The Providing Reliable, Objective, Verifiable Emissions Intensity Act, or PROVE IT Act, directs the Department of Energy (DOE) to study and report the average emissions intensity of nearly two dozen products made in the United States and other major economies. It recently passed out of the Senate Environment and Public Works Committee (EPW) with a decisive and bipartisan vote.
PROVE IT is led in the Senate by Sens. Chris Coons (D-DE) and Kevin Cramer (R-ND) with 11 additional co-sponsors: Sens. Angus King (I-ME), Lisa Murkowski (R-AK), Martin Heinrich (D-NM), Lindsey Graham (R-SC), Sheldon Whitehouse (D-RI), Bill Cassidy (R-LA), John Hickenlooper (D-CO), Dick Durbin (D-IL), John Boozman (R-AR), Alex Padilla (D-CA), and Mark Kelly (D-AZ). A companion PROVE IT bill in the House is anticipated, led by Reps. John Curtis (R-UT-3) and Scott Peters (D-CA-50).
PROVE IT has drawn the support of a broad coalition of business, industry, and advocacy groups who believe that the bill will substantiate the U.S. carbon advantage and that it will defend and promote U.S. commercial interests, lower global emissions, and ensure U.S. products are treated fairly in global markets.
This blog post articulates what the PROVE IT Act does, as passed by EPW, and gives an overview of why we need it.
How does it work?
PROVE IT directs DOE to publish the average emissions intensity of production in 17 different product categories for each country included in the study. A product’s emissions intensity means the quantity of greenhouse gases emitted as a result of the manufacturing of a single unit of product. When DOE cannot determine the average emissions intensity of production in a given country with reasonable accuracy, it will publish its best estimate alongside an assessment of existing gaps in the emissions data.
DOE is required to complete its first study within two years of enactment and update the data every five years thereafter, although it has discretion to prioritize certain goods and countries based on data availability and time constraints. DOE must work in collaboration with the Environmental Protection Agency, U.S. Trade Representative, and the Secretaries of State, Agriculture, and Homeland Security (Customs). While industry, foreign governments, and international institutions are invited to participate, there is no requirement for new data reporting or compulsory participation.
Which products will be covered?
The bill targets products across three categories of goods: energy-intensive products, fuels, and goods needed for decarbonization (see Table 1).
Energy-intensive products are the target of policies like the EU Carbon Border Adjustment Mechanism (CBAM), which attempt to address carbon leakage – production shifting to countries with lower climate ambition or less regulation. Energy-intensive products include industrial goods at various stages of processing.
Fuels are not covered by the CBAM and are not typically addressed in carbon leakage studies. That said, the U.S. is an important consumer and supplier of fuels on the international stage. The U.S. has used its lower-carbon fuels to improve the energy security of its partner countries, for example by exporting large quantities of low-methane natural gas to Europe to displace Russian natural gas.
Finally, PROVE IT will study goods that are considered necessary for decarbonization: critical and strategic minerals and technologies like EV batteries and wind turbine components. In each of these product categories, China holds well over half of global production and is, on average, more than three times as carbon intensive as the United States.
Table 1: Products studied in the PROVE IT Act
|Goods for Decarbonization
|Iron & steel
|Solar cells and panels
|Refined petroleum products
|Refined strategic & critical minerals (e.g. copper, cobalt, etc.)
|Petrochemicals & plastics
|Pulp & paper
Which countries will be studied?
The PROVE IT Act will study the emissions intensity of goods produced in countries with a sizeable share of the global market for covered products. It will also include countries that fall into one of three categories: partners in the “Group of Seven” (G7); countries with which the U.S. has a free trade agreement; and any “foreign country of concern.” This final designation is reserved for countries that may pose a threat to U.S. national security or foreign policy (see Table 2).
Table 2: Countries studied in the PROVE IT Act
|Countries of Concern
Why do we need the PROVE IT Act?
Data from the Climate Leadership Council, the Organization for Economic Cooperation and Development, and others have identified that American manufacturing is among the cleanest in the world. We call this America’s carbon advantage – goods manufactured in the U.S. are roughly 40% more carbon-efficient than the world average.
As climate-related trade policies emerge, for example, the EU CBAM and similar policies anticipated from the U.K., Canada, Australia, and Taiwan, it is increasingly important that the U.S. have an official source of data. The data collected by the PROVE IT initiative will:
- Help policymakers align economic and climate objectives, since the carbon advantage shows that the U.S. can expand its global market share while lowering global emissions.
- Encourage increased investment in U.S. industry, since trade tools like the EU CBAM will soon grant a competitive advantage to lower-carbon products in the global marketplace.
- Empower the U.S. government to challenge assumptions made about its relative carbon intensity by foreign governments and defend the emissions performance of U.S. industry.
- Increase transparency about the emissions-efficiency of economies around the world to shape the decarbonization priorities of the global community.
Sens. Coons and Cramer explain that “defending our strategic interests starts with quantifying our advantage.” In their words, “The PROVE IT Act would put high-quality, verifiable data behind these practices and bolster transparency around global emissions intensity data to hold countries with dirtier production accountable.” This would be the first U.S. government effort to comprehensively assess the relative carbon efficiency of goods produced in the world’s major economies.