Background
Tampere is the third largest city in Finland and sits on an isthmus between lakes Pyhäjärvi and Näsijärvi. The city developed a Carbon Neutral 2030 Roadmap and was the primary implementer of the EUfunded partnership model for sustainable neighbourhoods (KIEPPI) project.
As part of the KIEPPI project and in alignment with its 2030 Roadmap, Tampere sought to apply a circular economy (CE) approach to an infrastructure project. In 2021, the City of Tampere Construction and Maintenance of Urban Environment Unit announced that the renovation of Yliopistonkatu, a key street, would adopt a newly developed CE procurement procedure. This approach was unique given the lack of previous infrastructure-related CE procurement examples. The project marked the first of its kind in Finland.
Procurement objectives
City officials interviewed companies in an effort to explain the lack of infrastructure ventures with a sustainable procurement process. They found that while the private sector was ready for CE projects, the municipal government’s traditionalist approach to procurements and monopoly market position were creating bottlenecks. Based on this feedback, the city saw the opportunity for the Yliopistonkatu project to transform how the greater market functioned. The objective of the procurement was to promote Tampere’s sustainability and CE goals in a commercially profitable way.
This was also the first time a design and build operating model was used at a city level in Finland. This model, together with CE criteria, also aimed at optimizing the turnaround time of the project and minimizing the inconvenience caused by the site of the urban environment.
Criteria used
In a design and build (D&B) operating model, the chosen contractor is appointed to both design and then construct the works described in the contract. The City of Tampere viewed the D&B model as beneficial since the planning, construction and technical definition of street construction were no longer dependent on the city’s internal resources, know-how and experience. Rather, a D&B procurement aimed to (1) harness the know-how, experience and abilities of private actors to achieve the city’s circular economy goals, (2) make it possible to conduct business in accordance with circular economy goals and based on feedback from market dialogues, (3) shorten the project time, minimise additional or changes in work and improve budgeting and (4) improve knowledge on efficient operating models and new technical possibilities for design and construction.
As part of the D&B process, new public CE procurement criteria were developed by the city of Tampere Construction and Maintenance of Urban Environment Unit and the KIEPPI project (operating as part of the Sustainable Tampere 2030 program) with input from academia, research programs, UUMA4 program (use of recovered materials), public procurement specialists (KEINO academia) and companies. By collaborating with an expert panel, the city was able to create baseline criteria that ensured effective but realistic standards and avoided applying too of stringent measures from the offset.
After defining the initial criteria, procuring officials participated in market dialogues to explain the circular and sustainability aims of the procurement and initiate a deeper discussion with the companies.
Subject matter of the contract
This Yliopistonkatu D&B construction contract included street construction works and lighting works. The procurement of the contract favoured products and supplies with lower carbon emissions.
Selection criteria
The bidders were asked to indicate the existence of the following, with one (1) point allocated for a ‘yes’ response:
• A certified environmental management system.
• At least one reference of a previously completed project with recycled material.
Technical specifications
The selected contractor was expected to support the City of Tampere’s resource efficiency and carbon neutrality objectives. Among the technical specifications included in the EU Green Public Procurement (GPP) Criteria for Road Design, Construction and Maintenance (2016), waste production during excavation, excluding construction and demolition waste, should be recorded. An Excavation Materials and Soil Management Plan should be prepared to establish systems for the separate collection of:
I. excavated materials resulting from excavation activities (for example from site preparation and levelling, foundation, basement and trench excavation), typically soil and stones, including subsoil;
II. topsoil.
Closed loop re-use on-site for both excavated materials and topsoil should be maximised according to the results of the carbon footprint or LCA performance assessment (see criterion B14). Separate excavated material collection for re-use, recycling and recovery should respect the waste hierarchy in Directive 2008/98/EC.
In advance of construction, bidders were asked to submit proof of compliance with the following technical documents to the City of Tampere:
• InfraRYL 2006 Infra construction: general quality requirements
• General work description of municipal technical works KT02
• Asphalt standards 2000
• Asphalt contract documents 2005, work descriptions and value changes • Concrete and natural stone products as superstructure, SKTY publication no. 14
• Stonemason’s manual, published by Lemminkäinen Oyj
• General quality requirements for construction works RYL 2000
• Thermoplastic pipes to be installed in the ground and in water, installation instructions RIL 77/1990
• Concrete pipe standards 2001
• Concrete standards RIL 131-2001
• Government decree on the safety of blasting and excavation work VNa 644/2011
• Vibrations due to construction RIL 253-2010 • Construction trenching instructions RIL 181-1989
• Ministry of Social Affairs and Health publication 15/2004, Narrow Trenches
• General work description of green construction VRT 2011.
Once awarded, the contracting authority evaluated the chosen contractor’s compliance with stated obligations based on the information provided in the technical documents and the submitted environmental plan.
Social clauses
In an initiative to promote the employment of people in a weak labour market position through public procurement, the City of Tampere’s tenders include an employment condition that allocates 3% of the annual value of a contract towards hiring and employing a member of the ‘target group’. The target group includes young people, long-term unemployed, over-55, immigrants and/or partially disabled individuals.
Award criteria
As clearly stated in the tender request form, price was not the only factor considered. According to the evaluation criteria form, points were awarded for the following criteria:
1. Reducing the amount of waste.
a. The earth or stone materials formed in the contract implementation are used at the place of origin. Points awarded based on the percentage of recycled materials used out of the total mass quantity.
