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Carbon Footprint & why it matters in bidding

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Aug 31, 2023

Mirroring government policy, one crucial aim of sustainability in public procurement is reducing carbon footprints – these are the total amount of greenhouse gas emissions, primarily carbon dioxide, released into the atmosphere due to human activities. As the pressures of climate change influence public priorities, businesses are adopting sustainable business practices to meet their climate goals and mitigate the impacts of climate change.

Understanding the carbon footprint in public procurement

Public procurement is the process by which governments and public sector organisations purchase goods, services, and works from external suppliers, funded by the taxpayer. The scope of public procurement is vast, ranging from construction projects and transportation services to office supplies and energy contracts. As the importance of sustainability and environmental responsibility continues to grow, governments around the world are recognising the need to integrate ecological considerations into their procurement decisions.

Carbon footprint analysis in public procurement involves assessing the emissions generated throughout the lifecycle of a product or service. This analysis takes into account various stages, including raw material extraction, manufacturing, transportation, use, and disposal. By calculating the carbon footprint, decision-makers gain insights into the environmental impact of a particular procurement choice and can make more informed, sustainable decisions.

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Why carbon footprint matters in bidding

Aligned to the UK Government’s Net Zero by 2050 strategy, integrating carbon footprint considerations into public procurement aligns with these commitments and helps the government work toward their emission reduction targets.

Similarly, public procurement contributes significantly to the demand for goods and services, which, in turn, drives resource consumption and greenhouse gas emissions. By favouring suppliers with lower carbon footprints, governments can promote more sustainable production and consumption patterns, thus contributing to environmental conservation. This is supported by the increased drive for social value in bidding, asking suppliers to uphold commitments to improve their sustainable business practices.

Incorporating carbon footprint requirements in bidding processes incentivises suppliers to innovate and develop low-carbon alternatives. This, in turn, can drive market transformation, making sustainable products and services more readily available and affordable, thus more attractive to taxpayer-funded buyers.

As close focus is placed on green initiatives, the UK Government and councils are increasingly accountable to the public for their environmental actions. Integrating carbon footprint analysis into procurement demonstrates a commitment to sustainability, enhancing the public image of both the government and the winning bidders.

It is important to remember, though, that while reducing carbon emissions is a primary goal, it often goes hand in hand with cost savings. Energy-efficient products and services typically result in lower operational costs over their lifecycle. By considering carbon footprint in bidding, the Government and councils can achieve both environmental and financial benefits.

As climate change poses substantial risks to supply chains, this may affect the availability and cost of goods and services. By evaluating the carbon footprint of suppliers, the Government can more easily identify and mitigate potential risks by diversifying the supplier base and promoting local production.

Mirroring the public procurement ethos of being the ‘Most Economically Advantageous Tender’ (MEAT), bidders that focus on minimising their carbon footprint are more likely to engage in sustainable practices and collaborations with research institutions, driving innovation in sustainable technologies and practices. This improves their value for money and can boost their quality scores by offering additional sustainable services/practices as added value.

In 2023, many jurisdictions are enacting laws and regulations that require businesses to disclose and reduce their carbon emissions. By integrating carbon footprint analysis into procurement, the Government can ensure that they are working with suppliers who are compliant with current and future environmental regulations. Sustainable laws and regulations to be aware of when bidding in public procurement include:

  • Public Services (Social Value) Act 2012
  • UK Climate Change Act 2008
  • Equality Act 2010
  • Modern Slavery Act 2015

To maximise your compliance, look at the UK Government’s Sustainability Reporting Guidance: 2021-2022 and new 2023 updates to the Public Procurement Notice.

