Background

Consip Spa, an Italian public company, is entrusted with managing procurement for Italy's public sector, emphasizing transparency, efficiency, and sustainability. In line with Italian municipalities' aims to enhance public lighting quality and energy efficiency, Consip embarked on a mission to establish a framework contract encompassing services such as electricity supply, maintenance, energy upgrades, and smart city features for public illumination and traffic lights.

 

Procurement objectives

Consip’s key procurement objective was to achive energy consumption and emissions reduction, economic savings, and energy management services while complying with EU and Italian public procurement legislations regarding energy efficiency, ecodesign, hazardous substances restriction, chemicals registration and restriction, and greenhouse gas emissions management. To this end, Consip conducted a "Key Environmental Impact Analysis" to assess the primary environmental impacts of road lighting and traffic signals throughout their life cycle and to subsequently develop the procurement criteria.

Tender requirements

The framework complies with the ministerial decree (Official Gazette n.8 of 23 January 2014), which outlines minimum environmental criteria public authorities should consider for public lighting infrastructure and design services for public lighting installations.

In addition, suppliers must:

1. adhere to specific EU environmental regulations, notably EC Regulation 245/2009 for discharge lamps and EU Regulation 1194/2012 for directional LED systems,
2. comply with Legislative Decree 152/2006 Annex F of part IV "Waste" for packaging, 
3. present test reports for each set of criteria, guaranteeing adherence to the standards.

Selection criteria

Suppliers are required to hold:

• SOA OG10: High to medium-voltage electrical systems and public lighting setups.
• SOA OS9: Traffic lighting and safety systems for transportation.

Technical specifications

Lamp replacement: At contract end, lamps should retain a residual life equal to at least one-third of the initial technology's lifespan.

Standards for Luminaires: luminaires must meet specified criteria, like the CE marking and minimum IP characteristics.

Energy Efficiency and Performance: Parametric Index of Lighting Efficiency (IPEI): Lamps must achieve a minimum 'B' rating. This index evaluates energy efficiency, categorised from A++ (highest efficiency) to G (lowest efficiency). Assessment considers multiple factors: the lighting type utilised, the specific area illuminated, overall power consumption, and adherence to industry standards.

The entire public lighting system must be designed according to the lighting class identified for the visual task, such as intersections or sidewalks (UNI 11248) and the related minimum lighting requirements indicated to ensure user safety (UNI EN 13201).

Luminous efficiency by lamp type: Higher luminous efficiency means more light per unit of energy, ensuring less wastage.

High-Pressure Sodium Lamps:

• Lamps with power up to 45W: Efficiency must be at least 60 lm/W.
• For those between 45W and 55W: Efficiency should be 80 lm/W (bright) or 70 lm/W (opal).
• 55W to 75W lamps: Need efficiency values of 90 lm/W (bright) and 80 lm/W (opal).
• Those with a CRI greater than 60 should adhere to the standards set for metal halide lamps.

Metal Halide Lamps:

• Lamps rated up to 55W should have an efficiency of at least 60 lm/W.
• Those between 55W and 75W: Should reach 75 lm/W (bright) and 70 lm/W (opal).
• Lamps from 75W to 105W: Required to have 80 lm/W.

LED Modules:

• Luminous efficiency values differ based on the colour temperature of the light emitted.
• LEDs with colour temperatures up to 3,500K must achieve an efficiency of at least 70 lm/W with optics and 75 lm/W without.
• Those with colour temperatures between 3,500K and 5,500K: Efficiency values are 80 lm/W (with optics) and 85 lm/W (without optics).
• LEDs above 5,500K: Need to meet or exceed 85 lm/W with optics and 90 lm/W without optics.

Additional technical specifications concerning LED modules:

• Comprehensive technical data aligned with EN 62031, including power factors and criteria for flow maintenance and failure rate at 50,000 hours.
• Colour metrics, notably the colour rendering index (Ra) and proximal colour temperature (Tcp).
• Photometric reports that abide by EN 13032, safeguarding energy efficiency and minimising environmental detriment.

