Government procurement for sustainability outcomes

12 Jun 2019

This project, commissioned by the Co-operative Research Centre for Low Carbon Living (CRCLCL), aims to advance an important aspect of the National Energy Productivity Plan: specifically, Item 12, ‘improving energy productivity in government’.
In 2015, the COAG Energy Council agreed that each government within the Council should endeavour to improve the energy productivity of their own operations. The Plan commits jurisdictions to work with each other and with stakeholders to share learnings in the development and implementation of government energy productivity and efficiency measures, to improve government energy use using the most effective approaches.
In this context, the CRCLCL commissioned this project to analyse a range of prioritised opportunities, as nominated by governments themselves. These were:
New high efficiency, all electric and low carbon buildings (offices, data centres, places of education, hospitals)
Requiring higher energy productivity buildings (driving retrofits)
Consideration for carbon neutral certification through the National Carbon Offset Standard (NCOS) – although it was later agreed that carbon neutral certification would not be investigated as part of this report
High efficiency and lower carbon internal combustion engine vehicles - where duty cycles are not suited to electric vehicles (EVs)
EVs where duty cycles are appropriate plus provision of EV charging infrastructure
Energy procurement – consideration of power purchase agreements (PPAs) for renewable energy and provision for local energy trading from a microgrid ecosystem featuring renewable energy and storage on building sites.
Officials representing the Australian Government, the ACT and NSW Governments, and also the University of Melbourne, contributed data and other inputs, and participated in a Project Steering Committee. This Final Report incorporates comments received from the Steering Committee on an Exposure Draft Final Report.
Key Findings
Governments are very large consumers of services, including energy, transport and accommodation amongst others. Total government spending for all purposes in 2016-17 was $624 billion, although includes much expenditure that was not ‘procured’. In the same year, the Australian Government alone reported a total procurement value of $47.4 billion across 64,092 contracts.
Existing procurement guidelines encourage the objective of value for money to be considered in a broad context including:
considering the financial and non-financial costs and benefits of procurement
considering the environmental sustainability of the goods or services (such as energy efficiency and environmental impact, use of recycled products, etc)
considering whole of life costs such as initial price, maintenance, consumables and disposal costs.
All governments that examined this project have some government efficiency or resource sustainability policies and programs in place. The ACT Government, notably, is procuring renewable energy power purchase agreements (PPAs) to help meet its energy and carbon goals, as considered in Chapter 6, and the NSW has just recently updated its Government Resource Efficiency Policy. All governments examined have policies that encourage procurement of energy efficient buildings. However, many of these policies are now relatively old, with targets that are, arguably, out of date. From this perspective alone, there are cost-effective opportunities to strengthen sustainable procurement policies in many jurisdictions. The authors were unable to find examples of formal evaluations of government sustainable procurement policies in Australia.

Geographic Coverage