Social Cost of Carbon

SCC Requirements in Utility Resource Planning​

In May 2019, Washington state passed the Clean Energy Transformation Act (CETA). This law requires utilities to include the social cost of carbon in their resource planning. Utilities must use the social cost figures from the Interagency Working Group (IWG) on Social Cost of Carbon (SCC), using a 2.5 percent discount rate.

In Docket U-190730, the commission opted to use cost estimates from the IWG on Social Cost of Greenhouse Gases. The commission then adjusted these estimates to reflect 2022 dollars, using the Gross Domestic Product (GDP) Price Index from the U.S. Department of Commerce.

Adjusted Cost of Greenhouse Gas Emissions

The data is updated each year and outlines the SCC that utilities use to comply with CETA rules. For the years in between, like 2031 and 2032, the social cost values will be calculated using the same method.

Sources:
*IWG on the Social Cost of Greenhouse Gases Technical Support Document, Table 2. Revised August 2016.
**U.S. Bureau of Economic Analysis GDP Price Indexes, Table 1.1.4, Line 1. Revised May 2023.