The U.S. imports manufactured goods with 1.4 gigatons of embedded greenhouse gas emissions every year. But making more stuff locally can help reduce global emissions.
One of the first things that President Biden did when he took office was re-enter the United States into The Paris Agreement, an international treaty that set a goal for nations across the globe to reduce carbon emissions and limit global warming.
As the United States looks to reduce its greenhouse gas emissions, a few states and the federal government are exploring a policy framework known as “Buy Clean,” which seeks to ensure that sustainable products are used in government-funded projects, like the building of infrastructure. If implemented correctly, Buy Clean could be smart policy, as it helps tackle climate change while also strengthening local manufacturing and creating jobs.
We explain it below.
Let’s start with the basics. Who exactly is buying clean and what does that mean?
Buy Clean deals with government procurement. This means that when the government uses taxpayer money to purchase a product, it is required to abide by Buy Clean guidelines.
Buy Clean promotes the spending of taxpayer dollars on materials that are made in the United States in a cleaner, more efficient, and environmentally-friendly manner. This helps reduce industrial pollution while also supporting local jobs and domestic manufacturing.
This sounds familiar. Isn’t this just Buy America?
Buy America incentivizes investments in local manufacturing by giving preferences to domestically made materials in government purchases. If carefully structured, Buy Clean can serve in a complementary fashion by considering carbon emissions as well. Many U.S. manufacturers already lead the way when it comes to reducing their carbon emissions, and additional investments can help more domestic industries further reduce emissions.
Why is Buy Clean needed?
Buy Clean rewards manufacturers that have taken steps to reduce their emissions and creates additional motivation for U.S. companies to make further emissions reductions. But where it is most effective is taking on unfair imports.
Right now, the United States imports a lot of its pollution, something folks who work in this space refer to as the “carbon loophole.”
Every year, the U.S. imports manufactured goods with 1.4 gigatons of embedded greenhouse gas emissions. Many of these items could be produced by American workers and companies who are required to follow stricter environmental guidelines, but instead are made abroad by countries with lower standards. One report found that 25% of the world’s total emissions pass through the carbon loophole.
You also have to ship all that stuff. How much emissions are produced by shipping products from overseas?
Ninety percent of the world’s goods are transported by sea. Shipping currently accounts for 2.2 percent of all greenhouse gas emissions, and the industry is only expected to grow. The International Maritime Organization reports that maintaining business as usual will result in an estimated 250 percent growth in carbon emissions from shipping by 2050.
And that’s just the emissions part. All those cargo ships do additional damage to the environment. The North Atlantic Right Whale is now critically endangered, for example, in part because of regular vessel strikes.
Is American-made stuff really that much better for emissions?
In many cases, absolutely. Take the steel industry. Steel is highly CO2-intensive, and reducing steel emissions is viewed as critical to addressing climate change. But at the same time, steel is essential for society to function. It will be needed to rebuild America’s crumbling infrastructure, for example.
American steelmakers know they need to do their part to reduce emissions, and they aren’t shying away from the challenge. U.S. Steel, for example, just announced a new product line called verdeX, which will produce only a quarter of the carbon emissions previously produced in the steelmaking progress. The company will make verdeX at its LEED-certified facility in Arkansas, and the company also has pledged to be carbon neutral by 2050.
Cleveland Cliffs, meanwhile, recently announced a whole handful of environmental commitments, with the goal of reducing its greenhouse gas emissions by 25% by 2030 from its 2017 levels. In 2019, the company exceeded the U.S. 2015 Paris Agreement pledge of 26 to 28% greenhouse gas emissions reduction from 2005 baseline levels – six years ahead of target.
How does U.S. industry compare with others from around the world?
Let’s stick with the steel industry as an example. It’s helpful to compare the United States to China, which heavily subsidies its steel industry. China accounted for 51.3% of global steel production in 2018 (and that doesn’t include companies owned by China’s government that operate in other nations).
Unlike the United States, China does not release official emissions information, so research organizations must make assumptions when putting together their estimates. China’s industry emissions have been determined to account for 3.3% of all global greenhouse gas emissions; the U.S., meanwhile, accounts for 0.59%.
China knows it has a problem, and its government repeatedly has made (and broken) promises to reduce emissions. Its steel industry produced a record amount of carbon emissions just last year.
Meanwhile, the U.S. steel industry has voluntarily reduced its energy intensity by 31% since 1990 and its greenhouse gas emissions by 36% over the same period, according to the American Iron and Steel Institute. The U.S. Department of Energy has indicated that the steel industry in the U.S. has the lowest energy intensity and second-lowest CO2 emissions intensity of any major steel producing country.
You’ve talked a lot about steel. What about some other industrial sectors?
Aluminum is another good example of where the United States leads the way. Every ton of aluminum made in China is at least twice as carbon-intensive as the same metal produced in North America, according to the Aluminum Association.
Are there any concerns about Buy Clean?
As we’ve noted above, American manufacturers already have to abide by some of the strictest environmental regulations in the world, so many already are leading the way on reducing emissions. But American companies also find themselves competing with state-owned, controlled and subsidized companies from countries like China. In practice, that means they haven’t always had the money to make capital investments needed to reduce emissions.
That’s why it’s so important that Buy Clean works in concert with Buy America preferences for the materials it covers that are procured for government-funded infrastructure projects. Doing so ensures taxpayer money will not go to state-owned companies abroad and instead is invested into American companies, workers, and communities. Doing so will allow U.S. manufacturers to make projections about output and make investments.
Has Buy Clean ever been put into practice?
At the state level, yes. Buy Clean is currently the law in California, as it was signed by then-Gov. Jerry Brown in 2017 and began to go into effect in 2019 by requiring contractors who bid on state infrastructure projects to disclose greenhouse gas emissions data for certain materials. In 2021, contractors will have to show these materials do not exceed a certain emissions standard.
States like Oregon and Washington are now considering Buy Clean, and legislation also has been introduced in Congress to inform the process of creating federal Buy Clean standards.