Huckens. I'm a professor of Government procurement law, and the Lynn David research and government procurement law and Gw. Law school. The. The. This is part of a Webinar series sponsored by Gw. Law school and the web. The recording, besides being available on public procurement. International is also gonna be available on the Gw. Law government procurement law program E. 2 page.
We have both questions and answers available. That you can use that function, but you also. And it's a little bit more fluid. You can use the chat function if you have questions as you go, Tom and Rob and I will be responding. And I should just note that because some of us are advocates. We are the statements that are being made today, or or statements that are made in our personal capacity.
Carrie Waters is one of the panelists from Tuesday, and he's gonna and she's here to to be listening along. And she was able to respond to some of the harder questions that we got last session. So, Carrie, Welcome joining us. We have over 300 registrants to give you an idea of the the breadth of interest in this area. We have over 300 regiments from 63 countries around the world. This is really.
Emerging as an international issue, but one where solutions oftentimes are.
Coming from State and local governments, as we'll see in more detail on Tuesday.
So we, our agenda for today is Rob Anderson, who's a retired staff person from the Wto. I'm gonna give more detail on his background. In just a second.
He'll explain how trade agreements can facilitate green balancing against the importance of open markets.
Tom Galley, who's from Dla Piper, and I will assess how common initiatives in green procurement issues and how those might be best addressed. And then we're gonna have discussion questions both among the panel and among the the audience members as well. I hope that we'll be looking for your questions to discuss. Towards the end of this hour.
Now it W. What we learned on.
On the last session on Tuesday, confirmed what? What Tom will be talking about, what Rob will be talking about.
From studies. That being done internationally is that there are commonities that we're seeing for environmental sustainability, for green public procurement.
One's based on improved planning for green public procurement and the procurement process one based on contractor where contractors might not be qualified if they aren't able to address the greenhouse gas that are trivial to goods and services.
One based on eco labels. And I'm using the term Eco labels very loosely. And I apologize for that. We need to have a term that captures what really our technical standards.
For environmentally sound products. And so we're just using the term.
Eco label to capture that. But it's a very broad range of standards, and what we learned on Tuesday is that for a variety of very interesting reasons, including problems of enforcement.
Governments are steering towards a heavy use of ecolabels, and I think that was a very important outcome or important lesson learned from Tuesday.
Another is to another approach is to in the technical.
Away price and other quality issues against A against what the environmental or what the greenhouse gas emission impact really is of a product, and that technical weighing is is both very complex, and it could be very difficult to attain.
And we'll be talking about some is obviously the.
The the brass ring, and be the most wonderful thing if we could bring it into procurement on a regular basis. If.
Because it would in essence nudge the marketplace.
Towards screen towards a greener approach to the entire marketplace. Because that's occurred in other initiatives.
Like accessibility for it.
By requiring it accessibility. The information technology being bought by the government is accessible to persons with disabilities that's nudge the entire. It marketplace towards accessibility.
But there are a lot of costly hurdles that have to be overcome before that can become a regular part of the public world.
The last approach is life costing.
Considering what are the lifecycle costs that are attributable to greenhouse gases, for example, and taking that.
Full potential cost, including externalities, potential costs.
Outside the procurement system. Well, how will this impact the environment in general? That type of life approach.
Is the 5th approach that we're seeing commonly. So we'll be talking about these different strategies.
Over the course of today. So 1st I wanna start and and welcome Rob Anderson, who's a very dear friend of the program. Lovely to have him here to join us here. He's been a a part of several of our webinars. He regularly teaches with us.
He's a part time academic and independent consultant and a trainer on matters relating to competition, policy, government procurement, intellectual property, and the multilateral trading system.
Currently lives in Sarasota.
He previously worked in the Secretary of the World Trade organization from 1,997, through 2,019.
He held a position there of senior counsel and team leader for government procurement and competition policy in the organization. With 22,005, through March 2,019.
Rob led trainings all over the world, workshops all over the world.
Both to teach folks about how the Wto Government work system works.
Government procurement works.
But equally important to teach best practices to teach practices all the world. He did a wonderful job, leveraging his position Wto to help.
Spread the good word on what our best practices and increasing. That's an important part of.
Trade agreements in procurement.
How do we use them to spread best practices? And Rob did an outstanding job with.
He holds a title of honorary professor in the School of Law at the University of Nottingham, in the United Kingdom.
He serves as an external faculty member in the international public management program at the University of Rome. Torvado is a major program. There.
On procurement, is led by Gustavo.
It's sister program at the University of Belgrade and the Academy of International Economic Law and policy at the European Public organization in Athens, Greece.
He's got the other credentials here on the slide. I just want to emphasize. Rob is also a prolific author, and we'll be talking about a piece that he just coauthored. That relates directly to the topic today. So we're very privileged to to have him join us.
Also joined by Tom Daley from Dla Piper.
He focuses his practice on assisting companies to do business with Federal State, local governments, litigation matters.
Environmental matters and regulatory counseling and compliance issues.
He's successful, litigated, bid protests before the Us. Quarter planes and the Us. Government accountability office.
Yeah, that's our major bid protest. Forum here in the United States.
Well sized protests before the small business administration and office of hearings and appeals.
Tom also represents contractors and contract administration matters, and with claims under the contract disputes he assists clients and internal investigations bought by inspectors, general.
And Department of Justice. Investigations, related actions.
Brought under the False Claims Act.
That seems that sounds like a very broad portfolio, I know, for many of you, but it's actually all directly relevant to green public procurement.
Because these are various enforcement contract disputes.
Fraud claims potentially. We touched on very briefly in the last session. But these are enforcement mechanisms that will help.
Make, green public procurement, work.
Tom also advises clients on emerging environmental and climate change requirements. Tom is really one of the leading authors.
In our community. On the emerging.
Federal initiatives in green public procurement.
