to see the costs involved in switching. We also need a SCAE (Social cost of alternate energy), to better evaluate the costs/benefit analysis. One needs to look at the whole system, and not just the carbon portion of the system.

Steve T
Reply to  Les Johnson
January 12, 2017 3:19 am

Les Johnson
January 11, 2017 at 11:47 pm
Two things that need to be considered in calculating the SCC, is the benefits of fossil fuels. The other is the cost to replace fossil fuels.
A quick look at the benefits of using fossil fuels, is imagining that all fossil fuel usage stopped today. In only 6 months, there would be 6 billion or more dead, from a lack of food production and transport.
If one wanted an orderly transfer away from fossil fuels, to prevent that mass starvation, one needs to calculate the cost of replacement. This will cost 10s of trillions of dollars.
It seems to me that the the people wanting a SCC, can’t seem to see the costs involved in switching. We also need a SCAE (Social cost of alternate energy), to better evaluate the costs/benefit analysis. One needs to look at the whole system, and not just the carbon portion of the system.

Could we not propose that the main proponents of replacing so called “fossil fuels” conduct an experiment for the benefit of the world.
Both California and South Australia have struck out ahead of the rest with their energy policies. Should we not wait and see the result for a number of years (ten or twenty perhaps?).
In order to prove the efficacy of the policies though, it will be necessary to ensure that there is no use of “fossil fuels” via inter-connectors etc as these will not be available if everyone switches. This should prove how well it works, or not, then everyone else could convert, or not, to the same policies if successful.
Either it works or not – what’s to lose? 🙂

Reply to  Steve T
January 12, 2017 3:37 am

South Australia has already tried this. It failed three times between September and December 2016. But that didn’t stop them from blaming other people.

Crispin in Waterloo
Reply to  Les Johnson
January 12, 2017 6:15 am

Biomass burning is also subject to the SCC charge. It is not limited to ‘fossil fuels’.
I appreciate the comments above pointing out that the term ‘carbon’ is completely misleading. Believe it or not, one of the news items this morning is that an Alberta funeral home has been sending families a $100 invoice for a ‘carbon tax’ which came into effect on the first of January, to cremate a body!
The argument was the natural gas used emitted CO2. They reduced the charge to $10 upon complaint, but the question about the body itself went unanswered. What about the burning of the carbon in the body? Is a human body a form of renewable energy? If not, then families of the dead in Ontario and Alberta will have to pay a charge based on the combustion of the carbon mass of the corpse. The carbon tax cares not at all about the source of the emission, it cares about CO2.
Clearly there is a CO2 drawdown long term to be had by burying not cremating bodies. Ah-h the unanticipated consequences of tinkering with the law.

January 12, 2017 12:02 am

Only $36/ton, that doesn’t sound like much. Wasn’t it only last year that the cost was set at 350,000 Hiroshima bombs/day? I think they should stick to the Hiroshima metric, it sounds far more impressive. Lol!

Reply to  Klem
January 12, 2017 3:39 am

You’re right. Nobody points out what $36 per ton actually means. How much coal, oil and gas do we consume in the world at the moment. It must come to a gigantic extra cost when you actually start taxing it.

January 12, 2017 12:02 am

But who really believes the MSM’s idiotic nonsense about their so called CAGW? Here’s a 5 minute video by Lomborg that calls into question most of the silly nonsense peddled by the MSM.

And here Lomborg covers their delusional mitigation nonsense at the end of Paris COP 21. Even Hansen called COP 21 just BS and fra-d. Likewise the SCC doesn’t make a scrap of sense, because the numbers don’t add up.

Reply to  ngard2016
January 12, 2017 11:34 am

It’s probably long overdue, but has anyone attempted to determine the Social Cost of Stupidity?

Reply to  rocketscientist
January 12, 2017 4:42 pm

“Never underestimate the power of a large group of stupid people!”Einstein

Reply to  Willis Eschenbach
January 12, 2017 12:52 am

yes, agreed. One needs to look at the direct and non-monetized benefits, as part of the whole system.
Plus, one needs to account for the cost of replacement, when looking at the costs/benefits.

Tim Hammond
Reply to  Willis Eschenbach
January 12, 2017 2:59 am

That assumes the emitted CO2 stays in the atmosphere – but it has not stayed if it has been absorbed by plants (and then fixed in humans through food) or fixed permanently somewhere. And if that CO2 is not dependent on continuing emissions (i.e. it continues to be available decades after emission), then the value exists under the stop using fossil fuels scenario as well, and so is a wash and can be ignored.
You need to use only the “additional” CO2 under the various scenarios in the future. Discounting is done on INCREMENTAL cash flows (sorry to shout, have been saying this in finance for decades to people getting it wrong).
And 5% is a ludicrously low discount rate. Nobody values the future at such low rates.

Chris Schoneveld
Reply to  Tim Hammond
January 12, 2017 6:16 am

Willis; “increase in human food and fiber production at about a trillion dollars per year. ”
And what is the monetary value of the beneficial effect on humans (the poor etc.) from this increase in more food?

Reply to  Tim Hammond
January 12, 2017 7:09 am

More food means more poor people survive, which according to the enviro’s is a big negative cost.

Tom in Indy
Reply to  Tim Hammond
January 13, 2017 8:07 am

Tim Hammond January 12, 2017 at 2:59 am
“And 5% is a ludicrously low discount rate. Nobody values the future at such low rates.”
Willis Eschenbach January 12, 2017 at 1:27 pm
The interagency group looked at discount rates of 2.5, 3 and 5 percent, ultimately settling on 3 percent and putting the cost of one ton of carbon at $21. But the new study opts for discount rates of 1, 1.5 and 2 percent, ultimately putting the cost of one ton of carbon at anywhere from $55 to $266.
An accepted method for determining a proper discount rate is based on opportunity cost. What would the return be on an investment in the next best alternative? In this case, much of the money going toward the reduction of carbon dioxide is coming from national governments., suggesting the return on a long term treasury security is appropriate. (Assuming most governments run an annual fiscal budget deficit, so the climate money is borrowed at the long run treasury rate.) I’m guessing the study cited above also uses a “real” inflation-adjusted rate. So if you expect the weighted average(by country and investment in climate change) global long run treasury bond to yield 4% to 6% over the next 30 years, and you expect inflation to average 2% to 3% during that period, then a real discount rate might be in the range of 1% to 4%.
I would suggest bumping this rate up, due to the fact that not all investment in CO2 reduction projects comes from public investment. A proportion is from private investment. So, you need to do the same calculation based on the rate of return that a private investor could earn by investing private funds in the next best alternative to an investment in a project the reduces CO2. A quick and dirty approximation is the long-run annual, average “real” return to a globally diversified stock portfolio. Perhaps a 10% nominal return less 2% to 3% inflation over the next 30 years. So, a 7% to 8% real discount rate for the private portion of total investment in CO2 reduction projects.
I have no idea what the proportion of public to private investment looks like in CO2 reduction projects, so all I can say is that based on this approach, an appropriate discount rate is between 1% and 8%.
Also, notice that the interagency group has an incentive to opt for a lower discount rate, due to the mathematical fact that as the discount rate falls, the present value rises.

