Developing Bids for Environmentally Preferable Purchasing (EPP)
By developing bid documents that incorporate environmental goals, agencies can specify a variety of required attributes and establish an alternative method of price evaluation. As an example, a city could require products to meet relevant environmental certification standards, while also creating a pricing model that uses life-span cost analysis to incentivize durability.
Life-span analysis compares all costs directly associated with a product: initial costs, training costs, operating and maintenance costs, and disposal costs. Using life-span analysis to guide the bidding process is essential for ensuring equal opportunity for products that last longer and require a payback period to achieve overall savings. (Note: This is less extensive than life cycle analysis because it only considers direct costs to the end-user rather than all the environmental impacts from extraction, manufacturing, and disposal.)
General tips for designing EPP bid language:
- Revise any current specification language that could potentially act as a barrier to EPP products.
- Use established industry certifications as model language or requirements.
- Try to maintain existing performance standards to avoid complex re-writes, and to reassure staff that any new products are of equal quality.
- Use bid specifications to insert waste prevention requirements for packaging — provide explicit directions regarding take-back policies and acceptable materials.
- Make sure vendors will provide on-site training for staff if a new product requires a change in procedures.
RATIONALE
By shaping the bidding process to support the larger priorities of a city, procurement officers are allowed to buy products that initially cost more, but save money over time, and support those companies that are producing progressive products. Local and state governments combine to purchase over a trillion dollars worth of products annually. This purchasing power exerts a tremendous influence on which products and services are available in the national marketplace.
EFFORT REQUIRED
Purchasers will have to perform product research and create models to predict life-span costs. The effort required will depend largely on how detailed the product research is, and how broad the scope of the life-span analysis is. Calculating the total cost to a city from purchase to disposal, is much simpler than including excavation and manufacturing inputs.
BENEFIT
- Well crafted bid language can immediately eliminate unwanted products and simplify the procurement process by creating a clear precedence for selection
- An understanding of "big picture" costs
RISKS
- Standards too stringent, eliminate too many products
- Specification of inferior performing products
ACTION AGENT(S)
- Environmental Programs Division
- Purchasing Division
- Public Works Division
- Engineering Division
- Fleet Maintenance Division
- City Council
COST
If a city models the full life-span of a product, they should spend the same or less than they did previously on an annual basis. Some cities may decide that certain environmental attributes are important enough to justify added cost in some circumstances.
