In a recent study published in Nature Climate Change, a team of researchers have discovered that the social cost associated with the gas nitrous oxide is too low and does not accurately represent the real costs associated with the gas’s use. Nitrous oxide or N2O, which is made up of two nitrogen and one oxygen atoms, is a greenhouse gas which poses threat to the Earth’s ozone layer. The study finds that the current social cost associated with nitrous oxide “does not account for stratospheric ozone depletion” (stratospheric refers to the stratosphere, the section of our atmosphere that includes our ozone layer). Updating the cost of nitrous oxide to take account for this threat could increase the cost by at least 20%, according to the study.
It is important to note that this is a discussion of social costs. The “normal” cost of something is however much it costs to acquire, produce, and/or sell the thing. The social cost of something is this normal cost plus some extra amount that takes into account the impact the thing has on people or the environment. It is common in discussions of greenhouse gases to discuss social costs because normal costs do not include damages caused by greenhouse gas emissions, like those associated with climate change and global warming. Greenhouse gases heat our planet and damage our ozone layer, but these effects come much after acquisition, sale, and use of the gases. So, by default, the social costs that a warming planet imbues on the entire world’s population are not accounted for in the normal cost of something which produces greenhouse gases, such as fossil fuels.
This study has found that the social cost of nitrous oxide is too low because it has not accounted for the harming potential nitrous oxide has towards the ozone layer, which protects the Earth from some harmful solar rays. Such damaging effects should be included in the cost of the gas because they plainly are a cost of its use. Updating such costs will help us realize precisely how expensive substances like nitrous oxide, and other greenhouse gases, truly are. Only by having an informed idea of what something costs can we make judgements about whether the benefits outweigh the cost.
Source: Nature Climate Change; NYU