Tom In Indy
Reply to  Tim Hammond
January 13, 2017 6:16 pm

Willis Eschenbach January 13, 2017 at 8:54 am
The “next best alternative” would be putting your money in a pile and setting fire to it.
Tell that to Al Gore, Elon Musk and the other climate robber barons 🙂

January 12, 2017 12:35 am

Willis, in my opinion, any document or discussion that uses the word stakeholder is suspect. It is a nebulous construct referring to someone with any feeling that something might impact them. It is as weaselly as the term social cost of carbon, and generally appears in leftist screeds.

richard verney
Reply to  Willis Eschenbach
January 12, 2017 2:32 am

A stakeholder is someone who is affected by a decision or a negotiation of some kind.

Well on that definition that is almost everyone, and it covers almost every decision made/to be made.

Reply to  Willis Eschenbach
January 12, 2017 3:46 am

You need to be quite wide in your understanding of what a stakeholder is. I once had somebody install a small network device behind an office worker’s desk. This was in the days before computers were widely used. It took two days before that worker had unplugged the device and put it into a safe because of the noise of the fan. The net result was that that entire floor’s worth of users went dark.
This is because that person wasn’t considered as a stakeholder.

Reply to  Charles Rotter
January 12, 2017 3:16 am

I have the same attitude to ‘workshop’ when used outside the context of light engineering.

January 12, 2017 12:36 am

To date we can show real, observable, measurable BENEFITS of increasing CO2. For example, we can see and measure clear benefits of CO2 through satellite-measured “greening” of the planet.

The “greening” argument is often used to parry the SCC. While true enough, it utterly misses the point. The Social Cost of Carbon is not about producing CO2, it is about using fossil fuels. If people really want to talk about the cost of using fossil fuels, we can insist that the discussion include the cost of not using fossil fuels.
This is an argument which can be won, and will bring the issue of SCC into sharper focus.
The issue is really how the debate is framed, and the Luddites have framed the SCC debate to be beneficial to themselves, but also in a way which simply does not make sense.

January 12, 2017 12:57 am

Cash flow tomorrow is not worth as much as it is today.

A dollar today is worth more than a dollar tomorrow. This truth is called the discount rate.
The discount rate depends on the inflation rate which is unknowable. It makes no sense to spend a dollar today trying to save a dollar a hundred years from now. You could make the argument that in makes no sense spending anything at all to save a dollar a hundred years from now. In other words, any money we spend trying to save a dollar a hundred years from now is wasted. There are too many confounding factors which will invalidate our calculations.
A much better way to spend money today is to fund curiosity based research. It’s the only way we will stumble over the breakthroughs we need to continue society’s progress.

Tim Hammond
Reply to  commieBob
January 12, 2017 2:41 am

The inflation rate is mainly irrelevant to discount rates – you either do it all in real terms or assume a constant. The real drivers are opportunity cost and risk. Whilst the discount rate can be computed based on some “reality” in investment decisions, there is no solid theoretical basis for computing the discount rate for the SCC. If I don’t have children and don’t care what happens after I die, anything that happens beyond that timeframe has zero value to me is one extreme, that is perfectly valid from an economic standpoint.
The only way the SCC can have any significant value now is if you are willing to forego near term wealth in order to avoid lots of costs in the far future. You can have that view, but there is no cast-iron, empirical reason why it is right economically, let alone scientifically.

Reply to  Tim Hammond
January 12, 2017 12:05 pm

I believe putting a price on the SCC is about “money”.
They offer two ways to save the planet.
“Cap and Trade” is about making Hedge Fund millionaires into Globe Trotting billionaires.
“Carbon Tax” will give politicians another tax revenue stream to provide gobs of cash to keep getting reelected.
None of this will have any impact on “earth’s fever”.
Once there is a SCC, congress or EPA will be able to “adjust that cost” as they see fit.
If you understand it’s about the money, you’re way ahead.

Scottish Sceptic
January 12, 2017 1:16 am

They may as well have a government policy discussing the social cost of Oxygen.

Reply to  Scottish Sceptic
January 12, 2017 2:30 am

Yes, Oxygen causes forest fires, ageing, free radicals, decomposition, oxygen toxicity, rusting (oxidation), it too has a high social cost. The worst aspect of all, it allows humans to live.

Tim Hammond
Reply to  Scottish Sceptic
January 12, 2017 2:45 am

Economically the concept is fine as there can be costs that fall on everyone from some things that are not priced in for the actual consumer. Noise from aircraft for example.
But to be useful you need to know the cost pretty well, and the cost needs to be imposed now or in the near term. If you don’t the cost and/or its not payable fir many years, you are wasting your time trying to compute a number as all you can say is that its between zero and something else.

Reply to  Tim Hammond
January 12, 2017 3:49 am

You can’t even say it is above zero if you’re talking about carbon dioxide. It has gigantic benefits.

January 12, 2017 2:34 am

On the subject of the lack of economic logic behind green activity, in a recent issue of a UK car mag: “Dramatic fall in EV grants explained – The number of motorists claiming the government’s plug-in grant has fallen to its lowest level in 2 years following the decision to reduce the subsidy”. I’m quite happy with that. Why should my tax £s be used to support company drivers of Teslas and the like?

