Several methodologies help contracting authorities promote sustainability in procurement and take into account the environmental impacts of their purchases. One of these tools is life-cycle costing (LCC). The LCC approach moves beyond the initial purchase price and evaluates all other significant cost flows over the entire life period of works, supplies or services, such as installation, operation, maintenance and end-of-life (disposal) costs. A comprehensive LCC analysis also may take into consideration the costs of mitigating external environmental impacts.
The Report presents the concept of LCC and its links to the wider sustainable procurement agenda. The Report maps available LCC tools across EU and OECD countries and provides an in-depth analysis of selected tools. It also provides guidance on the practical implementation of LCC based on practitioner’s feedback. The Report also looks at the Hungarian context, analysing the policy framework and current practices related to LCC. Finally, the Report provides evidence-based strategic policy advice for the Hungarian Government on how to move towards a more structured and co-ordinated approach in the use of green public procurement criteria and especially the use of LCC.