AFTER AEP: THE CLIMATE CHANGE TORT AND THE SOCIAL COST OF CARBON - Articles

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Posted by: Lynn Pointer on May 16, 2012

By William Airhart

(Vanderbilt University Law School, May 2012)

 

The following is the Executive Summary of the winning entry in the TBA Environmental Law Section's 2012 Jon E. Hastings Memorial Award Writing Competition.  The full version of this article is available online at: https://www.tba.org/section/environmental-law-section.

 

Executive Summary

During the next half century, some form of federal regulation of greenhouse gas emissions is inevitable.  Over that same time, climate change will create winners and losers.  While farmers in the northern United States will enjoy longer growing seasons, for example, farmers in the southern United States will be faced with hotter temperatures and an increased likelihood of drought.  These climate change losers are unlikely to be fully compensated by a regulatory regime with broad applicability, and they will turn to the courts for relief.  Because climate change has a broad array of causes, plaintiffs will struggle to prove all of the elements of a climate change tort claim.  This paper argues that climate change plaintiffs should be able to rely on the social cost of carbon (“SCC”) metric to calculate damages and satisfy the harm element of a traditional tort.

Last summer, the Supreme Court decided American Electric Power Co, Inc. v. Connecticut, 131 S. Ct. 2527, No. 10-174 (2011) (“AEP”).  Plaintiffs in the case alleged that a group of electric power companies had emitted a collective annual total of 650 million tons of carbon dioxide, and in doing so had interfered with public rights in violation of both federal and state nuisance laws.  The plaintiffs had fashioned nuisance as a climate change tort.  The Court disagreed, unanimously holding that the federal Clean Air Act displaces federal common-law actions seeking abatement of carbon dioxide emissions from regulated fossil-fueled power plants.  In order to reach this holding, however, an equally divided Court first upheld the lower court’s jurisdiction over the nuisance claims.  Because the Court’s holding displaces only federal nuisance claims, the climate change tort remains alive and well in state courts, if only a plaintiff can craft a successful claim.

Tort law is a natural avenue for plaintiffs seeking compensation for damages caused by climate change; unlike statutory law, tort law is traditionally concerned in part with compensating victims for their losses.  Harm is a fundamental element of any tort action, and every tort allegation must be accompanied by a showing of harm or injury.  Normally, a plaintiff must have realized an actual loss in order to obtain relief.  Some alternative standards apply in the context of toxic torts, but the strategic climate change plaintiff will avoid alternatives and instead identify a concrete injury that has already been realized.  The loss of productive farmland stemming from increased temperatures or the loss of beachfront property due to rising sea levels are both examples of injuries that have already been realized.  When determining the extent of the injury, plaintiffs should be allowed to rely on the SCC metric to calculate damages.

The SCC metric, as determined by a federal interagency working group in 2010, estimates the present value of future damages caused by one metric ton of greenhouse gas emissions.  In other words, the SCC assigns a dollar figure (currently, $21) to every metric ton of carbon dioxide emitted in the United States.  To date, no one has recognized the potential utility of the SCC metric to project damages in climate change tort litigation.  The full import of the SCC metric, however, can be understood by referring back to the AEP decision.  At oral argument, Justice Ginsburg voiced her concern that climate change torts might force judges to become a “super EPA.”  Employing the SCC metric, however, should alleviate this concern.  Judges will not venture into uncharted territory because they will avoid adjudicating responsibility for climate change on an ad hoc case-by-case basis.  Instead, damages awards will be consistent and predictable across the country.  A metric ton of carbon dioxide will not be penalized at a higher rate in Tennessee than in Florida.

Using the SCC metric is not a cure-all for the damages posed by climate change, but it will provide some measure of relief to climate change losers, even if that relief is not perfect.  Many challenges lie ahead for plaintiffs pressing climate change tort claims.  Satisfying the harm element, however, should not be one of them.