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Climate change is an ongoing challenge that demands immediate and sustained action. In response, countries like the United Kingdom are ramping up their environmental efforts to meet stringent targets for reducing emissions. One such initiative is the introduction of the Procurement Policy Note 06/21 (PPN 06/21).
But what exactly is PPN 06/21, and how will it ensure businesses comply with the essential environmental regulations now being enforced? Let’s explore its role in shaping a greener future.
👉 In this article we examine PPN 06/21 and how it will push companies to meet the UK’s ambitious sustainability goals.
Following the UK’s pioneering move as the first major economy to make a legal commitment to achieving net zero carbon emissions by 2050, companies are required, starting September 30, 2021, to calculate and report their carbon footprint, aligning with this national goal.
The goal of PPN 06/21 is to ensure that companies vying for major government contracts are actively measuring their carbon output and taking steps to reduce their environmental impact. This policy not only aligns with the UK's sustainability objectives but also serves as a driver for businesses to prioritise greener practices.
Failure to meet the requirements of PPN 06/21 results in automatic disqualification from tendering opportunities. In essence, this policy incentivises businesses to implement and track net zero strategies to remain competitive.
👉 Importantly, PPN 06/21 applies to both U.K. and overseas companies bidding for government contracts valued at over £5 million per annum. Regardless of location, compliance is mandatory for those seeking to participate in the tender process.
Procurement Policy Note 06/21 (PPN 06/21) outlines specific obligations for businesses bidding on UK government contracts valued at over £5 million annually. The policy requires companies to demonstrate their commitment to reducing carbon emissions in line with the UK’s target to achieve net zero emissions by 2050. To comply with PPN 06/21, businesses must:
To ensure consistency and accuracy in reporting, PPN 06/21 mandates that businesses follow technical guidance when preparing their Carbon Reduction Plans. The technical requirements, as outlined by the UK government, include:
Emissions data must be calculated using recognised frameworks such as the Greenhouse Gas (GHG) Protocol or ISO 14064-1. Businesses must also use the UK Government conversion factors to translate their emissions into carbon dioxide equivalents (CO2e).
The CRP should include the following elements:
Complying with Procurement Policy Note (PPN) 06/21 requires a structured approach to ensure your business meets the UK government's standards for carbon reduction. Below are key steps your organisation can take to align with the policy and demonstrate a commitment to achieving net-zero emissions by 2050.
The first step is to thoroughly review the requirements of PPN 06/21, particularly focusing on the need to measure and report Scope 1, Scope 2, and selected Scope 3 emissions. Make sure your team understands which parts of your business operations are affected and what data will be required.
Establish internal systems or tools to track and measure your carbon emissions across the required scopes. This can involve using software or collaborating with companies like Greenly who specialise in carbon accounting to ensure accurate data collection.
Before you can set reduction targets, you must assess your current carbon footprint. This involves calculating your baseline emissions for Scope 1, 2, and relevant Scope 3 categories. Make sure to capture data accurately from all UK operations and use government-approved conversion factors to convert this data into carbon dioxide equivalent (CO2e).
Create a Carbon Reduction Plan that reflects your company’s commitment to achieve net zero by 2050. Use the UK government’s Carbon Reduction Plan Template as a guide, ensuring you cover all required sections: baseline emissions, current emissions, reduction targets, and carbon reduction projects. Your CRP should be a living document, updated annually to reflect progress and any changes in your operations.
Once your carbon footprint is understood, identify key areas where emissions can be reduced. This might involve switching to renewable energy, improving energy efficiency, optimising transportation and logistics, or reducing waste. Assign projects to specific teams within your organisation to ensure accountability for implementing these initiatives.
Ensure that carbon reduction becomes part of your overall business strategy. Align your sustainability goals with wider operational and financial plans to ensure the whole organisation is moving toward the net-zero target. Encourage cross-department collaboration to embed these goals into daily operations.
Your Carbon Reduction Plan must be signed off by a senior leader, such as a director or board member, demonstrating high-level commitment. This sign-off not only ensures accountability but also sends a strong message both internally and externally that your company is dedicated to reducing its environmental impact.
Once finalised, publish your Carbon Reduction Plan on your company’s website in a prominent location. This transparency is essential for compliance, as it allows the government and stakeholders to monitor your progress. Keep historical versions of the plan online as well, so progress can be tracked over time.
