30310 Federal Register / Vol. 65, No. 91 / Wednesday, May 10, 2000 / Proposed Rules

DEPARTMENT OF DEFENSE

GENERAL SERVICES

ADMINISTRATION

NATIONAL AERONAUTICS AND

SPACE ADMINISTRATION

48 CFR Parts 2, 11, 15, 23, and 42

[FAR Case No. 1999–011]

RIN 9000–AI71

Federal Acquisition Regulation;

Energy Efficiency of Supplies and

Services

AGENCIES: Department of Defense (DoD),

General Services Administration (GSA),

and National Aeronautics and Space

Administration (NASA).

ACTION: Proposed rule.

SUMMARY: The Civilian Agency

Acquisition Council and the Defense

Acquisition Regulations Council

(Councils) are proposing to amend the

Federal Acquisition Regulation (FAR) to

implement Executive Order (E.O.) 13123

of June 3, 1999, Greening the

Government through Efficient Energy

Management.

DATES: Interested parties should submit

comments in writing on or before July

10, 2000 to be considered in the

formulation of a final rule.

ADDRESSES: Submit written comments

to: General Services Administration,

FAR Secretariat (MVRS), 1800 F Street,

NW., Room 4035, ATTN: Laurie Duarte,

Washington, DC 20405.

Submit electronic comments via the

Internet to: farcase.1999–011@gsa.gov.

Please submit comments only and cite

FAR case 1999–011 in all

correspondence related to this case.

FOR FURTHER INFORMATION CONTACT: The

FAR Secretariat, Room 4035, GS

Building, Washington, DC 20405, at

(202) 501–4755 for information

pertaining to status or publication

schedules. For clarification of content,

contact Mr. Paul Linfield, Procurement

Analyst, at (202) 501–1757. Please cite

FAR case 1999–011.

SUPPLEMENTARY INFORMATION:

A. Background

This proposed rule amends the FAR

to implement E.O. 13123. The proposed

rule—

1. Defines in subpart 2.1,

Definitions—

(a) ‘‘Energy-efficient product’’

(relocated and revised from FAR

23.704);

(b) ‘‘Energy-savings performance

contract’’ (see 10 CFR 436, Subpart B);

and

(c) ‘‘Renewable energy’’ and

‘‘renewable energy technology’’ (see

sections 710 and 711 of E.O. 13123);

2. Revises the policies and sources of

authority in Part 11;

3. Revises part 15 to alert agencies to

the special procedures at 10 CFR

436.33(b) that agencies must use when

evaluating unsolicited proposals for

energy-savings performance contacts

(ESPCs);

4. Revises and relocates guidance on

energy-efficient products and services

from subpart 23.7 to subpart 23.2 so that

subpart 23.7 now focuses exclusively on

environmentally preferable products

and services;

5. Revises subpart 23.2 by—

(a) Renaming the subpart ‘‘Energy and

Water Efficiency, and Renewable

Energy’’ to reflect its expanded subject

area;

(b) Deleting outdated definitions and

guidance;

(c) Adding guidance on energy- and

water-efficient products (e.g., ENERGY

STAR) and services, and ESPCs; and

(d) Directing contracting officers to

sources for more detailed guidance and

information; and

6. Makes a number of editorial

changes.

The Councils proposed in FAR case

1998–015 other FAR amendments to

Subpart 23.7 to implement E.O. 13101

of September 14, 1998, Greening the

Government through Waste Prevention,

Recycling, and Federal Acquisition. The

Councils published a proposed rule on

FAR case 1998–015 in the Federal

Register on September 23, 1999 (64 FR

51656). After comments have been

reconciled, the Councils will publish a

final rule on these other changes to

Subpart 23.7.

