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Life Cycle Costing Implementation in Green Public Procurement: A Case Study from the Greek Public Sector

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  • Varvara S. Orfanidou

    (Department of Economics, Democritus University of Thrace, University Campus, 69100 Komotini, Greece)

  • Nikolaos P. Rachaniotis

    (Department of Industrial Management & Technology, University of Piraeus, Karaoli & Dimitriou 80, 18534 Piraeus, Greece)

  • Giannis T. Tsoulfas

    (Laboratory of Organizational Innovation & Management Systems (ORIMAS), Department of Agribusiness & Supply Chain Management, Agricultural University of Athens, 32200 Thiva, Greece)

  • Gregory P. Chondrokoukis

    (Department of Industrial Management & Technology, University of Piraeus, Karaoli & Dimitriou 80, 18534 Piraeus, Greece)

Abstract

Green Public Procurement (GPP) is an essential strategy for achieving goals related to public environmental policy, including sustainable production and consumption, streamlined use of resources and mitigation of climate change. The European Union has adopted policies towards “greening” public procurement for member states in order to promote environmental sustainability. Life Cycle Costing (LCC) is a method that measures the financial impact of an investment over the life cycle of a product. The current EU Procurement Directives (2014) are designed to position LCC centrally to sustainable sourcing. Although the literature identifies the links between the environmental dimension through GPP and the economic dimension through the use of LCC, the interaction between them in the context of public procurement has not been adequately captured. The aim of this paper is to evaluate the results of the LCC tools implementation in the context of GPP in Greece and study the economic impact of green procurement in public organizations. The urgent need of reducing energy consumption in the public sector due to the continuing energy crisis and climate change is an additional incentive to evaluate this impact. LCC tools developed by the EU were used, fed with data from public procurement contracts carried out in the Greek public sector. The results show that the adoption of environmental criteria requires market research, planning and coordination to make it cost-effective, especially under the legislative mandate of GPP in Greece by 2022.

Suggested Citation

  • Varvara S. Orfanidou & Nikolaos P. Rachaniotis & Giannis T. Tsoulfas & Gregory P. Chondrokoukis, 2023. "Life Cycle Costing Implementation in Green Public Procurement: A Case Study from the Greek Public Sector," Sustainability, MDPI, vol. 15(3), pages 1-15, February.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:3:p:2817-:d:1057261
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    References listed on IDEAS

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    1. Testa, Francesco & Iraldo, Fabio & Frey, Marco & Daddi, Tiberio, 2012. "What factors influence the uptake of GPP (green public procurement) practices? New evidence from an Italian survey," Ecological Economics, Elsevier, vol. 82(C), pages 88-96.
    2. Marianna Lena Kambanou, 2020. "Life Cycle Costing: Understanding How It Is Practised and Its Relationship to Life Cycle Management—A Case Study," Sustainability, MDPI, vol. 12(8), pages 1-19, April.
    3. Houda Taoudi Benchekroun & Zoubida Benmamoun & Hanaa Hachimi, 2022. "Implementation and Sustainability Assessment of a Public Procurement Strategy," Sustainability, MDPI, vol. 14(23), pages 1-22, November.
    4. Elena Fregonara & Diego Giuseppe Ferrando & Jean-Marc Tulliani, 2022. "Sustainable Public Procurement in the Building Construction Sector," Sustainability, MDPI, vol. 14(18), pages 1-23, September.
    5. Jose Luis Fuentes-Bargues & Pablo Sebastian Ferrer-Gisbert & Mª Carmen González-Cruz & María Jose Bastante-Ceca, 2019. "Green Public Procurement at a Regional Level. Case Study: The Valencia Region of Spain," IJERPH, MDPI, vol. 16(16), pages 1-24, August.
    6. Benedetta Nucci & Fabio Iraldo & Maria Rosa De Giacomo, 2016. "The relevance of Life Cycle Costing in Green Public Procurement," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 2016(1), pages 91-109.
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