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How carbon footprint is evaluated in bidding

The process of evaluating the carbon footprint of suppliers in bidding processes involves several steps:

  1. Data collection: Within the Pre-Qualification Questionnaire (PQQ), suppliers are required to provide comprehensive data about their products or services, including information on raw materials, manufacturing processes, transportation methods, and end-of-life disposal
  2. Life Assessment Cycle (LAC): LACs are conducted to quantify the carbon emissions associated with the entire lifecycle of the product or service. This includes assessing emissions from production, transportation, use, and disposal
  3. Carbon calculation: Using the collected data and LCA results, carbon emissions are calculated, typically expressed in CO2 equivalent units. This calculation provides a clear measure of the product's carbon footprint
  4. Weighting factors: Different stages of the product lifecycle may have varying levels of impact on the overall carbon footprint. Weighting factors are applied to account for these differences and provide a more accurate representation
  5. Comparison and evaluation: The carbon footprints of different suppliers' offerings are compared, and their environmental performance becomes a key criterion in the evaluation process
  6. Decision making: Procurement decisions are made based on a combination of factors, including cost, quality, and environmental impact. Choosing suppliers with lower carbon footprints contributes to the overall sustainability of the procurement process

Improving your carbon footprint through the Pagabo framework

Participating in the Pagabo framework facilitates access to a network of like-minded suppliers who share a collective commitment to sustainable practices. This interconnected community offers avenues for collaboration, knowledge exchange, and the adoption of innovative, eco-friendly solutions. The resultant environment becomes fertile ground for nurturing new ideas and embracing greener strategies.

Moreover, the framework exposes businesses to a wealth of sustainability expertise. The framework's focus on reducing carbon footprints and fostering sustainability provides an opportunity to interact with experts who possess intricate knowledge of these areas. This exposure empowers businesses with insights and insights needed to navigate the complexities of sustainability.

Alignment with recognised sustainability standards is another noteworthy advantage. An award from the Pagabo framework signifies compatibility with established sustainability guidelines. This alignment serves as a guiding compass, helping businesses to streamline their efforts, ensure consistency, and make informed choices that contribute to a reduced carbon footprint. This also helps to instil buyer confidence in your company as you have already proven yourself to be fully compliant.

Making Pagabo an attractive option, the framework offers specialised tools designed to evaluate the sustainability performance of suppliers, including their carbon impact. These tools equip businesses with the means to assess and select suppliers based on their environmental responsibility, thereby encouraging greener procurement decisions.

Underpinning all this, winning an award within the Pagabo framework underscores a business's dedication to sustainability. This recognition can be a powerful tool for communicating sustainability leadership to clients, stakeholders, and the broader market. It positions the business as an advocate for positive change, appealing to a growing customer base that values environmental consciousness.

Furthermore, Pagabo success nurtures a culture of continuous improvement and innovation. It fuels a commitment to surpass the framework's standards, inspiring businesses to devise novel approaches for reducing their carbon footprint and enhancing sustainable practices.

In essence, Pagabo award offers businesses the tools, resources, and connections necessary to embark on a transformative journey towards heightened sustainability and a reduced carbon footprint. Through collaboration, innovation, and a shared dedication to positive change, businesses can harness their Pagabo framework achievement to create a more sustainable and environmentally conscious future and deliver better value to the UK public.

For more information, see our blog on writing to win Pagabo award.

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Public procurement carbon footprint challenges and considerations

While integrating carbon footprint analysis into public procurement is a commendable step towards sustainability, there are challenges and considerations that need to be addressed. For example, suppliers may have varying levels of data availability and accuracy regarding their products' carbon footprints. These differences can come from differences in company size, influence and experience limiting exposure to innovative tools often negatively impacting Small Medium Enterprises (SMEs).

Integrating carbon footprint analysis should not inadvertently disadvantage small or local suppliers who may have fewer resources to invest in emissions reduction. As such, careful consideration of potential impacts on competition is necessary.

In addition, conducting a comprehensive LCA and carbon footprint calculation can be complex and time-consuming. Governments and organisations may need to invest in expertise and resources to ensure accurate evaluations. Standardised reporting frameworks and data collection protocols in public procurement can help address this issue.

An often-overlooked consideration is that carbon footprint is just one of several criteria that governments consider when awarding contracts. Balancing environmental considerations with cost, quality, and other factors is essential to making well-rounded procurement decisions.

How Thornton & Lowe can help you understand your carbon footprint

We know that our clients have what it takes to win, and we champion the SMEs that make it happen. With a success rate of 75% and 90% client retention, get in touch and let us be the voice that helps you to understand your public sector carbon footprint today!

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