Hidden Annual Climate Costs from U.S. Material Production: A New Study’s Findings
A recent study by the University of California Davis reveals that the United States’ material production carries a staggering $79 billion in hidden annual climate costs due to greenhouse gas emissions. These costs, unaccounted for in current market prices, effectively subsidize carbon-intensive industries and contribute to climate change.
Understanding the Key Findings
Externalized Emissions Cost
Lead author Elisabeth Van Roijen, PhD, explains, "The high price point is a common reason why low-emission alternative materials are not adopted voluntarily by industries. Accounting for the externalized cost of emissions could provide an economic basis for driving innovation and implementation of alternative material production methods."
Major Materials Affected
The study identifies nine materials that resulted in 427 million metric tons of CO2 emissions in 2018. The inclusion of climate costs in their prices could lead to significant cost increases for these materials:
- Cement: 62% increase
- Lime: 61% increase
- Gypsum: 47% increase
- Steel: 22%
- Plastics: 19%
Steel and plastics, despite their relatively lower fraction of market value, contribute over $20 billion each in annual climate costs due to their high production volumes.
Implications for Policy and Global Action
The report underscores the necessity for coordinated international action. Materials pricing localized to the US could lead to increased imports of cheaper, higher carbon-emitting materials from other countries. Given the global material demand, stakeholders call for further research into policy solutions to address climate impacts coherently worldwide.
Global Impact and Innovation
As material demand escalates, especially in emerging economies, the study emphasizes the importance of international collaboration. This will ensure sustainable practices are adopted across the board and mitigate the adverse effects on the environment.
Taking Action
The findings of this study highlight the urgent need to rethink our approach to material production. By factoring in the externalized climate costs, we can drive innovation and implementation of low-carbon production methods. Policymakers, industry leaders, and environmental advocates should take note and work towards policies that could shift the conversation from subsidy to sustainability.
You can read the full study here. Let’s discuss and implement a path towards reducing these hidden climate costs in the comments below.