By
Henrik Riisgaard, M.Sc. in Planning
Aalborg University
Fibigerstraede 13, DK-9220 Aalborg O, Denmark
henrik@i4.auc.dk
Public Procurement: greening and groping
- The Danish Progress
Summary
EU's 5th Environmental Action Programme emphasized consumers’ responsibility in relation
to the environment. One major consumer group is the public sector. The importance of public
institution’s behaviour is even larger than their share of consumption because they are
expected to behave as good examples to be followed by other consumer groups.
This paper examines public green procurement1 in Denmark. After a general introduction, the
research focuses at the municipal level. Based on previous research and a full-scale survey
issues like extent, product groups, reasons, information needs and faced problems are
examined.
This and other research show rising attention to, and activity in green procurement but also a
lack of reliable concrete advise and policy support. Some policy implications are given.
Introduction
The EU’s 5th Environmental Action Plan from 1992 differs fundamentally from the previous
plans. What was earlier regarded as environmental problems became with this plan issues and
symptoms. The real problems causing environmental loss and damage are now seen as the
present patterns of consumption and behaviour of man. Not only the cause of, but also the
solutions to environmental problems became connected with consumer choice.
To change patterns of consumption in a more sustainable direction, the EU launched an Ecolabel in 1992 to guide individual consumers. But individual consumers are not responsible for
all consumption.
Public procurement within the EU for which tenders were invited was in 1991 estimated to
ECU 350 billion per year (Danish Ministry of Environment and Energy (DEPA), 1995).
Adding to this the three new member countries and considering the sum of minor purchases
for which no tenders are invited, the public sector in the EU becomes itself an immense
consumer group.
In 1993, the European Commission adopted an internal communication on how to ensure
better integration of environmental protection into other policy areas within the Commission.
The communication addressed the issue of establishing a code of conduct on the
1
Commission’s own operations including procurement policies. Since then, however,
initiatives from the EU have been lacking with only one exception - a shift towards recycled
paper. Important issues that has not been altered are the EU directives regarding public
tendering. They do still not comment on environmental issues. (Oosterhuis, 1994). National
authorities are left without guidance on to what extent preference can be given to e.g. ecolabelled products. It is especially unclear to what extent the ordering part can set
environmental criteria for the production processes and thereby include a life-cycle
perspective in the procurement policy (DEPA 1995). Now, after years delay, the Commission
has started looking seriously at greening own operations following a strategy decided upon
last December. (Groenendal, 1996)
Another EU initiative was made by the Directorate General XII who commissioned a joint
Dutch-German research project on "product policy in support of environment policy". After a
broad inventory of product policy throughout the EU, public procurement was selected as one
of two case studies to be evaluated in depth (van der Grijp, 1995).
The Danish experience with Green Public Procurement
In Denmark, the environmental responsibility of public purchasers has been specified since
1991. Section 6 in the Danish Environmental Protection Act states that “Public authorities
must [...] in connection with procurement and consumption, endeavour to promote the
objectives of this Act”. So far, section 6 had no obligatory character but this is changing.
The purpose of public green procurement is twofold
(i)
(ii)
To reduce the direct impact on the environment
To encourage society in general to use products and methods of production
favourable to the environment
In 1991 the Danish Environmental Protection Agency published its first strategy directed
specifically at greening public procurement. The strategy paper estimated the total annual
amount of public procurement in Denmark to be 5 billion ECU of which the 2.5 billion is
procured for the state (including military, railways, etc.). The municipalities' and counties'
annual procurement amount to ECU 2 billion and 0.6 billion respectively. In some product
categories (e.g. photocopiers or computer prints) the public procurement is purchasing 20 per
cent of total Danish consumption.
An important part of the 1991 strategy was the financing of experimental projects,
information collection and environmental product assessments. EPA feasibility studies found
that lack of information was the most important barrier to green procurement whereas
technical and economic problems were minor barriers. In general, the purchaser was often
found to be insufficiently informed as to what criteria are important in evaluating the
environmental impact of a product.
To help solving the information problem, DEPA published reports, brochures and a general
procurement manual.
In 1994 an action plan for sustainable public procurement policy was launched by the
Ministry of Environment and Energy. The key word of this plan is large-scale
2
implementation. Based on the experiences of the last four years, specific product groups were
selected. These product groups should be products where public procurement is important,
both in terms of economic volume, environmental effect and share of total consumption. A
further selection criteria for product groups was visibility. The use of these selection criteria
resulted in totally 15 product groups.
