Federal agencies can use social cost of carbon — for now

By Lesley Clark, Niina H. Farah | 05/27/2022 06:41 AM EDT

The Supreme Court rejected a Louisiana-led bid to block the climate metric. That means the Biden administration can use it to help set federal policies while the 5th U.S. Circuit Court of Appeals considers the broader case.

The Supreme Court.

The Supreme Court. Francis Chung/E&E News

The Supreme Court has rejected an emergency request to block the Biden administration’s use of a key climate metric, effectively preserving federal agencies’ ability to account for the costs of heat-trapping emissions — at least for the time being.

Yesterday, the justices declined to intervene and reinstate a Louisiana district court order that had blocked the administration from using the interim social cost of greenhouse gases to help set federal policy (Greenwire, May 26).

The metric puts a dollar figure on the costs of releasing emissions. Under the Biden administration, the value for carbon dioxide is about $51 per metric ton, a sharp reversal of the Trump administration’s $1 per metric ton.


The justices, without comment, rejected a Louisiana-led bid to suspend an order from the 5th U.S. Circuit Court of Appeals temporarily allowing the use of the calculation pending its ruling on the substance of the case.

A spokesperson for the Office of Management and Budget said the administration was “of course very pleased with the Supreme Court’s order.”

“Properly accounting for the harms caused by greenhouse gas emissions is critical to our work to reduce energy costs and protect Americans from the growing impacts of climate change, which is already costing American communities and businesses billions of dollars in mitigation and response,” the OMB spokesperson said.

Louisiana Solicitor General Elizabeth Murrill said in a statement that she was disappointed with the Supreme Court’s decision.

“[B]ut we are confident that we will be successful in reinstating the injunction after this matter is heard on the merits at the 5th Circuit. Briefing is underway,” she said.

“In the meantime,” she added, “we will continue to flag the government’s use of these numbers.”

Louisiana Attorney General Jeff Landry (R) had requested that the justices block a March order from the 5th Circuit, which had reversed an earlier injunction from Judge James Cain Jr. of the U.S. District Court for the Western District of Louisiana.

Cain, a Trump pick, had agreed with the Republican-led states that the federal government’s use of the interim metric had improperly imposed regulatory costs on states.

The district court ruling had been widely panned by observers as premature, since Louisiana and other states had brought their challenge to the court before the social cost of greenhouse gases had been applied to any finalized regulations that would have required state action.

In a note to clients yesterday, the research firm ClearView Energy Partners LLC said the ruling will enable the Biden administration to use the interim social cost of greenhouse gases in its review of projects “that would have been adversely impacted by the preliminary injunction,” as detailed in a previous Justice Department briefing.

ClearView added that the combination of the Supreme Court’s rejection of the emergency application, and the 5th Circuit’s denial, also doesn’t bode well for another related challenge to the interim metric — one that is before the 8th U.S. Circuit Court of Appeals. In that case, Missouri Attorney General Eric Schmitt (R) is challenging a lower bench decision last year that found his challenge to the social cost of greenhouse gases was premature.

Critics of Cain’s order said the high court had avoided undermining agency expertise.

“This would have stretched even the current Supreme Court to its outer limits to endorse that district court decision,” James Goodwin, an analyst at the Center for Progressive Reform, said of the high court decision.

If the court had ruled in favor of the application to the court’s emergency docket, the result could have set a precedent for federal judges to interfere “in a really intrusive way” in agency science, Goodwin said.

“That is not to say that that isn’t going to happen in another case, with perhaps more ‘favorable facts,’ but it didn’t happen here,” he said.

Max Sarinsky, a senior attorney with the Institute for Policy Integrity at New York University School of Law, said he was not surprised by the high court’s decision. The institute had filed a friend of the court brief in the appeals court, arguing that the administration’s metric was based on research and evidence.

“As the 5th Circuit has previously explained, it is not the judiciary’s role to instruct the federal government on what research it may currently pursue or apply in the future,” he said. He added that the district court “badly misapplied bedrock constitutional principles about the role of federal courts,” and its injunction was swiftly lifted.

Sarinsky said the ruling allows federal agencies to continue to apply available climate damage valuations to help write policy (Climatewire, May 26).

“The federal government incorporated the best available science and economics in developing those valuations, drawing heavily from the work of esteemed researchers, including a Nobel laureate,” he said, adding that the government is currently updating the numbers to include the latest evidence and that the ruling allows the update to continue.

Green groups welcomed the decision, with the Environmental Defense Fund calling the lower court’s injunction “the result of a profoundly flawed decision.”

The reprieve will allow the administration “to rely on the best available science and economics to address the climate crisis” while the Department of Justice presents its case to the 5th U.S. Circuit Court of Appeals, said Rosalie Winn, the fund’s director of methane and clean air policy.

“Climate change is an urgent crisis,” Winn said. “If we hope to protect ourselves from the worst climate damages, we need to act quickly using the best and most up-to-date science.”

The ruling comes as Biden’s ambitious plan to tackle climate change remains stymied in Congress. The Center for Biological Diversity’s Climate Law Institute said the order “simply allows the Biden administration to continue to use the social cost of carbon metric to evaluate the huge costs of climate pollution across all economic sectors.”

“These costs must be taken into account in creating climate policy,” said Maya Golden-Krasner, deputy director of the Climate Law Institute. “Now the Biden administration must get serious about fighting climate change by ending federal oil and gas leasing and stopping approvals for new fossil fuel infrastructure.”

This story also appears in Energywire.