Measuring impact for your circular procurement can be quite daunting. Especially within the vast offering of tools, indicators and certificates. On this page we try to offer some guidance.
What are you looking for?
In their 'Circular Mectric for Business' 2020 report, Circle Economy offer us some clear definitions:
"A metric is a method we employ to understand change over time across a number of dimensions. We use it as a catch-all term to describe the method used to measure something, the resulting values, as well as a calculated or combined set of indicators.
The indicator is a crucial element of a metric, referring to a single value and its unit, and used to indicate (hence the name) a specific trend or performance.
Many of the metrics are partly or fully automated in online or offline tools that enable easy application and reduce the risk of errors. In this context, tools can therefore be considered automated metrics.
Metrics that have a certain degree of scrutiny and testing, and are commonly accepted as a standardised way of measuring, can be regarded as standards. Technically, one can consider both ‘informal’ standards and standards that have officially been documented and published by standardisation organizations.
A certificate is a specific type of standard that can not be applied by the organisation itself but requires a third party to assess whether the company’s performance has been according to a certain standard. They usually result in a product label being issued by the third party."
Adding to this, we can use a broader definition for 'tools' and include all material that helps you achieve your circular procurement and measure it's impact.
Criteria tools have an inspirational effect, and can help purchasers specify their criteria. It remains important to consider personally what’s important in your specific situation and enter into a dialogue with the market, especially if we want to stimulate innovation.
Given the time it takes to prepare these tools, remember that by definition they don’t contain the most recent options available in the market.
Most criteria tools were developed with a view to sustainable procurement, but we’ve noticed that they increasingly incorporate circularity concepts.
The SPP Criteria tool by Rijkswaterstaat (NL); generates specific sustainable public procurement criteria for various sustainable public procurement product groups at three levels of ambition.
In addition to the circular ambition chart, within the Green Deal Circular Procurement a set of indicators was developed. They can be used to compare your baseline (as-is linear procurement) to the outcome of your circular procurement.
This will help evaluate your ambitions and the procurement itself. And off course give you an idea of the positive impact that was achieved.
Life Cycle Costing
Under the 2014 EU procurement rules a contract must be awarded based on the most economically advantageous tender (MEAT). Cost or price will form part of the assessment of any procedure, and is usually one of the most influential factors. Yet this does not rule out Green Public Procurement. Costs may be calculated on the basis of a product’s life-cycle. When you purchase a product, service or work, you always pay a price. Purchase price, however, is just one of the cost elements in the whole process of purchasing, owning and disposing. Life-cycle costing (LCC) means considering all the costs that will be incurred during the lifetime of the product, work or service:
Purchase price and all associated costs (delivery, installation, insurance, etc.)
Operating costs, including energy, fuel and water use, spares, and maintenance
End-of-life costs (such as decommissioning or disposal) or residual value (i.e. revenue from sale of product)
LCC may also include the cost of externalities (such as greenhouse gas emissions) under specific conditions laid out in the directives. The current (2014) directives require that where LCC is used, the calculation method and the data to be provided by tenderers are set out in the procurement documents. Specific rules also apply regarding methods for assigning costs to environmental externalities, which aim to ensure that these methods are fair and transparent.
LCC makes good sense regardless of a public authority’s environmental objectives. By applying LCC public purchasers take into account the costs of resource use, maintenance and disposal which are not reflected in the purchase price. Often this will lead to ‘win-win’ situations whereby a greener product, work or service is also cheaper overall. The main potential for savings over the life-cycle of a good, work or service are: