Federal Supplier Climate Risks and Resilience Proposed Rule would increase GHG emissions reporting requirements for federal contractors

In November 2022, the Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA) proposed an amendment to the Federal Acquisition Regulation (FAR), known as the Federal Supplier Climate Risks and Resilience Proposed Rule, to increase the transparency of climate-related information related to government contracting. 

The proposed regulation would require applicable federal contractors to: 

• disclose greenhouse gas (GHG) emissions for scopes 1, 2 and 3,  
• conduct a climate risk assessment to identify risks in alignment with the Task Force on Climate-related Financial Disclosures (TCFD), 
• complete the Carbon Disclosure Project (CDP) climate change questionnaire, and  
• commit to developing a science-based target validated by the Science Based Targets initiative (SBTi). 

Who does it affect?

The proposed rule divides the federal contractor supplier base registered in the System for Award Management (SAM) into two categories:  

1. Significant contractors are defined as contractors that received between $7.5 million and $50 million in federal contract obligations in the prior federal fiscal year.  
2. Major contractors are defined as contractors that received more than $50 million in federal contract obligations in the prior federal fiscal year.  

In FY2021 alone, there were more than 5,500 qualifying contractors. This proposed rule is expected to cover 86% of annual federal spending and about 86% of the federal supply chain’s GHG and climate impacts [1].  

See the requirements for each contractor category: