The social cost of carbon dioxide (SC-CO2) measures the monetized value of the damages to society caused by an incremental metric tonne of CO2 emissions and is a key metric informing climate policy. Used by governments and other decision-makers in benefit–cost analysis for over a decade, SC-CO2 estimates draw on climate science, economics, demography and other disciplines. However, a 2017 report by the US National Academies of Sciences, Engineering, and Medicine1 (NASEM) highlighted that current SC-CO2 estimates no longer reflect the latest research. The report provided a series of recommendations for improving the scientific basis, transparency and uncertainty characterization of SC-CO2 estimates. Here we show that improved probabilistic socioeconomic projections, climate models, damage functions, and discounting methods that collectively reflect theoretically consistent valuation of risk, substantially increase estimates of the SC-CO2. Our preferred mean SC-CO2 estimate is $185 per tonne of CO2 ($44–$413 per tCO2: 5%–95% range, 2020 US dollars) at a near-term risk-free discount rate of 2%, a value 3.6 times higher than the US government’s current value of $51 per tCO2. Our estimates incorporate updated scientific understanding throughout all components of SC-CO2 estimation in the new open-source Greenhouse Gas Impact Value Estimator (GIVE) model, in a manner fully responsive to the near-term NASEM recommendations. Our higher SC-CO2 values, compared with estimates currently used in policy evaluation, substantially increase the estimated benefits of greenhouse gas mitigation and thereby increase the expected net benefits of more stringent climate policies.

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Abstract. Evidence of the physical and economic impacts of climate change is a critical input to policy development and decision making. The potential magnitude of climate change damages, where, when, and to whom those damages may occur across the country, the types of impacts that will be most damaging, and the ability of adaptation to reduce potential risks are all important and interconnected. This study utilizes the reduced-complexity model, Framework for Evaluating Damages and Impacts (FrEDI), to rapidly assess economic and physical impacts of climate change in the contiguous United States (U.S.). Results from FrEDI show that net national damages increase overtime, with mean climate-driven damages estimated to reach $2.9 trillion USD (95 % CI: $510 billion to $12 trillion) annually by 2090. Climate-driven damages are largest for the health category, with the majority of damages in this category from the valuation estimates of premature mortality attributable to climate-driven changes in extreme temperature and air quality (O3 and PM2.5). Results from FrEDI also show that climate-driven damages vary by geographical region, with the Southeast experiencing the largest annual damages per capita (mean: $9,300 per person annually, 95 % CI: $1,800–$37,000 per person annually), whereas the smallest damages per capita are expected in the Southwest region (mean: $6,300 per person annually, 95 % CI: $840–$27,000 per person annually). Climate change impacts may also broaden existing societal inequalities, with Black or African Americans disproportionately affected by additional premature mortality from changes in air quality. This work significantly advances our understanding of the impacts from climate change to the U.S., in what U.S. regions impacts are happening, what sectors are being impacted, and which population groups being impacted the most.

Improvements in local surface water quality in the Mississippi River Basin (MRB) can contribute to the regional environmental goals of reducing hypoxia in the Gulf of Mexico. To inform estimates of the benefits of water quality policy, we use a choice experiment survey in a typical subwatershed of the MRB to estimate willingness to pay for local environmental improvements and helping to reduce hypoxia far downstream. We find that residents place large values on reduced local algal blooms, improved local fish populations and diversity, and meeting local commitments to help with the regional environmental problem.

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