GREEN RULES ANNOUNCEMENT
As of the first of October, all businesses wishing to bid for government contracts worth more than £5 million will need to commit to a net-zero strategy that projects a science based target of achieving net-zero by 2050. This rule comes into play as the ‘Green Rule’ that will solidify the UK’s position as the front runners in the fight against climate change.
This new rule applies to all companies that wish to bid not just those that are awarded the contracts. Chancellor of the Duchy of Lancaster Steve Barclay said: “Government spends £290 billion a year on procurement and it’s right that we use this spending power to green the economy. Working arm-in-arm with business, we are taking giant strides to ensure this country is building back greener and tackling climate change. “
This is a clear indication that this is now a requirement and no longer an option. This was announced shortly before the government’s new net-zero strategy, that is planned for later this month, providing a solid foundation to move the nation towards that net-zero target by 2050.The UK is the first country in the world to put such a measure in place, underlining the government’s leadership in the fight to tackle climate change. A carbon reduction plan must be set up to outline where an organisation’s emissions come from and the environmental management measures they plan to implement to reduce emissions to net-zero.
Some large companies already report parts of their carbon emissions, known as Scope 1 (direct) and Scope 2 (indirect owned) emissions as part of the Streamlined Energy and Carbon Reporting regulations published in 2018.
The new rules will go further, requiring a commitment to achieving net-zero by 2050 at the latest, and the reporting of some Scope 3 emissions; including business travel, employee commuting, transportation, distribution and waste for the first time. Scope 3 emissions represent a significant proportion of an organisation’s carbon footprint. Understanding, reporting and reducing these emissions will play a substantial role in decarbonising governments supply chain, and the UK economy as a whole.