And he talk. He also writes and speaks on developments related to agency policies. He's council clients regarding the 4 Council.
Proposed disclosure of greenhouse gas emissions.
He'll be talking about that, and I'll be talking as well.
The proposal and climate related financial risk rule and its proposed sustainable procurement rule.
As I said, he's a very widely published author, and I'm I'm absolutely delighted that that Tom could could join us today. Thank you, Tom.
So, Rob, I'm gonna hand it over to you.
Thanks so much, Chris. Wonderful to be here with you, and.
And Tom, and with everyone present, and I really appreciate the opportunity. This is a.
Great contribution you make Chris, to.
International dialogue on these issues. It's it's really terrific.
And I'm very pleased to support it.
So this is a quick presentation I'm about to make. It's based on a similar presentation done recently at the University of Nottingham.
And on a joint article with my colleague and collaborator, Antonella.
And we'll give you the citation for that later in the.
2 or 3 slides from now.
Okay. So I wanna make clear. Right from the outset, I actually.
I think there is that the.
Parties to the Wto. On Government procurement.
Are thinking very constructively about a potential contributions in this area and really and overall the the present agreement on government procurement.
In the Wto.
Is, is, a, is, is.
Contains a lot.
Of.
Good approaches and good possibilities to promote sustainability and environmental.
And climate change, adaptation and.
And so there's a lot going on in this space that is very positive.
Nonetheless some of the old fashioned concerns.
Remain about.
Possible protectionist tendencies, and we'll come to those.
Towards the end of the presentation.
Okay.
So.
Next. Yes, thank you. So I wanna begin actually by pointing to a development.
In the theoretical literature, on on international trade, but also very much in current policy initiatives.
That, I think, is really constructive and long overdue. And this is the idea of what we call multi purpose, trade policy.
And this is a recognition that
That trade agreements.
You know, don't have to just serve the old.
Traditional objectives of ensuring an efficient international division of labor through trade, liberalization.
It's not to say that those objectives aren't important. They they are important.
But trade. Trade agreements. Increasingly, we're seeing other valid.
Legitimate and very important objectives.
And you know it's all it should be all about.
Using the tools that are at our disposal in the international.
To promote.
The actions and possibilities that we need to see come into fruition.
And right now, that's critically mitigating the global climate crisis.
So but it can also include things like bolstering labor.
Addressing inequality.
Helping countries to build resilient supply chains.
Safeguarding national security. You know all of these things have to be considered in.
And and and our legitimate things to think about.
In constructing modern trade agreements. That's really the point of this idea of.
Purpose, trade policy, and you'll see this reflected not just in academic writings.
But very much in, you know the the speeches of Ursula von Derian.
Usr Katherine, Ty, and and so forth. So next slide, please.
Chris.
Thank you.
Sure.
Can I just can I just ask a quick question, Rob? So this is actually a problem that we or an issue, not a problem an opportunity that we're dealing with separately, because the my colleagues and I in the American Bar Association or working to revise the Model Procurement Code.
And.
And though in that revision process there's going to be a new statutory.
Materials may be new. Reg.
But there's also a lot of lessons learned that are being churned up during the revision process.
What do your experience in the Wto.
The this, this codification or reconfification process.
Becomes a means of exchanging best practices, a lesson learned.
What's some of the best ways that you found in your work?
Through the through the Wto. What's some of the best ways that you have found.
To, to disperse, to, to change those lessons learned.
Well, thanks for that, Chris. I I would say.
You know, it's it's through the back and forth discussion in the Committee on Government.
And also through the back and forth discussion that we used to have in those
Regional and national workshops that you mentioned in your kind introduction.
For me.
And so you know, it's it's through dialogue.
And the dialogue can then feed into.
Yeah, you know. Into future revisions to the agreement on government procurement and other trade agreements.
You know the the Gpa. The Wto. On Government procurement.
Is not intended to be sort of a rigid instrument that is fixed forever. It's intended to be a work in progress.
It's intended to evolve over time. This is very explicit, and and you know that.
The present version of the agreement. The 12 version.
Like its predecessor, contains this, built in commitment.
To eventually.
Hold a review, and negotiations and discussions to improve the agreement over time.
So this is a really a terrific thing. It's a terrific opportunity.
I know it takes courage for governments to kind of muster their resources to to undertake those discussions.
And but
You know it. I think it paid off very handsomely in the 12 revisions.
In other words, I think that the 2,000 of the agreement is.
Greatly improved, including, with respect to.
Consideration of environmental, sustainable.
Ability, objectives.
And and other objectives. The things I've mentioned here on this slide. Good governance.
You know the the.
2012 version of the Gpa. Refers specifically.
To the efficient and effective management of public resources. So what you're seeing is that.
Whereas this used to be an agreement that was.
Front and center about trade liberalization.
And in a passing way.
Had some positive effects in other.
Areas.
To really what is.
To me. I think this.
This terminology, multi purpose, trade, agreement.
It.
Is, is quite useful, and applies.
Directly to the Gpa. 2,012. I think the Gpa.
Yes, it's good for trade.
It's also good for the efficient and effective management of public resources.
That's a quite an amazing thing. The the.
Signatory parties to the Gpa.
Want.
This agreement.
To be useful, not only for trade.
But for the public resource, management.
Good governance.
Environmental sustainability.
And I would argue.
That the Gpa. Is even has positive implications for human rights.
To the extent that it's ensuring nondiscrimination and fair procedures.
For individual suppliers. You know, this is something that's good for.
Women owned businesses, either minority owned businesses.
To to ensure a level playing field, so.
So that's and so, thanks. Sorry for a long answer to your.
Very useful question. But I think that all I think that all of this progress has been made, and a whole lot more progress can be.
Made.
Through further discussions and.
And just one or 2 slides from now we're gonna come to.
You know those ongoing discussions and.
So.
So so the Gpa
So, in addition to.
The new language.
New and very.
open language.
On environmental systems.
Sustainability that is built into the 2,012 version of the agreement.
And which already provides a lot of scope.
For countries to implement.
Pro sustainability measures.
In addition to that.
The 2,012 revision also.
Led to the creation of this Gpa. Work program on sustainable procurement.
And you know this is a terrific and timely thing.
And all credit to the parties, to the agreement for.
Having done this in 12, I think it was prescient on their part.
And
It provides.
I'd say further an opportunity for further progress. And, by the way, the work this work program, there's also a work program on small business
Or Smes, and and other other issues.
The work programs are intended.
To serve 2 purposes. One is to.
Contribute to the positive administration of the agreement.
Even right now, at present.
The other is to contribute to future the future evolution of the agreement.
So the Gpa. Work program on sustainable procurement.
It. It calls for these things which are noted in the slide. I don't need to.
Read them out, but it calls for a review of the objectives of sustainable and of the ways in which.
Sustainable procurement.
Is integrated into.
Current government policies.
And it directs the committee to identify measures and policies.
That are deemed to be best.
Practices to promote best value for money.
And that are consistent with parties, international trade obligations.
So you know.
This is a is a major opportunity for them to move forward. I'm not saying it's easy. I know I happen to know it's.
You know, it's difficult to.
Reach.
Agreement and common positions on these issues, but I think.
I I think a very real effort is is being made.
So if you turn to the next slide we can.
Highlight. One of the.
So now. So I think this the new EU us joint catalog.
Best practices on green public procurement.
Is really a terrific.
Positive.
And
I I suspect that many
Participating in this program.
Are aware of this, but in April 24, the EU and the Us.
Jointly issued. This extensive catalog of best practices for promoting green public, drawn from experience in their respective jurisdictions.
And this was, certainly not done only for the purposes of the.
Of of carrying forward this Wto work program.
But it it was done for broader purposes than just that.
But it certainly holds the potential to.
Enable they to form a very useful input into the work of the.
Wto work program on sustainability, which I just mentioned.
And.
And and to carry that forward.
And so I just quickly on, on the on the catalog.
In my view, it's an extremely useful compendium of best practices and related initiatives.
By itself.
Already in its own right.
For the promotion of Gpp.
And.
You know that in itself is a really useful.
Number 2.
It does affirm and uphold the requirement that Gpp procedures be implemented.
In a manner consistent with the parties. International obligations.
Including under the Government procurement of the Wto.
So I think that's that's, you know. These are really positive features.
I will say.
That on the second point.
I think we, I think the world needs more.
It was. It's very good and constructive that the parties affirmed this principle, and I really congratulate them for that. It's really important.
But what we need now.
Is guidance on how to do that.
How to ensure that things like eco labels.
Are used in a manner that is consistent.
With parties, international obligations. How do we actually do this?
To my mind.
You know this. So this that this calls for.
Guidelines that go further than just the present joint catalog as useful as that is.
And really delve into.
Current Practices.
In the EU, in the Us. And also in other jurisdictions, as well.
And really really set down some markers as to.
How to implement sustainability.
Through these various.
Measures.
In a manner that is consistent with international trade obligations. And I think that the the Wto. Committee on Government Procurement through its work program on Sustainable Procurement.
Can can play a very significant role in this work.
That's the sort of the theme and conclusion of the.
This article that I mentioned by Antonella and my colleague from Paraguay and myself, and the citation is given there, and I think
Chris, you very kindly uploaded that on the sort of.
Website for this seminar as well. So that's really great.
So.
Enough, and I I promise to come to a conclusion in about 2 min.
Oh, sure!
Sure.
So, Rob, can I just ask a quick question on the on the Gpa. Process. So the W. So I worked on the, as you know, I worked on the UN Model Procurement law for about 10 years, and I thought, you know, I just you know the I was the American voice that wasn't big deal.
But one day we would meet regularly in Vienna, and one day the subway was stalled, and so I showed up about 20 min late for the meeting.
And I walked into the room. It was the experts meeting, and.
It was completely silent.
This time completely silo. It's suddenly dawn on me that my job was to be the jerk. My job was to ask the annoying questions to try to drive the discussion forward, and a role that I embraced with relish and it and it and it worked cause there were other people who are good, conciliatory types in them, in the working.
Is there? Is there that kind of dynamic available in the Wto working group where you have somebody pushing hard from the outside, saying, let's fix this. Let's fix this. Now. Is that possible?
So the answer is, yes, that is absolutely possible. Now I'm speaking. I'm speaking now, and obviously I'm retired from the Wto. I'm just speaking in my personal capacity, based on my.
Recollections of the 15 years of negotiations.
But absolutely there's there's a great deal of, and.
You know, in individual countries or jurisdictions, or the European Union, for example.
Can decide to be champions of green procurement, and can push very hard.
And it.
Can sometimes put other.
Gpa. Parties a little bit on the defensive.
But.
To me. That's a constructive dynamic.
And it it is. It was that dynamic that led to the Gpa. 2,012.
And
And.
I wouldn't have happened without those, you know. Free, flowing discussions.
And you know the the.
I will say also the EU and the Us. Were the.
Leading.
You know, proponents of different positions, but.
There was.
Very extensive, and.
Good presentation, also by many other Gpa parties, the Canadians, the Swiss, the Japanese, the Koreans.
So many were involved, and it was. It was truly a free, flowing discussion, and it was.
You know very much about best practices in public. In addition to be.
About trade promotion.
So.
So absolutely. And, by the way, incidentally, I think your contribution to the trial work was.
Highly constructive one, and and.
You know, that's an that's another.
Good thing that happened, and also through our dear friend.
Caroline Nicholas.
And we should, we should be proud about that too. And and all of these instruments now are.
Certainly the Gpa. The Ancel model law.
