Last year, WildEarth Guardians called out the U.S. Department of Interior for touting the economic benefits of its fossil fuel management program while completely ignoring the carbon costs.
The omission was significant. As we estimated, the cost of oil, gas, and coal produced from public lands managed by the Interior Department in 2013 could be in the billions and likely overshadows the economic “benefits” reported. These costs reflect the economic damages caused by carbon-induced climate changes, in other words, the costs that society absorbs in the form of extreme weather, rising sea level, higher air pollution, etc.
Since the release of our report, however, we’ve come to find out that we seriously missed the mark in our cost estimate. In fact, the latest studies indicate we underestimated total costs by more than 100%.
As a report published yesterday in the journal, Nature Climate Change, reports, carbon costs are not actually the $101 per ton we relied on in our report, but actually $220 per ton.
The study, completed by Stanford scientists, is a telling revelation that the cost of carbon is getting more expensive than ever as our understanding of climate-related economic damages is refined. The findings should sound an even shriller alarm over the need to significantly curtail greenhouse gases as quickly as possible. As a press release from Stanford bluntly points out:
Based on the findings, countries may want to increase their efforts to curb greenhouse gas emissions, said study co-author Delavane Diaz, a PhD candidate in the Department of Management Science and Engineering at Stanford’s School of Engineering. “If the social cost of carbon is higher, many more mitigation measures will pass a cost-benefit analysis,” Diaz said. “Because carbon emissions are so harmful to society, even costly means of reducing emissions would be worthwhile.”
In our July 2014 report, we estimated the total cost of oil, gas, and coal produced from public lands overseen by the Interior Department in 2013 to amount to more than $176 billion. Based on the latest $220 per ton estimate from Stanford, however, total costs are actually higher than $383 billion. With the Department of Interior reporting $121 billion in economic benefits, this amounts to a total cost of $262 billion.
In other words, in 2013, the overall cost of oil, gas, and coal produced from public lands was more than double the reported benefits.
On the flip side, this means that every ton of coal, every barrel of oil, and every cubic feet of natural gas kept in the ground is money in the bank. With carbon costs rising, it means that fossil fuels on our public lands are becoming more valuable in the ground than out.
Unfortunately, with the Interior Department’s Bureau of Land Management claiming that increased oil production was a “major accomplishment” in 2014, the value of keeping fossil fuels in the ground may not be sinking in yet.