Australia has legislated a commitment to reduce national greenhouse gas emissions to net zero by 2050. Australia is also transitioning to a circular economy, in which products are either recycled, remanufactured, or re-used after they have served their initial purpose. The transition to a net zero and circular economy requires a shift in how we consume materials and how industry produces and delivers goods and services.

Leveraging the substantial and stable procurement spend by the Australian government is pivotal to drive this change throughout the economy.

The Environmentally Sustainable Procurement (ESP) Policy guides decisions and allows the government to measure the environmental outcomes from its procurements. It establishes a reporting framework which will create a baseline of environmentally sustainable procurement.

From this baseline the government will be able to increase ambition over time.

The ESP Policy applies climate, environment and circularity principles to 4 high-impact procurement categories. This will begin with construction services at or above $7.5 million from 1 July 2024.