What is the social cost of carbon?

The social cost of carbon represents an estimate of the economic damages associated with an increase in carbon dioxide emissions. It quantifies the monetary value of the negative impacts that each additional ton of carbon dioxide emitted has on society, which includes damages related to climate change such as health problems, decreased agricultural productivity, property damages from increased flood risk, and other environmental and social impacts. This concept is essential for policymakers as it helps in evaluating the trade-offs of carbon regulation and the cost-effectiveness of various climate-related initiatives.

In contrast, other answers refer to different aspects of carbon and climate policy. The market value of carbon emissions pertains to how emissions are traded or priced in carbon markets, but it does not capture the broader societal impacts. The cost of carbon capture technologies focuses on the financial aspect of removing carbon from the atmosphere rather than the social impacts of emissions. Financial investment in renewable energies addresses how funds are allocated to alternatives to fossil fuels, which is a proactive step in mitigating carbon emissions but doesn't quantify the costs of existing carbon emissions. Thus, the estimate of global damages from additional carbon emissions accurately reflects the broader implications of carbon dioxide release on society as a whole.