Last week the Cabinet Office published a Procurement Policy Note focused on carbon reduction which supports the UK’s commitment to net zero emissions by 2050.
Titled ‘Taking account of Carbon Reduction Plans in the procurement of major government contracts’ the policy will apply to the procurement of goods, services, and/or works where the anticipated contract is valued above £5 million per annum.
The policy will come into effect for procurements advertised on or after 30 September 2021, and is mandatory for central government departments, their executive agencies and non-departmental public bodies.
Carbon Reduction Plan
Organisations bidding for government contracts must provide a Carbon Reduction Plan which confirms their commitment to achieving net zero in their UK operations by 2050 and meets the Cabinet Office’s technical standard.
As well as Scope 1 emissions (direct emissions from owned or controlled sources) and Scope 2 emissions (indirect emissions), companies will need to go further and report some of their Scope 3 emissions too (all other indirect emissions that occur in a company’s value chain) which often represent a significant part of an organisation’s carbon footprint. Scope 3 emissions include business travel; employee commuting; transportation; distribution, and waste.
A template Carbon Reduction Plan has been set out within the Procurement Policy Note, however if your organisation needs hands on support developing a realistic Carbon Reduction Plan, our sustainability consultants can help.
Time to act
Organisations intending to bid for government contracts should immediately start to think about how they will address the new requirements and begin preparations for their Carbon Reduction Plan. Organisations must set out the environmental management measures they have in place currently, as well as those that will be in effect and utilised during the performance of the contract.
Carbon Reduction Plans need to be approved at Director level to demonstrate the organisations commitment to reducing emissions and must be updated and approved annually.
To ascertain whether organisations have taken adequate steps to understand their environmental impact and carbon footprint relevant to the delivery of the contract organisation should familiarise themselves with the likely question format that will be introduced during procurement.
Groundwork supports the introduction of these new requirements as it harnesses the power of procurement to encourage suppliers and other supply chain actors to shift towards products, solutions and production processes that align with the UK’s climate commitments.