Warren Latham
January 12, 2017 2:45 am

Interesting article indeed, however, the phrase “the social cost of carbon” is of no value and is a twisted, mis-use of the language.
Imagine saying “the social cost of oxygen”.
Without carbon, Mr. Revkin would not … well, he simply would not BE (at all) !

Reply to  Warren Latham
January 12, 2017 6:16 am

Perhaps that why they call it the “social cost of CARBON” and not “social cost of carbon diOXIDE”. It’s a propaganda trick.

richard verney
January 12, 2017 2:50 am

Unless one can have faith in economists, the entire concept of assessing the social costs of carbon is a farce.
We all know that economists are almost invariable wrong. How many economists predicted the Great Crash of the 1930s and the present financial crash that we are still lumbered with. We all know that every economic forecast made by government is always wrong. At any rate, I cannot recall ever seeing a government forecast that has been correct.
That being the case, what hope is that an economist can sufficiently accurately forecast the social cost of carbon such that his forecast is of real benefit?
To make matters worse, all these forecasts are based upon model projections of the climate that we know are wrong. Usually the forecast is based on the RCP8.5 scenario, which scenario is by now so severely discredited that it is farcical for any economic forecast to be based on such.
What we know as fact is that carbon (burning/using fossil fuels) is a big big plus. All developed nation’s economies are built on the back of it, so too our life expectancy and general quality of life. It has and is creating trillions of dollars of GDP throughout the world.
Whatever the social cost of carbon is, it is clear that it is a net benefit, and that all peoples of the world should be free to enjoy its benefits.
This planet needs more CO2, not less. This planet is also way too cold and could do with more warmth, not less.
It is about time that people embrace the real world. Hopefully the new POTUS will lead the way.

Reply to  richard verney
January 12, 2017 4:58 am

Hear, hear.

Reply to  richard verney
January 12, 2017 5:04 am

We all know that economists are almost invariable wrong. How many economists predicted the Great Crash of the 1930s and the present financial crash that we are still lumbered with.

Austrians did. They would also never argue that CO2 has a “positive cost”. That is because people buy voluntarily fossil fuels, which means, they do economical calculation and decide that gains are bigger than drawbacks for them now plus future discount. Because consumers are the majority, so according to democratic rule, the self-appointed intellectual aristocracy should suck it in and cope.

Reply to  richard verney
January 12, 2017 5:32 am

Hi Richard, I strongly agree with your following comments:
My comments, published in 2002 and later:
“The ultimate agenda of pro-Kyoto advocates is to eliminate fossil fuels, but this would result in a catastrophic shortfall in global energy supply – the wasteful, inefficient energy solutions proposed by Kyoto advocates simply cannot replace fossil fuels.”

“Cheap, abundant, reliable energy is the lifeblood of society.”

“Global Primary Energy Consumption by Fuel is:
86% Fossil Fuel (Oil, Coal and Natural Gas),
4% Nuclear,
7% Hydro,
and less than 2% Renewables (despite trillions of dollars in wasted subsidies).”

“Most green energy schemes are not green and produce little useful energy.”

“When misinformed politicians fool with energy systems, innocent people suffer and die.”
My comments, posted in 2009 and later:
“Earth’s atmosphere is clearly CO2 deficient in the geologic time scale, and plants are negatively affected.”
“Earth is CO2–deficient at this time and additional CO2 (from whatever source) is beneficial.”
“When all life on Earth comes to an end, will it be because CO2 permanently falls below ~150ppm as it is permanently sequestered in carbonate rocks, hydrocarbons, coals, etc.? ´
Regards, Allan

Reply to  Allan M.R. MacRae
January 12, 2017 5:39 am

My point in posting the above is that we have known since about 1985 that the catastrophic global warming hypothesis was false, because it was not founded in credible science.
It became increasing clear after about 2002 that the global warming hypothesis was not only false, it was fraudulent.

January 12, 2017 3:04 am

Ultimately, this is why ‘science’ is acquiring a bad reputation. The SCC depends solely upon ones political POV. The more you lean one way or another as a ‘scientist’, the higher or lower your estimate of the SCC. That isn’t science, it’s politics hiding behind the mask of science.
Science, to me, is a set of (even semi) verifiable facts or ideas.
Playing games on a computer is not science.
How about my model that indicates that we would be better off not funding sciences because my model indicates that we could run into problems created by science come 2100? What do I need to do/be in order for my model to be taken seriously? I can easily tweak my assumptions in order to get a different result if it will help.

Jim Gorman
Reply to  3x2
January 12, 2017 12:33 pm

Good point. What is the social cost of robots? What is the social cost of genetics when those who can afford it will have offspring that are better looking and smarter? What is the social cost of self driving cars? All these could justify removing funding from science!

January 12, 2017 3:23 am

Willis, great post as usual, and similar to the Smoking Gun #24. I’m going to update it with one of the graphs from above. BTW, I’d be honored if you critiqued the below list of Smoking Guns.
How to Discuss Global Warming With A Liberal. The Smoking Gun Files.

Crispin in Waterloo
Reply to  co2islife
January 12, 2017 8:42 am

I have a question for you. I read (again) your presentation at the above link. You have a graph showing the incoming radiation and the outgoing. The outgoing radiation has a significant peak around a particular frequency but it is not clear what it would look like up close. Is there not a very easy way in which to illustrate the impact of various IR source gases into their relative influences, available from the spectral analysis of the LWIR?
IR isn’t a ‘single thing’ it is a range of wavelengths..
If you used a standard FTIR analysis method it should be possible to assign to the spectrum as a whole the relative contribution to the outgoing radiation of each emitting gas. The thing I wondered first was whether the H2O spectrum contained more energy than the CO2 spectrum it envelopes. I have never seen such an analysis so it interests me and I do not have the tools to do it. There are probably a dozen papers on it that I have not found.
For those not familiar with this technique, Fourier Transformation Infrared analysers are devices that look at a spectrum of emissions and subtract from the total, one gas emission spectrum at a time, treating the remnant as a new set of measurements. By getting the subtractions correct, gases with overlapping spectra can be separated reasonable well. It is computationally intensive. This is routinely done to get the water vapour concentration from gas measurements. Two companies doing this are Cemtrex and Infrared Industries though the latter is being assisted by Nova Gas in Ontario. Anyone making FTIR equipment can accomplish the same thing.
It seems to me a pretty obvious check on statements that ‘water vapour is more important than CO2’, which I believe it is, but for which I have not seen quantified claims based on and FTIR separation of the emission profiles contained in the upwelling IR.

