Greening of PPPs does not stop with the award of the contract. Government departments will need to work with the contractor to ensure environmental performance throughout the life of the projects.
An effective payment mechanism is crucial….
PPPs are not procurements and require a real partnering relationship with the contractor. In this regard an effective payment mechanism should be put in place to ensure compliance with environmental criteria.
It is important that environmental requirements are not considered a politically correct add-on to a contract, which can be discarded at a later date through lack of understanding. In this regard it is necessary to ensure that the contractor knows the requirements behind the environmental specifications.
…Especially when paired with ways to bring companies together with governments to work out how to improve environmental performance…
As well as having the appropriate payment mechanism, there are further opportunities for exploring how the environmental aspects of a PPP contract are being handled. There should be reviews of performance after certain periods. It is also likely that the environmental rules will be strengthened during the lifetime of the contract. In this case it is important that governments work with the private partner to promote green PPPs. Companies often have a comprehensive understanding of environmental sustainability and this is an opportunity for mutual learning.
… But more dissemination of best practice in Green PPPs is still required.
While some companies maintain that there is a strong business case for sustainability, others in the private sector perceive it to be too risky. There needs to be a much wider dissemination of best practice case studies, and a sharing of information among private sector PPP professionals, in order to incorporate sustainability principles into PPP bids and operations. This would bridge the existing perception gap and contribute to a more consistent implementation of environmental sustainability criteria in public-private partnerships.
| ACTION POINT In order to integrate sustainable development into PPPs, a two-fold approach may be taken. The first step is to disseminate best practice case studies as to the reality of incorporating sustainability principles into PPP bids and operations, which would bridge the existing perception gap. The second step is to improve the policy coordination between the economic and finance ministries that have responsibility for a relevant PPP project or programme, and environmental ministries, in order to maximize the contributions of PPPs to sustainable development. |
Sources and Further Information
(i) United Kingdom Department of Transport, Green Public-Private Partnerships Guidance Note, 2003.
(ii) European Commission Interpretative Communication on Green Procurement, 2001.