• 6 points: at least 70%
• 4 points: at least 50%
• 2 points: at least 30%
b. Surplus soils created in the contract are utilised outside the contract. Points awarded based on the percentage of recycled materials used out of the total mass quantity.
• 3 points: at least 70%
• 2 points: at least 50%
• 1 point: at least 30%
2. Conserving natural resources.
a. Recycled materials from outside the project are utilised in the project. Points awarded based on the percentage of recycled materials used out of the total mass quantity.
• 3 points: at least 70%
• 2 points: at least 50%
• 1 point: at least 30%
b. The percentage of recycled asphalt in the asphalt mixes used in the project. Points awarded based on the percentage of recycled materials used out of the total mass quantity.
• 3 points: at least 70%
• 2 points: at least 50%
• 1 point; at least 30%
3. Reduction of other environmental impacts.
a. Vehicles and equipment used in the project meet appropriate emission standards.
• 3 points: vehicles at least Euro 6, equipment at least Stage 4
• 2 points: vehicles at least Euro 5, equipment at least Stage 3B
• 1 point: vehicles at least Euro 5, equipment at least Stage 3A.
In order to allot points, the contracting authority included a material recovery report Excel, also known as the mass economy Excel, which tracked all the masses generated or used in the contract and were evaluated both before and during the contract. The points awarded were derived from the evaluation criteria form, which was generated based on input in the mass economy Excel. The mass reporting was also monitored throughout the contract (see ‘Contract Performance clauses’).
Weighted criteria
Tenders were evaluated based on the most economically advantageous tender: 30% given to the quality criterion and a 70% to the cost criterion, based on the following calculations.
→ Price: (lowest given value/offered value) x 70
→ Quality: (offered value/highest given value) x 30.
The ‘Quality’ points are distributed according to the procurement’s objective criteria.
Contract performance clauses
Bidders were instructed to fill out a newly developed Excel on material recovery and use which would be followed up with the chosen contractor. All tenderers were also asked to complete a short version of an environmental plan which the chosen contractor would fill out in greater detail in order to ensure the environmental criteria were considered during the building process.
Results
The total contract value was €1,672,072.50 for the design and construction of Yliopistonkatu over a period of 1 year. The contract was awarded on 13 September 2021.
The procurement was published in June 2021 through Hilma, an open procurement platform widely used in Finland. Companies were able to comment on the new circular criteria before submitting their application. 4 weeks were allowed for questions and the deadline for submissions was 17 August 2021. The contracting authority received 3 bids, which is low for a wintertime procurement process but quite normal during the summer, and all three tenders were able to meet the sustainability criteria.
This achievement reflected the message received from a previous series of interviews conducted with influential infrastructure actors: infrastructure companies were ready to implement CE criteria but were waiting for an improved procurement process.
Since the infrastructure field in Finland is monopolized by city buyers, interviewees noted that public procurement is both the best way to nudge the industry towards a sustainable approach and the ideal starting point from which to develop wider CE practices. Additionally, the D&B model allowed potential contractors to influence the procurement process through CE-related ideas and innovations for the first time.
The winning tender was submitted by Turtolan Kaivin Ltd and was the most ambitious bid, both economically and according to the CE objectives.
Environmental impacts
Turtolan Kaivin Ltd promised to reutilize at least 70% of the materials generated at the place of origin and use the surpluses generated in the contract outside the contract to at least 70%. This means reusing rather than dumping the raw materials (stone, gravel, etc.) dug up when opening the street and ensuring that materials that do not meet the requirements of the current construction site are used in other, less material-demanding projects. The company also committed to using up to 50% of the remaining recycled materials outside the contract. The amount of recycled asphalt mass was a maximum of 50% of all asphalt used and monitored through a mass economy Excel throughout the entirety of the project. Presently, all the excavated mass has been used.
According to the Technical Report for the EU Green Public Procurement (GPP) Criteria for Road Design, Construction and Maintenance, a large range of environmental impacts can be accounted for in all components of the road life cycle. During the construction phase, materials production and transportation have the largest environmental impacts. These impacts include the consumption of non-renewable resources, global warming, acidification, photochemical ozone formation and eutrophication. On asphalt pavements, bitumen production and asphalt mix (including aggregates) are responsible for the main effects. Therefore, utilizing recovered material and low-emission equipment on a key road such as Yliopistonkatu generated positive environmental impacts.
Lessons learned
• The development of an infrastructure project such as the construction of Yliopistonkatu required more time and cooperation from a variety of experts than a ‘business-as-usual’ tendering process. In accordance with Article 40 of the EU Directive 2014/24/EU on public procurement (“Preliminary market consultations”), the contracting authority conducted extensive interviews with companies before designing procurement criteria. The interviews and meetings were important for understanding the state of the industry.
• After developing the criteria, informational briefings with potential bidders were essential for explaining the sustainability objectives and newly developed CE criteria to companies. The City of Tampere was able to describe its needs and requirements while suppliers could comment, question and seek clarifications.
• Market feedback revealed that the previous public procurement process did not allow for CE considerations, thus making it impossible for companies to offer or implement sustainable solutions. After identifying the bottleneck(s), it was important to properly address the legal and advocacy concerns.
More information
Contact person: Karoliina Tuukkanen, City of Tampere - Climate and environmental policy unit
Contact information from the City of Tampere website.
For related information, please see European GPP criteria for Road Design, Construction and Maintenance and the Technical Background Report.
Tender documents are available online (in Finnish). For English language version, please contact Karoliina Tuukkanen.