Reply to  Crispin in Waterloo
January 12, 2017 3:07 pm

You have a graph showing the incoming radiation and the outgoing. The outgoing radiation has a significant peak around a particular frequency but it is not clear what it would look like up close. Is there not a very easy way in which to illustrate the impact of various IR source gases into their relative influences, available from the spectral analysis of the LWIR?
IR isn’t a ‘single thing’ it is a range of wavelengths..

Chrispin, this chart better highlights the CO2 spectrum. You can also use

4 Eyes
January 12, 2017 3:27 am

So far the benefits of carbon based fuels vastly exceed the costs – both dollar cost and social cost.

January 12, 2017 4:03 am

I’ve long defended Andy Revkin’s curiosity and intellectual integrity, ever since he gave me a forum @ DotEarth in 2008, such that the bitter ones called it DotKim, but he’s not without bad error and this is one, not that I didn’t warn him.
The social cost of carbon is negative. AnthroCO2 is a boon, providing mild warming of net benefit, and near miraculous greening of tremendous universal benefit.
And it’s a side effect of the truly miraculous transformation that cheap energy has made upon society, and will continue to provide, provided we have the sense to use it wisely.

Reply to  kim
January 12, 2017 4:05 am

Heh, The Human Cornucopia.
H/t to RG for his ‘Human Volcano’.

January 12, 2017 4:09 am

Well, we’re this far into the comment thread and no one’s mention the desperately corrupt and corrupting Lord Stern? Even Pekka, bless his ever lovin’ frightened heart and incandescent mind, balked @ Stern.

Reply to  kim
January 12, 2017 4:14 am

More heh, I remember telling Richard T. over at Tom F’s early place, that the science wasn’t settled. I’ve even told him that the economics isn’t settled, and particularly so not @ 2 degrees C.

Reply to  kim
January 12, 2017 4:20 am

I don’t believe it is possible with AnthroCO2 to provide so much warming as to become net detrimental. We also can’t exceed greenhouse proven maximal CO2 content for the biome. We simply haven’t enough fossil fuels to do so, vast and growing as the reserves are.
I’ve got to Hat/tip Max Anacker for the numbers about this, though I suspected it long before he provided them.

John W. Garrett
January 12, 2017 4:17 am

Revkin is two-faced. Like “Chuckie” Schumer, Revkin has the principles and ethical backbone of an amoeba.

Reply to  John W. Garrett
January 12, 2017 4:21 am

Given a choice of the two, I’d rather have tea with Andee.

Reply to  John W. Garrett
January 12, 2017 12:16 pm

I’m not sure what your problem with Andy Revkin is. Andy’s a lukewarmer, but thinks CO2 is a serious (though poorly defined) long term problem. People here disagree and I do too, basically, though this will be decided long after we here are all gone. I admit I could be wrong.
I learned a lot by following Dot Earth, and I’m sorry that it’s gone. Andy is an honest broker of information, and has always presented both sides.

Reasonable Skeptic
January 12, 2017 4:41 am

The social cost of carbon…… is not the same as a cost benefit analysis rather it is only a cost analysis.
“The practice of estimating the economic costs and benefits of most government regulations began under an executive order of President Ronald Reagan in 1981. It has continued ever since. ”
All they need to do is determine the benefit of carbon and we are good to go. I wonder why this has never been tried?
Here is a hint. Compare New York City to rural Afghanistan .

Reply to  Reasonable Skeptic
January 12, 2017 7:38 am

Reagan was right.
The cost/benefit should be assessed for the consequences (regulations), not the cause (alarmism).
Then the cause can be addressed separately in all peace and quiet:
Alarmists have already accepted Lew flexing his professional ethics to collective diagnosis. They should have nothing against the method being used to analyse alarmism the same way. Then the help can be delivered locally.
While only typing the idea makes my fingers feel filthy, it must be recognised no amount of taxpayers money will be enough to cure the cause, hence remains ineffective.

Ron Konkoma
January 12, 2017 4:42 am

Given that atmospheric carbon dioxide is demonstrably causing the planet to become “greener”, and given that Greenpeace wants to reduce atmospheric carbon dioxide, should they not be renamed Brownpiece?

Reply to  Ron Konkoma
January 12, 2017 5:02 am

This is a measure of the grand delusion of alarmism. Granted the warming and greening are serendipitous, but the human race deserves praise and thanks for the production of AnthroCO2, not fear, blame and guilt.
The spell is only broken one by one, but one by ones seem to wander by one by one’er more, lately.

Don K
January 12, 2017 5:14 am

First of all let me say I agree with you. These SCC folks seem to have not the slightest idea what they are talking about, It seems ill-advised to do policy planning based on a number that could be anywhere in a range of orders of magnitude..
Example: Canada is a very large country — for practical purposes, it’s the same size as the US and China. But it has one tenth the population of the US, one fortieth the population of China. Why? Because it’ COLD up there. Too cold to grow crops mostly. I’ve done some random checking and I’ve yet to find an analysis of warming that includes doubling or quadrupling of Canada (or Russian) GDP.

the term “cost” appears about seventy times in the document … the term “benefit” only seven times. Thumb on the scales much?

I think that’s because “they” chose to define the effect of atmospheric carbon as a cost. Had they instead chosen to define it as a benefit, they would (if they knew what they were doing — which they don’t seem to) arrive at the same number with the opposite sign. And you’d probably see ‘benefit’ a lot more often and ‘cost’ less often. Not a thumb on the scales so much as an arbitrary choice between two somewhat unsatisfactory terminologies.

