Under 6% of major public tenders in the EU include circular economy criteria

Less than 6% of public tenders exceeding European thresholds have included circular economy criteria, although authorities can already take into account the costs over the entire life cycle, the use of recycled materials, and the possibility of reuse or recovery of products.

In short, an estimate cited in an independent report prepared for the European Commission shows that under 6% of tenders exceeding EU thresholds include circular economy considerations. Public procurement for innovation represents less than 1% of contracts in many member states, despite the available legal instruments. Authorities continue to frequently favor the lowest initial price, even though a more expensive offer at purchase may have lower costs and emissions over the duration of use. The main obstacles are the lack of technical skills, incompatible sustainability data, annual budgeting, and fear of challenges or litigation. The report recommends the systematic integration of circular criteria into national strategies, electronic procurement platforms, and standard documentation, but the conclusions do not yet represent a legislative proposal from the Commission.

Public procurement accounts for about 14% of the European Union's gross domestic product, yet this purchasing power is still used to a limited extent for the development of recycled material markets, reusable products, and solutions designed for a longer duration of use.

The independent report analyzes 17 projects funded through Horizon 2020 and Horizon Europe and cites an estimate from the European Investment Bank indicating that less than 6% of tenders exceeding European thresholds have included circular economy considerations.

The figure refers to procedures where the contract value is large enough for the application of European public procurement rules. It does not mean that the rest of the contracts do not contain any environmental criteria, as green public procurement can also cover other objectives, such as energy efficiency or pollution reduction, without explicitly pursuing material reuse and waste prevention.

Circular public procurement is more specific. It can favor products with recycled materials, repairable goods, reuse-based services, recoverable components, and solutions assessed based on their impact and cost over the entire life cycle.

European rules already allow authorities to award contracts based on the best price-quality ratio, not exclusively based on the cheapest offer. Environmental, social, and innovation criteria can be used, provided they are related to the subject of the contract, transparent, and non-discriminatory.

Authorities can also apply life cycle cost calculation. This method allows for the inclusion of expenses for purchase, energy, maintenance, repair, use, and disposal, as well as environmental effects that can be expressed and verified objectively.

In practice, the report finds that many administrations continue to compare offers primarily based on the price paid upfront. Circular products are thus considered more expensive, even when their total costs may be lower due to a longer duration of use, reduced consumption, or material recovery.

Short-term budgeting reinforces this trend. The department purchasing a product may bear the initial investment, while the savings resulting from consumption, maintenance, or waste reduction appear later in the budget of another structure.

The report also indicates a very low use of public procurement for innovation. In many member states, such procedures represent less than 1% of contracts, even though they can allow authorities to collaborate with businesses to develop and test solutions that are not yet available on the market at a commercial scale.

Among the existing tools is pre-commercial procurement, through which authorities purchase research and development services without being obliged to acquire the final product, and public procurement of innovative solutions, aimed at technologies close to market introduction.

Innovation partnerships allow for the combination of development and subsequent procurement of a solution in a single procedure when the necessary product does not yet exist. Competitive dialogue and market consultation before launching the tender can help the authority understand what is available and formulate requirements that do not exclude innovative suppliers.

The report shows that these tools are often avoided because they are considered complicated, risky, and time-consuming. Officials fear that using new criteria, negotiating, or performance-based requirements may lead to challenges.

Uncertainty is amplified by the fragmentation of rules. Circular procurement involves the simultaneous application of legislation regarding public contracts, waste, products, chemicals, technical standards, and sectoral requirements.

Differences between states regarding when waste becomes a commercial material limit the use of secondary raw materials. A recycled material may be accepted and certified in one country but treated differently in another, complicating cross-border tenders and reducing supplier confidence.

The lack of harmonized data represents another obstacle. Authorities must compare environmental statements, certifications, and emissions information presented in different formats, without common indicators that would allow for simple and verifiable assessment.

Tools such as life cycle analysis and life cycle cost calculation remain underutilized. Smaller administrations are particularly affected, as they have limited staff and do not always have specialists in materials, construction, emissions, or economic evaluation.

The report shows that solutions become easier to use when they are transformed into calculators, documentation models, guides, and standard criteria. An official does not then have to build an evaluation method from scratch for each contract.

The CityLoops project has developed a simplified calculator for emissions generated during demolition and renovation. Authorities can compare scenarios for concrete, excavated soil, and construction waste and can include a reference level for emissions in the tender.

CINDERELA has created a standardized structure through which construction products made from secondary raw materials can be compared with conventional alternatives. The tool covers resource consumption, environmental effects, and costs over the entire life cycle.

RECONSTRUCT and CIRC-BOOST have tested the use of digital models of buildings for tracking materials, emissions, and recovery possibilities. Data can be integrated into design, technical documentation, bid evaluation, and demolition planning.

The report concludes that the main problem is no longer the lack of circular solutions. Numerous methods have been tested in construction, bioeconomy, energy, health, and urban administration, but most have not yet become routine procedures.

Results often depend on teams and the funding of European projects. After the completion of pilot projects, authorities do not always have the staff, budget, or institutional support necessary to continue using the tools.

Criteria are applied more easily when they are part of standard models, electronic platforms, and internal rules. The effects are limited when their use depends solely on the initiative of an administration or an official with experience in the circular economy.

The report recommends that member states include circular procurement in national strategies and establish indicators for monitoring implementation. Competence centers could provide legal and technical assistance, standard documentation, and training for contracting authorities.

Teams preparing procurements should bring together specialists in finance, infrastructure, environment, and public contracts. This coordination would allow for the consideration of long-term costs and reduce situations where sustainability objectives are separated from budgetary decisions.

Experts also recommend integrating circular criteria into national electronic procurement platforms. Requirements regarding recycled content, life cycle cost, or material recovery could be introduced into reusable forms and models.

SMEs and startups also face difficulties. Complex documentation, high financial requirements, and overly large contracts can exclude businesses that offer innovative solutions but do not have the administrative resources of large suppliers.

Breaking contracts into lots, using functional requirements, and organizing consultations before the tender can reduce these barriers. Contracts carried out in stages can limit financial risk and allow for testing a solution before its expansion.

The report also recommends joint procurement between cities and regions. Grouping demand would allow for the use of the same specifications, sharing preparation costs, and sending a clearer signal to suppliers.

Public procurement can thus create predictable demand for recycled materials and circular products. Suppliers would have more confidence for investments in recycling capacities and the development of new solutions if public demand were not limited to a few demonstrative projects.

The report proposes that circular public procurement should represent a central tool of the future Circular Economy Act. This could transform the purchasing power of administrations into a mechanism for developing the single market for secondary raw materials.

The document is an independent report completed in July 2026 for the Directorate-General for Research and Innovation. Its content does not necessarily reflect the position of the European Commission.

Estimates and recommendations do not represent a decision and do not create obligations for member states or contracting authorities. Any requirements will depend on future proposals from the Commission and the European legislative process.

Public procurement is regulated at the European level by rules applicable to contracts of authorities, operators in utility sectors, and concessions. The framework already allows for the inclusion of environmental criteria and life cycle costs, but there is no horizontal obligation for all authorities to systematically apply circular procurement.

The future Circular Economy Act aims to develop a more functional European market for secondary raw materials. Public procurement can contribute by creating demand for recycled, reused, and repairable products, alongside measures applied to producers and waste management systems.