July 26, 2016 MEMORANDUM for LINDA NEILSON DEPUTY
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GSA Office of Government-wide Acquisition Policy July 26, 2016 MEMORANDUM FOR LINDA NEILSON DEPUTY DIRECTOR DEFENSE PROCUREMENT THRU: LORIN S. CURIT DIRECTOR FEDERAL ACQUISITION POLICY DIVISION OFFICE OF GOVERNMENTWIDE ACQUISITION POLICY FROM: HADA FLOWERS DIVISION DIRECTOR REGULATORY SECRETARIAT DIVISION SUBJECT: FAR Case 2015-024; Public Disclosure of Greenhouse Gas Emissions and Reduction Goals--Representation; Proposed rule Attached are the comments received on the subject FAR case published at 81 FR 33192, on May 25, 2016. The comment closing date was July 25, 2016. Seventeen comments were received. Response Date Commenter Organization Number Received 2015-024-1 07/01/2016 Warren Lavey Univ. of Illinois 2015-024-2 07/07/2016 Christopher Bangs Not Identified 2015-024-3 07/08/2016 Jeffrey Eric Grant Not Identified 2015-024-4 07/09/2016 Roger Prince Not Identified 2015-024-5 07/14/2016 Jack McChesney Applied Research Assoc. 2015-024-6 07/18/2016 Lance Pierce Carbon Disclosure Proj. 2015-024-7 07/25/2016 Brian Johnson Greenpeace 2015-024-8 07/25/2016 Nancy Young Airlines for America U.S. General Services Administration 1800 F Street, NW Washington, DC 20405 www.gsa.gov 2015-024-9 07/25/2016 Gretchen Goldman Union of Concerned Scientists 2015-024-10 07/25/2016 Colleen Morgan Corporate Sustainability Advisors, LLC. 2015-024-11 07/25/2016 Jim Bruce UPS Global Public Affairs 2015-024-12 07/25/2016 Jimmy Christianson Associated General Contractors of America 2015-024-13 07/25/2016 Andriy Shvab American Fuel & Petrochemical ManufacturersFPM 2015-024-14 07/25/2016 Christine Keck/ Energy Systems Group Gregory Collins 2015-024-15 07/25/2016 Howard Feldman American Petroleum Institute 2015-024-16 07/25/2016 Himani Phadke/ Sustainability Accounting Jean Rogers, Ph.D. Standards Board 2015-024-17 07/25/2016 Jim Coburn Ceres Attachments 2 7/1/2016 https://www.fdms.gov/fdms/getcontent?objectId=0900006482062bde&format=xml&showorig=false FAR Case 2015-024 Comment #1 As of: 7/1/16 8:27 AM Received: June 23, 2016 PUBLIC SUBMISSION Status: Pending_Post Tracking No. 1k08qd3pchi Comments Due: July 25, 2016 Submission Type: Web Docket: FAR20150024 Federal Acquisition Regulations: Public Disclosure of Greenhouse Gas Emissions and Reduction Goals Representation (FAR Case 2015024) Comment On: FAR201500240001 Federal Acquisition Regulations: Public Disclosure of Greenhouse Gas Emissions and Reduction Goals Representation (FAR Case 2015024) Document: FAR20150024DRAFT0002 Comment on FR Doc # 201612226 Submitter Information Name: Warren Lavey Address: 3104 Countrybend Lane Champaign, IL, 61822 Email: [email protected] Phone: 3122598868 General Comment See attached file(s) Attachments WGLFAR https://www.fdms.gov/fdms/getcontent?objectId=0900006482062bde&format=xml&showorig=false 1/1 FAR Case 2015-024 Comment #1 Federal Acquisition Regulation (FAR) Proposed Rule: Federal Acquisition Regulations: Public Disclosure of Greenhouse Gas Emissions and Reduction Goals-Representation (FAR Case 2015-024) Comments to the Department of Defense, General Services Administration, and National Aeronautics and Space Administration Warren G. Lavey June 23, 2016 Introduction I file these comments as an individual with relevant expertise. I am an adjunct professor at the University of Illinois. My experience in environmental disclosures and environmentally preferred purchasing includes: co-authored a report “Oil Shift: The Case for Switching Federal Transportation Spending to Alternative Fuel Vehicles” (American Clean Skies Foundation, 2012); submitted comments on the GSA-led procurement of domestic delivery services (DDS3) in 2012-14; contributed recommendations as part of the working groups for Powering Forward: Presidential and Executive Agency Actions to Drive Clean Energy in America (Center for the New Energy Economy, 2014) and the Climate Friendly Purchasing Toolkit (West Coast Climate & Materials Management Forum, 2015-16); drafted the purchasing goals and strategies in the University of Illinois’ Climate Action Plan (2015); presented purchasing strategies to the Illinois Green Governments Coordinating Council (2013-14); advised the Sustainable Purchasing Leadership Council (2014-16); and wrote an article on disclosing material environmental purchasing practices in Securities and Exchange Commission (SEC) filings (The Environmental Forum, March/April 2016). I support the proposed rule on public disclosure of greenhouse gas (GHG) emissions and reduction goals by suppliers to the federal government. Additionally, I support the proposed approach on public disclosure of risks faced by suppliers to the federal government as a result of extreme weather and other effects of climate change. Both proposals