Darrell Demick
Reply to  Don K
January 12, 2017 6:38 am

To all, excellent responses, my compliments!
Don K, I could not agree more with your comment – Canada IS a COLD country. I remember seeing on the Friends of Science web site a link containing a map of western Canada, and how the areal extent of land available for crops would be reduced by a 1 C drop in average temperature. it was truly scary.
And yet we have this wonderful socialist ruling party in the Province of Alberta, Canada, who have implemented a “Carbon Tax” effective January 1, 2017. Funny story, my very wonderful girlfriend’s mother received a check in the mail a day ago for C$100 (US$76.40 at current exchange rates) – this is her “Carbon Tax Subsidy”. I don’t want to know what the cost is of administering this process.
Social Cost of Carbon is quite simply just another form of transfer of wealth, and all governing bodies LOVE to have more tax money coming in. How they spend it is another issue entirely. And yes, even though the wonderful socialist party in Alberta are trying to do their best impression of Robin Hood, the poor will suffer more than the not-so-poor. Great Britain is a prime example of how people have perished due to not having sufficient funds to heat their homes – I believe the estimate for the winter of 2011-2012 was 30,000 deaths. And another 15,000 in the winter of 2015-2016.

Don K
Reply to  Darrell Demick
January 12, 2017 8:36 am

Darrell. A Carbon Tax makes more sense for a country like the US which is an energy importer than Canada which isn’t. Renewables have lots of problems, but in most cases they are domestic, not foreign, and that is in the very long run is positive. One effect of a carbon tax is somewhat like a tariff on foreign oil. Also, paying out the carbon tax money as a subsidy to the residents is probably a pretty good idea if one has to have a carbon tax. Otherwise, the money will likely be dinked away on a zillion mostly ill-conceived projects.

Reply to  Darrell Demick
January 12, 2017 9:29 am

DonK, if you make a countries energy more expensive, then it’s exports get more expensive as well.
Also all imports become more competitive as you increase the cost of things made here vs things made elsewhere.
Imports go up, exports go down.
Good way to ruin an economy.

Reply to  Darrell Demick
January 12, 2017 11:45 am

PS: Taxing imports has the same effect, no matter which import you are referring to.

January 12, 2017 5:19 am

Revkin’s bad faith and cynicism is on full display.
To not have a rational cost/benefit analysis on environmental policies means that the policies are irrational. yet he still supports the status quo.
For Revkin to write his article in such a way as to ignore what the purpose of cost/benefit is supposed to be, and to simply treat reforming the analysis to a rational basis is simply a wraskly Republican evil trick is to deliberately confuse the issue. It is as if he prefers the non-rational non-functioning, ineffective polices which the climate extremists have imposed on us.

Reply to  hunter
January 12, 2017 12:34 pm

SCC is about ground work to allow the real money to get richer and get even more power.
When you control CO2, you control life itself.

January 12, 2017 5:19 am

This about sums up the whole CAGW farce:
(Translation: uncertainty on top of uncertainty on top of uncertainty on top of uncertainty on top of…)
Maybe there’s a turtle down there somewhere, too.

Crispin in Waterloo
Reply to  PiperPaul
January 12, 2017 9:32 am

Piper Paul
You say that there is huge uncertainty about CAGW and its purported causes and impacts.
I am not so sure about that.

Bruce Cobb
January 12, 2017 5:35 am

Given the recent flooding in northern California, perhaps it is high time we considered the social costs of “hydrogen”.

January 12, 2017 5:47 am

You miss the point.
SCC was never about carbon. It was about the gap between uncompetitive “renewable” Versus carbon-emitting industries, and finding a way to fill that gap by putting a tax-burden on the latter to subsidize the former. How much was needed ? Answer : 30-50 $ are enough, to begin with (to be risen later, as need be).
So let SCC be 36$. Plus, 36 is a good number. 1 digit is not enough, 3 or more digit are too much. number beginning with “3” look good. odd number make feel odd, and -0 doesn’t look like a normal result of a calculus but something preconceived (which it is, indeed, but don’t want to show), that leave us 32, 34, 36 and 38. 38 (=2*19) or 34 (=2*17) are weird. 32 would have been fine, too.
“Social Cost of Carbon” (SCC) aka : “the tax on carbon-emitting industries to be turned into subsidizes for our otherwise uncompetitive crony-capitalism industries of renewable fun toys. “

Smart Rock
January 12, 2017 6:13 am

Here’s some of the “social” cost of having 6 percent of our electricity in Shiny New Green Ontario generated by wind/solar/biomass. At our house in southern Ontario, we now pay, on average, about 19¢/KWh (about 14.5¢ in US$), up about 85% in the last 10 years, solely due to closing coal-burning plants, building gas plants, cancelling gas plants, building more gas plants, paying the gas burners to stay idle two-thirds of the time in case the wind stops blowing, and subsidizing wind and solar producers by guaranteeing to buy all their output at 18¢/KWh (that is before the cost of distribution).
And on top of all that, because the rising cost of what we still refer to as “hydro” has reduced consumption quite dramatically, dumping the unwanted green power on poor New York at 3¢/KWh. At our property in northern Ontario, which is just down the road from a hydro plant (distribution cost = ± zero), we are paying on average 23¢/KWh.
Mother Wynne envisages a greener future where we will all heat our homes with electricity produced from the wind/solar/biomass when they have ramped up to the point where they can close the nukes that supply 60% of our electric power. No, we will stick with gas, thanks very much for the kind offer. Gas is why the price of electricity isn’t really hurting us that much.
Using green accounting, Ontario electricity is 13 percent renewable, but that’s installed capacity. Actual production in 2014 (the last year we have complete numbers for) was 6 percent. Capacity factor of 6÷13 = 46% which is actually good for renewables. Green accounting, of course, does not include the capacity factor of 35% for the backup gas plants.
Don’t even mention the carbon tax we’re all paying since January 1st this year.
“Social” cost? We’re already paying the cost of not using a small amount of “carbon”. It feels extremely anti-social to this disgruntled observer.
I can only imagine what the cost would be if we didn’t have those three big nukes that supply 60% of our electric power. Or Niagara Falls; hydro supplies 24%. Why can’t Mother tell the world how little “carbon” Ontario is emitting already? Oh yes, now I remember. Nuclear power is bad because…. (isn’t it something about radiation killing people?). And hydro electric power is bad because, well, er, well, just because….

