Are you bidding on UK central government public contracts worth £5 million or more? If so, have you measured your carbon footprint and set a Net Zero target for 2050?
On June 21st, 2021 the UK government published an important Public Procurement Notice (PPN) stating that, by September 30th, 2021 every entity bidding on UK public contracts worth £5 million or more will be required to measure their carbon footprint and have a Net Zero target for 2050 in place. This is so the UK government can assess if the bidder has taken steps to understand their environmental impact and carbon footprint relevant to the delivery of the contract. Failing to comply with this legislation means you will be excluded from the bidding process. View our dedicated PPN 06/21 page here
WHAT IS THE UK GOVERNMENT ASKING FROM YOU?
The purpose of PPN 06/21 is to support the UK governments 2050 Net Zero goals of which decarbonising the public sector is a strategic pillar. The UK government wants to determine that all businesses delivering high value public sector contracts have included sustainability as part of their business operations. It therefore asks you to measure your Scope 1, 2 and 3 (partial) carbon emissions annually and demonstrate that you have a carbon reduction plan in place that aligns with the governments 2050 Net Zero goals.
PPN 06/21 Compliance Step 1: Measure
In order to determine your emissions and set a net zero target to comply with PPN 06/21 you first need to determine the carbon emissions for your base year by measuring the applicable direct and indirect emissions for all your UK operations.
There are eight distinct types of emission you need to measure. These are:
Scope 1 emissions
Scope 1 emissions are ‘direct’ emissions from sources we own or control. In practice, this includes fuel combustion, company-owned fleet emissions and fugitive emissions (accidental emissions or leaks not vented intentionally from a vent or stack.
Scope 2 emissions
Scope 2 covers indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by us.
Scope 3 emissions
Scope 3 emissions are all other indirect emissions – often resulting from your supply chain. There are 14 different types of Scope 3 emissions. To meet PPN 06/21, you only need to measure and report five of these categories. These are:
- Scope 3 Category 4 emissions: Upstream transportation and distribution
- Scope 3 Category 5 emissions: Waste generated in operations
- Scope 3 Category 6 emissions: Business travel
- Scope 3 Category 7 emissions: Employee commuting
- Scope 3 Category 9 emissions: Upstream transportation and distribution
Measurement and reporting standards
You measurement and reporting of emissions must be made in accordance with the following standards:
- Government published reporting standard for Carbon Reduction Plans
- GHG Reporting Protocol corporate standard
Government published emission conversion factors must be used for all other greenhouse gases other than CO2.
- Subset of Scope 3 emissions outlined in PN 06/21 documentation
PPN 06/21 Compliance Step 2: Reduce
The second step would involve setting a target that reaches Net Zero in 2050 to determine the progress you make towards that target each year. Targets can be set absolute or based on an intensity metric, for instance, often FTE or revenue.
PPN 06/21 Compliance Step 3: Report
The final step is to detail your past, current or intended carbon reduction projects and how these projects achieve carbon reductions against your base year.
To comply with PPN 06/21 by measuring, reducing your carbon emissions get in touch with our Net Zero Advisory team.