14 December 2012

Report finds public purchasing has the power to influence the market

A new report analysing local governments’ experiences of energy efficient purchasing (EEP) has concluded that EEP policies and programs can be an effective way to promote energy efficient products by leveraging a government’s purchasing power and influence. The types of products purchased by governments can strongly influence manufacturers, as between 12 and 20 percent of a country’s gross domestic product (GDP) passes through its public procurement systems.

The report further found that as a big and visible consumer, actions taken by a government to improve their energy efficiency can strongly influence its citizens. Despite willingness, local governments face a number of barriers to enacting EEP. Limited financial resources, restrictive policies and procedures, a lack of incentives, weak governance and other issues present challenges to EEP take up.

Analysis of 10 global case studies, as well as interviews with experts, showed that EEP remains a popular policy instrument being implemented or considered in mostly developed and middle-income countries. The report was published by the Energy Sector Management Assistance Program (ESMAP), a global knowledge and technical assistance program administered by the World Bank.

To view the report, click here.