Defense contractors will not have to disclose their greenhouse gas (GHG) emissions as a condition of receiving a contract, at least for a year, congressional authorizers say in their annual defense policy bill.
“During the one-year period beginning on the date of the enactment of this Act, the Secretary of Defense may not require that any individual or entity other than a nontraditional defense contractor, as a condition of being awarded a contract with the Secretary, disclose a greenhouse gas inventory or any other report on greenhouse gas emissions, unless the Secretary determined that requiring such a disclosure is necessary to verify a voluntary disclosure of such inventory or other report by the individual or entity,” says Section 318 of the National Defense Authorization Act (NDAA) approved by the Senate and House on Wednesday and Thursday, respectively.
The Biden administration in late 2022 proposed that federal contractors disclose what are called Scope 1, 2, and 3 GHG emissions. Scope 1 emissions are those under direct control of a business, such as their industrial processes. Scope 2 emissions are indirect and would include acquired energy produced elsewhere. The third group of emissions are outside of an organization’s control and include things like emissions generated by suppliers and downstream uses of their product such as how the Navy uses its ships.
The NDAA also has a clause that applies to nontraditional defense contractors and prohibits the Defense Department from requiring them to disclose their GHG emissions as a condition of being awarded a contract.
The Biden administration is currently going through a rulemaking process related to contractor disclosure of GHG emissions. That process is ongoing.
Trade associations that represent defense and federal contractors have asked the administration to halt the rulemaking process to address their concerns, which include extending disclosure deadlines and giving contractors more flexibility in working with different entities that establish standards for carbon emissions.