A University of Alberta law professor is calling for a levy on carbon emissions that would compensate vulnerable populations for harms caused by climate change.
In a recent study published in Climate Law as a tribute to environmental law scholar Meinhard Doelle, Adebayo Majekolagbe and his co-authors, Dave Wright and Sara L. Seck, make the case for a monetary value — expressed in dollars per metric tonne of carbon dioxide released into the atmosphere — that reflects damages to human health, community, property and fragile ecosystems in the wake of extreme weather events.
The levy could contribute to a global fund to support those adversely affected, says Majekolagbe.
“When it is assessed that a project will emit X tonnes of greenhouse gases, the social cost of emissions should be calculated,” says Majekolagbe, “and a percentage of that cost should be remitted into a loss and damage fund to help those most vulnerable to and impacted by climate change in Canada and globally.”
Calculating socio-ecological harm in monetary terms may be a crude measure, but for now it’s the best one we have, he says.
“You want to make the impacts of climate change as vivid as possible, and people understand the language of money.”
Damages might include lost agricultural productivity or property lost to flooding, but also non-market damages to human health, living conditions and natural ecosystems. Canada does not currently consider loss and damage due to climate change in impact assessments, says Majekolagbe.
According to the study, the social cost of carbon is not about connecting emission sources to specific harms. Rather, it acknowledges that there are immense costs borne in the most vulnerable parts of the world when greenhouse gas is emitted.
“The conversation is more about the inherent harm in the emissions of carbon from fossil fuel,” he says. “We know that it would in some way contribute to actual, eventual harm, but our figures would reflect the potential harm.”
Majekolagbe stresses that any just climate change impact assessment framework should also account for the social costs of transitioning away from fossil fuels to greener energy — such as impacts on the well-being of fossil fuel workers, their families and host communities.
“It's not just the social cost of carbon; a just transition recognizes the social cost of the transition.”
Much of the work estimating the social cost of carbon has already been done by groups in the U.K., the U.S. and Canada, according to the study. During the administration of former U.S. president Barack Obama, Canada and the U.S. formed interagency working groups to arrive at more accurate modelling and values for that cost.
In 2018, Canada endorsed a joint statement on North American climate leadership, promising to “promote opportunities to use the social cost of carbon appropriately across a wide range of policy applications.” In 2020 the federal government committed to aligning the social cost of carbon with “the best international climate science and economic modelling.”
Canada’s current tax on carbon is $65 per tonne (up from $20 in 2019) and is set to increase to $170 per tonne by 2030. Much of the tax is returned to individuals from whom it is collected as a rebate, but that is often not where it is most needed, says Majekolagbe.
“The rebate goes back to Canadians without discrimination between those most impacted by climate change and those who are not,” he adds. “More importantly, it fails to recognize that persons and communities most impacted by the emissions are outside Canada.”
The tax also falls well short of the true social cost per tonne, currently estimated in Canada at $262 per tonne, which if collected could go much further in mitigating social harm on a global scale, says Majekolagbe.
So far, the social cost of carbon number is primarily symbolic. But he and his team are hoping to change that, with possible future projects on guidelines on how the social cost of carbon and impact assessment could be useful instruments for addressing loss and damage.
It’s frontier thinking, since no legal framework for compensation currently exists anywhere. But it’s an area of policy development in which Canada could take the lead, says Majekolagbe.
“People impacted the most by climate change are those who are already vulnerable,” he says. “Let’s not just put figures on paper — let’s give policy real teeth and translate it into redress for those suffering the worst impacts.”
