Sustainability Considerations for Procurement Tools and Capabilities: Summary of a Workshop (2012)

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Government Efforts

Many of the sustainable procurement activities within the federal government have been spurred by the 2009 Executive Order EO 13514, Federal Leadership in Environmental, Energy, and Economic Performance, which requires federal agencies to develop sustainability goals that focus on making improvements related to environmental, energy, and economic performance. As part of this effort, the General Services Administration (GSA) is working to integrate sustainability into its purchasing decisions. The Section 13 Interagency Working Group, created under Section 13 of EO 13514, is evaluating the feasibility of working with the federal vendor and contractor community to provide information to assist agencies in tracking and reducing greenhouse gas emissions (GHG) related to the supply of products and services to the government.

According to workshop presenter Stephen Leeds¹ from the Office of the Administrator at GSA, the agency purchases about $95 billion in goods and services annually, including 12 million products through 18,000 vendors, making the agency well positioned to influence the federal government’s purchasing decisions. GSA’s goal is to have a supply chain that is sustainable throughout. Sustainable procurement, Mr. Leeds added, is about “making smart investments in products that provide better services” for a longer period of time. Achieving a sustainable supply chain requires an understanding of the environmental “hotspots” within an industry—in other words, the components of the supply chain with

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¹ Senior Counselor to the Administrator at the time of the workshop.

the largest environmental impact. The agency’s thinking about sustainable purchasing is evolving, with a focus on life-cycle approaches, return on investment, risk mitigation, intentionality, and partnership, he said.

GSA is adopting a life-cycle approach to sustainable purchasing as it “bridges the silos of disposal and acquisition,” Mr. Leeds explained. The agency is sending a clear signal to the private sector that the focus is broader than the individual environmental impacts of purchasing decisions. Partnering with the private sector, as well as with state and local governments, is important to the agency’s work and its goal of achieving a sustainable supply chain.

Nancy Gillis from GSA’s Federal Supply Chain Emissions Program Management Office (PMO) described how GSA and other agencies have worked to advance sustainable acquisition in the federal supply chain. GSA does not view the concept of “sustainability” as synonymous with the “environment,” Ms. Gillis said, but considers it a broader issue that encompasses economic and social issues as well. The agency is approaching procurement decisions by prioritizing products’ life-cycle return on investment and by considering environmental, economic, and social benefits and costs. In other words, the agency is trying to balance the need to reduce energy use, resource use, and environmental impacts while also taking into account economic considerations.

Ms. Gillis discussed the office’s other activities, including collaborating with industry and supporting and managing the Sustainability in Procurement Fellowship Program. The program introduces fellows to the concept of sustainability and provides an overview of the federal government’s activities around sustainable procurement. Another effort is the GreenGov Supply Chain partnership, which was designed to increase the energy efficiency of vendors and contractors’ supply chains and to reduce their GHG emissions. The partnership resulted from a GSA report that found sustainability considerations, especially GHG emissions data, should be used in the federal procurement process, and that agencies should engage the vendor community to track and reduce GHG emissions through a collaborative, transparent, and deliberative process.²

The Section 13 Interagency Working Group is currently evaluating and recommending ways to advance sustainable acquisition throughout the federal government, Ms. Gillis explained. For example, after evaluating whether it is feasible for the federal contractor community to provide GHG emissions data related to the supply of products for use in government procurement decisions, the working group recommended that suppliers not be required to provide complete inventories of their GHG

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² General Services Administration (GSA). 2010. Executive Order 13514 Section 13: Recommendations for Vendor and Contractor Emissions. Washington, DC.

emissions. Instead, the group recommended that the government, as an incentive, inform suppliers that GHG emissions data could be considered by agencies when making procurement decisions.

Alison Kinn Bennett from the Environmental Protection Agency’s (EPA) Office of Pollution Prevention and Toxics described the activities of a subgroup of the Section 13 working group that focused on product standards and ecolabels. This subgroup, which involves GSA, EPA, Department of Defense (DOD), National Institutes of Health (NIH), United States Department of Agriculture (USDA), and other agencies is responsible for ensuring that the product-related acquisition goals of EO 13514 are met by providing guidelines for selecting environmental sustainability standards or ecolabeling programs. The subgroup views standards setting as a pyramid, as shown in Figure 2-1. Environmental and health data and tools are the base, with standards and incentives for green products built on those, Ms. Kinn Bennet said. From that, a system to verify standards is established, so that ultimately buyers are able to more easily find green products with effective, reliable standards.