Jerry Henson
January 12, 2017 6:16 am

A major and overlooked benefit of carbon is the up welling natural gas
enriching soils dramatically in soils such as the very fertile Kansas and
the Ukraine. Microbes oxidizing the natural gas, fertilizing the topsoil,
the CO2 thus created further fertilizing the crops.
A stark example of the difference between soils fertilized by plumes
of natural gas and adjoining yellow jungle soils not so lucky is
Terra Preta in the Amazon, the difference erroneously attributed to
actions of long dead humans.
A better defined version of hydrocarbon fertilization is the natural gas
powering the islands of life at deep oceans “smoker” vents, first
imagined to be “sulfur” powered.

January 12, 2017 6:39 am

Good post Willis. I largely agree with your commentary but caution on trying to include what has been spent already when you say:
“Nowhere in any of this accounting do I find one of the largest and most important costs. This is how much it has cost us to date to fight CO2. There have been untold billions and billions of dollars wasted on Solyndras and useless studies and “Social Cost of Carbon” government boondoggles and all the rest of the money and human resources wasted. ”
These are sunk costs and do not belong in the cost benefit analysis themselves. If similar costs can be expected moving forward then absolutely those future costs need to be accounted for, which perhaps was your point.
Of course, these actions (Solyndra, etc) are fair game for any kind of post-mortem analysis of the carbon policy efforts (assuming society eventually sees the light) to try and learn from our mistakes.

Reply to  Willis Eschenbach
January 12, 2017 12:47 pm

The only reason progressive solutions don’t work is the government never spends enough money.

January 12, 2017 6:43 am

I have a rule of thumb of my own.
Putting the word “social” in front of anything negates it.
To understand what I mean, replace “social” with “not” and the true meaning is the same.
IE “social justice” equals “not justice”.
So “social cost” equals …

Reply to  MarkW
January 12, 2017 6:56 am

Social engineering. Which of course now means, “tricking someone into giving you their password”.

Reply to  MarkW
January 12, 2017 8:45 am

I came to the same rule.
Social science: not science.
Social movement: halt.
Social support: abandonment.

January 12, 2017 6:55 am

I keep trying to find an article about the VALUE of carbon, and, inevitably, the word, “value”, is substituted for the IDEA of NEGATIVE value (i.e., cost), which is an abusive slight of hand with language, in my opinion.
Here, for example, is an article that does this very slight of hand:
There is ZERO talk of any … value whatsoever. Rather, the assumption is AUTOMATIC that there is NEGATIVE value ONLY (i.e., cost).
Here, shaking my head, is another article baiting readers with the notion of VALUING carbon, only to flip flop and add the word “reduction” to the word “value” to discuss “value in REDUCING carbon” :
And here you go again, … a long-winded market-analysis type presentation of …“valuation”, which inevitably morphs AUTOMATICALLY into its OPPOSITE concept of “cost”:–2
CONCLUSION: With “carbon”, the word value = the word cost in most people’s minds. This is another twist of deviousness that is the mathemagic of climastrology.

Darrell Demick
Reply to  Robert Kernodle
January 12, 2017 12:41 pm

Try to find the following – hope this works:
Craig D. Idso, Ph.D., published a paper in October 2013 entitled, “The Positive Externalities of Carbon Dioxide: Estimating the Monetary Benefits of Rising Atmospheric CO2 Concentrations on Global Food Production” (Center for the Study of Carbon Dioxide and Global Change © 2013,
The link at the end does not appear to work – my fault entirely. Short answer is that Dr. Idso calculates that increasing CO2 concentration is responsible for almost 30 trillion dollars over the time frame of 1961 – 2050 (actual to 2011, forecast thereafter). That is the equivalent of $4,554/second, …. , for 90 years (that is not a typo). Unfortunately the “green” movement – is it truly estimated at $1.5 trillion/year? – overwhelms this by an order of magnitude, to the tune of $47,532/second.
Ouch. No wonder formal media push climate catastrophe – thars money in them thar hills!!! Money doesn’t talk, it screams or swears (or both).

Darrell Demick
Reply to  Darrell Demick
January 12, 2017 12:48 pm

It does work ….

Darrell Demick
Reply to  Darrell Demick
January 12, 2017 12:48 pm

The link ……
: )

January 12, 2017 6:59 am

The world has inarguably become richer through the consumption of fossil fuels. Economic growth continues. Therefore, future generations will be richer than we are. They will be less rich than they could be if we divert resources away from productive activity to useless activity, n this case by placing regulatory burdens on economic activity. There is therefore a clear future social cost o carbon regulation. If the government would like to give me a grant, say £250,000, I will produce a formula to work out how geeat that cost is.

January 12, 2017 7:08 am

Now let us do an analysis of Oxygen (O2), where we totally forget its function in supporting life, and, instead focus (with a great sense of being disturbed) on its horrible effect of oxidizing metal, causing insidious destruction of civilization’s infrastructure, and the woeful free radical damage that it does on human cellular structures and functioning to cause premature death by aging.
And let us do a much needed analysis on Water (H2O — or should I say, “hydrogen”), where we focus on its destructive power in flooding, and its most unfortunate consequence of posing safety risks to young children who stray near deep vats of it, to say nothing of the emotional distress it causes when it falls from the sky on our big outdoor wedding party that we spent, say, $75,000 to stage.
The VALUE of Oxygen is the cost of its damage.
The VALUE of Water is the cost of its damage.
Down is up. Up is down. Emptiness is form, and form is emptiness, or, in the case, of climate assessments, … “empty headed”.

Reply to  Robert Kernodle
January 12, 2017 9:56 am

To Robert Kernodle,
That dangerous oxgyen causes billions of dollars of damage!
Oxidation (rust) of iron and steel.
But it does have its benefits !

Gary Pearse
January 12, 2017 7:16 am

SCC is definitely the premier fraud to bring down quickly and this fine essay shows that it is a no brainer to defeat it if logic and common sense still have a place at the table. It is the justification for all the multi trillions that have already been wasted and it’s real purpose of outsourcing to a new world order government is not even being concealed anymore.
The whole AGW exercise was really aimed at bringing the USA political economy down. All of Europe had willingly surrendered to a neomarxbrothers dystopia and couldnt bear the unfavourable comparison to a vibrant innovative and prosperous USA. It was bad advertising for what they were doing. Now we will see the US having to rescue Europe from itself once again, if it isn’t too late for all the other things they’ve do e to themselves.
Perhaps in the aftermath of the crash of this fool’s enterprise, the biggest problems will be dealing with the millions of displaced persons from the AGW wreckage, cleaning up the failed and uneconomic monstrosities erected to “solve” the imagined problem, recreating, repurposing and slimming down research institutions and universities, cleaning up scientific and social science journals and totally rededicating K-12 for proper education.

