International Outlook
Public procurement must be open to all suppliers, including those operating in other countries. It is therefore of importance to keep track of the international developments within the field. Currently, a lot of work is underway to review existing international standards specifically developed to support effective procurement practices.
The likely most significant impact on future procurement work in Sweden is the various upcoming regulations being developed as part of the EU's climate initiative "Fit-for-55," where many of the different major action programs particularly emphasize the importance of application in public procurement.
Common Approach and Practical Tools
It has become increasingly evident that both a common approach and practical tools are needed to carry out procurement in a fossil-free and circular manner in order to eventually meet the set climate goals in accordance with international commitments. Otherwise, there is a significant risk that different countries will report measures to reduce climate emissions based on their own calculation methods, which have been done differently than other countries'. Considering that many countries have set climate goals to be achieved and reported by 2030, there are concerns that the common goals to be reached in accordance with the Paris Agreement may not be met. There is concern that this could lead to something referred to as “the great calculation war”.
This issue is the same whether it occurs in procurement contexts, at a national or global level. The question of a common approach is therefore equally relevant in Sweden's public procurement among procuring authorities.
Several international initiatives have already been taken to create harmonized approaches and practical procurement tools. This has been mostly expressed through the development of various standards within the International Organization for Standardization (ISO). In the ongoing EU initiative on different types of regulations to reduce climate impact, these ISO standards are being used as a foundation but are adapted to upcoming regulations and legislation. Both at an international and European level, work is underway to further adapt procurement methods and practical tools to meet increased expectations that more effective procurement can significantly contribute to necessary climate transitions.
ISO Standards
The standards that are primarily central to application in the procurement area are those for life cycle assessments, LCA (ISO 14040/44), and environmental product declarations, EPD (ISO 14025). The EPD standard has been specifically developed for use in procurement with the aim of providing objective bases for comparisons. This is referred to in the standard as "support for informed choices," meaning that the information in an EPD should form the basis for various types of decisions in procurement contexts.
The ISO standard for EPD was published almost 25 years ago and has not undergone any updates since then. Much has happened in the field of environmental communication recently, and the need for objective and verified data has increased with the development of more effective climate work in procurement. ISO has therefore decided to update and revise all standards in the so-called ISO 14020 series—a project that has been ongoing for a few years now.
When the EPD standard was published in 2006, only a few EPD programs were established in the market, and the experience of applying the standard was limited. Over time, this led to a need for more guidance on certain specific issues, primarily in the areas of developing product category rules (PCR) and forms of mutual recognition between EPD program operators. Such "supplementary standards" in the form of technical specifications have since been developed—ISO/TS 14027 Development of product category rules and ISO/TS 14029 Mutual recognition of environmental product declarations (EPDs) and footprint communication programs. A question that will likely arise during the revision work is whether these supplementary standards can be incorporated into the main standard or should remain as separate documents. In the case of the supplementary standard on PCR development, this document has been widely used in other contexts, not least within the EU's method for environmental footprinting (PEF—Product Environmental Footprint)—see more below.
Broadening EPD to a More General Procurement Concept
For EPD, opportunities have arisen for a partially new approach to develop it into a more general procurement concept that follows a broadening of the EPD definition. In connection with the revision of the initial standard for the ISO 14020 series on principles and general requirements (ISO 14020: Environmental statements and programs for products—Principles and general requirements), a new definition of EPD was established, reading: "Environmental statement on a product's environmental performance based on predetermined parameters from LCA calculations and supplementary environmental information." The change made is the addition of the requirement for supplementary environmental information. This indicates the possibility of broadening the EPD concept to another form of environment-related information, beyond the parameters that are now included in an LCA calculation related to commonly occurring environmental aspects such as climate, eutrophication, acidification, etc. The requirements for the possibility of broadening EPD to other related areas are that these must be verifiable.
The concept of additional environmental information appears in both ISO 14025 and PEF, with several examples of the type of information that might be relevant here. Several different types of information may thus be included in an EPD in the future. The area that many primarily suggest should be included in this broadening of EPD is various aspects related to the circular economy with applications in circular procurement. This seems logical as LCA calculations gather information on resource flows in the form of mass balances consisting of mapping the inflows and outflows of materials and energy from defined product systems (unit processes) in what is called inventory analysis. This analysis provides a first impression of the magnitude of material and energy flows and results in a basis for overarching considerations of possible measures to reduce these flows in a resource-efficient manner. In the inventory analysis, modeling can be done of the reduced climate impact that can occur with different levels of use of recycled inputs - a common goal in circular procurement.
Circular aspects can thus very well be included in future EPDs. The preparation and planning work could be the same as for procedures for fossil-free procurement but with a greater emphasis on specific circular issues addressed in the needs and market analyses and the earlier supplier contacts. The specific circular aspects that need to be included in the requirements setting can be advantageously summarized in an Annex to the PCR document.
One of the main benefits of this type of broadening of the EPD concept is the cost advantages it brings by utilizing the opportunities for direct contact with suppliers that occur during LCA calculations and verification when developing an EPD to then collect and verify data of particular importance for circular procurement data that otherwise are very difficult and costly to obtain traditionally.