Ms. Kinn Bennett noted that the subgroup’s work has had several phases, including grounding; developing draft guidelines; assessing the guidelines using a survey of standards and consultation among federal agencies; holding listening sessions with stakeholders; and preparing a report. The assessment phase of the subgroup’s work focused on existing U.S. and international protocols for standard setting and environmentally preferable product claims and verification methodologies. A survey conducted by the subgroup identified about 80 guidelines for selecting standards in ecolabels. Those guidelines were then categorized into five general areas:

•  Standard setting: how the standard was created

•  Standard substance: the content, relevance and effectiveness of standard criteria

•  Conformity assessment: how the standard was created and whether it was third-party verified or compliance was self-declared

•  Program management: how the program is managed, governed and operated

•  Market penetration: the extent to which it is used and recognized in the market

Ms. Kinn Bennett noted that going forward, it will be important for agencies to address trade-offs and assess environmental impacts across media and life-cycle stages when making sustainable acquisition decisions. The subgroup wants to encourage more holistic, comprehensive thinking on standards and criteria development, she said.

Figure 2-1 Development of effective, green standards for products that buyers can readily identify.

Source : Alison Kinn Bennet presentation, December 7, 2011.

Josh Silverman from the Office of Sustainability Support at the Department of Energy (DOE) and Karen Moran from the Defense Logistics Agency (DLA) with the Department of Defense described sustainable procurement efforts at their respective agencies. According to Dr. Silverman, DOE relies heavily on its contractors to implement and integrate sustainability into procurement decisions; the agency establishes requirements, but contractors are responsible for implementing them. DOE also relies heavily on effective communication and information exchange; for example, the agency has an ongoing working group with hundreds of active members who regularly exchange information on best practices. The agency also tracks data on the use and procurement of green products and is trying to further integrate sustainability requirements into its contracting, with the goal of using sustainable procurement as a strategy to drive improved mission performance. The agency now requires contractors—particularly those providing construction and custodial services—to review contract actions for ways to integrate sustainability requirements.

Additionally, DOE conducted a quasi-“hotspot” analysis to assess both the products in highest demand and available standards, Dr. Silverman said. The Green Buy Program within DOE offers awards to contractors and vendors that purchase these priority products. He added that DOE is trying to incentivize and reward behavior that integrates sustainable approaches. It will be necessary to better quantify the benefits of these activities so that their impact can be understood and used to make the

business case for sustainable procurement, he said; a purely compliance-oriented approach may not be as effective in moving this effort forward.

Karen Moran described the role of the DLA as a combat logistics support agency and noted that much of the agency’s work is contracted. DLA is continually trying to incorporate sustainability into its procurement decisions and those of its contractors, Ms. Moran said. She described several ongoing sustainable procurement programs at the agency, including efforts to encourage procurement of bio-based products; a program that returns unused medications to vendors; and a variety of alternative fuel initiatives, including efforts to increase use of renewable energy and bio-diesel. Another initiative is incorporating environmental information into an electronic purchasing system known as the Federal Catalog System. This information includes environmental attribute codes that indicate a sustainable characteristic for a specified product.

Ms. Moran described a recent joint GSA/DOD sustainable procurement project that kicked off with a meeting on November 17, 2011. The meeting brought together representatives from both agencies to discuss translating policy into action, the need to integrate sustainable procurement into the course of business, life-cycle assessment, and the value of synchronizing GSA and DOD to enhance standardization. Participants at the meeting discussed the need for compelling messaging that would cast sustainable procurement in terms of an agency’s mission, Ms. Moran said. Discussion at the November meeting also explored potential ways to motivate behavioral change related to sustainable procurement along with the recognition that training alone cannot create culture change. Finally, Ms. Moran noted that there was discussion of the need for a tool-box, which should be scaled in complexity and size for different types of procurement, as well as the need for a mechanism to test products and provide feedback.