At state level procurement, 12 specific products groups were appointed: office machines,
computing equipment, office furniture, cleaning agents, paints, canteen cutlery and crockery,
lighting, transportation, organic food, copy paper and electric cables.
Municipalities were proposed to assign special priority to furniture and equipment, working
garments, and transport materials, but DEPA suggested that the state targets could also be
relevant to the municipalities.
On county level only one supplementary product group was appointed, namely hospital
equipment.
In all of the 15 target areas, environmental assessments have been made to enable the
purchasers to set environmental criteria and ask questions to the manufacturer - in other words
to close the information gap. The assessment method used the method of the EU eco-labelling
as starting point. This means that the few EU eco-labelled products consider similar
environmental issues as proposed for the 15 product groups. Also products labelled with the
Nordic swan are considered to fulfil similar environmental criteria. The difference to the
labelling criteria is that the DEPA assessments do not specify exact thresholds for the key
parameters - this is left to the deciding purchaser. It is also stressed that purchasers should not
await environmental labels in all product categories but should start setting their own
priorities and demand and consider environmental information from the producers. Although
15 product groups have been identified, DEPA recommends public purchasers to start with
only a few to get fast visible results and to get experiences than can be useful for wider
implementation.
The actions in the implementation phase included invitations to 2.000 state-level purchasers
for seminars and preparation of data sheets on target products.
Another important step in the direction of implementation was a circular of 1995, where the
Minister of Environment and Energy forced state institutions and state-owned or statecontrolled companies to:




formulate an environmental conscious procurement policy;
draft an action plan for its implementation;
nominate a person responsible for the implementation of the action plan;
maintain on-going documentation of the results achieved and report to DEPA once a
year.
The role of state institutions are emphasised throughout the action plan. Implementation on
this level compared to municipalities is expected to be easier, partly due to the fact that a
considerable share is purchased through the former State Directorate of Procurement. The
directorate has been changed into a company, Indkøbs Service, and former obligations to
procure through it are now removed. But many state institutions still use the same company
3
which enables elaboration of central green framework agreements which is supported by
DEPA.
Though the company has invited municipalities to join its framework agreements, only a very
limited part of municipal procurement is made through this central channel. The DEPA
support for green framework agreements has thus little impact on the municipalities. The state
emphasis should also be seen in the light of DEPA studies that proved it to be extremely
resource demanding for municipalities to obtain environmental data and to carry out analysis
on them.
As the largest problems are expected to occur in the municipalities combined with the fact
that the municipalities are purchasing most of the products with the potential of affecting
individual consumers, a closer look at this target audience seems interesting.
Danish Municipalities
Denmark has 275 municipalities that are very different in size. Copenhagen Municipality is
the largest with 471.000 citizens and Laesoe the smallest with only 2.300 inhabitants. Most
municipalities have between 5-20.000 inhabitants.
Denmark has a system of municipal self-government. Each municipality levies taxes and
elects municipal councillors to administer these revenues. The municipal responsibility is very
far-reaching as they are responsible not only for roads, sewage systems and electricity but
also schools, libraries, social services and cultural activities.
Denmark has one of the most decentralized systems of public administration in Europe. The
basic principle is that tasks should be undertaken as close to the citizens as possible. Local
authorities administer more than 50 % of public expenditure giving Denmark the most
decentralised government in Europe (National Association of Local Authorities, 1995).
Today, a further decentralization is taking place inside the municipalities. The elected local
councils who are still having the political and the financial responsibility are now handing
more influence and decision making processes to employees and citizens at the individual
level (e.g. user committees). This principle of delegation of authority is based on confidence
in new, better and more economical solutions to the municipal tasks when the decisions are
taken directly by the person(s) involved. The delegation of authority can also be seen as a
reaction to the citizens’ demand for influence and local democracy. It is the municipal council
of politicians who decides which administrative departments it will establish and which tasks
these should have. Keywords for the development of the local authorities are now:
simplification, decentralization and extended dialogue (Norup, 1995).
The municipal procurement is, as a consequence of municipal self-government, organized in
many different ways. Some local authorities have no procurement organization but leave it to
the individual institutions to purchase while others have a central office through which all
purchases are made. In between there are numerous combinations making it difficult to talk of
one model of municipal procurement.