Compliance with PPN 06/21 is not a one-time task. Your company must review and update its Carbon Reduction Plan annually to ensure it reflects any structural changes, new projects, and updated emissions data. Regular reviews will also help keep your business on track to meet its net zero targets.
To ensure successful compliance, engage all levels of your business. Train your employees on the importance of carbon reduction, provide clear goals and guidelines for how they can contribute, and incentivise sustainability initiatives within teams. The more embedded carbon reduction is across your workforce, the more effective your overall strategy will be.
👉 By following these steps, your business can effectively meet the requirements of PPN 06/21 and play a role in the UK’s wider efforts to combat climate change. Compliance not only keeps you eligible for lucrative government contracts but also positions your company as a leader in sustainable business practices.
Compliance with PPN 06/21 offers a range of benefits that extend beyond eligibility for government contracts. Key advantages include:
| Advantage | Description |
|---|---|
| Access to Government Contracts | Complying with PPN 06/21 ensures eligibility to bid for UK government contracts worth over £5 million annually, opening up lucrative opportunities in the public sector. |
| Improved Reputation & Brand Value | Demonstrating a commitment to sustainability enhances your company’s reputation, showcasing it as a forward-thinking, environmentally responsible business. |
| Alignment with Net-Zero Goals | By complying, your company actively contributes to the UK’s net-zero emissions target for 2050, positioning your business as a leader in climate action. |
| Increased Operational Efficiency | Implementing carbon reduction strategies often leads to greater energy efficiency, waste reduction, and streamlined operations, which can lower costs in the long term. |
| Stakeholder Confidence | Compliance boosts transparency and accountability, helping to build trust with clients, investors, and partners who prioritise environmental responsibility. |
| Competitive Advantage | Businesses that comply with PPN 06/21 are better positioned to win public sector contracts, giving them an edge over competitors that fail to meet these requirements. |
| Attracting Talent | Sustainability-focused businesses are increasingly appealing to top talent, particularly employees who value working for companies with strong environmental commitments. |
| Regulatory Readiness | Complying with PPN 06/21 ensures your company is well-prepared for future environmental regulations, reducing the risk of non-compliance as government policies evolve. |
| Innovation and Market Leadership | Engaging in carbon reduction often encourages innovation in green technologies and sustainable practices, allowing your company to lead within its industry. |
| Long-Term Cost Savings | Many carbon reduction initiatives, such as energy-saving measures and sustainable sourcing, can result in significant cost savings over time. |
Complying with PPN 06/21 requires precise carbon measurement, strategic action plans, and ongoing reporting to meet the UK government’s sustainability requirements. Greenly is here to help you achieve compliance while enhancing your sustainability practices.
Greenly offers advanced tools to help businesses measure their greenhouse gas emissions across Scope 1, 2, and 3, as required by PPN 06/21. Our platform provides a detailed breakdown of your carbon footprint, ensuring that you capture all relevant emissions, including upstream and downstream activities. This complete data set allows your business to track its progress toward net zero with confidence.
Developing a Carbon Reduction Plan (CRP) that aligns with PPN 06/21 is crucial for compliance. Greenly’s climate experts work with your team to create a custom CRP that not only meets government standards but also reflects your company’s specific sustainability goals. From setting a baseline year to identifying actionable carbon reduction projects, Greenly helps ensure your CRP is both compliant and impactful.
A key aspect of PPN 06/21 is managing Scope 3 emissions, which can be challenging due to the involvement of your supply chain. Greenly offers tailored solutions to help you engage with suppliers, promoting transparency and collaboration to reduce emissions throughout your value chain. By fostering sustainable partnerships, Greenly enables your business to minimise environmental impact beyond direct operations.
Greenly’s intuitive platform helps you stay on top of your carbon management obligations. With seamless integration across your operations, you can track emissions, update your Carbon Reduction Plan, and publish compliance reports. Greenly’s platform streamlines the process of meeting PPN 06/21 requirements, making compliance more efficient.
Partnering with Greenly gives your business the tools, expertise, and ongoing support needed to comply with PPN 06/21. From carbon measurement and tailored reduction plans to supply chain engagement and seamless reporting, Greenly is your trusted partner in sustainability. With our expert guidance, your company can meet regulatory requirements while leading the way toward a more sustainable future.
Start your journey to PPN 06/21 compliance with Greenly today and ensure your business is positioned for success in the public sector while making a positive environmental impact.
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