European steelmakers join new green-procurement coalition “Buy Better to Build Better”
Notable steelmakers, steel trade associations and construction firms have launched the Buy Better to Build Better (BBBB) coalition at an event at the European Parliament in Brussels, Kallanish learns.
This initiative is designed to enhance green public procurement practices across Europe. Members of the coalition include steel recycling trade association Euric as well as Italian steelmakers Ori Martin and Riva Group.
The BBBB manifesto suggests that Europe should adopt a more streamlined procurement strategy, integrating criteria aimed at stimulating demand for low-carbon products and circular construction solutions. In a note, the coalition proposes a revision of EU public procurement directives featuring “coherent and horizontal procurement rules beyond lowest price, simpler and standardised EU-wide tracking of GPP [and] continued support for public authorities in implementing GPP effectively.”
Because the purchasing power represents 15% of the bloc’s GDP, if used effectively, “it will accelerate the industrial transition while advancing European competitiveness.”
Over 50% of public contracts within the EU are allocated primarily on the basis of the lowest price, disregarding factors such as quality, innovation and sustainability. A revision of the EU public procurement directives has the potential to establish sustainable procurement as a standard practice, enabling the rapid scaling of green and innovative solutions across Europe. Increasing the production of sustainable products is likely to lead to a reduction in their prices, improving affordability and competitiveness within the market.
The construction industry, where public procurement makes up 31% of overall expenditure, would be most affected. Eurostat indicates that public procurement accounts for no less than of 11% of the total greenhouse gas emissions within the EU.
“The construction and steel industries are at a crossroads. This coalition represents a key opportunity to accelerate meaningful change by advancing construction and public procurement practices that prioritise truly low-carbon and circular materials, based on clear and objective criteria,” Riva Group comments.
According to Carlo Beltrame, chief business development officer for Italian steelmaker AVF Beltrame, the very first premium for green steel will originate from the public sector. There will be an increase in green public procurement, which will mandate the purchase of carbon neutral steel.
“Over the next two years, several things will change … From the steelmaking point of view, but also from the financial institutions perspective, we will start to see a heightened sensitivity towards embedded emissions,” Beltrame told Kallanish in a recent interview.
At present, there is no premium or reward mechanism in place for those who invest in low-carbon steel production. The market for green steel is in its early stages of development, although demand is projected to rise over the next two years.
Natalia Capra France
