Bristol, in the UK, started in 2009 a new contract for its waste management service. A dialogue with pre-qualified companies was established in order to define the approach of the new contract, in order to achieve the maximum recycling rates and a reduction in emissions. For the first time, the call for tenders included desired outcomes instead of conformance-based technical specifications. These were:
- reduce the ‘carbon footprint’ associated with the service in line with the agreed 2020 target for Bristol;
- increase waste reduction, reuse, recycling and composting, towards an aim of zero waste;
- deliver significant reductions of untreated waste sent to landfill;
- maximise the efficient recovery of resources, i.e. recyclates and energy from residual waste;
- tackle and reduce the incidents of environmental crime (e.g. by storing and collecting evidence from ‘fly tipping’);
- enhance community understanding of sustainable waste management.
The performance clause of the contract was set by establishing a CO2e reduction target to be met by 2020. As the duration of the contract was 2011–2017, a pro rata basis of 25 % was defined in the call for tender, using as a baseline the emissions data from the previous contractor in the 2009–2010 period. No shared benefit was defined, but a penalty was defined for each 1 % above the target to a maximum of 0.375 % of the annual contract value. Money raised this way was used for environmental improvements that the contractor failed to make.
As a result, all bidders included a carbon emissions management plan committing to a new collection regime and offering solutions oriented to reducing the number of journeys necessary, e.g. by using multi-compartment trucks, using telematics and monitoring driver behaviour. The winner offered a 32 % CO2e savings by 2017. During the first year of the contract, the recyclable materials collection rate increased from 38 % in 2010 to 50 % in 2011–2012. However, the penalty clause for not achieving the carbon reduction could not be implemented in the contract due to the high risk of supplier failure, which would imply a price increase for the final user.
The case in Bristol, UK, showed that the time taken to prepare the tender and the dialogue and negotiation was twice that of a conventional contract, although its evaluation was not more complex. This factor adds an extra administrative burden and a resource-intensive tender process. In the case of Bristol, it also added a restricted budget, so no incentive or penalty clauses were finally introduced in the contract.