Conference @ ALDE – “Environmental clauses in public procurement”

On 29 September 2022, Maître Thibault CHEVRIER, a lawyer at the Luxembourg Bar specialising in public procurement and a partner at CHEVRIER & FAVARI, spoke at a conference organised by the Association Luxembourgeoise de Droit de l’Environnement on the subject of “Environmental clauses in public procurement contracts“.

The origins of environmental clauses in public procurement can be traced back to fairly long-standing texts, such as Agenda 21 of the Rio Conference in 1992, which stated that “Governments (…) should therefore review the procurement policies of their agencies and departments with a view to improving the environmental element where possible“.

Almost twenty-five years later, the European Commission pointed out that “Green Public Procurement (GPP) is an important tool for achieving environmental policy objectives relating to climate change, resource efficiency and sustainable consumption and production“.

In this general context, it is also worth quoting an Interpretative Communication from the Commission, which stated that :

– The article on award criteria must be interpreted in such a way that environmental considerations may lead to the definition of specific award criteria;

– In most cases, such criteria relate to the quality or performance of the product or the execution of works or services (i.e. quality or technical merit as mentioned in the award criteria);

– Environmental elements may be used to determine the most economically advantageous tender, where these elements offer the contracting authority an economic advantage attributable to the product or service which is the subject of the contract.

These considerations have subsequently materialised in the case law of the Court of Justice, which, in a judgment of 17 September 2002 (C-513/99) relating to the Concordia Bus Finland case, ruled on the admissibility – and the limits – of environmental criteria in public procurement procedures:

64. It follows from the above considerations that, where the contracting authority decides to award a contract to the tenderer who submits the economically most advantageous tender, in accordance with Article 36(1)(a) of Directive 92/50, it may take criteria relating to the preservation of the environment into consideration, provided that they are linked to the subject-matter of the contract, do not confer an unrestricted freedom of choice on the authority, are expressly mentioned in the contract documents or the tender notice, and comply with all the fundamental principles of Community law, in particular the principle of non-discrimination.

 

65.    With respect to the main proceedings, it must be stated, first, that criteria relating to the level of nitrogen oxide emissions and the noise level of the buses, such as those at issue in those proceedings, must be regarded as linked to the subject-matter of a contract for the provision of urban bus transport services.

In another case leading to a judgment of 4 December 2003 (C-448/01), EVN – Wienstrom, the Court of Justice held, after renewing the admissibility of environmental criteria in public contracts, that the proportion of renewable energy used was a relevant criterion linked to the subject-matter of the contract, even with a weighting of 45%, adding nevertheless that this criterion must be verifiable:

31. In that regard, it should be noted that, in a judgment delivered after the lodging of the order for reference in this case, which concerned the interpretation of Article 36(1)(a) of Directive 92/50, whose wording is more or less identical to that of Article 26(1)(b) of Directive 93/36, the Court had occasion to rule on the question whether and in what circumstances a contracting authority may take ecological criteria into consideration in the assessment of the most economically advantageous tender.

(…)

40. As regards the award criterion at issue in the main proceedings, the Court has already held that the use of renewable energy sources for producing electricity is useful for protecting the environment in so far as it contributes to the reduction in emissions of greenhouse gases which are amongst the main causes of climate change which the European Community and its Member States have pledged to combat (Case C-379/98 PreussenElektra [2001] ECR I-2099, paragraph 73).

(…)

43.  In those circumstances, and since there is no evidence to support a finding that the requirements of Community law have been infringed, it must be held that the application of a weighting of 45% to the award criterion at issue in the main proceedings is not incompatible with the Community legislation on public procurement.

(…)

51. It is thus apparent that where a contracting authority lays down an award criterion indicating that it neither intends, nor is able, to verify the accuracy of the information supplied by the tenderers, it infringes the principle of equal treatment, because such a criterion does not ensure the transparency and objectivity of the tender procedure.

These considerations were subsequently codified in the directives applicable to public procurement, in particular Directives 2004/17/EC and 2004/18/EC and then Directives 2014/24/EU and 2014/25/EU, with, it should also be noted, an indication appearing in Directive 2012/27/EU on energy efficiency, which provides in its article 6 dedicated to public procurement an incentive for public bodies to study the possibility of concluding energy performance contracts:

3. Member States shall encourage public bodies, including at regional and local level, with due regard to their respective competences and administrative structures, to follow the example of their central governments to procure only high energy performance products, services and buildings. Member States shall encourage public bodies, when issuing invitations to tender for public service contracts with a significant energy component, to consider the possibility of concluding long-term energy performance contracts ensuring long-term energy savings.

Under Luxembourg law, environmental clauses can be incorporated into public procurement contracts mainly from the point of view of selection and award criteria, without forgetting the possibility of varying the subject matter of the contract, while at the same time including the issue of life-cycle costs.

From the point of view of technical specifications, a number of elements can be designed to promote ecological value and reduce the environmental footprint: