The US federal government has withdrawn a proposed rule requiring government contractors to disclose their greenhouse gas (GHG) emissions and establish emissions reduction targets. Announced on 13 January 2025, the decision precedes the transition to the second Trump administration, signalling a likely shift away from the Biden administration’s climate disclosure agenda.
Introduced on 14 November 2022 by the Federal Acquisition Regulatory Council (FARC)—comprising the Department of Defense, the General Services Administration, NASA, and the Office of Federal Procurement Policy—the rule aimed to align federal procurement with climate goals.
The proposed rule would have mandated contractors to submit annual inventories of direct (Scope 1) and indirect (Scope 2) GHG emissions. Also, it called for “major” contractors (contracts exceeding $50 million annually), to disclose “value chain” (Scope 3) emissions. These include emissions generated across supply chains and other indirect sources, requiring extensive climate monitoring.
If enacted, these requirements would have gone beyond the Securities and Exchange Commission’s (SEC) climate disclosure regulations finalised in March 2024, which are currently stayed pending judicial review and are also expected to face rollback under the incoming administration.
In their withdrawal notice, agencies cited two primary reasons. The first reason sighted was insufficient time under the Biden administration to finalise the rule. The second reason was public comments reflecting evolving regulatory standards and industry practices.
With the Trump administration set to take office, federal climate policies are anticipated to focus less on mandatory disclosures and more on deregulation. For government contractors, this may mean reduced compliance burdens, but it also raises questions about how the US will meet its international climate commitments.
