We are always pleased to see governments taking steps towards better procurement practices. Recently, the Canadian Government took a step forward for green procurement with Public Services and Procurement Canada (PSPC) announcing an RFP for clean electricity to power operations in Alberta.
This Clean Electricity Initiative aims to use 100% clean electricity by 2022, reducing greenhouse gas emissions and stimulating growth in clean renewable power infrastructure. The Government will also purchase Renewable Energy Certificates (REC) allowing attribution of clean energy consumption in regions where new clean renewable sources are not yet available.
These two new initiatives will see the reduction of Canada’s greenhouse gas footprint by approximately 133 kilotonnes in Alberta and the displacement o 41 kilotonnes of greenhouse gas emissions from electricity use in the rest of Canada.
Interestingly, these policies coincide with the launch of the CDP’s global report, Transparency to Transformation: A Chain Reaction, which warns of the $120bn of increased costs coming from supply chains by 2026, due to environmental risks.
The report outlines the significant financial risks linked to climate concerns of deforestation and water quality which could affect businesses who fail to get environmental data and fail/or act on the findings through the procurement process.
The report notes that corporate buyers may be impacted by these cost increases, so many large businesses taking note and demanding action. More than 150 businesses worth more than $4.3trn in purchasing spend, such as Google, L’Oréal, Walmart, Braskem, and Toyota, are working with CDP to request that suppliers disclose environmental data.
The good news is the number of suppliers disclosing data increased by 16% to more than 8,000. Additionally, corporate purchasers requesting disclosure through CDP grew by 24%. But there is still a long way to go. The Canadian Government is setting the bar on electricity procurement, let’s hope other governments take the opportunity to build back better.