January 12, 2017 7:32 am

‘It is a chimera, a scientific mirage.’
True ,but its one on which many careers have been built and much money made hence why it will be protected to the death by those cost/benefit measure on this show all ‘benefit ‘

David L. Hagen
January 12, 2017 7:38 am

SCC with emperical climate sensitivity – a net benefit?
In Social cost of carbon – going, going, gone!, the Cornwall Alliance highlights:

three scholars have published a paper challenging those (and many other) estimates of the SCC based on empirically driven estimates of climate sensitivity (warming to ensue from doubled atmospheric CO2 concentration after all climate feedbacks have had their effect . . . How badly? Enough that after correction, one widely used estimate falls by 30% to 50%, and another by 80%. . . .indeed, it could even turn out that the SCC is negative—that is, that CO2 added to the atmosphere brings more benefits than harms.

See: Kevin Dayaratna, David Kreutzer, and Ross McKitrick “Empirically-Constrained Climate Sensitivity and the Social Cost of Carbon” 2016

Integrated Assessment Models (IAMs) require parameterization of both economic and climatic processes. The latter include Ocean Heat Uptake (OHU) efficiency, which represents the rate of heat exchange between the atmosphere and the deep ocean, and Equilibrium Climate Sensitivity (ECS), or the surface temperature response to doubling of CO2 levels after adjustment of the deep ocean. Due to a lack of adequate data, OHU and ECS parameter distributions in IAMs have been based on simulations from climate models. In recent years, new and sufficiently long observational data sets have emerged to support a growing body of empirical ECS estimates, but the results have not been applied in IAMs. We incorporate a recent observational estimate of the ECS distribution conditioned on observed OHU efficiency into two widely-used IAMs. The resulting Social Cost of Carbon (SCC) estimates are much smaller than those from models based on simulated parameters. In the DICE model the average SCC falls by 30-50% depending on the discount rate, while in the FUND model the average SCC falls by over 80%. The span of estimates across discount rates also shrinks considerably, implying less sensitivity to this parameter choice.


Paul Penrose
January 12, 2017 7:55 am

Just like the IPCC, they started by assuming something not in evidence. In this case, that the non-monetized effects of burning carbon-based fuels is negative. This bias alone invalidates their analysis.

January 12, 2017 9:09 am

One of the tricks is to count the “cost” at say 2100 but ignore how much this would have slowed economic growth and the rise of people out of poverty. For example, say that CO2 would mean we incur 5% GDP costs in 2100 (which would be a huge number, except that GDP will keep rising in general). If the cost of preventing that harm leads to 10% less GDP in 2100, then we are better off absorbing the cost than trying to prevent it. I can get a 0% deductible on my car insurance, but this is not cost effective and hardly anyone does that.
One of the consequences of taking SCC seriously is EU policy which is banning vacuum cleaners that are strong enough to work properly — ignoring the fact that power does not equal total energy use since people will vacuum longer with such a vacuum. Likewise electric kettles that don’t heat, dryers that don’t dry. New buildings in various places like Germany are so energy efficient that people can hardly live in them–no air circulation, too hot at times too cold at others. These efforts effectively reduce people’s standard of living.

Craig Loehle
January 12, 2017 9:14 am

Costs: The US Forest Service has diverted huge amounts of money to studying climate change instead of into research that would help with forest management.
EPA has spent untold millions on reports about climate change and distorted management recommendations (e.g. for water quality) to “account” for future climate with guidance that cannot be followed.
The US Fish & Wildlife service has listed some species based mainly on climate change (e.g., polar bears) even while admitting in other listings that future impacts can’t be predicted. Such listings have economic costs.

January 12, 2017 10:11 am

“This introduces a whole new host of uncertainties—how and when and even whether things will change on the input side (emissions), how and when and even whether things will change on the output side (temperatures),”
Until a signal of ACO2 can be found in the temperature record there can be no calculation of cost. The only pathway for ACO2 to cause damage is to effect temperature. All of the perceived avenues of cost rely on unnatural warming with the possible exception of ocean PH reduction which so far can not be measured well enough to tell if it is changing let alone find an anthropogenic signal. There are several papers now that demonstrate a lack of reasonable correlation of ACO2 and atmospheric CO2 further undermining any spurious contention that the warming measured is attributable to ACO2.
I think this line of reasoning underscores Willis contention that calculation of SCC is not science.

Reply to  DMA
January 12, 2017 4:51 pm

DMA wrote:
“Until a signal of ACO2 can be found in the temperature record there can be no calculation of cost.”
Don’t hold your breath DMA – you will not find “a signal of ACO2 in the temperature record”, because if it exists it is drowned out by “the signal of temperature in the CO2 record”, which is clearly larger and is dominant.
Atmospheric CO2 lags temperature by ~9 months in the modern data record and also by ~~800 years in the ice core record, on a longer time scale.
Happy Holidays, Allan
To falsify the false global warming alarmist hypothesis, one only has to show that CO2 lags and does not lead temperature, and why, which I have done.

