Germany’s procurement law reform fails to improve climate action and circular economy – NGOs
Clean Energy Wire
The reform of Germany’s procurement law fails to use an opportunity to harness the immense spending power of public institutions to make basic industries more climate-friendly, according to environmental groups. The law changes lacked mechanisms to boost climate action, circular economy concepts and innovation in key industries such as steel or cement production, said environmental umbrella group DNR.
“A fatal signal in light of the necessity to reduce fossil fuel dependence and steer investments towards future-proof business models,” said DNR’s deputy executive manager, Tobias Pforte-von Randow.
Germany’s parliament adopted the law reform on Thursday with votes from the ruling coalition parties, the conservative CDU/CSU alliance and the Social Democrats (SPD). The reform is designed to simplify procurement procedures and improve the use of digital tools for public projects.
DNR called on economy minister Katherina Reiche (CDU) to use her power to issue statutory instruments that come with binding climate criteria. “Modernising our industry is a joint effort in which the public sector must also take responsibility,” said Pforte-von Randow.
WWF climate expert Viviane Raddatz said public procurement contracts represent a “low hanging fruit” for adapting the country to the future. “This becomes even more important if you look at the upcoming investments in the context of the special fund for infrastructure and climate neutrality,” Raddatz said, adding that the money in the 500-billion euro fund must be consistently targeted at climate neutrality. This includes emissions limits, longevity, repairability, reusability and the use of recycled materials as new standards, she added.
Instead of implementing requirements for circularity and climate action, public projects tend to opt for the cheapest solution in the short term, Raddatz argued. “This ignores the huge follow-up costs of an unchecked climate- and resource crisis.”
Conservative lawmaker Andreas Lenz said the law reform would speed up the implementation of projects under Germany’s special fund and particularly support the interest of small and medium-sized businesses. Armand Zorn from the SPD said the new law would ensure that investments “get on the road” instead of stalling in bureaucratic procedures, while also strengthening “green lead markets” for industry.
The Green Party rejected the reform in parliament. The public sector issues contracts worth up to 15 percent of Germany’s GDP, said Green MP Julian Joswig. While it would be right to accelerate procedures, the adopted law would not ensure that money is spent in a more targeted or sustainable fashion, he argued. On the contrary, the government aimed to also lower EU procurement law standards, Joswig argued.