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Survey of municipal green procurement
The following survey was designed as a combination of a 4-page questionnaire, key
interviews and document research. The questionnaires were sent out in June 1995 attended to
the purchase responsible in all 275 municipalities. After three weeks a reminder was sent out.
The same procedure was used in a comparable 1991 survey made for DEPA (partly published
in DEPA 1992). The aim of the survey was to see recent development in and status of green
procurement from the purchaser view. The answers in the returned questionnaires were built
in to a database and cross tabulated with other databases (based on Mikkelsen, 1995) on
political composition of the municipal councils, populations and areas.
The results of the survey should only be seen as indicators and not as the exact state of
municipal green procurement in Denmark. One important biasing factor explains this
reservation. The survey is based on self-reported behaviour and in self-reporting surveys there
was found a tendency that respondents will overestimate their efforts (e.g. Thøgersen, 1995).
Table 1: Selected indicators of progress in green procurement in numbers of Danish
municipalities (N=275).
1991
1995
returned the questionnaire
89
135
has adopted environmental considerations in
written procurement policy
are considering environmental aspects of
purchase without having a written policy
are planning to incorporate environmental
aspects into purchase
have demanded greener products from the
suppliers
have in some cases changed supplier to satisfy
a wish for greener products
4
19
57
79
12
87
24
47
16
23
The table shows a rise in activities. The number of returned questionnaires is in itself
interesting. The municipalities answering the reminding questionnaire instead of the original
one were found to be less active. Direct inquiries to non-responding municipalities showed
that these were even less involved. This suggest that the number of returning questionnaires is
itself an indicator of increased interest in public green procurement. It also implies that
expressions in percentage of returned questionnaires is a biased picture of reality.
The municipalities working actively in the field of green purchasing were asked what inspired
them to start. The three most mentioned incentives were:
(i)
(ii)
(iii)
the municipality wants to set a good example
employees wanting greener products
users (citizens and companies) wanting greener products
The municipalities want to put their own house in order before telling the users how to behave
in a more sustainable way. Less important seemed the pressure and information from DEPA
as DEPA publications and the change of section 6 in the law ranked as only 5th and 6th most
important driving force.
5
Obviously, the original strategy of putting central pressure on the municipalities to show the
citizens how to purchase is not the only initiator working. The top-down strategy is
complemented with pressure from the bottom, from individuals, and, more importantly, this
pressure is regarded as more influential. This conclusion is supported by a German evaluation
of municipal green procurement (Umweltbundesamt, 1993) finding that incentives more often
came from committed staff than from the political level.
Size
As could be anticipated, there was a tendency that the smallest municipalities did not answer
the questions. The mean size of the municipalities returning the questionnaire was larger than
the Danish average, and the mean size of municipalities having written environmental
considerations into procurement policy were even larger. However, a large size is not a
necessity as exceptions have shown. There seems to be no geographical tendencies.
Organization
Half of the responding municipalities have written procurement policies. About one third of
the responding municipalities expresses not to have a separate chief purchaser. This share is
probably even larger among the non-respondents as they are smaller.
Two thirds of all municipalities are subscribers to Indkøbs Service but as the total 1994
turnover of the company was only 100 Million ECU and the main purchasers were state
institutions, not even 1 per cent of municipal purchase is made in this central way. Using the
central framework agreements as a point of departure, the larger municipalities are able to
make better deals themselves.
In the municipalities where green procurement is made (indicator 2 and 3 in the table), this is
often just one part of a larger environmental commitment. Environmental management is one
of such larger frames. Some 30 municipalities are now actively working with this, either in all
municipal activities or in some institutions. Some 25 are planning to follow (Anderson, 1996).
So far, no Danish municipality applied for certification according to EU's Environmental
Management and Audit Scheme (EMAS) and public administrations are not yet admitted,
according to the Danish EMAS-competent body (Traberg, 1996). In other countries, the target
audience of the EMAS regulation is interpreted differently by the competent body and
municipalities have been certified (e.g. in the UK). Local agenda 21 is another umbrella
where green procurement in some cases has been part.
Specific product groups
Most of the active municipalities are concentrating their efforts on less than 5 product
categories. Of the 15 EPA-appointed target products the by far most used are: computer
equipment, paper, cleaning agents, and lighting. At the other end, asking for sustainable
working garment seems almost unknown.
