What Is Carbon Reduction in Procurement About?

Governments and companies are setting deadlines for achieving zero emissions. Public procurement can be used as a lever to drive change by promoting lower carbon alternatives into government supply chains.

This worked example below shows how using good procurement data and combining it with emissions data, it is possible to help communicate not only the likely emissions from contracting activities but also the potential savings that can be expected from demanding lower-carbon alternatives.

Why Measure Carbon?

Carbon emissions reduction is at the centre of the fight against climate change. This example provides a methodology to estimate the carbon intensity of public contracts, allowing you to adopt approaches to reduce CO2 emissions from procurement.

Benefits of Measuring Carbon.

Publishing good data on carbon emissions has multiple positive effects for those seeking to address their carbon emissions:

1)Using the data to plan and implement immediate, direct action to reduce carbon emissions from procurement.

2)Reward suppliers that are committed to reducing carbon intensity in their goods, works, services, and supply chain.

3)Publication and analysis of good data will unlock learning and iteration on what policies and processes work to reduce carbon intensity. You can’t manage what you can’t measure.

Getting Started

The immediate priorities for carbon reduction include carbon outputs and other greenhouse gas emissions such as methane and hazardous emissions such as nitrogen oxides. Beyond this, other metrics around carbon reduction include compliance to certification and measurement of plastic waste.

Options for data use

There are a number of different options available to those looking to link procurement data to carbon. These can range from simply identifying a contract opportunity as ‘suitable for low carbon alternatives’ through to requiring detailed information on the amount of carbon saved during a contract.

Below we outline how teams can start to implement these initiatives:

In an earlier article, we introduced ten different ways in which you can use data to drive and measure sustainability in your procurement. From these options, we have selected four of those options which can be especially useful for measuring carbon reduction:

Forecast Contract Impact (Option 4)

Estimating carbon values for contracts is a good way to project cumulative emissions and the possible effect of changing procurement strategies. It can help buyers to focus their efforts on the categories with the highest impact. This can also help buyers to set carbon “budgets”, ensuring that suppliers must adhere to a specified amount of emissions during the contract. The data can be used to inform suppliers of this requirement, but also to undertake cumulative analysis of contracting initiatives across government. This approach is best used in a single, well-measured category such as energy.

Request Sustainable Suggestions (Option 5)

Encouraging suppliers to detail how they will reduce the carbon emissions associated with their contract.

Measure Use of Certifications (Option 6)

You can use certifications such as Environmental Product Declarations (EPD) to gather information on carbon emissions associated with a product. You can also request the use of other environmental certifications (e.g. Type I ecolabels) and assess their impact by contrasting forecasting and contract implementation data.

Monitor Contract Performance (Option 7)

Public buyers can provide information on carbon emissions during, or at the conclusion of a contract.  A number of industries such as travel and construction have standardized measures for their emissions and these can be included in any contract performance update. As work is underway to create a binding treaty on plastic waste, these approaches can also be taken to measure the use of plastic, especially in sectors that are skewed towards heavy usage such as construction and medicines/medical equipment.

Sample indicators

Here you will find low code and no code options that can help governments to measure the uptake of policies and the likely reductions that are being secured through specifying low carbon products and services. It is also a great way to communicate that you are taking action on climate more generally.

You can use public reporting to:

• Demonstrate that a policy is being adopted by buyers.
• Estimate the CO2 reductions through purchasing low carbon alternatives.
• Show which categories are delivering the best reductions.
• Highlight which categories require further action.
• Set an emissions budget for different contracts.
• Publish a pipeline of upcoming contracts and their CO2 budgets.

Some of these are more complicated than others. Even if you don’t have a reliable pipeline of data on CO2 emissions and public contracts, you can still communicate this data to address policy commitments and put provisions in specific higher impact contracts to encourage innovation by suppliers. It is important to start with the most simple data features and ensure that you have a robust, repeatable process for publishing data on emissions. For guidance on how to do this, earlier in the toolkit, we introduced an M&E Framework for measuring progress against sustainability goals. Through insights gained from the data, buyers can use this to mandate carbon reductions in procurement, while suppliers can use the data to improve their own supply chains and working practices in an effort to reduce emissions.

Get in touch if you’d like to talk to us in more detail about our government procurement data, our data API, or our research capabilities.