Commercial, Energy Efficiency, GHG Emissions  -  November 17, 2022

White House Proposal to Protect Supply Chain from Climate-Related Risks

The Biden-Harris Administration is taking action to address GHG emissions and protect the Federal Government’s supply chains from climate-related financial risks. 

In support of President Biden’s Executive Orders on Climate-Related Financial Risk and Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability, the Administration is proposing the Federal Supplier Climate Risks and Resilience Rule, which would require major Federal contractors to publicly disclose their GHG emissions and climate-related financial risks and set science-based emissions reduction targets, according to a statement.

The proposed action is also an integral part of the President’s Federal Sustainability Plan, which set a goal to achieve net-zero emissions procurement by 2050. The Federal Supplier Climate Risks and Resilience Rule covers approximately 8% of the emissions associated with the Federal supply chain, which are estimated to be more than twice as large as the emissions from operating the Federal Government’s 300,000 buildings and 600,000 vehicles combined.

The proposed Federal Supplier Climate Risks and Resilience Rule calls for the largest suppliers including Federal contractors receiving more than $50 million in annual contracts would be required to publicly disclose Scope 1, Scope 2, and relevant categories of Scope 3 emissions, disclose climate-related financial risks, and set science-based emissions reduction targets.

Federal contractors with more than $7.5 million but less than $50 million in annual contracts would be required to report Scope 1 and Scope 2 emissions. All Federal contractors with less than $7.5 million in annual contracts would be exempt from the rule. Small businesses with over $7.5 million in annual contracts would only be required to report Scope 1 and Scope 2 emissions under the proposed rule.

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