United States:
Sustainable Procurement Far Case To Clarify Far Part 23
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Regulatory action around sustainable procurement and climate
change continues to heat up. A recent Federal Acquisition
Regulation (FAR) case on Sustainable Procurement takes another step
towards implementing the Biden administration’s ambitious
vision of leveraging federal procurement to confront the climate
crisis. FAR case 2022-006 will implement portions of Executive
Order (E.O.) 14057, on Catalyzing Clean Energy Industries
and Jobs Through Federal Sustainability, and OMB Memorandum
(“OMB Memo”) M-22-06 on procuring of sustainable
products and services. The FAR case will reorganize FAR Part
23 on Environment, Energy and Water Efficiency, Renewable Energy
Technologies, Occupational Safety, and Drug-Free Workplace for
consistency and clarity. The FAR case will also update the
definition of a “biobased product” in agency
affirmative procurement programs. A report on the draft
proposed rule is due on May 18, 2022. Additional guidance from
the Council on Environmental Quality (CEQ) is expected shortly and
may set off a further round of FAR cases.
Here is the essential context:
- Two FAR Cases Opened Last Year: The
latest climate-related FAR case joins two open FAR cases from last
year, which propose to implement different sections of E.O. 14030
on Climate-Related Financial Risk. FAR case
2021-015 anticipates implementing section 5(b)(i) of the E.O.,
directing the FAR Council to consider amending the FAR to require
major federal suppliers to publicly disclose greenhouse gas
emissions and climate-related financial risk while setting
science-based reduction targets. A draft proposed rule is
slated for internal FAR Council discussion on April 13,
2022. FAR case 2021-016 anticipates implementing section
5(b)(ii) of the E.O., and directs the FAR Council to consider
amending the FAR to ensure that major agency procurements minimize
the risk of climate change. An internal report on a draft
proposed rule is due to the Defense Acquisition Regulations Council
(DARC) on April 13, 2022. - E.O. 14057 Establishes Seven Sustainability
Goals: To put the nation on a path to net-zero
emissions by 2050, E.O. 14057 establishes seven government-wide
goals. The goals are: (1) 100 percent carbon pollution-free
electricity by 2030; (2) 100 percent zero-emission vehicle
acquisitions by 2035; (3) a net-zero emissions building portfolio
by 2045; (4) a 65 percent reduction in scope 1 and 2 greenhouse gas
emissions; (5) net-zero emissions from federal procurement; (6)
climate-resilient infrastructure and operations; and (7) a climate-
and sustainability-focused federal workforce. - Lifecycle Costing & Emission
Tracking: E.O. 14057 directs agencies to prioritize
reused, refurbished, or recycled products; maximize cost-savings
through full lifecycle cost methodologies; purchase products that
contain recycled content, are biobased, or are energy- and
water-efficient; and purchase EPA-identified or -recommended
sustainable products and services to the maximum extent
practical. The E.O. also directs agencies to pursue
procurement strategies to reduce contractor emissions and embodied
emissions in products acquired or used in federal projects, and
tasked the General Service Administration with tracking greenhouse
gas emissions by major federal suppliers. - OMB Guidance on Agency Targets and Third-Party
Standards: OMB Memo M-22-06, which accompanies E.O.
14057, directs agencies on immediate actions and further
requirements needed to comply with the E.O. In addition to
guidance on establishing agency targets, the OMB Memo instructs the
FAR Council to leverage existing third-party standards and systems
in developing regulatory amendments. The OMB memo echoes the
E.O. in stating that further “implementing
instructions” and “recommended actions” will be
issued by CEQ within 120 days of the E.O.’s
issuance. That deadline is now at hand.
Because of the generality of this update, the information
provided herein may not be applicable in all situations and should
not be acted upon without specific legal advice based on particular
situations.
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