The Social Cost of Carbon Doubles
The “social cost of carbon” — an influential figure used by policymakers to weigh the value of efforts that reduce greenhouse gas emissions — is outdated and underestimated. Updated estimates focused on the agricultural sector alone more than double the social cost of carbon, according to analysis from the University of California, Davis, and Purdue University.
The social cost of carbon represents the damage a ton of additional carbon dioxide will have on society and the economy, including agricultural productivity, human health, property damage due to flooding and energy costs.
The findings, published in the journal Nature Communications, show that for every additional ton of carbon dioxide emitted, the global economy loses between $3.50 and $8.50 due to effects in the agricultural sector, rather than gaining $2.70 as previously estimated. This leads the overall social cost of carbon to increase from $8.60 per ton of CO2 to between $14.80 and $19.70, an increase of 72 to 129 percent.
Climate change not a benefit to agriculture
Previous estimates were based on data from the 1980s and 1990s that suggested the short-term benefits of increased CO2 emissions on plant growth would benefit agriculture. The updated estimates show that climate change has an overall negative effect on agriculture.
Researchers analyzed more than a thousand published estimates of how crop yields from four global staples — wheat, rice, maize and soybean — respond to changing climate conditions.
The study found that higher temperatures have a negative effect on yields of all crops in almost all locations. For example, temperature increases of 2 degrees Celsius (3.6 degrees Fahrenheit) result in average yield losses of 11 percent for maize and 26 percent for wheat. These are only partially offset by the benefits from higher CO2 concentration, leading to net yield losses from climate change.
“The very early studies tended to show that the effects of warmer temperatures were not very severe and would be more than compensated by the beneficial effects of higher carbon dioxide concentrations,” said lead author Frances Moore, an assistant professor in the Department of Environmental Science and Policy at UC Davis. “Over the last few decades, as more work has gone into understanding how climate change might affect crop yields, science has found that hot temperatures themselves have large negative effects on crop yields.”
The study modeled the economic consequences of those yield losses in order to estimate the social cost of carbon. The authors found that a temperature increase of 2 C would result in economic losses of roughly 3 percent of the current value of the agricultural sector in sub-Saharan Africa and China, 2 percent in the United States, 11 percent in Central America, 9 percent in the Middle East and 2 percent in Western Europe.
One small part
“Agriculture is a small part of the global economy, so it’s surprising that when we put this all together, the social cost of carbon for the whole economy actually doubles,” said co-author Thomas Hertel, Purdue University distinguished professor of agricultural economics. “It makes you wonder about the other pieces.”
The National Science Foundation provided partial support to Purdue University for this study.