Each year, the federal government purchases about 50,000 new vehicles. Until recently, almost all of them ran on diesel or gasoline, contributing to U.S. demand for fossil fuels and encouraging automakers to continue focusing on fossil-fueled vehicles.
That’s starting to change, and a new directive that the Biden administration quietly issued in September will accelerate the shift.
The administration directed U.S. agencies to begin considering the social cost of greenhouse gases when making purchase decisions and implementing their budgets.
That one move has vast implications that go far beyond vehicles. It could affect decisions across the government on everything from agriculture grants to fossil fuel drilling on public lands to construction projects. Ultimately, it could shift demand enough to change what industries produce, not just for the government but for the entire country.
What’s the social cost of greenhouse gas?
The social cost of greenhouse gases represents the damage created by emitting 1 metric ton of carbon dioxide, methane and other greenhouse gases into the atmosphere.
These greenhouse gases, largely from fossil fuels, trap heat in the atmosphere, warming the planet and fueling climate change. The result is worsening storms, heat waves, droughts and other disasters that harm humans, infrastructure and economies around the world. The estimate is intended to include changes in agricultural productivity, human health, property damage from increased flood risk, and the value of ecosystem services.
It could shift demand enough to change what industries produce, not just for the government but for the entire country.
By directing agencies to consider those costs when making purchases and implementing budgets, the administration is making it more likely that agencies will purchase products and make investments that are more energy efficient and less likely to fuel climate change.
While only a fraction of the roughly $6 trillion that the U.S. government spends each year would likely be considered under the new directive, that fraction could have far-reaching impacts on the U.S. economy by reducing demand for fossil fuels and lowering emissions across sectors.
Estimating the cost
The Obama administration introduced the first federal social cost of carbon to incorporate climate risk in regulatory decisions. It’s calculated using models of the global economy and climate and weighs the valu…..