Sustainable Public Procurement: Towards a low‐carbon economy

59 Sustainable Public Procurement: Towards a low carbon economy
A whole life cost analysis has a positive impact on energy
efficiency through procurement. It not only helps explain and
justify a SPP decision but also acts as an important tool to arrive
at the decision. As discussed earlier in this chapter, cost
minimisation is very high on companies’ priority, approaching
SPP from a sustainable consumption perspective leads to a
greater buy in amongst the procurers. In order to reduce the
lifetime expenditure on energy, companies go for this analysis
albeit for big and/or energy intensive procurement only.
Although this is not a common and regular practice across
companies and products, the link between considering a long
term cost and energy efficient procurement choice was clearly
established.
The role of government in promoting SPP is complex. It can be
classified into two kinds - regulatory and enabling. Regulatory
functions are performed through various acts, rules, orders to
govern the actions of the government and its subjects. These are
often in the nature of making actions subject to command and
control. As against these, another set of laws and rules exist,
which works on the principle of directing and enabling in order to
meet the objectives of a proposed legislation.
When it comes to procurement, government policies therefore
operate at two levels – enabling, providing guidance in adopting
sustainability (e.g. BEE notifications) and another command and
control, (e.g. CVC, ECA guidelines). Currently the enabling role of
the government policies and institutions in promoting social
sustainability in the functioning of government departments and
companies is fairly established. A government framework, which
provides for energy efficiency in procurement, like the one that
provides for social sustainability, is therefore central to
developing and implementing SPP. While the possible and
existing role of the government in promoting energy efficiency in
procurement cannot be undermined, the obstacles in the form of
government policy and procedure cannot be ignored either.
As noticed in chapter II, the institutional framework governing
public procurement in India is primarily governed by the
Ministry of Finance’s GFR and the guidelines by the Central
Vigilance Commission and the DGSD. Government departments
and companies are usually concerned about meeting the
regulatory requirements as per the rules and policies of the
government. To meet (and come out clean of) the audit
requirements is placed very high on their agenda. And it is this
feature that acts as a negative influence for making SPP choices.
T E R I Report No. 2007GL01