Sustainable procurement for carbon neutrality of buildings: A Life Cycle Assessment (LCA)-based bonus/malus system to consider external cost in the bid price

Marco Scherz; Helmuth Kreiner; Alexander Passer

doi:10.1016/j.dibe.2023.100161

Sustainable procurement for carbon neutrality of buildings: A Life Cycle Assessment (LCA)-based bonus/malus system to consider external cost in the bid price

Marco Scherz, Helmuth Kreiner, Alexander Passer^*

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

Abstract

In order to exploit the existing GHG emissions reduction potential of a building in the early design phase, approaches and incentives are needed to promote sustainable procurement already in the tendering and awarding phase. The objective of this study is to develop a Life Cycle Assessment (LCA)-based bonus/malus system for the public procurement of buildings and provide a step-by-step guideline for practical application. GHG emissions are monetized and added to the bid price by using shadow prices to calculate external cost and a results-based climate finance (RBCF) approach to determine a GHG emissions bonus/malus. The results show that under the assumptions of the validation example, a 38 percent reduction in GHG emissions can be achieved at only a 10 percent increase in cost. It can be concluded that the application of the LCA-based bonus/malus system leads to a reduction in GHG emissions and thus combats progressive climate change.

Original language	English
Article number	100161
Number of pages	14
Journal	Developments in the Built Environment
Volume	14
DOIs	https://doi.org/10.1016/j.dibe.2023.100161
Publication status	Published - Apr 2023

Keywords

Life cycle assessment
External cost
Shadow price
Results-based climate finance
Carbon pricing
Sustainable procurement
Carbon neutrality
Sustainable construction

ASJC Scopus subject areas

Building and Construction
Computer Science Applications
Architecture
Civil and Structural Engineering
Materials Science (miscellaneous)
Computer Graphics and Computer-Aided Design

Fields of Expertise

Sustainable Systems

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

Access to Document

10.1016/j.dibe.2023.100161Licence: CC BY 4.0

1-s2.0-S2666165923000431-mainFinal published version, 1.85 MBLicence: CC BY 4.0

Cite this

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title = "Sustainable procurement for carbon neutrality of buildings: A Life Cycle Assessment (LCA)-based bonus/malus system to consider external cost in the bid price",

abstract = "In order to exploit the existing GHG emissions reduction potential of a building in the early design phase, approaches and incentives are needed to promote sustainable procurement already in the tendering and awarding phase. The objective of this study is to develop a Life Cycle Assessment (LCA)-based bonus/malus system for the public procurement of buildings and provide a step-by-step guideline for practical application. GHG emissions are monetized and added to the bid price by using shadow prices to calculate external cost and a results-based climate finance (RBCF) approach to determine a GHG emissions bonus/malus. The results show that under the assumptions of the validation example, a 38 percent reduction in GHG emissions can be achieved at only a 10 percent increase in cost. It can be concluded that the application of the LCA-based bonus/malus system leads to a reduction in GHG emissions and thus combats progressive climate change.",

keywords = "Life cycle assessment, External cost, Shadow price, Results-based climate finance, Carbon pricing, Sustainable procurement, Carbon neutrality, Sustainable construction",

author = "Marco Scherz and Helmuth Kreiner and Alexander Passer",

year = "2023",

month = apr,

doi = "10.1016/j.dibe.2023.100161",

language = "English",

volume = "14",

journal = "Developments in the Built Environment",

issn = "2666-1659",

publisher = "Elsevier B.V.",

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TY - JOUR

T1 - Sustainable procurement for carbon neutrality of buildings: A Life Cycle Assessment (LCA)-based bonus/malus system to consider external cost in the bid price

AU - Scherz, Marco

AU - Kreiner, Helmuth

AU - Passer, Alexander

PY - 2023/4

Y1 - 2023/4

N2 - In order to exploit the existing GHG emissions reduction potential of a building in the early design phase, approaches and incentives are needed to promote sustainable procurement already in the tendering and awarding phase. The objective of this study is to develop a Life Cycle Assessment (LCA)-based bonus/malus system for the public procurement of buildings and provide a step-by-step guideline for practical application. GHG emissions are monetized and added to the bid price by using shadow prices to calculate external cost and a results-based climate finance (RBCF) approach to determine a GHG emissions bonus/malus. The results show that under the assumptions of the validation example, a 38 percent reduction in GHG emissions can be achieved at only a 10 percent increase in cost. It can be concluded that the application of the LCA-based bonus/malus system leads to a reduction in GHG emissions and thus combats progressive climate change.

AB - In order to exploit the existing GHG emissions reduction potential of a building in the early design phase, approaches and incentives are needed to promote sustainable procurement already in the tendering and awarding phase. The objective of this study is to develop a Life Cycle Assessment (LCA)-based bonus/malus system for the public procurement of buildings and provide a step-by-step guideline for practical application. GHG emissions are monetized and added to the bid price by using shadow prices to calculate external cost and a results-based climate finance (RBCF) approach to determine a GHG emissions bonus/malus. The results show that under the assumptions of the validation example, a 38 percent reduction in GHG emissions can be achieved at only a 10 percent increase in cost. It can be concluded that the application of the LCA-based bonus/malus system leads to a reduction in GHG emissions and thus combats progressive climate change.

KW - Life cycle assessment

KW - External cost

KW - Shadow price

KW - Results-based climate finance

KW - Carbon pricing

KW - Sustainable procurement

KW - Carbon neutrality

KW - Sustainable construction

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U2 - 10.1016/j.dibe.2023.100161

DO - 10.1016/j.dibe.2023.100161

M3 - Article

SN - 2666-1659

VL - 14

JO - Developments in the Built Environment

JF - Developments in the Built Environment

M1 - 100161

ER -

Sustainable procurement for carbon neutrality of buildings: A Life Cycle Assessment (LCA)-based bonus/malus system to consider external cost in the bid price

Abstract

Keywords

ASJC Scopus subject areas

Fields of Expertise

UN SDGs

Access to Document

Other files and links

Fingerprint

ParisBuildings - Transition of the procurement process towards Paris compatible public buildings

Life cycle assessment-based procurement of buildings using the systemic know-why planning process

Transition of the procurement process to Paris-compatible buildings: consideration of environmental life cycle costing in tendering and awarding

Strategies to improve building environmental and economic performance: an exploratory study on 37 residential building scenarios

Cite this

Sustainable procurement for carbon neutrality of buildings: A Life Cycle Assessment (LCA)-based bonus/malus system to consider external cost in the bid price

Abstract

Keywords

ASJC Scopus subject areas

Fields of Expertise

UN SDGs

Access to Document

Other files and links

Fingerprint

Projects

ParisBuildings - Transition of the procurement process towards Paris compatible public buildings

Research output

Life cycle assessment-based procurement of buildings using the systemic know-why planning process

Transition of the procurement process to Paris-compatible buildings: consideration of environmental life cycle costing in tendering and awarding

Strategies to improve building environmental and economic performance: an exploratory study on 37 residential building scenarios

Cite this