4 Ways Your Business Can Benefit from PPN 06/21

In 2019 the UK government made legal commitments to significantly reduce the nation's greenhouse gas emissions and set the target of achieving Net Zero by 2050. To help achieve this target, the UK government has since introduced a selection of policies, a key one being the PPN 06/21.

PPN 06/21 and why you should know about it.

PPN 06/21, ‘Taking account of Carbon Reduction Plans in the procurement of major government contracts', was published by the UK government in June 2021. It is a Procurement Policy Note (PPN) that requires all government suppliers to demonstrate their commitments to achieving Net Zero greenhouse gas emissions by 2050. More specifically, the policy demands that suppliers (of goods, services and works) of ‘In-Scope Organisations' (ISOs; including Central Government Departments, their Executive Agencies and Non Departmental Public Bodies) monitor their greenhouse gas emissions and outline how they intend to reduce these over time.

Under PPN 06/21, suppliers must demonstrate their environmental commitments when bidding for ISO contracts with an anticipated contract value of over £5 million per annum (excluding VAT), subject to the Public Contracts Regulations 2015. However, it is highly likely that this threshold will decrease in over time, meaning PPN 06/21 policy requirements will become mandatory for more and more suppliers. It is also becoming increasingly common for smaller and non-government suppliers to be requested to demonstrate their emissions reduction plans. This is because larger organisations are making commitments to reducing emissions, and are cascading requirements down through their supply chains.

 

How does PPN 06/21 affect your business?

When bidding for ISO contracts, your businesses must provide a Carbon Reduction Plan confirming their commitment to achieving net-zero by 2050. Within the CRP, your businesses must:

• Provide data on your scope 1, 2 and 3 emissions for at least the past 12 months.
• Provide emissions reporting, in CO2e (carbon dioxide equivalent), for the six greenhouse gases covered by the Kyoto Protocol.
• Detail how you plan to achieve Net Zero for all your UK operations.
• Detail specific carbon reduction measures that you will undertake when performing the ISO contract.

Under PPN 06/21, your businesses' Carbon Reduction Plan must be published and clearly signposted on your UK supplier website and must be updated regularly (annually as a minimum).

Should your business fail to provide an adequate Carbon Reduction Plan and follow PPN 06/21 requirements when bidding for ISO contracts, your bid will be disqualified.

 

The benefits of PPN 06/21.

Whilst this policy may seem demanding, adopting the requirements of PPN 06/21 can provide multiple benefits for your business. It can:

Help your business stay competitive by enabling you to bid for large contracts.
Enable you to significantly reduce costs as well as emissions by increasing your emissions visibility.
Help you to identify opportunities to decrease material and energy use and improve efficiencies.
Attract more business as demonstrating your commitments to Net Zero can enhance corporate reputation and set your company apart from competitors.

At Tomson Consulting we provide a range of specialist services to support your business in meeting PPN 06/21 and other policy requirements.

 

Contact Pip Lorimer at pip@tomsonconsulting.co.uk to find out more.