Why Repealing the Greenhouse Gas Reporting Program Would Harm American Manufacturers

The most important reasons to continue reporting on climate pollution are that Congress required it and Americans across the board need it. If this isn’t reason enough, the GHGRP underpins business, trade, and investment decisions for American manufacturers. Among the many reasons why repealing the GHGRP would harm U.S. manufacturers specifically, here are four: 

1. They would be unable to demonstrate the cleanliness of their products in international markets.
2. They would be unable to verify claims for valuable clean energy tax credits.
3. They’d face higher costs from a patchwork of state-level reporting requirements.
4. They’d face hurdles in reporting verified sustainability progress to investors.

The EPA’s claim that repealing the GHGRP will save companies millions is shortsighted and ignores the additional cost burdens that such a repeal would place on manufacturers. Not only does this move by the EPA pose a huge challenge for policymakers and stakeholders who rely on this publicly accessible emissions data, but it also raises economic threats to the companies that Zeldin claims to be aiding. Below, we outline all the reasons that American manufacturers could lose out if the GHGRP is repealed.  

1. NRDC analysis found that repealing the GHGRP could jeopardize $1.6 billion to $9.3 billion worth of potential export revenue from jurisdictions considering or currently implementing emissions-based import fees. Many large economies, including the European Union (E.U.) and the United Kingdom, are adopting trade policies that prioritize importing cleaner materials over dirtier materials. This protects their domestic manufacturers from losing their portion of the market to foreign competitors dumping dirtier products. The United States would be well positioned to benefit from such trade measures because it has a well-documented record of producing materials like steel and cement with fewer emissions than many countries.   

   However, the United States cannot cash in on their lower-emission goods without good data, and GHGRP is the best source that American companies have to prove their cleaner production. Without good data, countries pursuing clean material border fees assume worst-case emissions, meaning cleaner U.S. products get penalized alongside dirtier ones. 

   American manufacturers would not only forfeit the advantage from their cleaner production, but U.S. exports would be less attractive against foreign competitors, risking billions of dollars’ worth of U.S. market share. The administration may assume they are helping dirty companies hide their high emissions. The reality is that they are taking away American companies opportunity to benefit from their cleaner production relative to foreign competitors.  

2. Repealing the GHGRP would prevent U.S. companies from verifying and claiming tax credits for energy technology, including carbon capture and sequestration and clean hydrogen production. For companies using carbon capture and sequestration technology, the U.S. Department of the Treasury and Internal Revenue Service require companies to use GHGRP data to certify the amount of emissions sequestered in order to qualify for certain clean energy tax credits. Without that data, manufacturers using carbon capture technology cannot access larger tax credits for lower-emissions production.  

   The Treasury recently issued interim guidance purporting to allow companies to claim carbon capture tax credits by certifying their emissions data with third-party verifiers to get around the use of GHGRP data. This loophole weakens the tax credit’s ability to reward companies pursuing actual emissions reductions and risks the abuse of taxpayer dollars. Repealing the GHGRP would not only cause uncertainty for producers looking to qualify for tax credits, leading to billions in lost revenue and investments that are no longer useful, but it would also reward companies looking to take advantage of these clean energy programs.   

3. Regulatory uncertainty in the absence of the GHGRP could create a “patchwork” of GHG emissions reporting requirements across various states, leading to higher compliance costs and administrative burdens for multi-jurisdictional manufacturers. At least 10 states pursuing their own GHG reporting programs, including Colorado and Maryland, reference the GHGRP methodologies or require covered facilities to follow the GHGRP reporting requirements. Without the GHGRP creating a model for consistent emissions reporting across states, manufacturers could face varied data collection methodologies, numerous reporting deadlines, and duplicative compliance measures. 

   As the National Association of Manufacturers noted, “In the absence of a national reporting baseline, state-level requirements could create a fractured GHG reporting landscape with conflicting state obligations, imposing additional administrative burdens and operational barriers for companies across the United States.” “Further, if the GHGRP is repealed, a future administration could reinstate the federal reporting program, adding potential start-up costs for companies that need to rebuild tailored reporting systems and acquire reporting expertise.   

4. Many companies will still need to collect company-wide emissions data for shareholders and investors and to comply with international obligations. Shareholders and investors are increasingly requesting GHG emissions data, and many companies document this data in annual reports. The EPA failed to consider that many companies will have to continue collecting this data, the gap that this dataset would leave, and the possibility of third-party verification costs. Additionally, thousands of U.S. companies are also subject to the E.U.’s Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD). The CSRD requires covered companies to report GHG emissions, while the CSDDD requires them to submit climate transition plans that may include emissions reduction targets.  

NRDC is not alone in calling for the EPA to stop this senseless repeal. United Steelworkers commented that the GHGRP “is vital to keep American industry competitive in our global economy.” We call on the EPA to stop with the delay tactics—the recent delay rule is nothing more than an attempt to prevent reporting for 2025. And further, the EPA must abandon this repeal effort because it would create long-term regulatory uncertainty, lead to business risks and investment uncertainty for industry, and cause high financial costs over time.