Worked example: Measuring carbon reduction

In this section we explain how you can use data to measure and monitor progress against the goal of promoting carbon reduction through procurement.

What is it?

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 describes 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 do it?

Carbon emissions reduction is at the center 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

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

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

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.

How to estimate carbon values?

Benchmarking carbon procurements

How to gather the data you need?

Analyzing and reporting data

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:

At the beginning of this section, 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 which can be especially useful for measuring carbon reduction:

Request sustainable suggestions (Option 5)

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

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.

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 use of plastic, specially in sectors that are skewed towards heavy usage such as construction and medicines/medical equipment.

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.

Sample indicators

Below are some simple 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. Below are some examples of possible outcomes and indicators to track:

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GOALS	OUTCOMES	INDICATORS	INFORMATION NEEDS	CALCULATION METHOD	OPTIONS FOR RECORDING THE DATA YOU NEED
Reducing carbon emissions	Promoting low carbon practices in public contracts	Share of tenders which comply with low carbon SPP policies	- Number of tenders that company with low carbon policy - Total number of tenders	Compliant tenders / Total number of tenders	See Option 5: Request sustainability suggestions
Reducing carbon emissions	Promoting low carbon practices in public contracts	Share of tenders which include a carbon budget	- Number of tenders which include a carbon budget within specifications - Total number of tenders	Contracts which include a carbon budget / Total number of tenders	See Option 4: Forecast contract impact
Reducing carbon emissions	Promoting low carbon practices in public contracts	Share of tenders which reference CO2 emissions within scoring of tender (award criteria)	- Number of tenders which reference CO2 emissions within the award criteria - Total number of tenders	Tenders which reference to CO2 emissions / Total number of tenders	See Option 5: Request sustainability suggestions
Reducing carbon emissions	Reducing carbon value associated with public contracts	Tonnes of Co2 associated with public contracts	- CO2 estimate of goods purchased - Amount of units purchased	CO2 estimates X Amount of units	See Option 4: Forecast contract impact
Reducing carbon emissions	Reducing carbon value associated with public contracts	Tonnes of Co2 saved through SPP implementation	- Projected CO2 before including SPP specifications - Actual emissions after including SPP specifications and monitoring results	Projected emissions - Actual emissions	See Option 5: Request sustainability suggestions See Option 7: Monitor contract performance
Reducing carbon emissions	Reducing carbon value associated with public contracts	Contribution to National Targets through SPP	- Alignment with National Targets (e.g. how reduction of emissions in public procurement is contributing to national net zero targets) - Uptake of prescribed technologies	Projected alignment with target (e.g. will achieve net zero in 2030)	See Option 5: Request sustainability suggestions See Option 7: Monitor contract performance
Reducing carbon emissions	Reducing carbon value associated with public contracts	Number of contracts prioritized for SPP implementation for being high-emitting contracts	- Prioritized contracts - Total number of contracts	Prioritized contracts / Total number of contracts	See Option 4: Forecast contract impact
Reducing carbon emissions	Promoting low carbon suppliers	Share of tenders which reference environmental certifications within specifications	- Number of tenders which reference environmental certifications within specifications - Total number of tenders	Tenders with reference to environmental certifications within specifications / Total number of tenders	See Option 1: Assign tags to procurements See Option 5: Request sustainability suggestions See Option 6: Measure use of certifications
Reducing carbon emissions	Promoting low carbon suppliers	Share of tenders which reference environmental certifications within scoring (award criteria)	- Number of tenders which reference environmental certifications within scoring of tender - Total number of tenders	Tenders which reference to environmental certifications within scoring of tender / Total number of tenders	See Option 1: Assign tags to procurements See Option 5: Request sustainability suggestions See Option 6: Measure use of certifications
Reducing carbon emissions	Promoting low carbon suppliers	Number of suppliers which meet low carbon (e.g. environmental certifications) criteria set in tender documents	- Number of suppliers which meet low carbon criteria - Total number of suppliers	Number of suppliers which meet low carbon criteria / Total number of suppliers	See Option 6: Measure use of certifications
Reducing carbon emissions	Reducing the purchase of carbon intensive products	Tonnes of CO2 associated with concrete used in public procurement projects	- CO2 estimate of concrete - Tonnes of concrete purchased	CO2 estimates X Tonnes of concrete	See Option 4: Forecast contract impact
Reducing carbon emissions	Reducing the purchase of carbon intensive products	Tonnes of CO2 associated with the use of steel in public procurement projects	- CO2 estimate of steel - Tonnes of concrete purchased	CO2 estimates X Tonnes of steel	See Option 4: Forecast contract impact

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.

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

Carbon reduction