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Wednesday, 6 Dec 2006

Green Procurement Policies: Presentations.

We are now in public session. We are meeting to discuss the environmentally friendly aspects of procurement practice in the Office of Public Works and the Department of the Environment, Heritage and Local Government. I welcome Mr. Ciaran O'Connor, assistant principal architect in the OPW, and from the Department, Mr. Mark Griffin, assistant secretary of corporate services, Mr. Liam O'Connell, principal officer of construction policy, Mr. Aidan O'Connor, principal adviser in the housing and building standards inspectorate, and Mr. Michael McKenna, assistant principal officer of environmental awareness. I thank our guests for attending this meeting. The format of the meeting will involve a brief presentation by our guests followed by a question and answer session with members. I ask Mr. Ciaran O'Connor from the OPW to make his presentation first.

Mr. Ciaran O’Connor

The OPW has a record in sustainable design dating back to 1996, when we were involved in producing the circulated booklet with UCD's department of architecture and energy conservation and the European Union's Directorate General XVIII. It became a bestseller in Britain rather than Ireland.

Following the booklet, we developed in our practice and elsewhere in the OPW a system of sustainable design in accordance with Government policies on bio-diversity, climate change and sustainability in 2000. Before I elucidate on the systems, we would like to clarify that they are not prescriptive of a single way to achieve an end result. We use the building research establishment environmental assessment method or BREEAM system, which was developed by the Building Research Establishment for environmental evaluations. An internationally recognised system, we have used it for the past two years and will continue to refine and develop it in consultation with Sustainable Energy Ireland.

As part of the process, people can choose different products and means to achieve good quality buildings. Under BREEAM, there are five standards ranging from excellent to fair or poor. We are aiming for the top two standards. BREEAM is an open and transparent system to achieve something in that people know how we mark the submissions we receive.

The second page of my submission details briefly the aspects of sustainable design examined by the OPW, such as the balance between costs, the environment, society and human benefits. The main issues of integration examined by us are resource issues, energy, the conservation of water, the types of materials used, and the building life cycle and whole cost. We are trying to develop a whole cost process whereby we could say that product X will give us 25 years and product Y will give us 15 years. We would ask whether a longer lifespan is worth using product X from the perspective of the public purse and whether it is the right thing to do from an ecological point of view.

On the third page, there is a description of how to implement an idea or aspiration. The submission contains an extract from the OPW's specifications outlining how we require sustainability proposals for all new capital projects. We explain what the projects must contain in a multi-page narrative describing necessary design aspects, including extensive glazing, natural ventilation and methods of passive cooling. To meet the requirements, people can choose various approaches from a sustainability menu, a page of which I have included in the submission as an example. The menu is not overly restrictive, but we demand good standards at least, namely, the top two standards.

The fourth page refers to the OPW green audit plan, which is integrated into our ISO or quality control programme. Our architectural services are audited by ISO officials twice per year to ensure that we are keeping the system up to date. Every time there is a design or technical review of any of our projects, the audit plan — I will not go into the minutiae — will spell out what the designers and consultants must do and what we expect of contractors. An example, an extract from the OPW's green audit checklist part L, is included on the following page. There are many sections within the checklist, which is part of the audit process. As it is available under the ISO system and kept up to date, a new person joining the team has immediate access to the system.

We set out key objectives for every development. When we are looking for sites, those objectives include environmentally sensitive project briefing and planning, sustainable site development and lifetime adaptable design, that is, as a building must last for a long period, it may begin with one objective, but finish with another, a situation to which we should respond. The objectives also include green materials and components, and energy conservation. We have installed systems that will monitor energy usage in all public buildings currently under construction. In recent years, we have reduced the amount of energy consumed by 5% per year via better lighting and energy control systems. We will try to continue that project.

Regarding renewable energy sources, we will install wood pellet boilers in the National Botanic Gardens next year to test how well they perform. Other key objectives include sustainable operations, all aspects of bio-diversity and compliance with the national climate change strategy.

The next page contains an extract on design life from our specifications. In our documents, we outline the minimum design lifetimes sought in our buildings. If committee members examine the bottom of the page, they will read that we look for 75 years for substructures and superstructures. The list details various items, such as IT services, every ten years or finishes every 15 years. These figures have been set as minimums. Anyone dealing with the OPW knows that he or she must produce to those minimums, which has led to a significant improvement in the past year, namely, people turning aspirational ideas into reality.

For any of the systems to work, there must be a series of benchmarks. Another extract explains our benchmarks. We use Sustainable Energy Ireland's recommendations, including whole-life costs and payback analyses. In the appendix, I provide the marking system used in respect of submissions on a project's mechanical or electrical aspects, including energy systems and air handling units. In the extract, we spell out that we use the BREEAM design and procurement checklist. We provide guidance to contractors on where to find best practice websites or organisations. We are not just containers of useful information, rather we are making it available to everyone.

The next page contains an extract from the OPW's specification on materials. We consider sustainable aspects such as embodied energy, the recyclability of materials, manufacture, delivery and use. We seek for all materials to be submitted and approved before use.

The photograph in our presentation is the Marine Institute headquarters, finished this spring, which contains many green aspects. The basis of evaluation is also considered. Our presentation includes a three page extract from a 16 page document for the benefit of committee members. We use the British Research Establishment Environmental Assessment, BREEAM, system, an internationally recognised system. We have condensed the BREEAM document and simplified it. We explain what sections we will use in evaluating the person's submission. I have included appendices for reference.

