A few years ago in there were a lot of data points where people calculated the social cost of carbon at $100 and lobbied the incoming Biden administration to adopt $100 as the government's social cost of carbon. I remember around that time people talking about the $100 target for DAC cost and it made sense to me that the social cost of carbon must be equal to the terminal DAC cost, because theoretically this is the price where it would be economically rational (and not purely catalytic) for society to purchase CDR.
I assumed it was not a coincidence when EU ETS prices rallied and were capped at 100 euros in '22 and '23.
Most recently, the EPA calculated the social cost of carbon at $190 per tonne but there doesn't seem to be any effect on how people talk about DAC/ CDR affordability or emissions trading markets.
I wonder if anyone reading has a more scientific or authoritative view on the relationship between the social cost of carbon circa 2020 and pricing targets in the various carbon trading markets / the origin of the mythical $100 CDR carbon tonne.
Great article/pod Susan !
re: $100 price:
A few years ago in there were a lot of data points where people calculated the social cost of carbon at $100 and lobbied the incoming Biden administration to adopt $100 as the government's social cost of carbon. I remember around that time people talking about the $100 target for DAC cost and it made sense to me that the social cost of carbon must be equal to the terminal DAC cost, because theoretically this is the price where it would be economically rational (and not purely catalytic) for society to purchase CDR.
I assumed it was not a coincidence when EU ETS prices rallied and were capped at 100 euros in '22 and '23.
Most recently, the EPA calculated the social cost of carbon at $190 per tonne but there doesn't seem to be any effect on how people talk about DAC/ CDR affordability or emissions trading markets.
I wonder if anyone reading has a more scientific or authoritative view on the relationship between the social cost of carbon circa 2020 and pricing targets in the various carbon trading markets / the origin of the mythical $100 CDR carbon tonne.