White House proposes legislation to reduce carbon emissions in US government supply chains

LinkedIn +

The Biden-Harris Administration has announced a proposal for a new rule requiring major Federal contractors to publicly disclose their greenhouse gas emissions and climate-related financial risks. The proposed ‘Federal Supplier Climate Risks and Resilience Rule’ would also see top-earning contractors set science-based emissions reduction targets.

This is one of the things US President Joe Biden is highlighting at the COP27 climate summit, currently taking place in Sharm El Sheikh, Egypt. The proposal is part of Biden’s ‘Federal Sustainability Plan’, which aims to ‘achieve net zero emissions procurement by 2050’.

If the rule was to be put in place, contractors receiving more than US$50 million in annual contracts would need to publicly disclose their Scope One, Scope Two, and some Scope Three emissions. These categories, outlined by the Greenhouse Gas Protocol, refer to direct, indirect, and external emissions. Contractors getting between US$7.5m and US$50m annually will only be required to release their Scope One and Two, direct and indirect, emissions data. Smaller businesses earning less than US$7.5m from government contracts would be exempt from the rule.

According to a White House statement, the US Federal Government is the world’s single largest buyer of goods and services, having spent over $630 billion last year alone. By implementing legislation demanding that contractors in the government supply chain are transparent about greenhouse gas emissions, the administration is hoping to manage emissions and ‘protect the Federal Government’s supply chains from climate-related financial risks’.

Share this story: