Government purchasing could be a game-changer for the European bio-based and circular industry, as well as EU policy at large.
Public entities have major purchasing power, giving them a unique ability to provide producers with the certainty needed to scale.
Here is how the Dutch and French governments are leading in sustainable procurement and how the practice can support Europe’s ongoing security agenda.
France’s public purse goes circular
For the last five years, the French government has released a wave of laws to encourage more sustainable purchasing by public authorities.
They include the 2020 anti-waste law for a circular economy (AGEC), whose article 58 makes public purchasers buy certain goods with between 20-100% recycled content.
A 2021 decree laid out the 17 product categories to which the law applies, from clothing to ink cartridges.
Meanwhile, the 2021 National Plan for Sustainable Procurement (PNAD) mandated that the state, local authorities, hospitals, and private sector players must ensure 100% of annual contracts are guided by at least one environmental consideration by 2025.
Data gathering is a priority too. Public authorities must now report to the Economic Observatory for Public Procurement, declaring what proportion of their annual expenditure was devoted to sustainable purchasing.
Together, these laws form a regulatory lattice-work that locks public authorities into greening contract awards. Other EU governments, in particular Norway, Denmark, and the Netherlands, are similarly shifting towards sustainable procurement. These countries have recognised that public procurement is a powerful economic stimulus, vital in scaling new lower-carbon industries.
Going beyond price
The principle of sustainable procurement is simple but powerful. It is when governments buy not just the lowest-priced goods and services, but those that offer long-term environmental and economic benefits.
For example, buying compostable materials may be costlier for public authorities upfront. However, over the long term, deploying these materials holds benefits that far exceed their monetary costs. These include protecting biodiversity, avoiding microplastic pollution, growing green industries, and allowing the country to meet its targets for decarbonisation.
Demand guarantees needed
Why are government purchases important in scaling the bio-based and circular industries? The reason is that it can boost demand in a reliable manner.
Today, we have thousands of bio-based or circular materials that could replace fossil plastics in almost every application. In general, they are lower-carbon and less resource-intensive.
Yet these materials still have a low market share. The reason is simple: fossil chemicals are still the cheapest – through least sustainable – options. This is thanks to a century or more of subsidies, custom infrastructure-building, and capacity investments into fossil-based supply chains.
For biomaterials to compete with fossil-based chemicals on price, producers need to make more of them. This is the dynamic of industrial scaling: manufacturing more goods means the cost of producing any one product unit decreases.
Yet before they invest in mass production, producers first need to know there will be demand. Without this, they cannot be sure they will earn back the outlay.
Offtake agreements are a solution to this uncertainty. Offtakes effectively demand guarantees because they involve a customer agreeing to purchase a certain volume of goods from a producer even before those goods have actually been manufactured. This gives bio-based producers the security they need to invest in expansion.
The forgotten demand driver
Private companies are usually involved in offtakes. Yet governments and public authorities can provide similar levels of certainty for manufacturers.
Governments are major buyers. In France, public procurement represented around 8% of GDP in 2021 with over 61% of public procurement contracts in volume awarded to SMEs.
The Dutch state procures around €116 billion worth of work, services and supplies every year, giving it the power to mould national supply chains in a more sustainable way.
Through sustainable procurement, therefore, public authorities can singlehandedly bolster the market for circular and bio-based production in a way that provides long-term certainty for industry.
How much public procurement is out there?
32 of the 34 OECD countries responded to a recent survey saying they have a national GPP policy or framework. 81% of these said that public procurement is a means to meet their climate goals.
The data is less clear on how much sustainable procurement governments are actually doing. Researchers can look at public tender databases. However, there are no certain indicators of when sustainability considerations factored into purchasing decisions. The data on public procurement is also fragmentary, even between European countries.
However, there is some indication that sustainable procurement policies are robust in some countries. A 2021 textual analysis on a database of 1 million public contracts in Europe found Norway, France, and Denmark were leaders in sustainable procurement, with France making most use of non-price criteria when buying.
The public is also receptive. A poll taken in May 2025 suggested that over half the public in Italy, Germany, UK, France, and Spain supported the notion of governments purchasing sustainable products even when non-sustainable alternatives were cheaper.
Still, there is a long way to go before sustainable procurements become the norm.
Currently, over 60 percent of contracts in the EU are awarded on price alone, without consideration of long-term environmental costs.
Pure price-driven purchasing also varies by country. Estimates say contract awards based purely on price range from under 10 percent in France and Croatia, where sustainable procurement is higher, to over 90 percent in Cyprus and Slovakia, where it is lower.
The Netherlands: coordinated contracting
Managing large budgets sustainably depends on specialist expertise. Knowledge in environmental science, cost-benefit assessments, regulation and the law are all needed to shift long-standing contracts evaluated on price towards new ones assessed on longer-term impacts.
As a result, a professionalised workforce is the first step towards making greener purchasing decisions. The Netherlands has been working on the procurement skills gap by setting up PIANOo (the Dutch Public Procurement Expertise Centre), a group that professionalises procurement and tendering in all government departments.
The very existence of a dedicated green procurement organisation shows how committed the Dutch government has been in its bio-based and circular procurement schemes.
We see this level of commitment in how clearly Dutch sustainable procurement is tied to industrial scale-up goals.
A major focus is on scaling bio-based and circular construction materials. This is a strategic choice from a sustainability perspective. Construction is difficult to decarbonise as the sector can’t simply be electrified – scaling bio-based and circular building materials is the most effective way to get the carbon footprint down.
The Dutch National Approach for Biobased Building was launched in 2023, aiming for at least 30% of new residential buildings to consist of at least 30% bio-based materials by 20230. It also reserved a budget of €200 million to stimulate demand for the sector.
Achieving such ambitious targets will have ripple effects through the supply chain. This will require tight collaboration between the public and private entities. The plan is for the government to collaborate with private actors like farmers, processors, and construction companies to expand capacity and integrate sustainable materials.
Individual public ministries are doing their share in supporting bio-based construction. The Dutch Ministry of Infrastructure and Water Management is experimenting with building a viaduct from reusable components. It is also developing road asphalts that bio-based elements and reduce the fossil-based bitumen component of this essential infrastructure material. Meanwhile, the Ministry of Defence is having parts of its equipment made from recycled parts of old military equipment.
Green procurement and EU security
The EU is trying to encourage more sustainable procurement. For one, it plans to release binding non-price criteria for public procurement via the Industrial Decarbonisation Accelerator Act. This should give bloc-wide consistency and clarity on how to award public contracts more sustainably.
Other regulations to watch are the revision of the 2014 public procurement directives – which promises to detail mandatory sustainability criteria for certain contracts – and the creation of a Critical Raw Materials Centre.
Sustainable procurement is all about adjusting spending priorities away from short-term costs and towards longer-term strategic considerations. This shift aligns with the broader policy mood in the EU, which revolves around bolstering military autonomy and economic independence.
Today, the EU is planning for a future of greater instability, both geopolitically and from climate impacts. This involves building domestic industrial capacity, trying to reduce dependence on imports, and sharpening its competitiveness in new low-carbon industries.
As resource security continues to exert its pull over all aspects of EU planning, expect more procurement policy that helps grow regional bio-based and circular capacity.
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