Overview
This regulation sets out the type of costs that must be taken into account by a contracting authority where tenders are evaluated on the basis of life-cycle costs.
Where life-cycle costing is used, this must take into account the costs borne by the contracting authority or other users (e.g. costs of use, maintenance costs, end of life costs), and / or environmental costs (i.e. environmental externalities) linked to the product, service or works (e.g. cost of emissions of greenhouse gases).
In assessing environmental costs, contracting authorities must ensure that the method used is based on objectively verifiable and non-discriminatory criteria, accessible to all interested parties and that the data required can be provided with reasonable effort by suppliers.
Contracting authorities must indicate in the procurement documents the data to be provided by tenderers for the purposes of assessing costs using a life-cycle approach, and the method to determine the life-cycle costs on the basis of the data.
Objective at this commercial stage
In developing an evaluation approach that involves life-cycle costing, these costs must be based on the costs borne by the contracting authority / other users, or environmental costs (e.g. cost of emissions of greenhouse gases). The evaluation of the latter must be based on objectively verifiable and non-discriminatory criteria (among other requirements).
Key considerations at this commercial stage
Contracting authorities should:
- ensure that the assessment of life-cycle costs is linked only to the costs borne by the contracting authority/ other users, or environmental costs (i.e. environmental externalities) linked to the product, service or works
- ensure that any evaluation approach that involves the assessment of environmental costs is assessed in accordance with objectively verifiable and non-discriminatory criteria
- ensure that the evaluation approach for life-cycle costs is fair and proportionate.
Legal framework
See also in the Procurement Act 2023:
- Section 23: Award criteria
Additional support and guidance
Make sure you:
- read the regulation
- seek legal and commercial advice in the context of specific procurements