To an increasing extent. I would argue the World Bank.
Guidelines.
Are, are converging, and in.
In a very, very useful way, and there's so there's a lot of scope for.
You know, cross fertilization across international organizations as well. The Oecd is doing very good work.
So.
This is, we're coming to the end of my presentation. And but thanks for the the question, and that's great.
And this is just a slide to note that.
Yes, all these great things, and they are great things have been going on in terms of discussions on.
International discussions, especially between the.
EU and the Us. But also in the Gpa.
Committee with other Gp. Parties.
And I'm.
You know this, this is.
Certainly contributing to.
Better understanding.
In the world procurement, community.
That said.
they.
You know the concerns about protectionism.
In this area have not gone away.
And this is just a little quotation from the annual report for last year of the Wto. Committee on Government Procurement.
And it does note that a number of delegations.
Quite a good number, I believe.
I understand, raised concerns about how the Us. Had been implementing. It's the build America by America Act, which is, you well know, as part of the.
Infrastructure Investment and Jobs Act, the so-called
Bipartisan infrastructure Bill.
And you know they they are.
Worried. Basically they are worried that.
The increasingly strong emphasis.
On, buy American.
Measures and policies.
Is potentially.
Undermining.
The trade-related objectives of the.
Of the Gpa.
And now to be fair and to be clear, the Us.
Said and says that this.
This concern is a wholly mistaken.
And that adequate guidance. Is there.
At.
To ensure that.
That that.
The Baba, and.
Other measures are implemented in a manner consistent with international trade agreements.
And that's been, you know, since back to the 2,009.
American Reinvestment Act.
This. That's been the formula to ensure.
To avoid outright conflicts in this era between countries in this area that is, to include those magic words.
You know these measures, implemented in a manner consistent with.
Us. Obligations under international agreements and.
You know so far that has.
Been able to avoid sort of.
Any way to avoid kind of really.
Glaring conflicts in this area and that. That's that's a very good thing.
So.
I'm just making people aware that this, you know, discussion is also happening in the background.
And I think it's fair to say that tensions could increase further. If there is a change of us administration that's the most that I will say about any.
Thing.
Concerning presence.
Presidential race.
And
And I. But I also want to underline one substantive.
Policy, point here.
And that is that.
A reversion to old fashionedism in the government procurement sector will raise costs.
And we'll and thereby can undermine the transition.
To.
Bring public procurement into a more sustainable future.
So we we need yeah, you know, the objective.
Active, of.
Competition, the objectives of competition.
And free trade in the Government procurement sector, you know, can be synergistic with the.
With with the objective of fostering and climate change, adaptation.
And so it's work.
While the parties.
Doing some very careful thinking in this area, and doing their best to.
To avoid.
You know to manage.
Because let's face it. It's not only the United States.
If we read the recent statements by Ersa Land, which was, it were quoted, I think, in the previous seminar.
And and.
And in other Gpa. Parties as well. There are efforts to.
There are renewed efforts to favor domestic suppliers.
So we need to manage this properly to.
To ensure that those efforts don't undermine.
The objectives of good public procurement, policy, and even the transition to.
A more sustainable future.
Think I'm now coming to my last slide, unless.
Yes.
Yeah, I just wanna I wanna just to explain to folks with this with a means of practical terms.
Is so the build, America. And we talked about this in the last session. Rob, is that the Baba act.
Says that infrastructure would that infrastructure presumably will go to American companies, infrastructure purchases.
Done with Federal grants through State and local grantees.
That's what Boba says. But, as you point out, it says, we're gonna honor our international trade.
That's what Congress said.
In the implementing materials from the Alpha management budget. It says.
Yes. But if you want, if, for example, wants to buy a really good.
Product that is, as a very low greenhouse gas emission signature if they want to. In Maryland's member of the of the Gpa. If Marilyn wants to do that through its procurement function.
The.
Manufacture from, let's say, Sweden, which is a member which is through the EU, is a member of the Gpa. They have to go through a waiver process.
They have to go waiver process to be able to enforce their own rights on the Gpa. And those waivers are very difficult to move through.
So in essence, the the Biden Administration has raised a barrier. So that's our problem.
And just so the audience understands. That's going on politically here in the United States.
President Biden, as you as I'm sure you heard. He's not gonna run for election.
Vice President Kamala. Over the last few days since Sunday has been embraced by the Democratic party.
Vice President Harris is stronger on climate issues than President Biden. So there we have a very sharp contrast now between.
If we and we're gonna talk in just now, Tom's gonna be talking, and we'll be talking about.
The position that the trump administration is likely to take on issues of green procurement.
Versus the public positions that vice President Kamala Harris is now the presumptive Democratic nominee.
Has taken on these climate issues very sharp contrast.
Absolutely.
So to to conclude. You know I I am pointing out that the Gpa. 2,012, and this is what is covered in this article by Antonella and myself, which is just out in the current issue of the Public Procurement Law Review.
So this, the present Gpa, 2,012 does provide scope for implementation of sustainable.
Ability, criteria and requirements.
And already.
Further to that. The new EU Us catalog is a major breakthrough. It's very useful in its own right, and it's also potentially can now be given to.
The
Wto. Committee on Government Procurement, or tabled before the Wto Committee.
And used as a basis for further work.
And so all of these things are tremendously positive.
Still, there are, as we've just been discussing now with Chris. There are significant concerns in the air.
And we have to. We have to the international community.
Needs to think through.
How do we.
How do we successfully promote sustainability? And Gpp.
While managing.
And.
Managing. They they!
The tendency to invoke local preferences.
And ensuring those. Don't get out of hand.
Okay, so how do we do this? Well, maybe we'll come back to this in questions. But just.
Very much, in brief.
You know, I think we should be using the tools like the Gpa.
And other trade agreements. By the way.
To to create a to. And I think we're already moving down this path to create a community of like minded countries.