Ballasts (power supplies): All ballasts are supplied with detailed technical data on efficiency:

• Nominal Efficiency: More efficient ballasts waste less energy.
• Power Factor: A high power factor means the device uses electricity more efficiently.
• Operating and Container Temperature: Devices that run cooler are typically more efficient and might have longer lifespans.
• Dimmable Ballasts Information: dimming typically uses less power.
• Radio Frequency Interference (RFI) suppression and harmonics on the network for remote-controlled power supplies: improves the energy efficiency and reliability of the power grid.

Lamp mercury content limitation: 

• Strict limits are imposed on mercury content. Limits are set for high-pressure sodium and metal halide lamps, ranging from 12 mg to 190 mg, depending on the lamp's power.

Installation, maintenance, and disposal:

• Bidders had to provide explicit instructions on accurate installation, diligent maintenance, and ecologically sound disposal for lamps, LED modules and ballasts.

Warranty and spare parts: For all products, the supplier must:

• Provide a manufacturer's warranty for a minimum of three years.
• Ensure the availability of spare parts for the warranty duration verified through a suitable guarantee certificate. Products with a Type I eco-label are presumed to comply with the criteria.

Packaging: Packaging materials should be easily distinguishable for separation by type. They must be recyclable, made from recycled content, meeting weight-based recycling criteria of 90% for paper/cardboard and 60% for plastic. Demonstrated via a technical data sheet of the packaging, other technical documentation from the manufacturer, or a test report from a recognized body, showing:

• all materials used and their relative quantities by weight,
• the recyclability characteristics of each material used,
• the content in recycled material,
• the methods suitable for separating different recyclable materials,
• the technical standards the packaging complies.

White certificates (energy efficiency certificates):

• The lighting products must come with white certificates, which verify that the lighting will achieve or exceed a certain TOE savings over its lifespan. This mechanism is the main tool for promoting energy efficiency, as per the Ministerial Decrees of 20/07/2004 and 21/12/2007.
• Companies that achieve energy savings beyond a certain threshold can earn these certificates and trade them with other entities that may not be able to meet their energy-saving obligations. Consip stipulated that 50% of the revenue from these certificates must be returned to the regional administration in each lot.

Smart city features and enhancements: The Supplier must identify a city (per lot) in which it will implement and administer a "smart city" service, including:

• sensors and smart lighting,
• systems and cloud networks to measure and control energy-saving,
• energy enhancements based on audits and technical offers,
• Include luminosity regulators, remote monitoring, alarm notifications, and system parameter programming.

Award criteria

Commitment to Green Energy: This criterion emphasizes the preference for bidders committed to supplying 100% certified green energy throughout the contract duration. Green energy is defined in letter b) of ARERA ARG/elt resolution no. 104/11 and subsequent amendments, and certified through Guarantee of Origin (GO), issued in Italy by the GSE (Energy Services Manager).

The national Guarantee of Origin system and contract execution ensures the delivery. To fulfil the obligations, penalties are set for every kWh of non-green, uncertified electricity.

Point Allocation: Bidders who commit to 100% green energy receive an additional 1.25 points out of a total possible technical score of 50 points.

Evaluation Basis: Offers are evaluated based on a 50-50 split between price and technical aspects. While a minimum provision of 50% green energy is mandatory, the 1.25-point score for supplying 100% green energy pertains to the technical portion of the evaluation.

Contract performance conditions

• Preliminary assessment (per lot): Supplier performs and shares initial audit to identify system improvements and maintenance needs, including technological interventions  and an activity plan, to be approved by the region.

