Combining procurement data from Stotles with insights from emerging sustainability policies, this report outlines strategies you can implement to capitalise on a public sector sustainability procurement market that is growing 33% YoY. Read ahead to:

• Understand fundamental policy shifts: Dig deeper into regulatory changes and funding that is set to transform the sustainability procurement market.
• Target top buyers: Pinpoint the sectors & specific buyers leading the charge to refine your target account list.
• Explore trending industries: Target upcoming sustainability contracts for suppliers in software, consulting and construction industries.

Throughout this report, we showcase specific opportunities identified through the Stotles platform. To take the next step and identify contracts relevant to your company, get started for free today.

Over the past five years, procurement for sustainability-related initiatives has skyrocketed across the public sector.

The graph below visualises the number of contracts awarded each year tagged with environmental sector CPV codes (71’, 45’, 90’ and 80’), which has increased by 200% over the period shown, an average of 33% yearly.

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To help you understand the policies & initiatives catalysing this market growth, this section will explore the two key policies driving growth.

As part of the Procurement Act 2023, the current process of a buyer selecting a tender by the Most Economically Advantageous Tender (MEAT) will be replaced by the Most Advantageous Tender (MAT) system.

The MEAT approach involved contracting authorities evaluating tenders based on perceived quality and relative price. [GATE] However, when a buyer had a limited budget, the scoring was often weighted toward price rather than quality. To help you understand the policies & initiatives catalysing this market growth, this section will explore the two key policies driving growth.

With the new MAT approach, authorities place less emphasis on price when evaluating tenders and a greater focus on social value, including the environmental impact. As a result, in the coming years, sustainability components are expected to become more integral to successful bids. This shift indicates the greater responsibility each authority has to meet their specific environmental and sustainability goals.

With more significant transparency requirements, buyers must report on suppliers’ performance throughout a contract’s lifecycle, increasing the demand for quality sustainability services.

Kickstarting the boom in 2021 was the Net Zero Strategy announced in the Conservative Autumn Budget that gave us details of a £30b plan for the “green industrial revolution”. This forced local and central authorities to hit net-zero targets, leading to a downstream boom in the procurement of sustainability services that saw an 18% increase between 2021 and 2022.

Entering the second half of 2024/25, the Labour government has pledged new commitments to net-zero targets in the form of initial investments of approximately £15b into Great British Energy (GBE) and the National Wealth Fund (NWF). The functions of these investment vehicles are to promote clean energy, reduce carbon emissions and ensure long-term investment in carbon-reducing infrastructure, providing new opportunities for suppliers.

Details of GBE and the NWF are yet to be fully revealed, but the Autumn budget set to be announced on the 30th October 2024 should give suppliers more visibility into where funding will be allocated.

In this section, we highlight the top sectors and specific buyers who have led sustainability activity.

Understanding a high-level analysis of the top sectors that are driving demand for sustainability services in the public sector allows you to focus your sales efforts on the most relevant buyers. The pie chart below reveals the percentage of total contracts awarded by each government sector over the past five years.

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The analysis shows that 89% of all sustainability procurement is emerging from local and central government authorities. This is unsurprising, as these authorities are typically responsible for leading core infrastructure projects and meeting critical sustainability criteria outlined by the central government.

To help you focus your sales efforts on the most active authorities in these sectors, the bar chart below highlights the top 10 most active authorities over the past five years.

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We can see that the Department for Energy, Food and Rural Affairs (DEFRA) lead the way for central government suppliers, followed by other mission driven organisations such as Natural England and the Marine Institute.

From local government, Leicestershire County Council and Derbyshire County Council lead the way, awarding 103 contracts between them. In the next section, we will provide buyer spotlights on the top central and local authorities, DEFRA and Leicestershire County Council.

In this spotlight, we will highlight critical tactics to identify and qualify opportunities in central authorities.

DEFRA is responsible for environmental protection, food production and standards, agriculture and rural communities throughout the UK. Over the last five years, this buyer has procured 503 sustainability related tenders with a total value of £411m.

One tactic successful suppliers use to identify upcoming opportunities is to analyse historical contract award data and identify contracts coming up for expiry that they can target for renewals ahead of the official tender date. Below, we have highlighted three example contracts to demonstrate the opportunities involved.