would be improved 1 FAR Case 2015-024 Comment #1 through small changes in the response options and additional details clarifying the terms. The following discussion provides policy analysis and suggested wording revisions. Policies and Precedent As the Notice correctly observes, the proposed representations would help the agencies implement Executive Orders 13693 and 13653. The proposal would also strengthen compliance with the SEC’s guidance on disclosing climate risks. Section 15(a) of E.O. 13693 provides that the Council on Environmental Quality (CEQ) shall annually identify and publicly release an inventory of major Federal suppliers using publicly available Federal procurement information, including information as to whether the supplier has accounted for and publicly disclosed, during the previous calendar year, annual scope 1 and 2 greenhouse gas emission data and publicly disclosed a greenhouse gas emission reductions target (or targets) for 2015 or beyond. With the issuance of E.O. 13693, the Administration released a Scorecard to publicly track self- reported GHG emissions disclosure and emissions targets for Federal suppliers with total USG contracts in FY 2014 exceeding $1 billion.1 The Scorecard reflected three levels of supplier performance for disclosure or targets: green (disclosed at minimum Scope 1 and 2 emissions in 2014; has a current GHG goal or target); yellow (commitment to disclose emissions in 2016; commitment to set a target in 2016); and red (no disclosure; no target). The White House statement observed that the Scorecard served “to encourage continued progress across the Federal supply chain”. In June 2015, CEQ provided instructions for implementing Section 15(a) of E.O. 13693:2 Supplier greenhouse gas inventories should be conducted in accordance with the GHG Protocol Corporate Standard or similar standard. Public disclosure means that the information is available and accessible to the general public, for example, by posting the information on the company's 1 CEQ, “Federal Supplier Greenhouse Gas Management Scorecard”; The White House, “FACT SHEET: Reducing Greenhouse Gas Emissions in the Federal Government and Across the Supply Chain” (Mar. 19, 2015). 2 CEQ, “Implementing Instructions for Executive Order 13693, Planning for Federal Sustainability in the Next Decade” at 68 (June 10, 2015). 2 FAR Case 2015-024 Comment #1 website; through a company sustainability report, annual report, or similar document; or by reporting annual emissions and/or targets to an emissions reporting program or registry. As for E.O. 13653, two sections focus on identifying suppliers’ vulnerability to extreme weather and other climate change risks, and encouraging suppliers to assess and mitigate these risks. Section 5(a) requires agencies to develop Agency Adaptation Plans, which evaluate significant climate change risks to operations and missions, and outline agencies’ actions to manage these vulnerabilities. In particular, the agencies must describe how they will consider the need to improve climate adaptation and resilience with respect to agency suppliers and supply chain. In addition, Section 4(a) directs DOD, NASA and other agencies to “develop and provide authoritative, easily accessible, usable, and timely data, information, and decision-support tools on climate preparedness and resilience”. Finally, the Notice refers to the SEC’s 2010 Guidance Regarding Disclosure Related to Climate Change. This Guidance was intended to assist registrants’ management determine whether climate change-related issues were material, and confirmed that, if material, registrants should provide climate change-related disclosures.3 According to comments filed with the SEC4 and a New York Times article in 2016,5 there are widespread concerns from institutional investors, legislators, state authorities, and others that registrants are not adequately addressing climate change risks. The SEC appears to be doing little to encourage companies to assess, manage and disclose climate change risks; the SEC issued 49 comment letters to companies addressing the adequacy of their climate change disclosures in the two years after releasing the Guidance, but only three such letters in 2012 and none in 2013.6 In contrast, the FAR Notice observed the “growing Federal and public interest in better understanding operational and supply chain risks facing agency suppliers and steps those suppliers are taking to identify and manage those risks.” 3 SEC, “Business and Financial Disclosure Required by Regulation S-K; Concept Release” at 38 (2016). 4 Id. at 208. 5 Gelles, D., “S.E.C. Is Criticized for Lax Enforcement of Climate Risk Disclosure”, N.Y. Times (Jan. 23, 2016). 6 Id, 3 FAR Case 2015-024 Comment #1 The proposed FAR revisions would strengthen disclosures related to climate change,