• Waste management: Conform with WEEE Regulations for waste collection and treatment of replaced items
• Performance monitoring: Suppliers should ensure regular monitoring to uphold and improve system efficiency throughout its life cycle.
• Staff training: The supplier must provide training and information to public administration staff on:
  • Eco-efficient management of the lights and fittings;
  • Elements of danger and risk to the health and environment of the products managed;
  • Procedures for effective environmental measures, focusing on waste management, hazardous substance use, and preventing soil pollution from pollutants.
• Lights and fittings maintenance
  • The Supplier will be obliged to clean all the surfaces that make up the plants by using products compliant with the Minimum Environmental Criteria¹ for cleaning products.
  • The paint products must ensure compliance with the minimum requirements set out in the Italian Minimum Environmental Criteria.

^{1 The Minimum Environmental Criteria (CAM) in Italy are legal requirements targeting optimal environmental solutions in product/service life cycles, underpinned by Law 221/2015 and Legislative Decree 50/2016, ensuring "green" public procurement, circular consumption, and promoting green employment; it mandates the use of Ecolabel-compliant products for products like cleaning solutions and paints.}

Results

Consip launched the €1.5bn framework contract, spanning 12 geographic lots, with the goal of achieving a 32.65% in energy savings. Every contract drawn from the framework contract is an Energy Performance Contract (EPC). These EPCs obligate public entities to adopt and maintain advanced energy-efficient strategies beyond their duration, ensuring they reap long-term benefits. By the contract's conclusion (6-9 years), each public administration is poised to gain up to 25% of these financial savings. Furthermore, while mandated to hit the 32.65% savings target, the supplier is also bound to remit 50% of the value from their earned white certificates (or energy efficiency certificates)² back to the public administration.

In total eight bids were received from five temporary joint ventures, one consortium, and two standalone companies, bringing together 32 companies. These participants ranged from large national and international industrial groups to smaller regional firms, all representing the Energy Service Company (ESCO) sector. Of these, only five were successful.

With reference to Lot number 5, which includes the Liguria and Emilia Romagna Regions, the top bid here offered a significant discount of 63% on the non-energy component, with an average discount value of approximately 50%. All bidders met the highest value in energy-saving targets, surpassing the 32.65% threshold.

The attainment of these energy-saving goals was made possible through a range of efficient measures, including the upgrading of lighting systems, rewiring of  facilities, integration of flow regulators, and the implementation of astronomical clocks for lighting control. Furthermore, the integration of sensors and cloud networks played a pivotal role in bolstering city maintenance, enabling intelligent lighting solutions, and facilitating efficient mobility management, aligning with the overarching objectives of "smart city" initiatives.

^{2 White Certificates (or Energy Efficiency Certificates) in Italy represent verifiable energy savings companies achieve, with each certificate equating to one tonne of oil equivalent (TOE) saved. White Certificates are issued to energy distributors or ESCOs and can be traded, allowing entities to meet mandatory energy-saving targets set by the government. The system promotes market-driven energy efficiency and helps reduce national energy consumption and emissions.}

Sustainable impacts

The new framework significantly boosts sustainability, setting higher energy-saving goals in kWh per order. Earlier versions reduced energy consumption by 68,412 TOE and CO2 by 123,435 tons. The new framework has a benchmark of up to 32.65% less energy than the baseline and a commitment to technological evolution in public lighting.

Over the four previous editions of this framework, there's been a consistent trajectory of innovation and enhancement. Due to these progressive measures, public authorities have witnessed a reduced energy consumption totalling 661,651 TEO. This has led to decreased CO2 emissions of 1,446,498 tons.

What are the lessons learned?

1. Technical Precision Matters: Precise adherence to technical details is essential for monitoring progress. This is pivotal to realising energy efficiency and hitting savings objectives.
2. Empower Public Administrators: Ensuring that public administrators are well-informed and trained on establishing and verifying environmental and social criteria is paramount. This aids in capacity building and enhances the overall effectiveness of the initiative.
3. Training is Essential: Suppliers must offer comprehensive training to municipal staff operators, especially in managing eco-efficient lighting systems. This commitment focuses on operational efficiency and underscores the importance of waste management, handling hazardous substances, and pollution prevention.

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