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To understand DEFRA's supplier relationships, we've analysed prior procurement trends and awards. This information helps you understand who the incumbent suppliers are and what types of suppliers DEFRA typically favour, allowing you to better price and position your bids.

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In this spotlight, we will highlight key tactics to identify and qualify opportunities in local authorities.

Leicestershire County Council is responsible for a wide variety of civil services spanning from education, transport, planning, fire and public safety, social care and waste management. Over the last five years, Leicestershire County Council has procured 53 tenders tagged with environmental CPV codes, totalling £1.9b.

Leicestershire County Council exhibits significant activity around research, reporting and net zero roadmaps. Suppliers providing these services should monitor this buyer and engage with decision makers to better position their bids.

Successful suppliers use historical contract award data to identify contracts coming up for expiry that they can target for renewals ahead of the official tender date. Below, we have highlighted 3 example contracts to demonstrate the type of opportunities involved.

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To showcase supplier relationships with Leicester County Council, we’ve repeated the award analysis introduced in the DEFRA section. This award data helps you understand which suppliers Leicester County Council prefers and provides insights into the partnerships they prioritise, enabling you to tailor your approach accordingly.

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In this chapter, we dive deeper into three key sustainability verticals experiencing continued growth; software services, consultancy & professional services and construction.

These key verticals account for more than 77% of all sustainability related procurement since 2019.

Use the contents bar on the left hand side to navigate to the most relevant vertical, where we analyse historical procurement trends and identify tangible future opportunities for suppliers to leverage.

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Sustainability software services in public procurement refer to specialised software solutions that assist public sector organisations in integrating and managing sustainable practices. These services include tools for tracking and analysing environmental impact, managing supply chain sustainability, optimising resource use and ensuring compliance with sustainability standards.

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Whilst this sector only makes up 8.4% of the total volume of contracts we use in our analysis, the total value of contracts within this sector has been more than £43.6b over the last five years, growing at 17% YoY.

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It's important to note that sustainability services are often bundled in larger contracts. Top suppliers monitor contract expirations to target key renewals. By analysing a buyer’s expiring contracts, they can strategically engage decision-makers early. Below are three upcoming opportunities for software suppliers to leverage.

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Consultancy & professional services focus on integrating sustainable practices throughout buyer authorities. This includes services such as sustainability appraisals, carbon auditing and support for innovation in sustainability technology.

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Accounting for 23% of all sustainability procurement between 2019 and 2023, 372 different buyers procured consultancy & professional sustainability services totalling more than £55b. Like with the above vertical spotlight, this value is slightly inflated because sustainability services are often bundled into larger contracts.

From the graph below, demand for these services is booming with a 35% average YoY increase in the number of these types of contracts coming to market.

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Suppliers track contract expirations to target key renewals. Timing engagement with decision-makers is crucial, especially as sustainability services are often bundled in larger contracts. Below are three upcoming expirations to give you an idea of the types of opportunities you can expect in this vertical.

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Construction sustainability services ensure that the public sector’s planning, construction and maintenance of infrastructure adhere to sustainable practices. These services focus on minimising environmental impact, promoting energy efficiency and using sustainable materials.

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Over the last five years, there has been an uptick in the procurement of these services, with an average YoY increase of 37%.

Accounting for 46% of sustainability procurement in our analysis, there have been 2,557 contracts for sustainability construction suppliers, worth a total value of £85b between 2019 and 2023. It is important to note that this value is slightly inflated because sustainability services are bundled into larger contracts but are still categorised by an environmental CPV code.

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Suppliers monitor expiring contracts to identify opportunities and pre-engage with key decision makers to get ahead of competitors. Below are some upcoming expirations in Stotles for you to get an idea of how you can use our platform to win more business.

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The procurement of sustainability services has grown by 33% YoY over the last five years and is expected to continue rising due to initiatives like the Procurement Act, changing regulations, and investments in bodies like NWF and GBE. Additionally, new transparency laws will ensure that contract clauses are enforced. With this sector expanding, suppliers should closely monitor and explore upcoming contracts with sustainability components.

The data all point towards local and central buyers leading the charge in the procurement of sustainability services, especially in the software, consultancy & professional services and construction verticals. It’s crucial for suppliers in these areas to stay ahead of upcoming opportunities. With Stotles, you can monitor these trends, explore relevant data, and position your business to win more contracts. Sign up for free today to get started.