Today, House Committee on Natural Resources Chairman Bruce Westerman (R-Ark.) led a letter with eight other members to U.S. Department of Defense Secretary Lloyd Austin, National Aeronautics and Space Administration Administrator Bill Nelson, Federal Acquisition Regulatory Council Chair Mathew Blum, Council on Environmental Quality Chair Brenda Mallory and U.S. General Services Administrator Robin Carnahan, requesting the withdrawal of a proposed federal acquisition regulation related to disclosure of greenhouse gas emissions and climate-related financial risk. In part, the members wrote:

"The Proposed Rule appoints a single entity—an international nonprofit called Science Based Targets Initiative (SBTi)—as judge, jury, and executioner. It grants SBTi the power to validate all ‘science-based targets,’ which are targets ‘for reducing GHG emissions that [are] in line with reductions that the latest climate science deems necessary to meet the goals of the Paris Agreement to limit global warming.’ The Proposed Rule requires that every major contractor develops science-based targets and submits them to SBTi for validation and widespread publication. Not only must the contractors pay thousands of dollars in fees for SBTi validation, but the Proposed Rule itself estimates that each contractor's annual costs associated with science-based target implementation will be hundreds of thousands of dollars...

"SBTi’s international nature raises further concerns. SBTi’s website states that the organization is ‘a global body enabling businesses to set ambitious emissions reductions targets in line with the latest climate science. It is focused on accelerating companies across the world to halve emissions before 2030 and achieve net-zero emissions before 2050.’ Because SBTi is a foreign- organization, headquartered in England and Wales, judicial recourse for U.S. companies saddled with an unfair validation process is limited. Clarity related to how SBTi will be held accountable by the FAR Council, DOD, GSA, NASA, or CEQ is also severely lacking in the Proposed Rule.

“Accordingly, the Committee firmly requests that DOD, GSA, and NASA withdraw the Proposed Rule, close FAR case 2021-015, and cease any progress towards a final rule."

Background

The proposed SBTi rule would require federal contractors to register their greenhouse gas emissions with an international nonprofit based in the United Kingdom. If finalized, contractors doing business with the federal government, which may not be their primary business, would be required to register their green house gas emissions with a foreign nonprofit.  The registration and verification processes are not free, and in many cases, could cost hundreds of thousands of dollars in, something many small businesses cannot afford. To make matters worse, the nonprofit selected by CEQ and others for GHG emissions registration has been subject to numerous complaints, and did not appear to go through a competitive bidding process.

The House Committee on Natural Resources has previously raised concerns over the proposed rule and the unmitigated disaster it would be for federal contractors. As the rule has moved forward, members are calling for its immediate withdrawal.