My hypothesis was discussed extensively in 2008-2009, because it contradicted the popular notion that increasing atmospheric CO2 primarily caused rising temperature, which was false. Both sides of the fractious global warming debate (the warmists AND the skeptics) bitterly contested my hypothesis.
The close dCO2/dt relationship and resulting 9-month lag of CO2 after temperature is now generally accepted, even among many warmists. The best counter-argument the warmists have suggested is that the ~9-month lag “must be a feedback effect”, which is a cargo-cult argument:
“We KNOW CO2 drives warming (our paychecks depend on it), therefore it MUST BE a feedback effect.”
… Here is one depiction of the subject dCO2/dt vs T relationship, although I think it is slightly different mathematically from my own, which I suggest is technically more correct.
If you want to check my math, the 2008 spreadsheet is here – see Figures 1 to 4.
I used UAH LT and Hadcrut3 for temperatures, and global CO2 concentrations back to 1979. The dCO2/dt vs T correlation holds.
In a separate unpublished spreadsheet I used Hadcrut3 and Mauna Loa CO2 back to 1958 and the correlation still held.
I no longer use the surface temperature data, Hadcrut or other, because I have lost confidence in its accuracy, especially due to all the recent “adjustments”.
In conclusion, I remain reasonably confident that the future cannot cause the past (in our current space-time continuum). 🙂
Regards, Allan
Post Script:
Statistician Bill Briggs also examined my hypo in 2008 using a completely different approach, and supported my conclusion (even though I did not like his methodology much. because it only examined a 12-month lag).
See also Humlum et al, January 2013, written five years after my paper:
– Changes in global atmospheric CO2 are lagging 11–12 months behind changes in global sea surface temperature.
– Changes in global atmospheric CO2 are lagging 9.5–10 months behind changes in global air surface temperature.
– Changes in global atmospheric CO2 are lagging about 9 months behind changes in global lower troposphere temperature.
– Changes in ocean temperatures explain a substantial part of the observed changes in atmospheric CO2 since January 1980.
– Changes in atmospheric CO2 are not tracking changes in human emissions.

Reply to  Allan M.R. MacRae
January 13, 2017 3:05 am

The rate dCO2/dt changes ~contemporaneously with global temperature, and its integral atmospheric CO2 lags temperature by ~9 months in the modern data record.
Regards, Allan
“Carbon Dioxide in Not the Primary Cause of Global Warming: The Future Can Not Cause the Past”
by Allan M.R. MacRae, Calgary Alberta Canada
Published in January 2008, updated Feb. 6, 2008
There is strong correlation among three parameters: Surface Temperature (“ST”), Lower Troposphere Temperature (“LT”) and the rate of change with time of atmospheric CO2 (“dCO2/dt”) (Figures 1 and 2). For the time period of this analysis, variations in ST lead (occur before) variations in both LT and dCO2/dt, by ~1 month. The integral of dCO2/dt is the atmospheric concentration of CO2 (“CO2”) (Figures 3 and 4).
The IPCC states that increasing atmospheric CO2 is the primary cause of global warming – in effect, the IPCC states that the future is causing the past. The IPCC’s core scientific conclusion is illogical and false.
While further research is warranted, it is appropriate to cease all CO2 abatement programs that are not cost-effective, and focus efforts on sensible energy efficiency, clean water and the abatement of real atmospheric pollution, including airborne NOx, SOx and particulate emissions.
The tens of trillions of dollars contemplated for CO2 abatement should, given the balance of evidence, be saved or re-allocated to truly important global priorities.

Reply to  Allan M.R. MacRae
January 13, 2017 3:18 am

Moderator please:
Figure 1 is shown twice in in my post at 3:05am today.
Can you kindly replace the above two identical Figures 1 with the following:
Thank you.
[graph links snipped in this comment to avoid repeats – done -Anthony]

January 12, 2017 10:48 am

Nothing says science to lay people like myself than speculation by Committe. Don’t beleive this comports with the scientific method we were taught in school.
Lets hope Trump clears this underbrush.

Joel Snider
January 12, 2017 1:18 pm

This is the pure socialist base of the eco-nut movement – the idea that, since the climate (or environment, or whatever) affects everybody, we (as in those in power) should be given the power to control your lives for the greater good.

Michael Kelly
January 12, 2017 4:46 pm

The disasters to befall people 83 years from now (if we “do nothing”) always brings this scene to my mind. [youtube

Reply to  Michael Kelly
January 12, 2017 4:49 pm

Just make the machine move 1000 times slower and have no one screaming.

Michael Kelly
Reply to  Cladis Advisory
January 13, 2017 10:19 am

Except that they are screaming, instead of stepping a couple of feet to the side. The latter is analogous to the inevitable adjustment people will make if any adverse climatic phenomena manifest themselves.

January 12, 2017 4:47 pm

Willis– Once upon a time you led me to a interesting number — the real value of a gallon of fuel or the real value of a kWh of electricity. If a person’s labor rate is $15/hour, the value of a gallon of gas is about $5000. A kWh is about $150. (By some slip of fate, 1 lb of coal = 1 kWh)… { 1 person might generate 100 watts continuous for 10 hours = 1 kWh… Might is a mighty big word here. 1 gallon of gas ~ 33 kWh.}
This points at the inverted aspect of the Social Cost of Carbon. Carbon made it possible for less time to be dedicated to cutting firewood. It made it possible for kids to spend more time studying other subjects than optimizing their musculature. More people could study the sciences. More people could become doctors and lawyers and such. Carbon has saved ever so many more lives than it has taken. It has removed people from deadly situations and put them into non deadly ones.
It takes far fewer people today to mine coal. It takes fewer people to harvest trees. All of this is directly tied to carbon. Making a solar panel without a carbon based power supply? Challenging … It can be done. The sacrifice necessary would be huge. Windmills find carbon also enticing…
Attempting to enlighten those on the other side of the aisle is not easy. One man with a pick axe in a coal seem can power a town all by himself. (maybe not a huge town). The town does not need much in the way of advanced technology to make it happen. A fire pit is enough to benefit from the beauteous bounty that is coal.

January 13, 2017 10:25 am

The phony SCC and carbon taxes are indeed an attack on the poor and working poor:
“The woman — a mother of four, with three grandchildren from Buckhorn, Ont. — asked Trudeau how she was supposed to afford a hydro bill that has risen above $1,000 a month and asked him to justify the federal government’s planned carbon tax.”

Reply to  PaulH
January 13, 2017 8:49 pm

Excerpt from the Global News article:
“In 2015, the most recent year for which data is available, Ontario utility providers disconnected nearly 60,000 customers from their electricity services for non-payment. Many of these customers, upwards of 95 per cent, were reconnected within two business days. At the end of 2015, more than 565,000 customers in Ontario were behind on their hydro bills to the tune of $172 million.”
Doltan McGuinty and Kathleen Wynn are the scounrels/imbeciles who did this damage to Ontario.
Justin is just a foolish fellow-traveler. He does things that feel good, not things that do good.

January 14, 2017 9:26 am

Spelling correction: “scoundrels/imbeciles”
Technical Note:
The two terms are NOT mutually exclusive.

Johann Wundersamer
January 19, 2017 7:55 am


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