Appendix A contains a mechanical and electrical services supplement. We state our minimum information requirements. In any new building we require a computer generated model of how sunlight and air enters the building and how glare and heat loss are controlled. This model is verified by a third party and we explain the marking system. The second last paragraph of appendix A concerns the degree beyond which the building satisfies the requirements of the building brief. We explain options that can be taken to go beyond the minimum requirements, which will garner additional marks.

We also explain what is required for the completed sustainability menu for mechanical and electrical services. A full simulation presentation is desired and, if this is not possible, the minimum we require is an illustration on maximum air, operation, ventilation and a schedule of assumptions calculated. We can then verify if the assumptions are accurate and fair.

We support sustainable forestry. The OPW was one of the first to introduce sustainable design in forestry and it has been included in our specifications since 1996. Our experience dates back to 1986 when we developed eight species of Irish wood at the Killykeen Forest Park project. At the time Irish wood was used in 16% of the market, now it has over 50% of the market. This was the first time Irish timber had been used for different end uses. We embedded monitors in the building and checked its progress. This research was conducted over ten years and fed into the national standards system. Our knowledge in this area dates back a long time.

Appendix B concerns sustainable forestry and tropical forestry. Emotive suggestions are made that tropical forestry should be banned but this is not fair. Countries such as Ghana make a major effort to introduce sustainable forestry systems while neighbouring countries are not doing such a good job. We support these initiatives. We set out the problems and how to support sustainable forestry. Wood must come from a legal source, it should be properly managed and no endangered species must be used. We seek documentation to verify the legal and sustainable sources. We also promote the use of local wood. Ireland will be a net exporter within the next five years.

With the change of specification and the new standards for cement introduced in 2004, based on the European standard, it is possible to use other additives. Pulverised fly ash is the by-product of Moneypoint or other coal burning systems. The slag is recyclable and can be used in concrete to reduce the amount of cement. It has been used in the Dublin Port tunnel, the Jack Lynch tunnel and the Boyne Valley bridge. We also introduced the use of ground granular blast furnace slag, a by-product of steel production. While Ireland has no steel production, the by-product would otherwise go to waste. It is useful for integration with cement and we propose its use in our specification. We also explain the new cement standards, a matter about which few people have knowledge. We explain that the regulations from December 2003 take precedence over British and Irish regulations. The use of certain products must conform with EU standards. We explain these standards and the extent to which one can substitute.

In appendix C we list six types of cement use ranging from use in a tunnel or the sea, where it is chemically attacked, to use in office construction where there is no risk of that. We explain the percentage of replacement substances that can be used. This is based on research in other countries. In Holland, for example, 54% of concrete contains green additives and the figure for Britain is 18%. The figure is low but growing in Ireland. For each of these uses, the percentage of substitution is scientifically based. We spell out the new standards for different systems so there will be no confusion. The manual contains a brief note on sustainability and concrete, which is inherently sustainable. Key design aspects are also considered, as is the orientation of a building, heat recovery, the use of light, passive solar gain and comfort. The photograph in appendix D is of the European Commission food and veterinary office, County Meath. It won a European award for sustainability one year ago.

Appendix D lists standards and aspects of biodiversity. The photograph is of Backweston laboratory complex, which brought Irish laboratory standards in line with international standards. It was a field with corn before we started. It had flooding problems but we used this to create ponds for wildlife. Native species were replanted in the area and, with the assistance of our colleagues in the national parks, we introduced wildlife and birds into the area.

Appendix D also considers the use of atria, which can be used for circulation, reduction of running costs and efficiency of floor layout. The photograph shows the stack or chimney effect in the atrium of Galway City Museum, similar to what we will do at our headquarters. Light and air is brought through the building, making it cheaper to run. We take a wide overview and do not support any one product. We insist on meeting standards and leave it open to people how they will do so.

Mr. Mark Griffin

I thank the committee for the invitation to discuss how we take account of environmental considerations in the Department's procurement policies. It is timely to have this discussion with the recent publication of the abridged Estimates volume, today's budget and the publication of the national development plan in a few weeks. Like committee members, I found the presentation by the OPW interesting. One distinction to draw is that, unlike the OPW, only an extremely small part of our budget involves direct procurement by the Department. We have a capital provision in the public capital programme of approximately €3.6 billion, most of which is channelled through the local authority system. Our perspective, therefore, is somewhat different.

I will cover our approach and that of the Department of Finance to this issue at national level, how we address green procurement within the Department, the effect of our green procurement policies throughout the local government system and the effects of our regulatory role. People readily accept much of our public procurement policy is determined at EU level. The main driver is EU Directive 2004/18/EC on the co-ordination of procedures for the award of public works contracts, public supply contracts and public service contracts. This was transposed into Irish law and sets out the means by which environmental considerations can be addressed in the procurement of public infrastructure.

The Department of Finance has primary responsibility at central level for the preparation of procurement guidelines for public bodies. In the context of this role, it made available the EU handbook on environmental public procurement in October 2004. The handbook explains to public purchasers how they should integrate environmental considerations with their purchasing practices for goods and services. Comprehensive information on all aspects of public procurement is available on The existence of the website was brought to the attention of the entire Department. As the lead Department for the local government system, it also brought its existence to the attention of all local authorities which refer to the website in the normal course of their procurement activities.

