Improving contracting authorities' competences in life-cycle costing and green public procurement through the use of digital tools in Hungary

In alignment with the European Green Deal and other EU strategic frameworks, several legislative acts governing sectors of the Single Market have been revised or newly adopted in recent years. These reforms introduced mandatory green public procurement provisions, placing clear obligations on contracting authorities to integrate environmental considerations into their purchasing decisions. This shift underscores the EU’s commitment to leveraging public procurement as a strategic tool for achieving sustainability objectives. 

Recognising the strategic importance of public procurement in advancing sustainability, the Government of Hungary adopted its first comprehensive Green Public Procurement Strategy in 2022. The strategy sets two key objectives: 

• By 2027, at least 30% of all public procurement procedures should include environmental criteria. 

• Contracting authorities should be equipped to integrate environmental considerations beyond mandatory cases, supported by a robust toolbox, capacity-building initiatives, and dissemination of good practices. The strategy also emphasizes the broader adoption of LCC as a cornerstone of sustainable procurement. 

Despite the evolutions of the European legal framework to encourage the uptake of green public procurement, the integration of environmental criteria in Hungarian public procurement remains limited. According to the results of the Hungarian Public Procurement Performance Measurement Framework, fewer than 10% of procedures applied environmental criteria annually between 2019 and 2023. The use of LCC methods is even more modest, with only 0.62% of procedures applying LCC in 2023. While these figures show a slight upward trend, they highlight the need for accelerated progress.

To support these goals, a 2021 project, implemented by the OECD and funded by the European Commission through the TSI funds, developed three LCC calculation tools for water and sewage pumps, medical devices, and public lighting. These tools, along with accompanying guidelines (which are available on the the website of the Public Procurement Authority and in the Hungarian e-procurement system) and capacity-building workshops, have introduced contracting authorities and suppliers to LCC principles and methodology. Despite this progress, Hungary requires further assistance to reach the ambitious goals set out in the Green Public Procurement Strategy. This project aims to develop a further LCC tool, as well as an e-learning training package, and deliver capacity-building workshops to help Hungarian contracting authorities and private sector actors familiarise themselves with environmental criteria and LCC methods. 

The projects main deliverables include: 

• an e-learning training package on green, sustainable public procurement, mandatory environmental criteria, and life-cycle costing, 

• an additional life-cycle costing tool in a relevant purchasing category to be identified by the project beneficiaries and the OECD in collaboration

• capacity building workshops that will enhance the capability of contracting authorities and tenderers to carry out life cycle costing calculations in relation to the selected purchasing category.