The Role of Government

Governments need to be diligent in promoting the green criteria in PPPs…

Before making the decision to undertake a project or programme, public authorities need to evaluate and take into account the environmental and health factors. In some cases, at the project level they will undertake Environmental Impact Assessments (EIAs) as a part of the preparation of plans, programmes, policies and legislation that are likely to have significant environmental effects.36 They may also undertake Strategic Environmental Assessments (SEAs) towards these ends as well.

As the contracting authority, the burden for ensuring compliance of PPPs with green criteria rests with the government. They must fix clear objectives and specifications in contracts. They should identify some environmental factors as the key performance indicators, as well as environmental risks and the party that should manage them.

…By bringing the environmental national policies into line with the project's goals….

Public bodies are increasingly scrutinized by environment Ministers and stakeholders, NGOs and the public to determine if their policies are in line with environmental standards. Government departments involved in PPPs will have therefore to benchmark their strategies against their own Government's environmental policies. This will also include the EU rules on environmental considerations in procurement. See European Commission Interpretative Communication on Green Procurement (2001).

Projects are sometimes undertaken with the express objective to achieve environmental goals. In Canada, for example, the Vancouver Landfill Cogeneration Plant, undertaken as a PPP, was designed to reduce carbon emission in line with that Government's support of the Kyoto Agreement.37

…And bringing environmental 'champions' and advisers into the process…

Sustainable development advisors need to be consulted in order to help the contracting authorities ensure that sustainability considerations will be consistently included in PPPs. It is important to consistently interpret value for money based on whole life costing, and not a cheapest-bid-wins scenario. This would be aided by expert sustainability advisors, in compliance with national and international legal obligations.

…While putting sound practical environmental objectives into the project…

In considering PPP projects the government should explore whether more environmentally-friendly methods would achieve the same goals. For example, localised satellite offices with hot-desking and telecommuting may be a more cost effective, environmentally preferable and socially beneficial alternative to a large office in a prime inner city location. Also, exploring opportunities to reduce unused space and maximise the use of brownfield land across the public sector's land Could be a solution for some projects. If new buildings or relocations are planned, preference should be given to sites which are already well served by public transport in order to reduce car emissions.

…And into the contracts….

Governments can build into the contracts environmentally preferable products, such as avoiding ozone depleting chemicals, choosing low maintenance materials with low embodied energy and made from recycled materials when possible. They should also specify types of building, such as energy efficiency buildings, which can be designed from the outset for disassembly and recycling. They can also favour use of brownfield as opposed to greenfield sites that minimize car dependency.

…When picking bidders…

The contracting authority must send a clear signal to the private sector that sustainability will be rewarded in evaluation bids and in the award of a contract. The selected bids should demonstrate that they have understood the needs of the site and that they have the ability to develop appropriate solutions which meet environmental requirements to conserve resources, minimize waste and reduce pollution both during construction and during the lifetime of the project. The final evaluation of tenders should not be based on price alone. The requirement in the public sector to achieve value for money for the taxpayer means looking beyond the initial price to take account of the whole life costs and quality. A low cost design may result in high maintenance and operating costs and negative environmental impacts.

…While being especially careful of what is specified and what is being offered by the bidder.

The evaluation team will need to ensure that the claims made by bidders make sense, satisfy the specification and assess as well whether they offer more than is expected. Answers to these questions can be found by reference to various guidance materials such as the Green Claims Code.

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36  Most countries have national legislation on environmental assessment. In the European Union, these processes are regulated through the EIA Directive 2003/35/EC and SEA Directive 2001/42/EC. In the UNECE region, two international treaties have been negotiated in order to harmonize standards and procedures for these processes: the Convention on Environmental Impact Assessment in a Transboundary Context (Espoo, 1991) and the Protocol on Strategic Environmental Assessment (Kiev, 2003).

37  The environmental aspect was taken into account by the City of Vancouver and Maxim Co for the Vancouver Landfill Cogeneration Plant. Under this arrangement Maxim, a private company, has financed, built and is operating a world-class cogeneration facility to convert waste to energy. It raised 83 per cent of the Can dollars 10.3 million project cost through debt financing arranged by Corpfinance International - principally a 20 year 7.8 per cent fixed interest rate, non recourses loan for 7.6 million - and provided equity for the balance. Under matching 20 year agreements, the facility uses landfill gas collected by the City to generate electrical and thermal energy.