United States: Changes are coming to the Biden administration’s federal sustainability plan
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- A possible amendment to the Federal Acquisition Regulatory (FAR) would require federal agencies to consider the “social cost of greenhouse gas emissions” in purchasing decisions and to give preference to bids and contracts. proposals from suppliers with lower social costs of greenhouse gas emissions – such as the Buy America domestic preference policy.
- The decree establishes a “buy clean” policy, designed to promote the use of building materials with low intrinsic emissions.
- The General Services Administration (GSA) is responsible for ensuring that new leases are “green leases”, requiring annual reporting of greenhouse gas emissions, energy consumption, water consumption and gas. waste production.
President Joe Biden issued a Executive Decree on Catalyzing Clean Energy Industries and Jobs through Federal Sustainability on December 8, 2021, highlighting the role and initiative of the federal government “[a]is the nation’s largest landowner, energy consumer and employer ”, to“ build, purchase and manage electricity, vehicles, buildings and other operations to be clean and sustainable ”.
The Executive Decree (EO) and its support Federal sustainability plan monitor and build on two previous EOs linked to climate, Executive Decree on the fight against the climate crisis in the country and abroad (EO 14008, January 27, 2021) and Executive Decree on Climate-Related Financial Risk (EO 14030, May 20, 2021), as well as a notice of the draft regulation published by the Federal Acquisition Regulatory (FAR) Council in October 2021 (extended comment period Dec. 14, 2021 to Jan. 13, 2022), which invites comments on a potential amendment to the FAR to ensure that federal agency purchases minimize the risk of climate change.
This OE further energizes the Biden administration’s efforts to position the United States as a leader in the low-carbon economic transition to reduce net greenhouse gas emissions to zero, giving nearly all agencies federal power to play a role in reducing emissions. Furthermore, the directive is the latest in a series of actions aimed at reversing steps taken by the Trump administration’s broader deregulation initiatives to “unravel the bureaucracy.”
Objectives of the Federal Sustainability Plan
The Biden administration’s sustainable procurement initiatives have the potential to impact a wide range of industries, entrepreneurs and donors. At a high level, the Federal Sustainability Plan aims to achieve the following objectives:
- Net zero emissions purchases:Building on OE 14030, the Federal Sustainability Plan seeks to require public disclosure of greenhouse gas emissions by major federal contractors and corresponding reduction targets. Likewise, the FAR Council proposed an amendment to the FAR “to ensure that major government procurement by federal agencies minimizes the risk of climate change, including require that the social cost of greenhouse gas emissions be taken into account in purchasing decisions and, where appropriate and feasible,
favor offers and proposals from suppliers with a lower social cost in terms of greenhouse gas emissions. “
- Net zero federal buildings and leases: In one Memorandum to executive agencies (M-22-06)(published as part of the sustainability plan), the General Services Administration (GSA) is responsible for developing guidelines for “federal green leases” within 180 days of issuance of the OE to ensure that all new leases (including replacement, succession and replacement leases) entered into after September 30, 2023, “for at least 25,000 rentable square feet in a building where the federal government leases at least 75% of the total building area ”Are“ green ”leases. The memorandum provides that such “green leases” will require lessors to report to the agency “annual data on greenhouse gas emissions from facilities, energy consumption, water consumption and production of gas. waste “. New leases entered into after September 30, 2030 for more than 25,000 rentable square feet must relate to buildings with net zero emissions.
- “Buy it own” policy: The OE establishes a “Buy Clean” policy, encouraging the use of building materials with low emissions and intrinsic pollutants. A “Clean Procurement Working Group” is established to provide recommendations on policies and procedures within 180 days. Their task includes the identification and prioritization of pollutants and materials, “such as concrete and steel”, to be covered by the Buy Clean policy, “the mechanisms for collecting information on the environmental performance of treatment facilities. primary eligible materials, as well as recommendations for pilot programs to incentivize the purchase of low intrinsic emission materials. “
- Electricity without carbon pollution:EO orders US Secretary of Defense, Secretary of Energy and GSA administrator “to use the scale of federal electricity consumption to aggregate and accelerate new generation capacity electricity without carbon pollution to meet federal energy needs ”. As part of the sustainability plan, the government will work with utility providers to negotiate supply contracts that include carbon pollution-free electricity and energy storage. Agencies are also encouraged to explore options to increase energy and water efficiency, including the use of Energy Service Contracts (UESC) and Energy Saving Performance Contracts (ESPC).
- Net zero emission vehicles: The OE calls for 100% zero-emission vehicle acquisitions by 2035. As of June 30, 2022 and each year thereafter, agencies are required to submit a “strategic plan to transform their fleet into vehicles. zero emissions ”, which must include, among other things,“ a plan for the installation of the necessary recharging or refueling infrastructure;… and the consideration of energy storage technologies and ancillary services to support vehicle-network technology “.
Conclusions and takeaways
The latest EO and Sustainability Plan establish concrete goals, policies, and procedures to advance the Biden administration’s sustainable procurement goals. What makes this EO unique, compared to the Biden and Obama administration’s previous federal sustainability decrees, is that it is much broader in its objectives and parts of impact.
As such, it will be essential for companies to review and assess how the OE relates to their current and future federal activities and goals, as well as to prepare for the opportunities it will create. Federal contractors and donors can (and should) expect to see these policy principles incorporated into future procurement actions – and perhaps start taking steps to understand their current greenhouse gas emissions, as well as ways to reduce discounts.
While climate change remains a polarizing issue, and although we still grapple with excess executive power in federal procurement (see, for example, the federal contractor’s vaccine mandate), these initiatives are likely to encounter less resistance and will be implemented in a meaningful way, creating immediate effects and lasting impacts on the federal procurement landscape.
The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.
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