Implementing Smart Specialisation in Energy through Innovation Procurement
How to turn innovative public procurement from an underused option to a powerful boost for innovation in energy?
This question was discussed in a workshop organised as part of the European Week of Regions and Cities 2019, by the Smart Specialisation Platform on Energy (S3PEnergy), a joint initiative of DG REGIO, DG ENER and JRC.
By developing a forward-looking innovation procurement strategy, public procurers can drive the R&D and deployment of innovative energy solutions from the demand side. In line with the Energy Union strategy, innovation procurement can be used as tool to facilitate a quick, clean energy transition, and at the same time create opportunities for local companies.
The main aim of the workshop was to help public authorities, procurers, policymakers, researchers and other stakeholders harness the power of innovation procurement to support the implementation of their Smart Specialisation Strategies (S3) in Energy.
Representatives from different regions and organisations presented interesting examples of innovation procurement initiatives carried out across Europe with ESIF, in the context of smart specialisation. They explained in details the activities carried out, the methodology followed, the obstacles encountered, the lessons learnt, and the support or tools they make available for others.
Some 40 participants from various organisations attended the workshop: mainly EU, national, regional or local public administrations (fund managers, public buyers, S3 practitioners, etc.), but also researchers, members of civil associations and enterprise organisations.
The main lessons learnt, for both public procurers and policy makers, mentioned by the different speakers about the use of innovation procurement can be summarised as follows:
- Innovation procurement has proven to be an excellent way to accelerate local economy and support better public services.
- “Think Big - Start Small” approach: As in the context of S3, Innovation procurement requires long-term planning and an ecosystem development along the quadruple helix. This should be included in a long term energy strategy and innovation agenda.
- Continuous cooperation, pooling of resources and mutual trust are needed along the procurement cycle. Energy is a particularly complex topic, involving many stakeholders (including many different administrations) and requires special effort.
- Non-standard procurement takes more time and internal decisions' procedures within public governments are long. The mind set within the administration should be changed and procurement should be seen as a strategic tool and not as a burden.
- Innovation procurement comes with some risk for public buyers. There is a clear need of a firm financial commitment and incentives rewarding those willing to take risks.
- From the idea to the innovative solution: a good approach for project definition and selection is key. The needs' identification is one of the most crucial part.
- The market should be engaged before the tender. A good knowledge of the available R&I solutions is required.
- In energy, it is not as much about technological innovation but about business/finance & ROI/process innovation.
- New administrative capacities and skills are needed. To ensure success along the procurement cycle, technical assistance and supporting networks can be used (e.g. ICLEI's Procura+ Network, PPI2Innovate Competence Centres, MED PPI Network, etc.).
Take away message
Public Innovative Procurement (PPI) is a promising tool to enhance public administration performance, support innovative companies and find solutions for societal needs.
A pro-innovation procurement approach could support the implementation of S3. Especially in a sector such as energy, where the public sector is a key source of demand, PPI could influence the market towards innovative and sustainable energy-related products/services.
PPI remains challenging but the speakers showcased several successful experiences and informed about many supporting tools, networks and guidance documents.
- Guidance on Innovation Procurement (EC)
- Introduction to the Thematic Smart Specialisation Platform on Energy
- How the Programme for Innovation Procurement contributes to an acceleration of the energy transition in Flanders
- Boosting innovation in energy through PPI – Experiences of PPI2Innovate project
- final report of the project “SMART SPP – Early market creation of innovative highly energy-efficient technologies through smarter engagement with the market in the pre-procurement phase”
- Guidance for public authorities on Public Procurement of Innovation
- Tools and guidance on innovation procurement
- Prominent MED project: experiences in the use of PPI in small Mediterranean municipalities
- Leaflet Prominent MED project
Piet Desiere (Government of Flanders): "PPI is a promising instrument to come to solve societal needs, but further European support is required"
Rafael Hirt (ICLEI - Local Governments for Sustainability): "The Procura+ Network, the Innovation Procurement Platform and the Procurement Forum offer useful support to public buyers to exchange and learn from best practice examples on innovation procurement in Europe."
Ivan Šimić (Managing Director of Regional Energy Agency North): "Innovation procurement is a great tool for public authorities, getting innovative solutions that meet their needs, and also to support entrepreneurs. It comes with some risks; policy makers need to develop instruments that would ensure a serious uptake of innovation procurement.“
An Schrijvers (Government of Flanders):“It takes much energy to carry out successful projects on sustainable energy. A firm commitment of all partners (public, private, civil, academic and financial) is needed. Advice and support on innovation procurement can definitely contribute, but co-financing seems crucial to compensate for the risks taken."