What Suppliers Need to Know
Introduction
The NHS has committed to achieving net zero carbon emissions by 2040 for emissions it directly controls and by 2045 for its supply chain emissions. Given that over 60% of the NHS’s carbon footprint comes from its suppliers, this ambitious target hinges on the participation and transformation of the businesses that provide goods and services. For suppliers, understanding and preparing for the evolving requirements is critical to both securing contracts and supporting the NHS in its sustainability journey.
The NHS Net Zero Supplier Roadmap: A Timeline of Action
The NHS has laid out a clear Net Zero Supplier Roadmap, with increasing requirements set to take effect in the coming years. Suppliers need to be aware of key deadlines:
- April 2023: Contracts worth more than £5 million must include a Carbon Reduction Plan (CRP) covering Scope 1 (direct), Scope 2 (indirect, mainly energy usage), and selected Scope 3 (other indirect) emissions.
- April 2024: The CRP requirement expands to cover all new contracts, regardless of value.
- April 2027: Suppliers will need to report their Scope 1, 2, and 3 emissions publicly, including global operations.
- April 2028: New requirements for carbon footprinting individual products supplied to the NHS will come into effect.
Given this structured roadmap, it’s essential for suppliers to stay ahead of these requirements rather than reacting when deadlines approach. The transition to net zero isn’t just a compliance task—it’s an opportunity to innovate and lead in sustainable business practices.
The Carbon Reduction Plan: A Critical Component
A key aspect of the NHS’s procurement requirements is the Carbon Reduction Plan (CRP). The CRP needs to be detailed, covering not only the supplier’s direct emissions but also parts of its wider value chain (Scope 3 emissions). While this may seem daunting, leveraging experienced consultancies can ensure that the calculations are accurate and compliant with the mandatory government-published emissions factors under PPN 06/21 and NHS-specific guidelines.
Suppliers may be tempted to use automated software to calculate emissions, but care must be taken—incorrect emissions factors or poor methodology can lead to non-compliant reports (emissions factors must be taken from DESNZ published data sets). In contrast, professional consultancies like C Free bring a deep understanding of the regulatory landscape and can help suppliers navigate these complexities, ensuring that the CRP meets all required standards.
The Evergreen Sustainable Supplier Assessment: A Vital Tool
In addition to the CRP, the NHS requires suppliers to complete the Evergreen Sustainable Supplier Assessment. This tool allows suppliers to demonstrate their sustainability efforts and track their alignment with the NHS’s net zero targets. It also provides suppliers with the opportunity to showcase their progress, which will become increasingly important as the NHS evaluates suppliers on their long-term sustainability commitments.
Challenges and Opportunities for Suppliers
Suppliers face several challenges, particularly around data collection and emissions reporting, which can be difficult—especially when calculating Scope 3 emissions. This includes emissions from a supplier’s supply chain, such as transportation, manufacturing, and product usage. Collaborating with consultancies is a sound strategy, as they can assist in gathering and analysing complex data streams.
However, the challenge also presents an opportunity. By embracing sustainability early and embedding it within the business strategy, suppliers can differentiate themselves from competitors. The NHS, committed to decarbonising its supply chain, will favour suppliers who can clearly demonstrate progress and innovation. For those who adopt the requirements proactively, there are clear competitive advantages in securing NHS contracts.
Why Acting Now Is Crucial
The timeline to meet the NHS’s net zero requirements is short, and the expectations are escalating quickly. Starting now will give suppliers a head start in refining their CRPs, understanding the nuances of Scope 3 emissions, and working closely with sustainability experts to ensure compliance.
Delays in preparation could result in missed contract opportunities, especially as the NHS moves towards its 2030 target of only working with suppliers who can meet stringent net zero standards.
Conclusion
The NHS’s commitment to net zero is clear, and suppliers play a pivotal role in making this vision a reality. By staying ahead of the roadmap milestones, seeking expert guidance, and embedding sustainability into the heart of their business operations, suppliers can not only comply with evolving regulations but also position themselves as leaders in sustainable healthcare provision. The path to net zero is a shared journey, and those who act now will be well-placed to thrive in a low-carbon future.
