Biden Issues Sustainability Executive Order

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Biden Issues Sustainability Executive Order to catalyze nation’s clean energy initiative

On December 8, President Biden issued an Executive Order (EO) to “catalyze” the nation’s clean energy economy and direct the federal government to achieve the following five climate goals:

  • 100% carbon pollution-free electricity by 2030, at least half of which will be locally supplied clean energy to meet 24/7 demand;
  • 100% zero-emission vehicle acquisitions by 2035, including 100% zero-emission light-duty vehicle acquisitions by 2027;
  • Net-zero emissions from federal procurement no later than 2050, including a Buy Clean policy to promote use of construction materials with lower embodied emissions;
  • A net-zero emissions building portfolio by 2045, including a 50% emissions reduction by 2032; and
  • Net-zero emissions from overall federal operations by 2050, including a 65 percent emissions reduction by 2030.

According to this EO, the federal government will transform its portfolio of 300,000 buildings, fleet of 600,000 cars and trucks, and annual purchasing power of $650 billion in goods and services to:

  • Transition federal infrastructure to zero-emission vehicles and buildings powered by carbon pollution-free electricity, reducing the federal government’s greenhouse gas emissions by 65% by 2030,and achieving net-zero emissions by 2050.
  • Make federal agencies more resilient, and increase the sustainability of federal supply chains, achieving net-zero emissions from federal procurement by 2050.
  • Mainstream sustainability within the federal workforce, advance equity and environmental justice, and leverage partnerships to accelerate progress.

The EO provides additional detail regarding the future transformation of the federal government’s building portfolio:

  • The government will, across its existing portfolio and during new construction, increase water and energy efficiency, reduce waste, electrify systems, and promote sustainable locations; and
  • Implement a Federal Building Performance Standard.

Given the Administration’s continued focus on greenhouse gas emissions, it should probably come as no surprise that the Securities and Exchange Commission (SEC) will likely require emissions data as part of its forthcoming climate disclosure proposal, expected early next year. SEC Chair Gary Gensler has, in recent speeches, pointed to emissions data as an example of potential quantitative disclosure requirements.

According to Politico, at a Wall Street Journal conference on December 7, Gensler said that the SEC was considering Scope 1, 2, and 3 emissions as required disclosures. Scope 3 refers to emissions not produced directly by an organization, but rather from its supply chain. In commercial real estate that likely entails tenant activities. “We are considering all three, and the reason is that many investors find it relevant to their investment decisions,” he said.

Source: CREFC Sustainability Initiative

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