I will now speak on how the Department approaches the issue of green procurement. In September 2003 it became the first Civil Service organisation to achieve accreditation to the standard ISO 14001:1996, the international standard for environmental management systems. The initial certification was awarded in respect of the Department's headquarters at the Custom House. This year it was upgraded to the new ISO 14001:2004 standard.

The Department is responsible for only a limited amount of the direct procurement of goods and services, the value of which amounted to approximately €52 million this year. A real and tangible effect of the ISO certification is that we direct our procurement policy towards utilising an increasing range of environmentally preferable products and services with the aim of reducing demands on resources. Apart from obvious examples such as the use of recycled paper, e-publishing and the purchase of energy efficient office printers, there are other more novel examples such as the conversion of the entire fleet of more than 150 vehicles of the national parks and wildlife service to use biofuels, mostly biodiesel. The Department recently ordered 25 new vehicles capable of running on a 30% blend of biodiesel. We expect the entire fleet will operate on biodiesel by the end of next year.

To reduce energy usage, the Department's policy is to use a number of energy saving devices such as energy efficient lights, powersave function on electrical office equipment and photocopiers with duplex facilities. This led to energy consumption in the Department's headquarters decreasing by more than 3%, from 982,000 kW in 2003 to less than 948,000 kW in 2005. Following a tender process, a contract was awarded for the supply of electricity from renewable sources to the Department's main offices.

Representatives from the OPW spoke about the work the office does on environmental sustainability in the significant programme of work it has under way as part of the Government's decentralisation programme. In collaboration with the OPW, the Department set high environmental specifications for its decentralised offices in Wexford. It is intended the new offices will incorporate many of the latest developments in sustainable construction, energy and water conservation. Examples were cited during the OPW's presentation and I will not dwell on them at great length. The precedent set in the Wexford office will be followed in the construction of the Department's other decentralised offices.

The public capital programme announced a number of weeks ago will make a capital provision across the local government sector of €11.7 billion next year. As I stated previously, the Department will have a capital spend of €3.6 billion. While local authorities as contracting authorities are legally responsible for their own procurement, we made it clear to them by circular and publication of the EU directives on the e-tenders website the need to have regard to environmental considerations in their tendering and procurement procedures across the main capital programmes such as housing, water services and waste.

It is worth referring to good initiatives and outcomes in this area. Local authorities were directed to follow the Department's guidelines to promote sustainability and energy efficiency when procuring social housing. The guidelines state that during the design process regard should be had to the implications for sustainability of all aspects of dwelling design. They point out that appropriate design decisions on dwelling layout, levels of insulation, amount and orientation of glazing, utilisation of solar energy, heating systems and fuel type, construction materials and measures to limit the use of potable water can contribute greatly to ensuring sustainability.

Adherence to the guidelines is monitored by the Department's housing inspectorate which is headed by Mr. Aidan O'Connor who is present at this meeting and can go into detail on social housing if the committee deems it useful. Among the many good examples of social housing schemes constructed using sustainable building methods or incorporating environmentally friendly features are the Ballymun and Ballybough regeneration projects and Crobally housing estate in Tramore, County Waterford.

The tender award criteria for all publicly funded projects in the water services sector, most of which are now procured through the design-build-operate, DBO, mechanism, take into account the full cost of constructing the infrastructure and the operation and maintenance costs over a 20 year period. The life cycle approach referred to in the OPW's presentation is also considered in the context of procuring major water and sewerage schemes. Energy requirements comprise a large component of operational costs and this approach gives an incentive to tenderers to offer energy efficient solutions to keep down running costs. To date, 90 schemes have been procured by local authorities under DBO arrangements, 14 of which are operational.

Capital funding for the inclusion of energy recovery facilities in wastewater treatment plants is also provided by the Department. The inclusion of requirements in tender documents, with the Department's support, has been very effective. For example, the methane gas produced from the sludge digestion process in Ringsend supplies approximately 50% of the heating requirements of the plant.

The role of the Department in driving specific procurement activities through policy and funding is also evident in the waste area. Since 2002 it has overseen investment of approximately €50 million in the provision of waste infrastructure, including bring banks, civil amenity sites, composting facilities and materials recovery sites. In 1998 we were landfilling 91% of our municipal waste and recycling only 9%. I know this committee is extremely interested in this matter on which it produced a report a number of months ago. The results of the investment and initiatives taken by the Department, local authorities and business are dramatic. In 2004 we recycled 34% of our waste, as opposed to 9% in 1998. We increased eightfold the diversion of household waste from landfill from 37,000 tonnes in 1998 to more than 300,000 tonnes in 2005.

It is clear the regulatory role played by the Department and its agencies led to significant environmental outcomes in procurement activities. Last year expenditure on housing construction amounted to €21.4 billion, with more than 86,000 housing units completed. Approximately one third of our housing stock was built in the past 10 years. The progressive improvement in building regulations which started with the major overhaul in 1992 means every house built and procured in the private or public sector should now have an improved environmental performance in energy usage and water conservation. This is being further developed through the Building Control Bill 2005 and by amending Part L of the building regulations brought in at the end of last year which introduced legislative provisions to transpose the EU energy performance of buildings directive. We were among the first group of member states to notify the Commission of transposition of this directive. One requirement of the directive is that designers of large buildings over 1,000 sq. m. must consider the economic and technical feasibility of alternative energy systems such as renewable energy and combined heat and power. This requirement will be operative from 1 January 2007.

