PPN 01/24 Carbon Reduction Contract Schedule · first published 18 March 2024
PPN (Procurement Policy Note) 01/24 introduces a standard Carbon Reduction Contract Schedule developed by Cabinet Office. Buyers in central government — departments, executive agencies, and non-departmental public bodies — can now include this schedule in contracts to require suppliers to report on greenhouse gas (GHG) emissions, set carbon reduction targets, and produce a GHG Emissions Reduction Plan. Crucially, use of the schedule is optional: buyers must judge whether it is relevant to the contract subject matter and proportionate. This builds on PPN 06/21, which already requires suppliers on contracts worth £5m+ per year to publish a Carbon Reduction Plan (CRP). If a buyer includes this schedule in your contract, you will face specific, contractual decarbonisation obligations — not just a pre-qualification hurdle. The schedule is also expected to be folded into the government's standard Model Contracts in future.
WHO THIS APPLIES TO
THE ENKII VIEW
For SMEs, the key risk is that this schedule converts carbon commitments from a one-off bid requirement into ongoing, contractual obligations with monitoring throughout the life of the contract — potentially including contracts below the £5m/year PPN 06/21 threshold. The opportunity is that buyers are expected to assess a supplier's "maturity" on carbon reduction before including the schedule, meaning SMEs who can clearly demonstrate existing carbon awareness are better placed when buyers make that proportionality call. SMEs who are already tracking their GHG emissions will find it far easier to comply if a buyer does include the schedule.
1. Start measuring and recording your organisation's greenhouse gas (GHG) emissions now — even at a basic level — so you can demonstrate 'maturity' if a buyer assesses whether to include the Carbon Reduction Schedule in your contract.
All SMEs bidding for central government contracts — Buyers must assess 'the Supplier's understanding (i.e. maturity) of carbon reduction initiatives and ability to introduce effective measures' before including the schedule. A supplier who can show existing emissions awareness reduces the buyer's risk and may influence whether the schedule is applied proportionately.
2. Review your contract terms and any new tender documents for inclusion of the Carbon Reduction Schedule — if it appears, you will be contractually required to set GHG reduction targets, report on emissions, and maintain a live GHG Emissions Reduction Plan throughout the contract.
SMEs already holding or bidding for central government contracts at any value — The schedule creates binding contractual obligations (not just bid-stage commitments), including 'contract specific GHG emissions reporting, setting supplier GHG emissions reduction targets and monitoring and reducing GHG emissions throughout the life of the contract.'
3. Be alert to contract variation requests from your buyer that introduce the Carbon Reduction Schedule into a live contract — review the obligations carefully before signing.
SMEs on existing central government contracts — The PPN explicitly permits buyers to 'apply them to existing contracts, through contract variation, where appropriate,' meaning this could arrive mid-contract, not just at renewal.
4. Ensure your published Carbon Reduction Plan (CRP) required under PPN 06/21 is up to date — PPN 01/24 builds on that existing requirement and buyers may use both together.
SMEs bidding for contracts worth £5m+ per year (central government) — PPN 01/24 explicitly states it 'supports Procurement Policy Note 06/21 which applies to... contracts with an anticipated value of £5 million per year or more' and requires a CRP; having a credible, current CRP strengthens your position under both notes.
5. Check whether your public sector buyer has voluntarily adopted this schedule — ask at market engagement or clarification stage, as non-central-government buyers are encouraged (though not required) to use it.
SMEs in any sector considering wider public sector contracts (e.g. NHS, local government) — 'Other public sector contracting authorities may wish to apply the approach set out in this PPN' — voluntary adoption means the schedule could appear in contracts outside central government without a formal mandate.
Every rule below quotes the official document verbatim.
The PPN applies to all central government departments, their executive agencies and non-departmental public bodies ('In-Scope Organisations'). (All central government departments, executive agencies and NDPBs)
“The contents of this Procurement Policy Note (PPN) apply to all Central Government Departments, their Executive Agencies and Non-Departmental Public Bodies, and are referred to in this PPN as 'In-Scope Organisations'.”
Other public sector contracting authorities (e.g. local councils, NHS) are encouraged but not required to apply this approach. (Wider public sector — voluntary adoption only)
“Other public sector contracting authorities may wish to apply the approach set out in this PPN.”
In-scope organisations can apply the provisions immediately from the date of publication (18 March 2024). (All in-scope organisations, from 18 March 2024)
“In-scope Organisations can apply the provisions of this PPN with immediate effect.”
The Carbon Reduction Schedule is optional and should only be included where relevant to the contract subject matter and proportionate to do so. (All in-scope organisations considering use of the schedule)
“Use of the Carbon Reduction Schedule is optional and should be included where relevant to the subject matter of the contract and proportionate to do so. It may not be appropriate to include the Carbon Reduction Schedule in all contracts.”
Before including the schedule, buyers must assess four factors: their own carbon maturity, the supplier's carbon maturity and ability to introduce measures, the value and estimated GHG emissions linked to the contract, and the criticality of the contract. (In-scope organisations, all contract values)
“Before including the Carbon Reduction Schedule in a contract, In-scope organisations should assess: their understanding (i.e. maturity) of carbon reduction initiatives... the Supplier's understanding (i.e. maturity) of carbon reduction initiatives and ability to introduce effective measures; the value and estimated carbon GHG emissions linked to the contract; and the criticality of the contract”
If included, the schedule requires contract-specific GHG emissions reporting, supplier GHG emissions reduction targets, and a supplier GHG Emissions Reduction Plan maintained throughout the contract life. (Contracts where the Carbon Reduction Schedule is included)
“These include contract specific GHG emissions reporting, setting supplier GHG emissions reduction targets and monitoring and reducing GHG emissions throughout the life of the contract though a supplier GHG emissions Reduction Plan.”
The Carbon Reduction Schedule is expected to be incorporated into future versions of the government's suite of Model Contracts, and can also be applied to existing contracts via contract variation. (All in-scope organisations; existing and future contracts)
“It is expected that the Carbon Reduction Schedule will be incorporated into future iterations of the suite of Model Contracts... In-scope organisations may also choose to use these terms in relevant procurements, or apply them to existing contracts, through contract variation, where appropriate.”
PPN 06/21 (which this PPN supports) requires suppliers bidding for contracts with an anticipated value of £5 million per year or more to publish a Carbon Reduction Plan (CRP). (Contracts ≥£5m per year (existing PPN 06/21 requirement, referenced for context))
“This PPN supports Procurement Policy Note 06/21 which applies to major government contracts, framework agreements and contracts awarded under dynamic purchasing systems, with an anticipated value of £5 million per year or more. It requires bidding suppliers to detail their commitment to achieving Net Zero through the publication of a CRP.”
This briefing is enkii's interpretation of the official document — the official text always governs.
Source document © Crown copyright, reused under the Open Government Licence v3.0 via the GOV.UK Content API. enkii tracks every Procurement Policy Note and briefs changes the day they land — see all briefings.