That is, the Gpa. Parties and affiliated countries.
Who care about competition and fair procedures and non-discrimination in government procurement.
And who are equally committed to sustainability.
And to achieving and to climate change. Related objectives.
Through their procurement systems, and talk with each other about how to do this in the most useful.
And most universally acceptable ways.
And you know the the opportunities are there.
A thing like the the EU Us. Catalog is a great contribution.
The the Gpa. Committee is there. The work program is there? And.
So, you know I I think I'm I'm very hopeful for the future, but it will take effort.
Thanks a lot, Chris, for this opportunity.
Thank you very much, Rob.
Tom. I'm gonna turn it over to you.
Yes, thanks, Chris and Rob appreciate the the opportunity to be here today and to cover some of the common approaches in green procurement.
As Chris mentioned, I in Dlai Piper's government contracts.
My client base is is companies in the private sector who do business with federal, State, and local governments as opposed to working directly with agencies so.
Some of my comments and views might be colored by that experience, and it's a little bit different of an angle.
To look through. So here we've got 5 of the most common approaches. Chris covered these.
At a high level earlier. So I'm gonna walk through each of them and discuss what's included in there.
So at the planning stage there's a few different ways. You can do it in the Us. You typically don't see it. But in Europe, and and this is discussed in the joint catalog as well.
There are certain jurisdictions that actually have requirements that governments direct.
At least a certain percentage of their annual spending towards screen procurement. And what screen procurement means in that sense is usually defined within those jurisdictions.
You can also have.
Emission reduction targets and net 0 spending goals that are set at the.
Federal government level. So these are the broad
Goals that all agencies have to work to meet.
But agencies are also able to set their own individual sustainability goals and plans. They.
At least in the Us. They have annual climate, not annual, but they have their own sustainability plans that are out there that discuss.
Specific actions that an agency is taking in the context of.
Climate change and sustainability.
There also are procurement level examples. So.
A few years ago very popular one was
The usps.
Decision to buy 0 mission vehicle. So during the acquisition.
Planning and market research stage.
Building in considerations related to sustainability.
So rather than buying internal combustion engines, they went and purchased a certain amount of 0 mission vehicles.
We see it with a Department of State, too, which.
You can think of has a lot of physical assets, embassies. So they are in the process of retrofitting those buildings to make them more energy and water, efficient.
Another one that's gotten a lot of coverage recently is the Department of Defense. They've been purchasing contracts to purchase.
Carbon free electricity. And that's.
Part of their efforts to meet the goals relating to Cf or carbon free electricity set by the Federal Government, but also their own
The goals that they've set, such as.
Having microgrids on each installation. By, I think it's it's 2030. So agencies are doing. And they and they're spending money to do it.
To meet their own goals and.
To touch briefly on Bab.
As as background. A couple of years ago the Us. Had 2 bills that were passed that.
Set up multiple programs with billions of dollars of funding for clean energy. So.
One of those is to build out an Ev charger network in the Us. So that.
It would facilitate the use of Evs.
In America, because you'll have more access to the chargers as part of that.
There are these domestic content requirements that rob.
Discussed, where.
A client was planning to go after these grants.
And they're looking at their supply chain in order to be eligible for that funding.
The and it might not have this exactly right. It's it's been a while, but the steel in the housing for the Evars had to be.
Manufactured in the Us. And in 55 of the components.
Used in the Ev. Chargers had to be manufactured in the Us. So.
There is that sort of
Building into the.
Clean energy projects. The Us. Government is funding.
Purchasing products that are manufactured in the United States.
Contractor, qualification.
So the idea here is that the government the Us. Government at least considers responsibility in each of the award decisions that it makes and.
It's in far part 9. There's number factors that are considered.
But.
Here you would be building in environmental considerations related to responsibility.
There's a proposed far rule relating to the disclosure of greenhouse gas emissions and climate related financial risk.
Chris is going to cover that more later in the presentation, but at at a high level.
It requires contractors with more than 7.5 million in prime or direct contract awards.
To disclose their scope. One and 2 emissions.
And then it imposes additional requirements.
On major contractors, or those with more than 50 million in those prime awards.
That's not the only way you can do it. You could also have a sort of.
Certification that contractors would need to make when they submit a bid that they have not.
Committed certain environmental violations, or compliant with.
Environmental regulations. So.
You would be screening out noncompliant wars as being non responsible and therefore ineligible for award.
The Eco labels. I there's a slide later that we'll discuss this in more.
Detail, but it's encouraging or requiring.
Agencies to purchase products and services that meet the requirements of green labeling program.
Technical evaluations. That's the 4th one we have here.
And that is building in minimum requirements or valuation factors related to sustainability in the award decision.
Last year there was a draft Rfp. That came out.
For a large government, wide procurement known as Alliance 3.
And what they did there was to build in points to be awarded. If an offer was.
Disclosing their scope, one and 2 missions, and additional points for scope. 3 missions. So right now in the Us. There.
The rule is, it's it's proposed rule. It's not required to disclose your greenhouse gas emissions.
But agencies are taking.
The matter into their own hands by.
Saying, Okay, we're gonna have a
Point scoring process of 0 to 100 points.
3 points will be for offer wars who are disclosing scope. One or 2 omissions.
And another free points for disclosure of scope. 3. Mission, so.
Having the award decision build in factors that relate to environmental considerations. You can also do this through eco labels.
So it's a different category on here. But the idea would be that if your product is not.
Compliant with the applicable program. It would be non-responsive to the specifications in the Rfp. And then it would.
Get knocked out in the technical evaluation.
And separately from those 2. You could also do this on a procurement by procurement basis.
Such as writing in energy requirements, or an ability for a product to be reused a second time.
The last one lifecycle costs.
This is starting to be considered in award decisions. But it's it's not widespread by any means. There's an upcoming proposed rule in the United States that would require agencies to consider the social cost of carbon when making award decisions and.
