Biden Administration Publishes Interim Social Cost of Carbon Values
Client Alert | 2 min read | 03.02.21
On February 27, 2021, the Interagency Working Group on Social Cost of Greenhouse Gases (Working Group) published interim values for the Social Cost of Carbon (S-CO2), Social Cost of Nitrous Oxide (S-N2O) and Social Cost of Methane (S-CH4) (collectively referred to as the Social Costs of Greenhouse Gases (S-GHG)). As we predicted in our prior client alert, the Working Group reinstated the values that had been established for these parameters immediately before the Trump Administration disbanded the Working Group in 2017. To that end, for 2021 the Working Group set S-CO2 at $51 a ton, S-N2O at $18000 a ton and S-CH4 at $1500 based on a 3% discount rate. These rates will replace the Trump Administration’s calculation of the Social Cost of Carbon, which included values as low as $1 based on a 7% discount rate. The new figure will be used on an interim basis while a Working Group readies the final values, which are expected in early 2022.
There are two main reasons why these interim figures are so much higher than the values used in the Trump Administration. First, the Working Group reverted to the lower three discount rates (2.5 percent, 3 percent, and 5 percent) that were used in regulatory analyses between 2010 and 2016. The lower the discount rate used, the higher the value assigned to future damages. Second, the Working Group elected to take into account global damages associated with release of greenhouse gases, rather than limiting the analysis to U.S.-only damages.
As we previously noted, a higher Social Cost of Carbon will make it more difficult for agencies to approve actions that cause the release of GHGs because the benefits must outweigh the heightened costs associated with such GHGs. Consequently, we expect there will be intense scrutiny on the underpinnings of the interim Social Cost of Carbon value, in particular, the appropriate discount rate. The Working Group stated that it will soon issue a Federal Register notice with a detailed set of requests for public comments on the new information presented in its notice, and we expect that affected industries – on both sides of the issue – could be gearing up for a battle.
Insights
Client Alert | 10 min read | 03.27.25
FinCEN Axes Corporate Transparency Act’s Reporting Obligations for U.S. Companies and U.S. Persons
Since December of last year, the status of the CTA has been in a state of perpetual flux, following a dizzying series of federal court rulings and FinCEN announcements. On February 28, 2025, we reported that FinCEN paused enforcement actions for entities required to report under the CTA’s Beneficial Ownership Information Reporting Rule (BOI Rule) until FinCEN issued an interim final rule providing new guidance regarding the BOI Rule’s requirements and associated deadlines. Then, on March 2, 2025, Treasury went a step further, indicating that it would altogether cease enforcement against U.S. citizens and domestic reporting companies for violations of the BOI Rule, explaining that it would instead issue proposed rulemaking to narrow the scope of the BOI Rule to “foreign reporting companies” only and set new reporting deadlines.
Client Alert | 3 min read | 03.27.25
Client Alert | 3 min read | 03.27.25
MoCRA Under the Trump Era: A Look at FDA's Monitoring and Enforcement Two Months In
Client Alert | 4 min read | 03.27.25