In recent days, PACE has pointed out how the president’s recent announcement on climate action and energy are bad for American consumers and businesses. Thankfully, members of Congress who are also concerned that this plan might substantially raise energy prices are also speaking out.
In a recent letter to key energy officials in the administration, a group of Senate leaders led by Ranking Environment and Public Works Member Senator David Vitter (LA) challenged the administration’s calculations on the social cost of carbon. Vitter was joined by Senators Roy Blunt (MO), Jeff Sessions (AL), John Barrasso (WY), James Inhofe (OK), Roger Wicker (MS), and John Boozman (AR). Together, the group questioned a recent update by the administration of the Social Cost of Carbon (SCC), a document that serves as the government’s official calculation of the downsides of carbon dioxide emissions. This calculation is crucial because it is weighed against actual costs to the economy and consumers when analyzing the cost-benefit of environmental regulations such as the ones President Obama and EPA are proposing.
“We are troubled by reports on the updated estimate, especially the continued use of lower discount rates that appear to diverge from the Office of Management and Budget’s (OMB) own existing guidance and the apparent lack of stakeholder involvement in the effort,” the letter states. “While the discount rates remain unchanged from 2010, the fact remains that the new SCC for 2013 increased from $22 to $36 per ton of carbon dioxide emitted (a more than 60 percent increase).”
The senators correctly point out that the discount rate chosen by the administration has huge impacts on the calculated price of carbon. Under one scenario, carbon is priced at$11 per ton. Under another, the price soars to $52 per ton. Such significant discrepancies in modeling outcomes have led some to believe that the administration is “cooking the books” on the social cost of carbon to make its environmental regulations appear more attractive.
Other leaders in Congress have spoken about the way the president’s energy plan hurts constituents. For example, in remarks on the House Floor recently, Representative Martha Roby (AL) outlined the concerns of several energy consumers in the state’s 2nd Congressional District.
Roby and other congressional leaders are fearful that constituents will see higher energy bills in light of new environmental regulations and plans to tax carbon dioxide emissions.