Where practicable and feasible, to get preference to.
The proposals with a lower social cost of carbon.
That that proposed rule is interesting because it was originally drafted in.
September 2023, but it's been under consideration.
Within the Federal Government. Since then it's not clear why or really the status of that rule. It's.
It's a long time to be under review for 10 months.
And also around that same time the Biden Administration came out.
With a directive for agencies to consider the social cost of greenhouse gas emissions and high impact procurements such as when.
The government is purchasing large energy, consuming products and systems. So.
That seems to be set up as a sort of pilot program.
They'll be able to gather lessons learned to to implement it in the future.
I see this one as.
Having a big potential to impact award decisions. So you think about a.
Solicitation, now.
You might have like basic factors in there, technical past performance. And you're you're inserting.
Into that a sub factor for price.
Similar to how you would have a price. Reasonableness, determination is the price too high for the Government to pay.
Or a price. Realism.
Evaluation, which is, is the price too low. You would then.
Potentially also have a
A life cycle cost analysis where you would adjust upwardly.
Or potentially, downwardly, the price offered by.
A offer or so just another basic example. Let's say it's a lowest price, technically acceptable.
Procurement. You have 2 offers. Offer a offer. B. They submit.
Firm fixed prices of 100,000 for offer, and 105,000 for offer. B.
The agency is part of its evaluation, considers life cycle costs, and it upwardly adjusts.
Offer a $210,000 such that it's no longer the lowest price technically acceptable offer.
I think there you could have a potential big protest ground of.
The.
Agency unreasonably evaluated the life cycle costs of client A's price. It should have only been upwardly adjusted by $2,000.
Or kind of the inverse of that offer. Bees.
Price evaluation was unreasonable.
Because it was not upwardly adjusted. It should have been upwardly adjusted by 8,000, and.
It wasn't so it's not a.
New novel type, protest, ground argument still built into a challenge to the price determination.
But I think that that's 1 area that you're you're likely.
And just in terms of next steps. I. The Department of Defense has a model for consideration of life. Cycle costs.
It's not used across the government, to my knowledge.
But there is some development that's going on there. And there's going to need to be a process whereby the data that is needed for those.
Is requested from the offerors when they're submitting their proposal.
Just quickly telling this the the reasons we have. Steve, my colleague Steve, is a picture on here is just remind me.
That on the program page.
But Steve has written extensively on these various options and on environmental sustainability.
On the program page. We have a link to a companion of his articles alongside his picture on the program. Page.
Thank you, Chris.
So I I won't.
Spend a lot of time here since we're getting close on time. But Rob covered this. There's also a webinar.
On public procurement international. So it's a really great guide. I'll echo everything, Rob said. It covers from the planning stage through award. And it's.
It's worth going to take a look at.
Here. We've identified a few next steps.
And potential issues. So.
Chris, if you could actually jump to the next slide, I'll just run through it all at once. We've.
Identified and color coded the 5 different areas.
Based on the difficulty or challenges associated with each, so green being the easiest.
Red being the the most challenging, so.
Just to share, to go through these.
The the planning process. This is already happening. I identified a few examples.
Earlier, of.
Where that is happening. It's going to be a learning process for agencies, and it's going to be iterative. So you.
Want to see some sharing of data publicly in between government agencies asked to.
How best to do this.
And you also need to ensure it happens right? It's not just paying lip service of carbon in the market planning stages, and decided not to do it, so.
Having
Some accountability there to make sure that it's being considered appropriately in the planning stage.
The contractor qualification. So.
There are real costs to contractors to inventory and disclose their greenhouse. Gas emissions in my practice will work with a multinational corporation, and they have disclosure requirements in the EU. They have. They're working with me on the proposed far role. Other lawyers in the Us.
In a rule issued by the sec relating to disclosure. And then there's another disclosure regime in California. So maybe it's another set of lawyers helping them with that one.
And it can get expensive and complicated quickly. So.
Developing a contract or qualification system, so that companies know what to expect when they're entering the public sector in a given country.
And to help to keep the the burden down, while also ensuring that there are
Environmentally responsible or submitting proposals.
And just this is another example that
Not related to environmental considerations. But we do work with clients who are based in the Us. And they want to enter.
10 potential markets, and we'll work with local council in those countries to help them develop a plan.
So they'll look at costs to enter those countries, to to enter the public sector.
So if you have contractor qualifications that are set really high, such as.
You need to have emission reduction targets.
And have them validated by the Ti, just to be eligible to do government work companies.
Might shy away from that, and not want to spend all the money needed to do that.
Ecolabels, we, you know, promising to get there. That's gonna be on the next slide.
Technical evaluation. We talked about a few different ways to do it. So.
There. It's it's coming to a conclusion on how best to do it again. That's gonna be a learning process. And officials are going to need.
Training on that procurement. Public procurement officials don't always have that same.
Background in climate change or environmental.
Considerations that that all of us on the
The webinar to or may not, may be developing that. So there's got to be some training there to teach that that new skill set. It's.
Can be hard for somebody with with no training or experience in this to.
Evaluate a claim that an offer is going to be net 0 by 2,040 or some other umission reduction target that they're representing in their proposal, and to know whether that's a legitimate.
Action the the contractor is taking, or if it's more of a greenwashing.
Type of claim.
For life, cycle cost.
Here. You still need to have that.
The model built out as to how costs will be considered, and it would be beneficial to have a.
Consistent approach there, because you're asking contractors to dig up this data to include it in their proposals.
And that can take time. It can slow down the procurement process. And if you have an offer where a competition with hundreds of offers.
You may want to hold off until a second or 3rd phase of the competition to evaluate those costs. So.
There's things that need to be worked through. As this becomes more of a routine consideration.
In the procurement process. If you could move to slide 52, please.