Building energy ratings will also be required for new dwellings from 1 January 2007 and for new non-domestic buildings from 1 January 2008. The introduction of the building energy ratings will help to create widespread market visibility and awareness of the energy performance of buildings. It is anticipated that this in turn will stimulate demand by consumers, developers and architects for more energy efficient and renewable energy products and services in buildings.

Green procurement is also being promoted through regulatory systems targeted at environmental protection. For example, the Environmental Protection Agency discharges important licensing functions under the integrated pollution prevention and control system for certain waste activities. While the principal objective is to protect our environment, an important if indirect impetus on green procurement results from attaching conditions to licences typically requiring the licensee to use the best available technology to meet emission or other standards.

I welcome the Office of Public Works and the Department of the Environment, Heritage and Local Government. I am impressed by the document provided by the OPW, while the constructive manner in which Mr. Griffin addressed issues indicates he is doing the best he can.

When the OPW conducts audits of proposals for buildings, does it insist on a certain proportion of renewable energy and, if not, does Mr. Ciarán O'Connor think it a good idea? I want to be as constructive as possible in my comments and would like to learn whether the OPW can play a bigger role in terms of insisting on action. I have no criticism of the generalities he outlined for us but merely ask whether they can be fine-tuned.

Mr. C. O’Connor

The Deputy asked a very interesting question. The gap between aspiration and implementation reminds me of the slip between cup and lip. While the BREEAM system evaluates a range of issues and takes a global perspective, we will be able to judge from tests on specific energy saving initiatives, such as the tests we are about to conduct on wood pellet technology in a major project in the Botanic Gardens, whether they deliver all that is claimed for them. As is the case with any argument, one side will make great claims but we want to road test initiatives to determine their value.

The OPW has a policy of seeking returns on our investments within a 15-year period. Solar systems are not able to offer such a return on the basis of current energy costs but they would bring returns over a 20-year period. However, the technology involved would have to be updated in 12 to 15 years' time. Crossover points such as these remain to be fully evaluated but our intention is to effect change by testing initiatives ourselves rather than starting a process which may not deliver sufficient value to the Exchequer. With regard to the wood pellet system, for example, someone will be required to take responsibility for storing the wood, which is not necessary in a gas system. We need to consider those costs as part of projects, which is why we are going to test a sizeable project to determine how closely it meets the targets claimed for it.

Will the OPW be dealing with designs for schools?

Mr. C. O’Connor

The OPW does not deal with schools, although if the Department of Education and Science asks for advice, we gladly give it.

Who sets the criteria for schools and other public buildings which are not the responsibility of the OPW?

Mr. C. O’Connor

In broader terms, the Department of the Environment, Heritage and Local Government sets the strategies for biodiversity and sustainability while, for example, the Department of Arts, Sport and Tourism assesses the architectural policies which we integrate into our systems. The design criteria are, therefore, spread across several Departments. However, because the OPW implements the policies and has developed experience from maintaining our buildings, we are able to verify the success of particular initiatives without having to rely on anecdotal evidence.

Does the need exist for one Department or agency to have responsibility for all these issues at a national level? That would permit Departments to co-operate to a greater extent than is the case without losing their independence.

Mr. C. O’Connor

The OPW would welcome that. We already work with colleagues in various Departments and would be glad to help them further on these matters.

Does the Department of the Environment, Heritage and Local Government wish to comment on Deputy O'Dowd's question?

Mr. Aidan O’Connor

My Department recognises the leadership in best practice developed by the OPW through its experience of negotiating direct contracts. We try to achieve our aims on energy through Sustainable Energy Ireland, which has established a home of tomorrow criteria and evaluation system. Many claims are made for projects, so we need some means of assessment before granting approval. The funding we offer is conditional on projects liaising with SEI and meeting the criteria for approval.

With regard to the monitoring system to which Mr. Ciarán O'Connor refers, we insist on the use of local authority technical expertise. Tralee Town Council, for example, developed a system with the co-operation of the National Building Agency to supply its own energy expertise to monitor the ground heat source system in the project. We also try to tie systems together among various projects. A number of local authorities have established energy management agencies, such as the City of Dublin Energy Management Agency, which monitors social housing projects. We have also reached agreement with SEI to fund the sustainable element fully so that rather than requiring local authorities to seek grants from SEI, which is the case for the private sector, we will provide equivalent funding in addition to bridging grants as part of our housing delivery programme.

Recently, I visited London with others on the committee to observe a low-cost housing scheme which used unique and thermally efficient building materials. The Irish company involved told us they won a design contest in the United Kingdom for the most thermally efficient house at the best price. Should similar initiatives be taken by the Department in terms of a competition for efficient homes? We could have, not a uniform design, but a prototype design that should be, by regulation, incorporated into all our social and affordable and other housing.

Mr. A. O’Connor

We have tracked that project in the Deputy Prime Minister's office in the UK. Irish firms did well in the challenge, which was set on a fixed price and did not relate to site cost. From the public purse perspective we monitor costs, effectiveness and the concern. Decisions on social housing are made on a project-by-project basis so it is a matter of how well it is presented. Mr. Griffin referred to a number of ongoing projects. I could refer to any number, for example the York Street redevelopment in Dublin city. That went through a strong vetting process on sustainability and cost. They are doing it in a cost contract and are examining the green cement issue. Did the Deputy ask if we propose competition?

