The UK government’s Public Procurement Notice (PPN) 06/21 marks a significant shift towards sustainability in public procurement. This policy mandates that suppliers demonstrate their commitment to tackling climate change, reducing waste, and addressing social inequality when bidding for public sector contracts worth over £5 million annually. By complying with these requirements, businesses can seize a valuable opportunity to secure high-value contracts, boosting revenue while contributing to a more sustainable future.
Key requirements:
To comply with PPN 06/21, companies must create and implement a Carbon Reduction Plan (CRP) that includes the following:
- A signed and approved plan by a director.
- Reporting on scope 1, 2, and relevant scope 3 emissions.
- A commitment to achieve Net Zero by 2050.
- Annual emissions calculations and updates to the plan.
- Details of the environmental management measures that can be applied in the delivery of the contract.
Businesses can use a selection of standards to measure their impact and develop a subsequent CRP, such as:
- Greenhouse Gas (GHG) Protocol: A globally recognised framework for measuring, reporting, and managing GHG emissions.
- ISO 14064-1: An ISO-accredited standard used to verify emissions data.
UK Government conversion factors: Factors that allow organisations to calculate GHG emissions from a range of activities, including energy use, water consumption, waste disposal, and transport.
Why the change?
The introduction of PPN 06/21 came as part of a wider push towards combating climate change. Public sector procurement accounts for a significant portion of the UK’s economy, so the legislation enables government spending to be leveraged to drive sustainability. There are other pressure factors, too, such as growing demand from investors, customers, and the wider public for companies to show tangible progress in sustainability. PPN 06/21 ensures all businesses bidding for public sector contracts are contributing to the UK’s Net Zero ambitions transparently and are accountable for their activities.
Regulatory impact
PPN 06/21 represents a significant regulatory shift in public procurement, impacting businesses across a wide range of sectors. From construction to technology, companies are required to show tangible progress in reducing carbon emissions, rather than merely expressing good intentions. Non-compliance can result in financial penalties, reputational damage, and lost business opportunities. More critically, companies not yet aligned with broader sustainability goals risk falling behind future government policies and market expectations, which could lead to negative consequences.
Positive Planet’s role
Sustainability consultancies, such as Positive Planet, can play a crucial role in helping businesses navigate legislation like PPN 06/21. With expertise in carbon footprint measurement, reduction planning, and regulatory compliance as well as alignment to key frameworks such as GHG protocol, Positive Planet can provide valuable guidance and efficient project turnarounds to help your business comply with PPN 06/21. Our tailored support in data analysis and strategic planning means your business can access higher-value public sector contracts, even with the tightest deadlines. Positive Planet ensures that organisations meet the requirements of legislation and integrate sustainability deeply into their business strategies.
Next steps for businesses
Businesses not yet complying must assess their current emissions and develop a stringent Carbon Reduction Plan to reduce them, focusing on scopes 1, 2, and relevant scope 3 emissions, and aligning with the UK’s Net Zero target to unlock the possibility of attaining high-value government contracts. For businesses already complying, it’s imperative to remain ahead of the curve with regulatory changes. Follow your CRP annually, updating actions, disclosing more data, and improving transparency where necessary to continue to drive your sustainability actions. This will not only ensure you continue to comply with PPN 06/21 but will also prepare you for other new sustainability regulations shaping the legislative landscape such as the UK SRS.
To summarise, PPN 06/21 represents a pivotal moment for businesses working with the UK public sector. This regulation drives sustainability in procurement by ensuring companies transparently address climate change. Compliance offers businesses the opportunity to access high-value contracts while simultaneously embedding a sustainability strategy that will lay the foundations for future decarbonisation and innovation.
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