Edward Rau from the Division of Environmental Protection at the National Institutes of Health (NIH) spoke about efforts to incorporate sustainable procurement at NIH. His department directly purchases, funds, or influences purchases related to health care, food, drugs, and biomedical research; however, NIH has few sustainable criteria for these products and no effective tools to help make such purchases more sustainable, he noted. The information on sustainable purchasing that is available consists primarily of static reference documents distributed across many separate Web sites, which typically cannot be applied by procurement professionals to perform, facilitate, or track purchasing transactions. One area where NIH would benefit from a sustainable procurement tool would be in purchasing replacement freezer units that are 10 percent more energy efficient than the current units on NIH’s Bethesda campus, Captain Rau said. This would save NIH about $1 million a year in electricity costs. According to

a recent survey, the current freezer units account for 29 percent of total electricity use, $12 million a year in costs, and releases of about 59,000 metric tons of carbon dioxide equivalence per year.

Another gap in sustainable procurement tools is in identifying hazardous toxic or polluting substances, Captain Rau noted. From a public health perspective toxicity is one of the most important criteria in sustainable acquisition, he said. Although the interim Federal Acquisition Regulations (FAR) require procurement of products and services that are nontoxic, this has been difficult to implement, due in part to a lack of clear definitions and toxicity data. To address gaps in available information, Captain Rau has spearheaded the development of a “substance of concern” list that would restrict or prohibit the government from procuring products or services that contain or release listed substances of concern. The proposed list could be used as an interim screening and selection method until better data and methods of comparative toxicology are developed. The list would inventory substances by their chemical abstract service registry number to reduce synonym confusion, be derived from other well-established listings such as EPA’s Integrated Risk Information System (IRIS)³ or the Consumer Product Safety Commission’s Safer Products lists,⁴ and characterize the listed substance as banned or restricted in certain uses. Where available, it would also list alternatives for the substance of concern.

Another area with gaps that a procurement tool could address is the tracking and reduction of greenhouse gas emissions in the supply chain,

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³www.epa.gov/iris

⁴www.saferproducts.gov

added Captain Rau. Metrics, emissions accounting requirements, and boundary definitions would all need to be established for such a tool. Full life-cycle data would also be needed so that the focus is not just on the embodied greenhouse gas of the product but also its full life cycle. He gave the example of sulfur hexafluoride, which appears on the substance of concern list, not because it is toxic per se but because it is a potent greenhouse gas.

Another major gap in sustainable procurement efforts is consideration of a product’s end of life. Currently, procurement tends to focus on a product’s recycled material content or bio-based materials rather than on its reusability, recyclability, or biodegradability. These considerations are critical for meeting net zero goals that are becoming more widely adopted, Captain Rau said.⁵

He described his view of the elements that would be included in an effective sustainability-oriented procurement tool. It would provide an authoritative, one-stop sustainable shopping reference for all products and services, be very centralized, and be automated. It would be interactive and not merely a reference companion or compilation. It would have a simple, two-step search-and-buy function; purchasers would search for a specific product or service and then be directed to where to buy a compliant product. This would save time by eliminating the need to search for applicable requirements and products that conform to them, as is currently done. The tool would eliminate the need for purchasers to understand complex, rapidly-changing, sustainable procurement requirements, thus minimizing training needs. It would also have data collection and reporting functions and would link directly to other procurement systems to avoid multiple data-entry errors. In addition, it would characterize a transaction as compliant or noncompliant with any regulations, such as the Federal Acquisition Regulations (FAR), and track how well a product or service adheres to other desirable but not mandatory sustainable attributes. It is critical that users have confidence in the quality of the data, and be assured that purchases made with the tool meet all applicable requirements, Captain Rau stressed. Lastly, for scientific and medical applications, it would be critical that purchases of medical supplies and devices directly link to agency approvals, such as Food & Drug Administration (FDA) approvals, and to published medical literature.

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⁵ The DOD has a primary goal focused toward net zero, meaning net zero energy use, water use, and waste. The aim is to start with reduction, then progress through repurposing, recycling, energy recovery, and lastly disposal. Other agencies are moving toward this concept of net zero. See: army-energy.hqda.pentagon.mil/netzero/.

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