While I acknowledge and welcome all the good innovations, the UK has become a market leader by using competition, telling the construction industry what it wants, backing the best it has produced and demanding the most efficient and greenest housing one could have. We should do the same in Ireland. Perhaps it is a political rather than an administrative decision. We should show the same leadership demonstrated by that type of competition.

Mr. Griffin

Mr. Aidan O'Connor and the OPW have set out good instances of where green procurement is having tangible results in housing and the areas for which the OPW is responsible. Does the Deputy suggest we take this back a step and explore how we can get this to overarch all the procurement activities of Government such as in the local authority and education sectors?

I suggest we drive the agenda by virtue of a competition if necessary to focus everybody on this issue.

Mr. Griffin

While we are conscious that much work has been done by the Department, the local authorities, the OPW and others, there is still work to be done in the area of green procurement. We have started work in the Department on the preparation of an action plan on green procurement. That derives largely from the commitments by Heads of State and Governments earlier this year at the European Council to try to increase the rates of green procurement across the EU. The plan, which will be completed next year, will examine issues such as targets, how we drive the preparation of green procurement action plans in public and semi-public authorities, indicators for measuring progress and the legal and administrative framework for pubic procurement. These sorts of issues that are being dealt with by individual sectors will be addressed on a cross-cutting basis in this action plan, which we will prepare in consultation with the other partners involved in Government sector procurement.

We should try to finish our meeting at approximately 3.30 p.m. I am sure everybody agrees.

I welcome the delegations from the OPW and the Department of the Environment, Heritage and Local Government. Is it correct that only the OPW uses the BREEAM formal evaluation mechanism for procurement? Does any other agency or Department use that or an equivalent system?

Mr. C. O’Connor

Not that I am aware of.

So the OPW is the only Government agency that has a formal evaluation and rating?

Mr. Griffin

The questions are slightly different. The Deputy's first question was whether other Government agencies use BREEAM. His conclusion was that the OPW is the only Government agency that uses evaluation.

Is there an equivalent? Is there is a formally scored system?

Mr. A. O’Connor

There is Sustainable Energy Ireland's system of appraisal for advancing energy issues in the home of tomorrow. Once people meet the criteria, we offer funding. There are ways of establishing the criteria. Mr. Ciaran O'Connor has a systematic process——

I am talking about evaluating an overall project such as a school, hospital or housing scheme.

Mr. A. O’Connor

We have a directorate that evaluates the implications of the social housing schemes that come to us. Our attempt is first to deliver on Government policy action on architecture, the quality of the environment and the other sustainability elements such as the footprints of the buildings. We apply those systems in our evaluation. We do not apply BREEAM but use it as an informing system.

The system used——

Mr. A. O’Connor

It is our own appraisal system for meeting guidelines. Value for money is the other criteria and is often the balance.

Let us leave value for money aside for now. If the BREEAM system or another formal sustainability assessment were not in use, does the OPW have examples of where a project might have been approved on grounds of price rather than sustainability? Has the Department of the Environment, Heritage and Local Government refused approval for social housing or other schemes on grounds of sustainability rather than price? A recent article in The Irish Times claimed that the Department had refused to support the OPW on the use of environmentally friendly cement in public building projects. It quoted correspondence between the Department and the OPW and claimed the Department actively opposed the OPW’s approach on environmentally friendly cement.

Mr. C. O’Connor

I will take the first question on price over sustainability. It is a rolling programme which we are applying to all decentralisation projects and implementing as part of our projects. In the decentralisation projects, a developer who submits a design and cost must answer all our questions, which encompass the BREEAM issues, in the specification. We check that for verification and assess what the developer has achieved. Then we consider whether the price obtained under the public tender is accurate in terms of what the developer undertook to do. We assess whether he will deliver on his commitments and whether we will receive what we sought. It is a competitive tendering process, as part of which the developer is told he must meet certain minimum criteria which we will check and verify. We try to avoid an either-or situation because that could lead to choices being made on the basis of price. We provide a level playing pitch and require developers to build to a good or excellent, rather than a poor or only fair, standard under the BREEAM system. The developer must explain how he will achieve that and at what price.

The menu I mentioned earlier enables a contractor to state whether he wishes to meet minimum standards or, for extra payment, to exceed those standards. We then carry out a clear evaluation of the options open to us. In projects we design ourselves under a Government-style contract, which involves a different process from where a developer is engaged, we adopt the same practice within our architectural and engineering services.

I mentioned the OPW audit process for ISO certification which enables us to track the green issues from the initial sketch scheme through the documentation and evaluation of tenders to ensure we get the required result.

Mr. A. O’Connor

Deputy Gilmore asked about social housing. Projects are sometimes refused but we hope to engage in the early stages of such projects through our inspectorate system.

Has the Department of the Environment, Heritage and Local Government refused some projects?

Mr. A. O’Connor

We have done so for various reasons.

Has it done so on sustainability grounds? For example, have any been withheld for failing to meet the criteria set down by Sustainable Energy Ireland?

Mr. A. O’Connor

Many schemes were supported.

Can Mr. Aidan O'Connor give any example of a housing scheme being submitted by a local authority or voluntary housing body to the Department for approval and refused because it did not meet the requirements under SEI standards?

