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Estimating the Social Cost of Non-CO2 GHG Emissions: Methane and Nitrous Oxide

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  • Alex L. Marten
  • Stephen C. Newbold

Abstract

Many estimates of the social cost of CO2 emissions (SCCO2) can be found in the climate economics literature. However, to date far fewer estimates of the social costs of other greenhouse gases have been published, and many of those that are available are not directly comparable to current estimates of the SCCO2. In this paper we use a simplified integrated assessment model that combines MAGICC and (elements of) DICE to estimate the social costs of the three most important greenhouse gases—CO2, CH4, and N2O—for the years 2010 through 2050. Insofar as possible, we base our model runs on the assumptions and input parameters of the recent U.S. government inter-agency SCC working group. We compare our estimates of the social costs of CH4 and N2O emissions to those that would be produced by using the SCCO2 to value the "CO2-equivalents" of each of these gases, as calculated using their global warming potentials (GWPs). We examine the estimation error induced by valuing non-CO2 greenhouse gas emission reductions using GWPs and the SCCO2 for single- and multi-gas abatement policies. In both cases the error can be large, so estimates of the social costs of these gases, rather than proxies based on GWPs, should be used whenever possible. However, if estimates of the social cost are not available the value of non-CO2 GHG reductions estimated using GWPs and the SCCO2 will typically have lower absolute errors than default estimates of zero. Updated version posted 2-14-2012

Suggested Citation

  • Alex L. Marten & Stephen C. Newbold, 2011. "Estimating the Social Cost of Non-CO2 GHG Emissions: Methane and Nitrous Oxide," NCEE Working Paper Series 201101, National Center for Environmental Economics, U.S. Environmental Protection Agency, revised Feb 2011.
  • Handle: RePEc:nev:wpaper:wp201101
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    References listed on IDEAS

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    Cited by:

    1. Havranek, Tomas & Irsova, Zuzana & Janda, Karel & Zilberman, David, 2015. "Selective reporting and the social cost of carbon," Energy Economics, Elsevier, vol. 51(C), pages 394-406.
    2. Richard S. J. Tol, 2015. "Economic impacts of climate change," Working Paper Series 7515, Department of Economics, University of Sussex.
    3. Rhodes, Joshua D. & King, Carey & Gulen, Gürcan & Olmstead, Sheila M. & Dyer, James S. & Hebner, Robert E. & Beach, Fred C. & Edgar, Thomas F. & Webber, Michael E., 2017. "A geographically resolved method to estimate levelized power plant costs with environmental externalities," Energy Policy, Elsevier, vol. 102(C), pages 491-499.
    4. Weyant John, 2014. "Integrated assessment of climate change: state of the literature," Journal of Benefit-Cost Analysis, De Gruyter, vol. 5(3), pages 377-409, December.
    5. Robert w. Hahn & Robert A. Ritz, 2013. "Does the social Cost of Carbon Matter?: An Assessment of U.S. Policy," Cambridge Working Papers in Economics 1346, Faculty of Economics, University of Cambridge.
    6. repec:eee:energy:v:143:y:2018:i:c:p:585-596 is not listed on IDEAS
    7. repec:eee:ecoser:v:18:y:2016:i:c:p:175-185 is not listed on IDEAS
    8. Marcus C. Sarofim & Stephanie T. Waldhoff & Susan C. Anenberg, 2017. "Valuing the Ozone-Related Health Benefits of Methane Emission Controls," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(1), pages 45-63, January.
    9. Liu, Wei & Yin, Yafeng & Yang, Hai, 2015. "Effectiveness of variable speed limits considering commuters’ long-term response," Transportation Research Part B: Methodological, Elsevier, vol. 81(P2), pages 498-519.
    10. Marten, Alex L., 2011. "Transient temperature response modeling in IAMs: The effects of over simplification on the SCC," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 5, pages 1-42.
    11. repec:wsi:ccexxx:v:04:y:2013:i:01:n:s2010007813500012 is not listed on IDEAS
    12. Aaheim, Asbjørn & Mideksa, Torben, 2017. "Requirements to metrics of greenhouse gas emissions, given a cap on temperature," Ecological Economics, Elsevier, vol. 131(C), pages 460-467.
    13. Richardson, Leslie & Keefe, Kelly & Huber, Christopher & Racevskis, Laila & Reynolds, Gregg & Thourot, Scott & Miller, Ian, 2014. "Assessing the value of the Central Everglades Planning Project (CEPP) in Everglades restoration: An ecosystem service approach," Ecological Economics, Elsevier, vol. 107(C), pages 366-377.
    14. Tichavska, Miluše & Tovar, Beatriz, 2015. "Environmental cost and eco-efficiency from vessel emissions in Las Palmas Port," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 83(C), pages 126-140.
    15. Krupnick, Alan & Darmstadter, Joel & Richardson, Nathan & McLaughlin, Katrina, 2015. "Putting a Carbon Charge on Federal Coal: Legal and Economic Issues," Discussion Papers dp-15-13, Resources For the Future.

    More about this item

    Keywords

    social cost of carbon; global warming potential; integrated assessment;

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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