With every new presidential administration comes new priorities. For President Biden's administration, one theme stands out: climate change. One early action in this arena could impact the trucking industry. Namely, a recent executive order seeks to change the "social cost of carbon" calculation. Under the Obama administration, the social cost of carbon was estimated at $42 per ton. The Trump administration set it at $8 per ton. Some estimate that a Biden administration price tag could be as high as $125 per ton.

How does this impact trucking? Federal rule-makers are required to consider the costs and benefits of significant new regulations. With a higher cost of carbon, fuel efficiency gains help the benefits of related rules pass the cost-benefit test much quicker.

Trucking-related rules likely to get a boost from the new calculation:

• Mandatory speed limiters. We know what you're thinking, "but isn't the speed limiter rule about safety?" Some say yes but, let's remember that FMCSA and NHTSA declined to estimate the number of crashes avoided in their last notice on this issue and demonstrated the benefits of the rule in terms of fuel efficiency gains.
• New trailer and tire regulations.
• New engine efficiency requirements.

All these rules cost consumers but, at $8 per ton, it takes a lot more benefit (e.g., carbon emissions reduction) to justify the cost. $125 per ton will get them there much quicker.