Mr. A. O’Connor

SEI is a system whereby a developer aspires to implement sustainable objectives. Not all housing schemes which come to us have that aspiration, though our belief is that they should. Our social housing design guidelines give direction in that regard and the proposed revisions to those guidelines will reinforce that strongly. Refusals are made by our Department if certain criteria are not met. We often try to advance projects and deliver equality within a project by means of advice and the provision of resources. The voluntary sector works through a local authority first and, having secured its recommendation, comes to us for funding. It is not a perfect system and there are glitches. We aim for a system whereby——

I am trying to establish a fact. I know of many cases, as I am sure do other committee members, where a local authority or voluntary housing body returns to the Department for approval for a housing scheme previously withheld on the grounds of costs, numbers, density, etc.

Mr. A. O’Connor

Or lack of density.

Can Mr. Aidan O'Connor tell us if the Department has refused a scheme because the developer did not meet the energy requirements?

Mr. A. O’Connor

We operate a different method, whereby we encourage developers to meet certain criteria when it is an identified sustainable energy project. We then direct them to Sustainable Energy Ireland, with which we have improved our communication. We are interested in seeing such projects delivered, not in refusing them. We operate as a central advisory body to local authorities and try to provide them with resources and capacity to deliver the programmes. We try to meet both quantity and quality targets in respect of the housing programme. There is not always an exact match but the aspiration is in line with the NESC report and has been advanced in our housing policy, Building Sustainable Communities, in which we try to tie together all the issues. We also try to emphasise the importance of settlement patterns in the urbanisation process and encourage urban design that will allow developments to become sustainable urban extensions. There is more than one narrow issue in any programme. We try to take a broad view and to supply capacity to local authorities while at the same time funding them and encouraging best practice.

I will try a third question.

Mr. A. O’Connor

The Deputy has asked me to identify a case of refusal but we should identify the positive results and encourage them. I can provide such a list, if he wishes.

No, we are pressed for time.

Mr. A. O’Connor

How many schemes does the Deputy think we receive? A sustainable programme is in place, which we try to lead by giving guidance, while remaining at arm's length. Mr. Ciaran O'Connor and the OPW are at an advantage in having direct contracts into which they can build the required provisions, whereas we use the building regulations as performance requirements. There is no straight answer to the Deputy's question.

That is for sure.

Mr. Griffin

I will respond to Deputy Gilmore's question on the article in The Irish Times. We have written to local authorities for a number of years. A circular issued by our Department in August 2004 made it very clear that, in light of EU directives adopted in that year, local authorities could and should include environmental considerations in tender documents. That was open to them in advance of the consolidation of the circulars in 2004.

In response to the specific issue on cement, the Minister, in reply to questions tabled by Deputies Bruton and O'Shea on 4 October, wrote: "The recent initiative by OPW on the specification of cements in buildings to be produced by them is welcome". That was in the context of enabling environmental considerations to be taken into account when procuring public infrastructure. Following that we wrote to the local authorities reflecting the undertaking given by the Minister in his reply and did so again a couple of weeks ago, when we drew their attention to the provisions of a circular of July 2004. We said that requests for tenders might encourage prospective tenderers to address environmental considerations when deciding on the particular materials they proposed to utilise. The circular gives a number of examples of such materials, such as timber-framed windows certified as being from managed forest sources and modified cement products.

Could that be circulated?

Mr. Griffin

Of course. The market for green cement or modified cement products has changed in the past couple of years. There are far more players in the market in a position to provide such products in response to requests for tenders, which is a healthy development and one the Department welcomes. The decision to restate the requirements relating to environmental considerations reflects, to a certain extent, how the market for these and other products has changed.

I welcome the contributions from the Office of Public Works and the Department of the Environment and Local Government. Both are enormously influential in the building sector in this country, with the OPW particularly so in the direct procurement area. The Department of the Environment, Heritage and Local Government sets the agenda for local authorities and other agencies and although Mr. Griffin stated the Department was not responsible for much direct procurement, I believe he may have been disingenuous in a sense.

When the Department tells local authorities to jump, local authorities tend to do a backwards somersault. Joking apart, I believe the Department to be enormously influential on how local authorities go about their business. The Department also controls the purse strings for an enormous number of capital projects undertaken by local authorities.

I cannot understand why the Office of Public Works has a green procurement policy but the Department of the Environment, Heritage and Local Government does not. It has been indicated the Department is looking into this and a circular from less than a week ago has been shown to us. Perhaps it is a significant change but I am very mindful that the Office of Public Works is able to give us a brochure listing chapter and verse on how the body seeks to maximise the environmental aspects of its projects. Although the Department does not do so, it circulates a letter from a week ago indicating some changes.

Why is the Department not doing more and why is it dragging its heels on the issue? It is clear that if the OPW is considering two projects of equal merit, it will favour the greener option, but it is not at all clear that the Department will do so. The clearest example is green cement. Why is the Department not favouring it, or is there a change of heart from a week ago? Why is the Department not doing more to favour green procurement, which the European Commission actively promotes as part of delivering sustainability?

It should be remembered that matters such as climate change are significant global issues that we can do something about here in Ireland. It comes down to the amount of carbon emitted by a building over its life cycle and, more important, there is an issue of materials used in procurement. It seems to be a no-brainer to favour green cement over conventional cement, which emits much more carbon, as the better option. Why does the Department not favour this material or has it had a change of heart within the past week?

In the interests of time management, perhaps the Deputy could ask all his questions at this time?

If we look across the water to the UK, it has moved further and faster on building regulations. While it is not specifically building procurement it would certainly be worthwhile casting our eye across there and considering how much further ahead is that country. For example, every new home has a condensing boiler and every refurbishment must use a higher specification of heating equipment, unlike here. Why is the Department not pushing the boat out in this respect?

