PPN06/21: Your Carbon Reduction Plan
Whether you are new to public sector tendering or a seasoned bidder, you would have noticed that alignment with PPN 06/21 is now a consistent requirement from procuring authorities and a weighted criterion in the evaluation of your bid submission.
This Procurement Policy Note, issued by the UK government, focuses on "Taking Account of Carbon Reduction Plans in the Procurement of Major Government Contracts." Its aim is to ensure suppliers contribute to the national goal of achieving Net Zero carbon emissions by 2050.
Importantly, PPN 06/21 applies to contracts valued at £5 million or more per annum (excluding VAT). This threshold ensures the policy targets large contracts with significant environmental impacts, requiring suppliers to submit a Carbon Reduction Plan (CRP) as part of their bid. While contracts below this threshold are not explicitly covered, procuring authorities may voluntarily apply similar requirements, especially for projects with notable sustainability implications.
So, what exactly is PPN 06/21, and what is the easiest approach to satisfy this inescapable requirement? In essence, it mandates that suppliers bidding for high-value contracts provide a CRP detailing their current carbon emissions and reduction commitments, focusing on key categories like energy use, business travel, and waste. Compliance is not just about meeting bid criteria but demonstrating accountability and contributing to the UK’s sustainability objectives.
The simplest way to align with PPN 06/21 is to adopt a structured, transparent approach, such as leveraging frameworks like the GRI Standards (Global Reporting Initiative). These standards provide clear methodologies for tracking, managing, and reporting emissions data. By integrating GRI-aligned disclosures into your CRP, you not only enhance the quality and competitiveness of your bid but also support broader environmental goals.
In the sections that follow, we’ll break down the specifics of PPN 06/21, how it applies to your organisation, and the practical steps you can take to ensure your submissions are both compliant and compelling.
Overview of PPN 06/21
PPN 06/21 focuses on "Taking Account of Carbon Reduction Plans in the Procurement of Major Government Contracts". It was published on September 2021 and applies to all central government departments, their executive agencies, and non-departmental public bodies in the UK. It is part of the government's strategy to support its commitment to achieving Net Zero carbon emissions by 2050.
Key Highlights of PPN 06/21:
Application Scope:
Applies to contracts valued at £5 million or more per annum (excluding VAT).
Mandates suppliers bidding for these contracts to submit a Carbon Reduction Plan (CRP).
Carbon Reduction Plan (CRP): Suppliers must detail:
Current carbon emissions: Baseline data including Scope 1 (direct emissions), Scope 2 (indirect emissions from purchased energy), and a subset of Scope 3 (emissions from business travel, employee commuting, and waste).
Reduction commitments: Measures and commitments to reduce greenhouse gas emissions, aligned with the UK’s Net Zero target.
Third-party standards: Adherence to recognised environmental standards or frameworks, such as PAS 2060 (carbon neutrality).
Policy Intent:
Encourages suppliers to align with Net Zero pathways.
Drives accountability and sustainability in public procurement.
Evaluation Criteria:
A supplier’s compliance with the CRP requirement is considered during the procurement evaluation stage.
A non-compliant CRP may disqualify a supplier from being awarded the contract.
Implementation Date:
Took effect on 30th September 2021 for all in-scope procurements initiated after that date.
Exemptions:
Certain procurements, such as those subject to national security considerations, may be exempt.
Goals of PPN 06/21:
To integrate sustainability into public sector supply chains.
To encourage suppliers to actively measure and reduce their carbon emissions.
To align procurement practices with broader UK climate change targets and sustainability goals.
