Social Cost Of Carbon

Carbon emissions and GHG present a negative externality towards the global environment, yet these GHG emissions are not easily captured or represented in monetary terms. Several Methods have been used to estimate the value of carbon emissions that might arise from capital protects (Comhar. 2008): Marginal Abatement Cost of Carbon (MAC) or Avoidance Cost, and Social Cost of Carbon (SCC) or Damage Cost techniques. The social cost of carbon has been defined as the full effect on social welfare of emitting an extra ton of carbon (as carbon dioxide) at some point in time, over the lifetime of that ton in the atmosphere. The SCC measures the full global cost today of an incremental unit of carbon emitted now to the full global cost of the damage

The models that have been developed to estimate the social cost of carbon are connected to emissions and atmospheric changes and damages. Due to uncertainty in the extent and level of impacts brought about by climate change assumptions made include a discount rate to achieve a balance Marginal Abatement costs are used because they reflect the additional future damage from small changes in current emission and they always rely on the discount rate (Tol, 2005). The Social Cost of Carbon has been estimated at £70/tC with a range of £35 to £140/tC (Clarkson and Deyes 2002). Mangroves provide a number of benefits they are associated with various functions that include conservation of natural ecosystems. Through photosynthesis, mangroves ecosystems distribute soil nutrients and transport oxygen to living organism with their environment. Mangrove biomes bridge the ecosystems environments of the land and sea, their importance in stabilizing and reserving the peripheral ecosystems is unquestionable (e.g. every hectare of mangroves can feed 12 tons of living organisms. Placing an economic value on Carbon Sequestration is appropriate because like other ecosystems, mangroves have economic consequences application of monetary valuation is

(2009), this is useful because economic value of any resource-environment system lies in the contribution of its ecosystem services and functions to human well-being there are three main concepts. that must be identified the private costs and benefits versus the environmental social costs and gains, the environmental social costs and gains are usually distributed throughout society, rather than being paid or accrued directly to the company or organization that is undertaking a project. The environmental social costs become externalities; they must considered during decision making processes to ensure greatest efficiency. The outcome of carbon valuation (maximizing costs minus benefits) will depend on what is included in the categories of costs and benefits, valuation each of the goods and services, discount rate(s) used, risks and uncertainty undertaken and the Choice of “prices”: Current/real/shadow. In calculating costs and outputs, the varying amounts of the good or service results in a different price (or willingness to pay). There will be a marginal cost and marginal benefit for each