A powerful policy tool that puts a price tag on greenhouse gases has reemerged as a flashpoint in the courts and in Congress, the latest development in an ideological tug-of-war that has played out for most of the Biden administration.

The White House has been developing updated estimates for the tool, known as the social cost of carbon, since the day President Joe Biden took office. The metric is a dollar estimate of the harm to the economy caused by releasing one ton of planet-warming carbon dioxide, taking into account such variables as lost agricultural productivity, property damages from strong storms, and diminished fresh water availability.

The administration hasn’t issued a one-size-fits-all metric for usage across all agencies. Biden signed an executive order in 2021 that directed an interagency working group to publish social costs of carbon, nitrous oxide, and methane by January 2022. But those numbers still aren’t out.

In December, the working group said the scientific literature has evolved recently, and it told agencies to use their judgment to determine which estimates of the social cost of greenhouse gases “reflect the best available evidence, are most appropriate for particular analytical contexts, and best facilitate sound decision-making.”

To one Republican aide on the Senate Environment and Public Works Committee—who, like other congressional and White House aides interviewed for this report, was granted anonymity to discuss the committee’s work—the working group’s language basically gives federal agencies carte blanche to set the costs wherever they like.

The Environmental Protection Agency, for example, has pegged the social cost of carbon at $190, nearly four times the $51 interim figure established shortly after Biden took office. By contrast, under the Trump administration the price dipped as low as $1 a ton.

The Biden administration repeatedly urges lawmakers and the public to trust them, the aide said. But its December statement was only half a page long, raising questions about whether the working group has the data—or, if it does, whether it’s not sharing the data with congress or the public, the aide said.

In response, a White House official said it’s not unusual for agencies to do their own analyses, and that all relevant agencies had an opportunity to provide feedback to the EPA when it undertook its analysis.

The White House official also said the EPA had an interest in developing its own estimates based on developments in the scientific literature because it was trying to get several rules out the door. In the meantime, the interagency working group’s efforts are ongoing, the official said.

Lawmaker Interest

Some of the confusion over the social cost of carbon was on view during a recent hearing before the Senate Environment and Public Works Committee.

Scott Spellmon, commanding general of the US Army Corps of Engineers, said “there is a dollar figure” the agency uses when incorporating the social cost of carbon into its decisions, but he wasn’t able to tell Sen. Shelley Moore Capito (R-W.Va.) what that figure is. The Army Corps didn’t respond to a follow up interview request.

Max Sarinsky, senior attorney at the Institute for Policy Integrity, said both the EPA’s $190 figure and the $51 interim figure from the interagency working group were developed through a rigorous process, so other agencies should be able to use either number without worrying about their trustworthiness. The EPA’s numbers are “the better choice moving forward,” Sarinsky said, because they draw on newer evidence than the working group’s.

But that does little to placate Republicans, who continue to press the administration for answers.

Another Republican aide on the Environment and Public Works Committee said it appears that the working group is either ignoring the president’s executive order or purposefully concealing its final numbers, possibly as a way to justify what Republicans have deemed Biden’s “radical climate agenda” and hurting American energy workers and producers.

Republicans also worry that the social cost of carbon is being used more expansively.

In September, the White House issued a memo telling federal agencies to consider using the metric when developing their budgets, reviewing project permits, and purchasing goods. That could affect the way agencies calculate how large fines should be for violators, how they measure the success or failure of their programs, how they decide which grant applicants get awards, and how they evaluate foreign aid.

Legal Disputes

The social cost of carbon is also being debated in the courts between agencies and groups challenging approvals for fossil fuel projects.

The Federal Energy Regulatory Commission is one of the agencies navigating how—or if—it can implement the metric.

FERC said in a February brief that the Code of Federal Regulations doesn’t require the use of the social cost of carbon protocol “as it is not generally accepted as a scientific method to estimate environmental impacts for a specific project.”

“It was not developed for project-level reviews and there is no generally accepted threshold for assessing whether a particular amount of emissions is significant,” the commission said in response to a challenge to its approval of a liquefied natural gas export terminal in Texas.

FERC reiterated that sentiment when responding to a challenge against its approval for two interstate natural gas pipelines, saying the “social cost is not generally accepted for determining the ‘significance’ of individual projects’ effects” under the National Environmental Policy Act.

Despite asserting there’s no legal mandate, the commission said it’s calculated the social cost of greenhouse gas emissions stemming from projects “for informational purposes.” FERC used that phrase again when defending authorizing a natural gas expansion project in New Jersey, but didn’t elaborate on what it refers to.

“The Commission did disclose the social cost of greenhouse gas emissions values over the 20-year period of the assumed Project life for informational purposes, which is consistent with the Commission’s practice for other projects,” it said in its October brief.

Marcella Burke, former deputy solicitor for energy and natural resources at the Interior Department, said when social cost of carbon cases came before her office, “they fell depending on the politics of the judge.”

As a result, many companies may be choosing to wait until the November presidential election before deciding to litigate, said Burke, now managing partner at Burke Law Group PLLC. But even before that happens, the Supreme Court may decide to overturn the Chevron doctrine of deferring to agencies’ expertise.

Sarinsky said Chevron deference affects agency interpretations of ambiguous statutes, so if the social cost of carbon can be framed as a factual, scientific finding, it likely won’t be implicated.

But in theory a party could mount a legal challenge to an agencies’ use of the social cost of carbon, claiming that a federal agency doesn’t have the statutory authority to consider monetized climate impacts—at which point “the jig may be up,” Burke said.