The purchasers were furthermore asked to tick off which of six named reasons had been used
for which of the 15 product groups. The three most often used reasons for selecting green
products were: environmental benefits, the prospect of saving money and the existence of
detailed documentation of environmental conditions. The environmental benefits argument
was applied to most products. The saving reason was given mostly to four target groups:
lighting, computer equipment, office machines and cleaning agents. Detailed documentation
6
was used as an argument especially for the purchase of more sustainable paper and cleaning
agents. The least used reason was that "EPA has in its brochures recommended criteria for
this product category".
In a few cases the green procurement was not directed at greener products but at greener
companies who could prove their environmental intentions and activities by means of a
certified environmental management system.
Information
The municipalities use in average between 3 and 4 sources of information on green products.
The most often mentioned (by 101) source of information is catalogues from suppliers. When
asked which manuals they use, only 7 mention the new procurement manual co-written by
DEPA. The Manual had one month earlier been sent to all municipalities in 3 copies. The
information problems seem to be severe. In one fifth of the returning questionnaires, the
purchaser has ticked off a lack of information to be a general problem. But four times as many
find it difficult to assess the information when judging which alternative is more sustainable.
Where the information problem used to be a lack of information it has become a flooding
problem with lots of uncontrolled information from suppliers claiming environmental
superiority. For the local purchaser in a small decentralised municipality it seems impossible
to assess the information. The guidance from the DEPA is on which questions to ask but not
on how to judge the answers.
Impact on Industry
It is difficult to analyze the industrial impact of this scheme, understood as development of
less damaging products or a larger appliance of existing "green" products. First of all green
procurement is not registered separately. Secondly, it is to early to see the real potential of the
instrument.
There are, however, indicators of a large potential. For instance, an environmental consultant
at the Danish Association of the Graphic Industry states (Høiseth, 1995): "This is the
strongest tool to environmental improvements ever used in this industry". He is referring to a
specification for off-set printing used by the Ministry of the Environment before making
contracts. This specification and especially the prospect of its wider application is simply the
best argument for promoting environmental management in this industry. A recent survey
(Kvalitetsgruppen, 1995) shoved that 59 per cent of businesses in this industry expect
increased green demand by their customers.
Foreign studies show similar potentials of public procurement. In 1993, Bill Clinton
announced that, where-ever possible, personal computers procured by the US Government
should comply with certain energy-saving standards. As the US government is Worlds largest
purchaser of computer equipment, no serious PC manufacturer on the US market can ignore
these standards (Stevels, 1995). Today these standards and the energy-star label are widely
used - both outside the US Government and on other office machines. In the Netherlands,
ministries have in few cases successfully changed the market supply of less damaging
products by asking suppliers for greener products (van der Grijp, 1995).
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Discussion: two dilemmas
The survey exposed two central dilemmas. The first dilemma concerns decentralization.
Decentralization is by EPA conceived as a difficulty to green procurement even though it is a
desirable change for other reasons. To EPA the problem of decentralization is that central
assessments and central framework agreements are to be complemented with training for
thousands of purchasers enabling them to execute similar functions. The decentralization also
hinders the Minister in imposing direct instructions on the municipalities similar to the ones in
the state circular, even though the law enables such directions. This way, the necessary
political provisions at municipal level can not be forced through from the Ministry but have to
develop through dialogue. Another disadvantage of the decentralization is that an expected
side effect, more competitive green products, becomes more difficult as it seems more likely
to press the price if the order comes from few large purchasers instead of thousands of small
ones. On the other hand, the decentralization does enable committed staff to follow their
interests and experience fast results of their efforts, thus making them even more committed.
Thereby the decentralized organization becomes more dynamic compared to the centralized
even though the initializing phase is more difficult. Also, the decentralized organization has
probably more potentials of affecting private consumers, at least the 360.000 of them
employed by the municipalities.
The second dilemma is closely connected to the first and concerns the degree of guidance. For
many decentralized purchasers in small municipalities procurement is just a secondary task.
