Cameron PrellSteve McBradyPeter J. EyreMatthew B. Welling

Federal agencies (and their government contractors) are about to embark on a second generation of sustainability upgrades to federal government facilities, procurement and operations.  On March 19, 2015, President Obama released an executive order titled “Planning for Federal Sustainability in the Next Decade” (“EO”).  The EO establishes next generation greenhouse gas (GHG) reduction and sustainability targets and mandates that agencies develop plans to deploy clean energy and resource efficiency measures to improve resilience and environmental performance throughout their supply chains.  The EO mandates the establishment of a new Chief Sustainability Officer for each agency charged with overseeing implementation and compliance with EO.  The 7 largest federal procuring agencies will also be required to submit a plan to implement at least five new procurements each year that will include requirements considering government contractor GHG profiles and management practices.

Climate Risk Management.  Within 90 days of the EO (approximately June 16th), the head of each federal agency must propose agency-wide, 2025 GHG emission reduction plans for scope 1 (direct greenhouse gas emissions from sources owned controlled by the agency), scope 2 (direct greenhouse gas emissions resulting from the generation of electricity, heat, or steam purchased by the agency) and scope 3 (greenhouse gas emissions from sources not owned by the agency but related to agency activities, including vendor supply chains).  The targets will not include emissions from certain vehicles and equipment, and electric energy generation produced and sold commercially to other parties as the primary business of the agency.

Sustainability Efforts.  Beginning in fiscal year 2016, and as part of achieving the GHG reductions, each agency must also implement the goals of the EO by:

  1. Promoting building energy conservation, efficiency, and management by (i) reducing building energy intensity, and (ii) improving data center energy efficiency.  Beginning in 2020, all new construction at federal buildings greater than 5,000 sq. ft. must be designed to achieve net-zero energy, water or waste capabilities.
  2. Ensuring that at least 25% of the total amount of building electric energy and thermal energy is clean energy, accounted for by renewable and alternative energy by 2025, and at least 30% of the energy consumed is renewable.
    i.  The EO contemplates clean and renewable energy will be installed or procured on a bundled or unbundled basis with equivalent renewable energy credits (“RECs”).
    ii.  The EO contemplates energy installations that include renewable (e.g. solar, wind, geothermal, waste, biogas) and alternative technology types (thermal power, combined heat and power systems, fuel cell energy systems, small modular nuclear, waste heat, carbon capture and  sequestration).
  3. Improving agency water use efficiency and management, including stormwater management.
  4. Improving agency fleet and vehicle efficiency, including reduction of fleet-wide GHG emissions intensity by at least 30% by 2025 relative to a 2014 baseline.
  5. Promoting sustainable acquisition and procurement by ensuring that each of the following factors are included to the maximum extent practicable in certain covered procurements:
    i.  Implementing efficiency and performance-based contracts for federal buildings.
    ii.  Mandating purchase preference for recycled content products designed by EPA, energy and water efficient products and services, and BioPreferred and biobased designated products until an agency achieves at least 95% compliance.
    iii.  Procuring sustainable products and services identified by EPA and DOE clean energy and sustainability programs.
    iv.  Purchasing environmentally preferable products and services that meet or exceed EPA or other environmental performance criteria.
    v.  Advancing waste prevention and pollution prevention, including annually diverting at least 50% of non-hazardous solid waste pursuing opportunities for net-zero waste management.