This rule was not subject to Office of

Management and Budget review under

section 6(b) of Executive Order 12866,

Regulatory Planning and Review, dated

September 30, 1993. This rule is not a

major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

The Councils do not expect this

proposed rule to have a significant

economic impact on a substantial

number of small entities within the

meaning of the Regulatory Flexibility

Act, 5 U.S.C. 601, et seq., because this

rule simply provides additional

guidance to Government contracting

and technical personnel with respect to

the Government’s preference, currently

set forth in FAR subpart 23.7, for buying

environmentally preferable and energyefficient products and services. This

rule requires a contracting officer, when

acquiring an energy-using product, to

purchase an energy-efficient product

(where life-cycle cost-effective and

available), i.e., a product that is in the

upper 25 percent of energy efficiency as

designated by the Department of

Energy’s (DOE’s) Federal Energy

Management Program or that meets DOE

and Environmental Protection Agency

(EPA) criteria for use of the ‘‘ENERGY

STAR’’ trademark label. The 25

percent benchmark for determining

energy efficiency is currently addressed

at FAR 23.704. Small entities that offer

products to the Government may use the

ENERGY STAR label, if the product

meets DOE and EPA criteria. The rule

also provides guidance to contracting

officers on the use of energy-savings

performance contracts as alternatives to

the traditional method of financing

energy efficiency improvements.

An Initial Regulatory Flexibility

Analysis has, therefore, not been

performed. We invite comments from

small businesses and other interested

parties. The Councils will consider

comments from small entities

concerning the affected FAR subparts in

accordance with 5 U.S.C. 610. Interested

parties must submit such comments

separately and should cite 5 U.S.C. 601,

et seq. (FAR case 1999–011), in

correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act does

not apply because the proposed changes

to the FAR do not impose information

collection requirements that require the

approval of the Office of Management

and Budget under 44 U.S.C. 3501, et

seq.

List of Subjects in 48 CFR Parts 2, 11,

15, 23, and 42

Government procurement.

Dated: May 4, 2000.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, DoD, GSA, and NASA

propose that 48 CFR parts 2, 11, 15, 23,

and 42 be amended as set forth below:

1. The authority citation for 48 CFR

parts 2, 11, 15, 23, and 42 continues to

read as follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C.

chapter 137; and 42 U.S.C. 2473(c).

PART 2—DEFINITIONS OF WORDS

AND TERMS

2. In section 2.101, add, in

alphabetical order, the definitions

‘‘Energy-efficient product,’’ ‘‘Energysavings performance contract,’’

‘‘Renewable energy,’’ and ‘‘Renewable

energy technology’’ to read as follows:

2.101 Definitions.

* * * * *

Federal Register / Vol. 65, No. 91 / Wednesday, May 10, 2000 / Proposed Rules 30311

Energy-efficient product means a

product that—

(1) Meets Department of Energy and

Environmental Protection Agency

criteria for use of the Energy Star

trademark label; or

(2) Is in the upper 25 percent of

efficiency for all similar products as

designated by the Department of

Energy’s Federal Energy Management

Program.

Energy-savings performance contract

means a contract that requires the

contractor to—

(1) Perform services for the design,

acquisition, financing, installation,

testing, operation, and where

appropriate, maintenance and repair, of

an identified energy conservation

measure or series of measures at one or

more locations;

(2) Incur the costs of implementing

the energy savings measures, including

at least the cost (if any) incurred in

making energy audits, acquiring and

installing equipment, and training

personnel in exchange for a

predetermined share of the value of the

energy savings directly resulting from

implementation of such measures

during the term of the contract; and

(3) Guarantee future energy and cost

savings to the Government.

* * * * *

Renewable energy means energy

produced by solar, wind, geothermal,

and biomass power.

Renewable energy technology

means—

(1) Technologies that use renewable

energy to provide light, heat, cooling, or

mechanical or electrical energy for use

in facilities or other activities; or

(2) The use of integrated wholebuilding designs that rely upon

renewable energy resources, including

passive solar design.