They ask for simple advice on which manufacturers to choose and which ones to avoid
(Hansen, 1994). There are several problems with such a detailed information service. First, it
outdates very fast and is thus an expensive service. Secondly, it would not be adjusted to the
local areas giving locally based priority to local environmental problems. Thirdly, DEPA does
not feel competent of judging other aspects than the environment, and it would lead to unfair
competition if DEPA recommended one product rather than another. But most importantly,
there exists no simple definition of what is the most sustainable product that could be
juridically defended when non-complying manufacturers would complain for not being on the
list. However, the coming product fact sheets will be a cross between the procedural approach
of the manual and the direct recommendations of eco-labels and thereby coming closer to the
wish of many municipalities. A second way of fulfilling the demand for independent brandname information is to direct the procurers to the existing independent "Grøn Information"
point set up for private consumers. This information point is funded by the Ministry of the
Environment but steered by consumer organizations, and therefore the information is not
directed towards the professional consumers.
Conclusions
Green public procurement is more than minimising the direct environmental impact of public
bodies. It is also tool to indirect environmental improvements outside the public sphere and to
environmentally superior products. Public green procurement is thereby one of few ways to
award environmentally outstanding companies for their efforts to go beyond compliance with
current legislation. Furthermore green procurement has a positive signal value to other
consumers.
To what extent the green procurement in Denmark can fulfil its objective to affect industrial
development and private consumers, is too early to judge and was not the focus of this survey.
8
There are, nevertheless, Danish and foreign signs of large potentials.
Some other important experiences, however, could be found. The Danish initiatives are, at
this stage, very much directed towards visible success. Therefore a cautious stepwise
approach is made. In the national policy, emphasis is on the "easier" target audience: state
institutions. Likewise the purchasers are recommended to, and, do in fact, only look at very
few specific products. One negative aspect of this "visible success" orientation is the focus on
buying green (which is visible) instead of buying less by redefining needs (which demands
change of behaviour and could be more difficult).
The Danish municipal experience shows many motivated purchasers. The study shows fast
growing attention from all sides. An important finding is that the attitude of purchasers and
employees is a mayor driving force, whereas official policy is lacking behind. Many of the,
mainly minor, purchasers feel unable to transform their good intentions into sustainable
procurement behaviour and are asking for concrete brand-name advice instead of the given
procedural advice.
One policy suggestion of the study could therefore be to broaden the scope of the ecolabelling regulation to also meet the information needs of public and other professional
purchasers. This proposal, is, unfortunately, not likely to happen as the EU eco-labelling
scheme faces severe delays already. The Commission wants to solve these problems first and
make a thorough investigation of the existing problems.
Broadening the scope of the EMAS regulation to allow certification of public authorities
would probably not have much effect on the Danish municipalities because most of them are
to small to benefit from the certificate. A less systematic and more modest approach to
environmental management seems to be preferred.
Changing EU’s tendering directives to allow environmental specifications is likely
to be more important. Without the total life cycle perspective on products being clearly
allowed, there is no pressure from large-scale consumers on industry to improve production
processes. As it is now, these consumers are impeded from being stakeholders on the
production process. Only the current level of legislation in the country of production can now
be demanded. A first step could be to allow tendering to demand eco-labelled products or at
least the fulfilment of the same criteria, without the purchaser having to ensure that it is not a
barrier to trade.
An important EU initiative is the recent step towards a review and greening of EU's own
administration. This project will amongst other things collect member countries' experiences
that are now not systematically collected and exchanged. The project might run into
implementation problems similar to Dutch and Danish experiences. This could effect that
public green procurement gets on the political agenda. The opposite, a successful
implementation of the EU project might serve as a model for other public institutions that are
now mostly groping towards greening.
9
Notes:
1 "Green" in this respect is somewhat misleading as buying for instance recycled paper is not
without environmental costs. "Green" is, however, easily understood and also used in official
Danish policy documents. The word "Sustainable" has been used in English translations of
DEPA documents but seems even more misleading as development and equity issues are left
out. "Less environmentally damaging" is more precise but not very handy.
A generally applicable definition of a green product is difficult to make. Less resource
demanding and energy saving is environmentally preferable. But when it comes to
substitutions it becomes more difficult. Ideally the definition should be based on a life cycle
assessment (LCA), but to provide an exact answer this needs weighing of different
environmental issues. In this study no such general definition was provided. Buying green
simply means that environmentally considerations were taken during procurement. Due to
different preferences among purchasers this can lead to different purchase: one buying 100
per cent recycled copy paper and another buying swan-labelled copy paper based on virgin
fibres.
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(proposal for strategy for the promotion of public green procurement policy) Copenhagen
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197, Copenhagen
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