I have a more specific question referring back to Deputy Gilmore's comments. Is it correct that if a local authority wants to build housing, using its initiative to secure the prospect of grant funding from Sustainable Energy Ireland, the Department will deduct it from the capital grant allocation? Would a local authority be penalised for taking the initiative through a deduction of funding?

Mr. Griffin

I strongly disagree with Deputy Cuffe's statement that the Department does not have a green procurement policy. I hoped my presentation had made the matter quite clear to the committee. The Department influences a range of programmes relating to social housing, which Mr. Aidan O'Connor has covered in detail in response to some questions. These include the following: water services; the waste programme; implementation of building standards and transposition of EU directives in that regard; and the regulatory role of the Department. It should be clear from these that we have a multitude of green policies which have either a direct or indirect influence on procurement.

To imply our green policies started with the publication of a circular at the end of November is to be somewhat disingenuous. Social housing design guidelines have been in place since 1999 and a circular issued in 2004 made it very clear to authorities that environmental considerations could and should be taken account of in preparation of tender documents. This built on the work of the EU Commission and the Department of Finance through the e-tender website.

Sustainability is an issue when local authorities and the Department are involved in procurement processes, and it is one we take very seriously. For example, how the life-cycle approach affects our considerations was made very clear at the outset. We take account of operating and maintenance costs in that sector and this influences decisions on awarding contracts for specific procurement projects.

It would be wrong to state that sustainability is the be all and end all in that we must take account of value for money. Although they are not exclusive, value for money and the availability of funds in a particular financial year or over the period of a multi-annual capital envelope must be considered by the Department and local authorities.

It is clear from the circular sent out in 2004, the Minister's reply to the House on 4 October this year and the circular sent out in November, as well as developments in the market for this product, that we are open to the use of modified cement projects in particular tender processes where it would fit in with relevant technical standards etc.

A key question is whether the Department in any way provides an incentive for doing so, as that is what sustainability is all about. With respect, a hodgepodge of policies from the early 1990s to now does not amount to a green procurement policy. The document from the Office of Public Works reads fairly coherently, but Mr. Griffin is talking about changes in the building regulations in 1992, which do not add up to sustainability. It does not glue together in any coherent way.

Mr. Griffin

My presentation mentioned changes in the building regulations commencing in 1992, and it is quite clear there have been several changes to them over the past 16 to 18 years. For example, I mentioned the amending of Part L, which will come into effect at the start of 2007, and further advances in this area for non-dwellings commencing in 2008.

I hoped the presentation made to the committee was quite coherent in trying to present the way green procurement is taken account of across the wide range of activities for which the Department is responsible. I stated that the Department is trying to draw together the additional efforts that are needed to advance the green agenda within the Department and those relating to other Departments and public sector authorities.

Is the Department favouring green procurement? This letter merely says that requests for tender may encourage and may incorporate, it does not mention benefits that might relate to this.

Mr. Griffin

We favour green procurement.

Where does it say that?

Mr. Griffin

When these circulars are drafted we must take account of the specific legal provisions of the EU directive.

Where does it say the Department favours green procurement?

Mr. Griffin

The fact that it is not stated explicitly in the circular——

I think Mr. Griffin is grudgingly conceding the fact that a tenderer may incorporate environmental considerations.

Mr. Griffin

I think that is merely the Deputy's interpretation of what I am saying.

If I were a contractor reading that I would see a clear message.

Mr. Griffin

The circular explicitly states at the end of the first paragraph that "local authorities planning such procurement are again urged to consider how they can contribute to the protection of the environment and promote sustainable development while ensuring that best value for money is obtained in the award of contracts". I do not think we can be clearer than that.

With respect, Mr. O'Connor was far clearer on the subject of green requirements and how, in awarding a contract, consideration is taken of the environmental proposals contained in the contract documents.

Mr. Griffin

We are quite happy to give the Deputy a copy of the social housing design guidelines and the other tender specifications that exist in the area of water services and other areas of procurement in which the Department is either directly or indirectly involved. Most of the documentation on how we approach procurement is available on the Department's website and we have replied on that basis to a number of parliamentary questions. We will be happy to provide this information to the committee if it is of any use.

How do we compare with the UK on building regulations and what of the issue of funding for Sustainable Energy Ireland, SEI?

Mr. A. O’Connor

I may have caused a lack of clarity on the issue of funding for SEI because we fund projects that meet the criteria applied to that organisation. We had meetings with the technical and administrative sides of SEI so there would not be an issue of partial funding that could leave a gap between the remaining funding and the normal unit cost ceilings approval for projects. We decided to act on this and declare that when a project meets Sustainable Energy Ireland's criteria we will fund it as part of the capital programme. We remove the issue of Sustainable Energy Ireland having to fund social housing programmes. We fully fund such programmes, often to a greater degree than would have been achieved had the project proceeded through the private sector. This is meant as a way to encourage sustainable development, as mentioned by the Deputy, on a project by project basis and, in terms of value for money, we see the need for a monitoring system that will help us do this. We work closely together through the early engagement of our inspectorate that consists of professional architects who advise the local authority. In this way we try to clear a path early for an eventual approval at contract stage. We are trying to engage at this level and are taking on board the developing area outlined in the House of Tomorrow programme.

It is often argued that our Part L building regulations arrived earlier and were better than those of rivals. The home energy rating, HER, system has been transposed into our system and our regulations are performance based with each section being reviewed over time. The programme on building standards is another of our initiatives.