* * * * *

PART 11—DESCRIBING AGENCY

NEEDS

3. In section 11.002, revise paragraph

(d) to read as follows:

11.002 Policy.

* * * * *

(d)(1) The Resource Conservation and

Recovery Act of 1976 (42 U.S.C. 6901,

et seq.), Executive Order 13101 of

September 14, 1998, Greening the

Government through Waste Prevention,

Recycling, and Federal Acquisition, and

Executive Order 13123 of June 3, 1999,

Greening the Government through

Efficient Energy Management, establish

requirements for acquiring—

(i) Products containing recovered

materials;

(ii) Environmentally preferable

products and services;

(iii) Energy-efficient products and

services; and

(iv) Products and services that utilize

renewable energy technologies.

(2) Executive agencies must consider

use of recovered materials, energy

efficiency, environmentally preferable

purchasing criteria developed by the

EPA, and environmental objectives (see

subparts 23.2 and 23.4 and 23.703(b))

when—

(i) Developing, reviewing, or revising

Federal and military specifications,

product descriptions (including

commercial item descriptions) and

standards;

(ii) Describing Government

requirements for supplies and services;

and

(iii) Developing source selection

factors.

* * * * *

4. In section 11.101, revise paragraph

(b) to read as follows:

11.101 Order of precedence for

requirements documents.

* * * * *

(b) Agencies must prepare

requirements documents to achieve

maximum practicable—

(1) Energy efficiency, including using

renewable energy technologies; and

(2) Use of recovered material, other

materials that are environmentally

preferable, energy-efficient and waterefficient products, and renewable

energy technologies (see subparts 23.2,

23.4, and 23.7).

* * * * *

PART 15—CONTRACTING BY

NEGOTIATION

5. In section 15.603, add paragraph (e)

to read as follows:

15.603 General.

* * * * *

(e) Agencies must evaluate

unsolicited proposals for energy-savings

performance contracts in accordance

with the procedures in 10 CFR

436.33(b).

PART 23—ENVIRONMENT,

CONSERVATION, OCCUPATIONAL

SAFETY, AND DRUG-FREE

WORKPLACE

6. Revise the heading and text of

section 23.000 to read as follows:

23.000 Scope.

This part prescribes acquisition

policies and procedures supporting the

Government’s program for ensuring a

drug-free workplace and for protecting

and improving the quality of the

environment by—

(a) Controlling pollution;

(b) Managing energy and water use in

Government facilities efficiently;

(c) Using renewable energy and

renewable energy technologies;

(d) Acquiring energy-efficient

products and services, environmentally

preferable products, and products that

use recovered materials; and

(e) Requiring contractors to identify

hazardous materials.

7. Revise subpart 23.2 to read as

follows:

Subpart 23.2—Energy and Water

Efficiency and Renewable Energy

Sec.

23.200 Scope.

23.201 Authorities.

23.202 Policy.

23.203 Energy-efficient products.

23.204 Energy-savings performance

contracts (ESPC).

23.200 Scope.

(a) This subpart prescribes policies

and procedures for—

(1) Acquiring energy- and waterefficient products and services, and

products that use renewable energy

technology; and

(2) Using an energy-savings

performance contract to obtain energyefficient technologies at Government

facilities without Government capital

expense.

(b) This subpart applies to

acquisitions in the United States, its

possessions and territories, Puerto Rico,

and the Northern Mariana Islands.

Agencies conducting acquisitions

outside of these areas must use their

best efforts to comply with this subpart.

23.201 Authorities.

(a) Energy Policy and Conservation

Act (42 U.S.C. 6361(a)(1)) and Resource

Conservation and Recovery Act of 1976

(42 U.S.C. 6901, et seq.).

(b) National Energy Conservation

Policy Act (42 U.S.C. 8253, 8262g, and

8287).

(c) Executive Order 11912 of April 13,

1976, Delegations of Authority under

the Energy Policy and Conservation Act.

(d) Executive Order 13123 of June 3,

1999, Greening the Government through

Efficient Energy Management.

