Equitable Assignment of Standing for Intergenerational and International Environmental Policies
Recently, the U.S. Environmental Protection Agency (“EPA”) issued a final rule updating valuations of the social cost of greenhouse gases (“SC-GHG”), which measure the global economic loss caused by the emission of greenhouse gases. The ability to monetize the costs and benefits of regulation is an exceptionally relevant component of regulatory impact analyses as the finding of a favorable cost-benefit balance is crucial to the enaction of policy. In the environmental context, the SC-GHG is the most important measure for cost-benefit analysis of ameliorative climate change policies. Mortality costs comprise the major component of the SC-GHG and may result from both the direct and the indirect impacts of climate change—which vary greatly depending on the temporal and geographic context under consideration.
The valuation of risks to future lives raises concerns along these two dimensions. Future assessments intrinsically involve the consideration and weighting of intertemporal impacts, which become particularly pronounced when very remote time periods—such as those involved in modeling climatic futures—are involved. Because climate change is a global problem, there is also an international dimension to valuation. Countries may differ on their assessment of the benefits associated with reduction of climate-change-related mortality risks and on the discount rate that reflects their intertemporal preferences. Variation along these dimensions greatly influences the measure of SC-GHG. SC-GHG estimates have previously been the subject of litigation, and judicial scrutiny of these measurements will only increase in a post-Chevron era. In each instance, the court has upheld the use of the SC-GHG in performing regulatory impact analyses, but recently federal appellate courts have signaled a willingness to strike down regulations justified through controversial SC-GHG estimates. Thus, it is imperative that the measures be based in solid economic and scientific reasoning.
This Article explores the intertemporal and international valuation of mortality risks in the context of climate change, drawing on insights from the structure of pertinent statutes and the manner in which courts and federal agencies have historically addressed the valuation of environmental harms. We develop six interrelated principles for valuing environmental policy impacts internationally and intertemporally: (1) federal agencies should account for future generations in regulatory impact analyses; (2) federal agencies should use country-specific preferences to monetize future mortality risks; (3) assessments of the global costs of greenhouse gases (“GHGs”) should use discount rates that reflect the country’s intertemporal preferences; (4) estimates of the global costs of GHGs should also report country-specific estimates; (5) more affluent countries should subsidize countries with a low share of domestic benefits; and (6) courts should allow for the representation of future generations in present environmental litigation. The organizing theme of our framework is that there should be full recognition of the impacts of current policies on affected populations across time and, when relevant, across countries. As part of this full recognition, the assessment of the benefits of these policies should be valued based on the preferences of the affected populations. The principles developed in this Article may appear straightforward and clearly desirable, but they would induce a major departure from current practices. Still, recognizing the costs and benefits of environmental policies—accounting for both intergenerational and international differences—will be more legally sound and ensure environmental equity across generations.