The question related to a snapshot of the State in comparison with the UK in 2006. It is blindingly obvious to me that heating requirements there are superior to those under Irish building regulations and this relates to the present day, not 1992 standards.

I think some of these issues should be directed to the Minister.

It is a very specific question. How do Irish building regulations compare with UK building regulations in 2006?

Mr. A. O’Connor

They are comparable.

Why does every new home in the UK have a condensing boiler yet there is no such requirement here?

Mr. A. O’Connor

It is done on a performance basis and the regulations use broad terms such as stating houses should be free of dampness. We revise those technical guidance documents on a regular basis.

Are we doing better than the UK or not? That is the question I asked.

I am anxious about the time.

I will be very brief and I thank the representatives of the Office of Public Works, OPW, and the Department of the Environment, Heritage and Local Government for their presentations.

Does anyone have an idea of the rate of replacement for green cement? Figures were given relating to pulverised fuel ash, PFA, cement for Denmark and the UK along with ground granulated blastfurnace slag, GGBS, cement percentages for other countries but do we know what the figures are for Ireland?

I have seen first hand the changes in social housing in the past ten years, particularly in Ballybough and other Dublin City Council developments, but many apartment blocks built by the private sector in Dublin are reaching ten to 12 years of age. Many of these were built to the minimum standards that applied at the time and, given the Department's regulatory role, are there plans for a retrospective study of how standards can be raised in such buildings? Some recent apartment developments barely cross the standards threshold.

I too welcome the presentations, especially that of the OPW given what it has achieved and how this has been approached. However, under public contract it is true that it is easier for the OPW to reach standards than the construction industry in general.

Regarding social housing, it was mentioned by the OPW that subsidies are given project by project to achieve the standards set out in this circular. Do double standards apply when a contractor tenders for local authority housing? Generally the lowest tenderer gets a contract but in housing surely consideration should be given in the adjustment of tenders and seeking value for money to contractors tendering for a higher standard building.

We should consider the €21.4 billion spent over the past ten years and last year's housing market. If a universal system of standards applied giving the public value for money it would be clear what is being achieved. In my opinion social housing is of a higher standard than council housing and this may see local authorities providing a higher standard of house under the social housing programme than under council house programmes or by builders in general. Surely the standard of the house to be built should be considered where contracts apply, that is to say, in the case of council housing local authorities should not be compelled to accept the lowest tender.

Mr. A. O’Connor

As regards the long-term durability aspect and the monitoring of standards, we have an inspectorate involved in inspection in the private sector. The inspectorate does this through the floor area compliance certificate in accordance with the criteria set out in the HA1 document. In addition to the building regulations, this deals with long-term durability. In that case we set out a 60-year lifetime, almost parallel to the OPW's system. The Senator also asked if a study was being carried out. I understand a study has been proposed on the monitoring of quality and standards of housing over time.

All those buildings would have gone through the planning process and have been built in accordance with the building regulations of the period. They would have been signed off by professionals in the building industry. A standard is maintained in that way. When we refer to social housing we include local authority housing — produced for rental and ultimately tenant purchase — as well as voluntary housing. We treat them in the same manner. The social housing design guidelines would apply equally to those.

If the Senator's question relates to the tendering system, we look at the lowest possible tender. A tender evaluation is carried out by the local authority and presented to the Department. There may be cases where the lowest tender is not taken. However, we try to achieve the best value for money. Standards should be met before the tendering process. Our criteria should be met in the tender documentation that is then put to the market. At that point it should include the quality aspect.

The question I am asking refers to the standards used in the tender documents. Is there a method of evaluating this against the tender received by the local authorities?

Mr. A. O’Connor

Yes. That is done in the tender analysis.

Mr. O'Connor mentioned the green cement. Is it being evaluated on a project by project basis?

Mr. A. O’Connor

Yes. We usually try to have a monitoring system in place. This is done within the contract if it is being examined at that time.

Why does the circular state that it "encourages" prospective tenderers? It does not say that certain standards have to be met.

Mr. A. O’Connor

That may be a question for Mr. O'Connell. The issue is that managers and directors of services are being asked to aspire to this. The tender documentation is prepared by either the local authority, or the architects or engineers on behalf of the voluntary body——

——and surely on behalf of the Department of the Environment, Heritage and Local Government.

Mr. A. O’Connor

Yes, through our approval. They would have gone through a series of approvals. Sometimes our procedures might be overly demanding and we should perhaps have simpler approval systems, but that is for another day.

Approval is one thing, but is it not the Department that sets the standards that local authorities must implement in their housing programme?

Mr. A. O’Connor

It does so in the design guidelines. There is also the statutory requirement of meeting building regulations.

We will have to return to this issue at a later stage.

I was also going to suggest that. Perhaps we could do so early in the new year because I would like to pursue many of these issues.

Mr. C. O’Connor

Senator Brennan asked about the percentage of green cement used — it is less than 1%. In Britain the figure stands at 18%, while it stands at 54% in Holland.

We have had a robust exchange of views and the meeting has been informative. I thank the officials from the Department of the Environment, Heritage and Local Government and the Office of Public Works for their attendance and contribution today.

At our next meeting the Minister will brief us prior to his attendance at the EU Environment Council meeting on 18 December.

The joint committee adjourned at 3.35 p.m. until 10.30 a.m. on Wednesday, 13 December 2006.