23.202 Policy.

The Government’s policy is to acquire

supplies and services that promote

energy and water efficiency, advance

the use of renewable energy products,

and help foster markets for emerging

technologies.

30312 Federal Register / Vol. 65, No. 91 / Wednesday, May 10, 2000 / Proposed Rules

23.203 Energy-efficient products.

(a) If life-cycle cost-effective and

available—

(1) When acquiring energy-using

products, contracting officers must

purchase ENERGY STAR or other

energy-efficient products designated by

the Department of Energy’s Federal

Energy Management Program (FEMP); or

(2) When contracting for design,

construction, renovation, or

maintenance of a public building that

will include energy-using products, the

design specification must specify or the

agency specifications must require that

the contractor provide ENERGY STAR

or other energy-efficient products.

(b) Information is available via the

Internet on—

(1) ENERGY STAR at http://

www.energystar.gov/; and

(2) FEMP at http://www.eren.doe.gov/

femp/procurement.

23.204 Energy-savings performance

contracts (ESPC).

(a) Section 403 of Executive Order

13123 of June 3, 1999, Greening the

Government through Efficient Energy

Management, requires an agency to

make maximum use of the authority

provided in the National Energy

Conservation Policy Act (42 U.S.C.

8287) to use an ESPC, when life-cycle

cost-effective, to reduce energy use and

cost in the agency’s facilities and

operations.

(b) Under an ESPC, an agency can

contract with an energy service

company for a period not to exceed 25

years to improve energy efficiency in

one or more agency facilities at no direct

capital cost to the United States

Treasury. The energy service company

finances the capital costs of

implementing energy conservation

measures and receives, in return, a

contractually determined share of the

cost savings that result.

(c) To solicit and award an ESPC, the

contracting officer—

(1) Must use the procedures, selection

method, and terms and conditions

provided at 10 CFR part 436, subpart B;

and

(2) May use the ‘‘Qualified List’’ of

energy service companies established by

the Department of Energy and other

agencies.

Subpart 23.7—Contracting for

Environmentally Preferable Products

and Services

8. Revise the heading of Subpart 23.7

to read as set forth above.

9. Revise section 23.701 to read as

follows:

23.701 Applicability.

This subpart prescribes policies for

acquiring environmentally preferable

products and services.

10. Amend section 23.702 by revising

paragraph (f) to read as follows:

23.702 Authorities.

* * * * *

(f) Executive Order 13123 of June 3,

1999, Greening the Government through

Efficient Energy Management.

23.703 [Removed]

23.704 through 23.706 [Redesignated as

23.703 through 23.705]

11. Remove section 23.703 and

redesignate sections 23.704 through

23.706 as sections 23.703 through

23.705, respectively.

12. In addition to the changes above,

in newly redesignated section 23.703,

remove paragraph (b)(2) and redesignate

paragraphs (b)(3) through (b)(6) as

paragraphs (b)(2) through (b)(5),

respectively.

PART 42—CONTRACT

ADMINISTRATION AND AUDIT

SERVICES

13. In section 42.302, revise paragraph

(a)(68) to read as follows:

42.302 Contract administration functions.

(a) * * *

(68) Ensure contractor environmental

practices are evaluated for possible

adverse impact on contract performance

or cost, and, as part of quality assurance

procedures (part 46), monitor contractor

compliance with environmental

requirements specified in the contract.

ACO responsibilities include, but are

not limited to—

(i) Requesting environmental

technical assistance, if needed; and

(ii) Ensuring that the contractor

complies with—

(A) Specifications requiring the use of

environmentally preferable products,

energy-efficient products, and materials

or delivery of end items with specified

recovered material content; and

(B) Reporting requirements relating to

recovered material content utilized in

contract performance (see subpart 23.4).

* * * * *

[FR Doc. 00–11595 Filed 5–9–00; 8:45 am]

BILLING CODE 6820–EP–P