EU's Efforts in Climate and Circularity
Within the framework of the EU's Green Deal, the EU Commission has developed a comprehensive package to ensure that future actions in policy areas such as climate, energy, transport, and taxes are adapted to enable a reduction of greenhouse gas emissions by at least 55 percent by 2030, which is the EU's goal in international climate agreements compared to 1990 levels. This initiative, called "Fit-for-55," will be continuously reviewed and updated as needed to reach the goal of being climate neutral by 2050. It is important to note that the upcoming EU regulations and rules within the framework of "Fit-for-55" are intended to become legally binding. This means that the proposed measures must be carefully prepared and developed to be practically applicable when the market begins to implement them.
The EU institutions have launched a wide range of initiatives within the framework of upcoming environmental and climate work. Here are several different proposals for new policy and product-related legislation and initiatives for sustainable products that also build on good resource management with circular starting points. Many of these activities will in one way or another affect the upcoming work with public procurement, which is clearly evident through the following examples of quotes from some central policy areas:
- The Circular Economy Action Plan, CEAP: Circular public procurement can drive the European Circular Economy Action Plan, including life cycle cost, repairability/recyclability, climate impact, and resource consumption.
- The Ecodesign Regulation, ESPR: To boost demand for environmentally sustainable products, the ESPR aims to set mandatory criteria for the public procurement of specific groups of products.
- The Construction Products Regulation, CPR: The possibility to include criteria in public procurement on sustainability objectives within the CPR without putting at risk the functioning of the single market.
Focus on Procurement and Communication Tools
A number of operational tools are proposed for use in circular procurement based on the ambitions of the global sustainability goals, mainly:
- Product Environmental Footprint, PEF
- Digital Product Passport, DPP
- Declaration of Performance, DoP
- CE marking
An attempt to illustrate the most relevant of these proposals for new regulations and legislation is shown in the figure below.
Illustration of Procurement and Communication Tools Division of the EU's climate initiative "Fit-for-55" into different action areas, with particular indication of activities that may be used in procurement work (marked in orange).
The EU Commission is dedicating significant efforts to various forms of guidance to avoid misleading and deceptive information and communication about products' environmental performance: Proposal on new rules to empower consumers in the green transition. For this, a specific directive called Green Claims has been developed, which in Swedish has been translated to "Gröna Miljöpåståenden."
Product Environmental Footprint, PEF
The EU has gradually introduced new regulations and rules to streamline its environmental work as these issues have become increasingly recognized and prioritized on the political agenda. In 2010, the EU Commission presented a strategy for a single market for green products, which became the origin of a broader concept for the EU's future efforts to reduce greenhouse gas emissions.
As a result of the introduction of the single market for green products, the EU Parliament tasked the EU Commission with developing a method for environmental footprinting - PEF. The method was based on the ISO standards for LCA (ISO 14040-44), which were developed to be applicable under different conditions that may apply in a global market. However, the EU Commission considered that the LCA method had some shortcomings, primarily regarding the difficulty in using LCA for product comparisons. To correct these, a method for environmental footprinting was developed, where the results of LCA calculations were supplemented with various environmental impact categories.
A specific PEF Guide outlines the methodology to be followed, which includes the development of product-specific rules called PEFCR (Product Environmental Category Rules) and the reporting of results for 16 environmental impact categories to cover all the issues that may need to be addressed in the upcoming regulations and directives that are part of the EU's climate package "Fit-for-55." The PEF Guide has been developed to serve as a key building block in the EU's flagship initiative in its 2020 strategy - A Resource-Efficient Europe.
The development of the PEF methodology began about ten years ago and has focused on developing PEFCR for a number of prioritized product groups, resulting in over 20 PEFCR documents. In recent years, the PEF work has undergone an evaluation and is now in a transition state for decisions on the scope and direction of the continued work. The evaluation has included activities to gather information on how different target groups perceive the usability of the PEF methodology.
Digital Product Passports (DPP)
Transparency and accessibility of information about circularity and sustainability are essential for successfully extending the lifespan of products through recycling, maintenance, and other measures. For products that will be regulated under the Eco-Design Directive, such information must be presented in digital product passports. These passports will ensure access to data across the entire value chain and support environmental efforts for producers, importers, distributors, repairers, and recycling operators. The digital product passports will also contribute to the achievement of the EU's safety goals by enabling the tracking of potentially harmful substances from a lifecycle perspective, as advocated in the Chemical Sustainability Strategy (CSS).
Declarations of Performance (DoP)
Declarations of Performance play a crucial and necessary role in increasing transparency and openness about product information, facilitating the implementation of the EU's single market objectives. Every product covered by the EU's harmonized standards issued in the European Technical Assessment requires such a declaration to obtain a CE marking. This declaration is a compilation of various product characteristics, including essential environmental information.
CE Marking
By CE marking products, the manufacturer ensures that the product meets the essential health, environmental, and safety requirements in the relevant directives. The marking then serves as a means for free movement within the internal market. The CE marking indicates that the performance of construction products is in accordance with the prepared Declaration of Performance. One of the main purposes of CE marking is to avoid trade barriers and enhance the competitiveness of construction products.