Yeah.
Do. I just wanna just wanna quickly. If I could just throw in here on the lifecycle costing the the one of the problems and reason that we have this in yellow is lifecycle costing. If it's done rigidly.
Canon in essence.
Perpetuate monopolies or Oligopolis on a marketplace, because.
The oftentimes the strongest market players are involved in the regulatory process in setting up how life cycle costs will be assessed.
In the Us. About the Federal level. About 60 of procurement is done using competitive negotiations, competitive dialogue, and there's going to be more play in.
In a competitive dialogue or competitive negotiation.
That's not true. In the European Union, for example, the European Union. Only about 2 or 3% of the procurements are done. The major procurements are done.
Using a competitive dialogue negotiations, they're more likely to use a formula. The formula for lifecycle costing.
Creates a risk of all goplastic behavior excluding those who don't fit that formula. So it's just an issue that we want to flag. And that's why we have it in yellow with regards to lifecycle costing.
Alright, so just a quick note on Ecolabels, and then I'll I'll turn this over to Chris. So.
In the Us. There was a final rule issued earlier this year became, I was effective in May 24.th
And it requires agencies to procure products and services.
To the maximum sent practical, and that's the the key language in the rule. There were existing requirements, but now.
The far Council has tried to give agencies less discretion, and to require them to procure those services to the maximum extent practicable.
It applies to all procurements, including micro purchases, although there are certain exceptions for things like weapon systems.
And it's also important to note that not all products and services.
At this time are sustainable. So if you have a unique solution that's not doesn't exist in the market that's not going to be covered.
Under this rule, because the rule.
It identifies certain statutory and regulatory programs.
As
Providing the definition of what is a sustainable product and service. The main one.
Being the EPA recommendations program which covers about 40 equal labels. And that's.
A significant difference than the.
450 roughly, that are available globally.
So if you have a product or service that's covered under one of those ecolabels.
The agency must acquire products and services unless it's not practical.
So the final rule.
Set out 3 instances where it's not, and that could be the price. It's too high to to buy one of these sustainable products or services.
There are performance issues, or time considerations. You can't get it delivered.
Within the
The required schedule.
So the other thing on this rule that was important is that the burden for identifying which products and services are covered by the programs is now on the agencies.
They need to identify it in the solicitation, evaluate it and then enforce it in the award decision. And that's.
Important, because in the past we would have clients come to us, and they would.
Identify the predecessor rule to this and say they're asking for information that.
Which products and services are covered under the purchasing programs, and I don't even know where to start with the purchasing pro like, I have no familiarity with it, so by placing the burden on the agency they have to, and then planning stage which we talked about, go through and identify. The applicable Eco label programs identify it. And then the contractors.
Will submit in accordance with the solicitation requirements.
The delta between the 40 and 4, 50.
Reflects that the EPA takes a a more stringent view on which.
Maybe I'm reading a little bit into it which eco labels it considers to be legitimate. They have a framework which is, gonna talk about this more. But.
They believe the framework that they use allows for transparent and consistent approach to evaluating equal programs. But.
Even if
Notwithstanding that framework, the.
Rule is not going to develop to 60 ecolabels, 120.
In any
Quick manner, because the EPA to expand its program.
It needs to go through its rulemaking process, the far counsel. They froze the list of ecolabels.
As of October 2023, so.
It's not going to be rapid evolution where you jump from 40 to 400 equals overnight. So Chris, would you.
Take us through that that last bullet point there on the different frameworks.
Sure glad to just quickly. And and apologies. We're gonna go a little little bit over, maybe 10 min or 15 min over, so we can address some of the open questions.
The the the EU, the Court of Justice for the European Union.
Issue Decision column in Maxillar. The Max Avalar case. The real name of it is is the North Holland, but it's it had to do with.
Coffee machines being installed in Government offices in the Netherlands.
Max Havelar was the standard that was used. The fair trade standard that was used.
Long, complicated story, but the bottom line is the Max. Have a decision, and the court justice of the European Union.
Laid out a very, very good approach.
2 technical standards of this kind, saying, for example, the technical standards, the goals, have to be clearly stated. The meetings that you have to discuss the technical standards have to be public. Anybody. If they have questions about the technical standards, they have to have an opportunity to raise those questions.
So the Max have our decision, which was then carried in to the 14 directives into Article 53 of the directives, very, very thoughtful approach from the Court of justice then carried into the European directives about how these kind of standards have to be derived, and I think it's a good lesson for all this is a good comparative lesson.
Just Tommy. Just wanna talk briefly about the the the rule that you alluded to before that stalled the proposed rule that would say that contractors will not be qualified if they can't present data on their carbon gas emissions.
Excuse me, the greenhouse gas emissions.
And it was. It's based on a an executive order, and that so this was issued in November 22, and it hasn't gone forward. It's been stalled.
One of the reasons, because of a development, and the Supreme Court that all of us could see coming with a Supreme Court struck down the chevron doctrine, which was, we had a webinar on this. So a couple of weeks ago, where we talked about the the in the chevron doctrine, there's deference to agencies in their interpretation of the law under Lower Bright, which is the case that replaces it.
The local right decision for the Supreme Court issued a few weeks ago. That decision means that courts are going to be much more probing, and they may go after this rule. This rule will impose hundreds of thousands of dollars of costs at least.
On major contractors as Tom's been discussing. It's a complicated process to compile data on greenhouse gas emissions.
And as a result the courts might start. In the meantime a Conservative Congress stepped in the the House Representative.
Representatives propose, and finally, the National Defense Authorization Act included language stopping the Defense Department, which is.
The the Major procuring agency in the Us. Government, stopping the Defense Department. Gathering this information.
From the traditional defense contractors for year and non-traditional contract defense contractors in Congress has said, No, this is too expensive. This is going too far and essentially made it impossible to gather the data necessary, not only for contractor qualification, because that's a 1st step to actually evaluating greenhouse gas emissions.
