Question

Which one of the following statements best describes the term Social Cost of Carbon?
It is a measure, in monetary value, of the -

• A. long-term damage done by a tonne of CO₂ emissions in a given year
• B. requirement of fossil fuels for a country to provide goods and services to its citizens, based on the burning of those fuels
• C. efforts put in by climate refugee to adapt to live in a new place
• D. contribution of an individual person to the carbon footprint on the planet Earth

Answer 1

The Correct Option is A

The term "Social Cost of Carbon" refers to a concept in environmental economics that quantifies, in monetary terms, the economic cost of the damage caused by emitting one additional tonne of carbon dioxide (CO₂) into the atmosphere. The correct statement that best describes this term is:

1. Long-term damage done by a tonne of CO₂ emissions in a given year.

Here's the step-by-step reasoning:

• The Social Cost of Carbon (SCC) represents the estimated monetary value of the environmental and economic damages resulting from an additional tonne of CO₂ emissions.
• This includes various impacts such as agricultural yield changes, human health effects, property damages from increased flood risk, and changes in energy costs due to climate changes.
• By putting a price on the social cost associated with carbon emissions, policymakers and economists can evaluate the benefits of reducing emissions and implementing policies to fight climate change.

Let's explore why the other options do not describe the Social Cost of Carbon:

• Requirement of fossil fuels for a country to provide goods and services to its citizens: This statement refers to the energy needs of a country rather than the economic impact of CO₂ emissions.
• Efforts put in by climate refugee to adapt to live in a new place: This focuses on human displacement due to climate change, not the direct economic impact of emissions itself.
• Contribution of an individual person to the carbon footprint on the planet Earth: While this relates to CO₂ emissions, it considers individual impacts rather than societal costs.

In conclusion, the Social Cost of Carbon is a critical concept for understanding and addressing climate change's economic impact, enabling informed decision-making in policy and environmental economics.