A directive issued on Thursday by the Biden administration would, for the first time, have federal agencies consider the economic damage caused by climate change when deciding what kinds of vehicles, equipment and goods to buy.
The new guidance from President Biden could affect purchasing decisions across the government, from agriculture to defense to health care. The idea is to take into account the greenhouse gases generated by goods and projects, how they contribute to global warming, and the cost of that to the economy.
The potential impact is significant. The federal government is the world’s largest consumer of goods and services, spending roughly $600 billion each year. The changes could shift purchases for the federal government’s fleet of roughly 600,000 cars and trucks from gasoline-powered to all-electric vehicles, redirect the flow of billions of dollars of government grants and reshape or kill some major construction projects.
“It will be the first time this ‘whole of government approach’ is used to evaluate the climate consequences of government actions,” said Richard Revesz, Mr. Biden’s regulatory chief, who is helping lead the initiative. Mr. Revesz, a climate law expert, has focused on using cost-benefit analysis when designing policies meant to protect human health and the environment.
Critics said they feared the new step would end up harming the fossil fuel industry.
“It will constrain the development of traditional energy sources and infrastructure build out, and give a new rationale to boost the development of wind and solar and E.V.s,” said Mandy Gunaskera, who served as chief of staff of the Environmental Protection Agency in the Trump administration and is now a visiting fellow at the Heritage Foundation, a conservative research organization…
…Still, expanding the metric to cover procurement decisions could get tangled up in debates over how to determine the number of carbon dioxide emissions associated with building, say, a new highway.
“There are undoubtedly a series of procurement and legal issues that would have to be worked out,” said Michael Greenstone, an economist at the University of Chicago who helped the Obama administration to develop the social cost of carbon. “The plumbing to make this work is where the rubber hits the road.”