In a technical evaluation.
No, Congress said. We don't want the data gathered this point. So you see, significant political opposition.
In part because of the cost. And you see the parallel. That same thing happened to the sec. The sec. Pulled back on its proposed rules regarding what public companies have to gather and disclose because of the same Tor type of.
Cost based opposition to forcing companies to gather greenhouse gas emission data.
California, though, as Tom alluded to California is requiring that of companies that have more than a billion dollars revenues. So you see this disparate advances where some governments moving forward and other governments are stalling, is also, by the way, appalling issue that was slowed in the European Union. The same type of requirement for for corporate disclosures, greenhouse gas emissions. So a lot of things moving in power.
Parallel, but because of cost issues. Some seem to move forward faster than others.
Now I just wanted to to go through a few. Tom already alluded to.
The the how we weigh these various initiatives, various that.
Difference. There are things that are unpredictable that really.
How big is. So, for example, if you have a bit of a procurement system which is true in most of the worlds, are based on low price.
It makes a lot of sense to use an eco label to use an environmental standard, because that's easy. Just you plug it in the specifications.
You take the lowest price product that meets those specifications.
We're a technical evaluation where you're weighing price quality and green issues. That's a very complicated approach and maybe much more difficult to to implement, and Molina talked about that in the 1st session that as a result.
Developing nations that have less sophisticated procurement systems may be simply, they may be leapfrogging ahead of the United States and the European Union just by broadly using ecolabels is very, very interesting.
So I wanted to talk about this this middle issue. The we're at that Abby raised in the 1st session.
She she quoted Ursula of mine.
Who I mean. I've been used to researching on the president of the European Mission. By the way, she turns out she had a lot of very distinguished American ancestors. A very interesting part of her background.
Besides, the fact that she's fully in English.
And and the question I have for you, Rob, is.
Is there a mechanism under the Gpa. She has signalled here. You see it from the quotation, and Abi raised this in our 1st session. Abby raised this.
Is there a mechanism of the Gpa.
Deal with what we see you referred to as soft.
Where you can see a new directive. New procurement in the European Union might well include.
Protectionism. A European preference? Is there a way within the Gpa.
Deal with issues, you prospectively, a problem that we see coming down the tracks.
And thanks, Chris. Well, absolutely. And and you know, in the Gpa. Committee within the committee.
Any party can raise any question it wants to of.
Of any other party.
And and you you saw kind of a a hint of that.
In the in the statement that I quoted from the annual report. But yes.
Yes,
Countries can ask for.
A presentation on on the new initiative. Now, in practice. A lot of that tends to go on kind of behind the scenes. Country.
Country.
Before it surfaces in the Gpa. Committee, but.
There's nothing to prevent it from being.
Put on the agenda for discussion.
In the Gpa. Committee itself.
And may I add.
You know, that's also very much the kind of thing that could.
Be directly discussed.
Work program on sustainable public.
And
And you know.
And and, for example, the the second, if I may forgive if I may, the second bullet point on the slide here, which green procurement approach is least likely to trigger trade concerns.
Which are most likely to trigger international concerns.
You know, these are the kinds of questions that.
Ultimately it would take a lot of work. It would not be easy, but the.
Committee on Government Procurement in this work program.
Could provide some answers.
To those questions, and that would be, you know, a tremendous way to carry forward.
The dialogue beyond what they've already done.
So sure you can. You can talk about these things, and and I hope countries will.
The the Tom. A big part of our job in the Gw. Program is to gather together. It's like being a sort of wheelhouse you gather together as a lot of the different legal type of solutions. If I could, just briefly is who close out here.
Talk about the last 2 bullets here.
You. Let's say you represent that Swedish vendor who wants to sell a product that has very few greenhouse gas emissions.
Through the supply chain. The scope 3. Assessment is very, very low.
Let's say you represent that vendor, but they're encountering problems.
Getting that getting the agency to take that seriously during the planning process.
Under the rule that's already been published. The final rules that you're supposed to take this into account.
Is there a remedy that you can use as a lawyer to try and force the issue in the Us. Government.
Yeah, so it.
It's more challenging to file a protest that would require an agency to consider.
The scope 3 missions of a product as opposed to.
If the agency voluntarily.
Wrote in a specification that said that the scope 3 emissions for this product need to be X or below
There could be a challenge.
Or a competitor that doesn't meet that. To say it's an unduly restrictive.
It's not reasonably related to what the agency needs. It's not legitimate. And then the GO. And the courts here generally are pretty deferential to the agency so long as they can articulate that.
This product, we'd actually need lower emissions. For whatever reason.
But you, if a client came to me and said, we want them to include a specification.
That includes consideration of scope. 3 emissions. I wouldn't be a protest that I would recommend to them. It would be trying to get in front of.
Agency decision makers earlier in the process before there is a draft Rfp. To explain.
Why, your product?
Or why scope 3 mission should be encouraged. So it's it's a more of a soft approach than a litigation measure, because you really need the agency to go ahead and affirmatively decide that that's in their best interest to include.
The scope, 3 emissions.
Going back to Rob's Point before Tom. So you're talking about a discussion.
Rather than a lawsuit.
Yeah, that's right.
Very interesting.
Okay.
Anything else you'd like to add, gentlemen.
Thank you. I want to remind everybody, and thank very much for the audience for joining us.
Remind everybody. We have our last session on state and local that's going to be on.
Tuesday. At the same time. It's going to be 12 noon.
Eastern is going to be 9 Am. Pacific, and it's going to be then 1,800 Central European time. And we'll be. And we have experts from around the country.
Talking about state and local solutions for green.
Thank you both. Thank you for an excellent webinar. Have a good day, everyone. Take care.
Bye.
Alright, thanks, all.
Thank you so much, Chris.