AGC Responds to Biden's Administration's Reformulating of the Social Cost of Greenhouse Gases

Learn more at July 20-22 virtual conference, free to AGC members

The Biden Administration reinstated the Interagency Working Group (IWG) on Social Cost of Carbon (or Greenhouse Gases, SC-GHG) and set a deadline to publish final values by Jan. 2022.  Currently, the SC-GHG values are used by federal agencies in decision-making and cost-benefit analyses of new rulemakings. The IWG chose the Obama Administration’s values as an interim measure.  AGC joined a coalition to provide substantive recommendations to the IWG on the steps ahead to ensure a clear and transparent process with full engagement.  The coalition urged the IWG to keep the focus of SC-GHG to the intended use, improve modeling/assumptions, address uncertainty, follow OMB guidance for evaluating opportunity costs, fix its analysis of intergenerational issues, and put global externalities into context.

Joint comments from AGC and other industry trade groups urge a narrow use of the SCC limited to the cost-benefit analysis for significant rulemakings (where permissible under an agency’s statutory authority), stating that “establishing these guardrails can ensure the estimates serve their intended purpose.”  The coalition letter notes “[t]he inherent inability to arrive at accurate and precise calculations of future impact of GHG emissions greatly limits the usefulness of SC-GHG as a tool to drive federal policy, including policy as it relates to the consideration of individual projects.”  For example, the SC-GHG “is particularly inappropriate for NEPA analyses.


One of the first executive orders signed by President Biden – Executive Order 13990, Protecting Public Health and the Environment and Restoring Science To Tackle the Climate Crisis – began a process to revise SC-GHG that are expressed as a dollar amount per metric ton of a GHG and intended to monetize GHG emission reductions and climate change resulting from each ton of GHG emitted.  While SC-GHG estimates were developed by the IWG during the Obama Administration, the group was disbanded under President Trump, so federal agencies have been relying on an “interim” SCC.  The Biden Administration has given the interim SCC a value of $51 using a discount rate of 3%; this is the figure the Obama Administration used, adjusted for inflation (compared to the $1 to $7 per ton used by the Trump Administration).  Per EO 13990, the IWG will recommend areas of use by Sept 2021 and publish the final SC-GHG estimates no later than January 2022. 

Learn More at July 20-22 Virtual Conference

The Biden Administration is taking an “all of government” approach to climate change. Join AGC and contractor members in a discussion on what that approach means for the construction industry---our projects and firms. Hear a briefing on administration actions related to climate so far, and how the cost of greenhouse gases may be factored into future regulations. Discuss how climate policies and trends may impact an owner’s decision on what to build---and how they want you to build it. Explore what the focus on greenhouse gases may mean for construction operations, equipment, risk, and materials. Find out how to get involved in AGC efforts related to climate.  Check out the agenda for more details on sessions, speakers, and discussion opportunities. Register today (free to AGC members).

For more information, contact AGC’s Leah Pilconis at

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