Editing IPCC:AR6/WGIII/Chapter-11 (section)

=== 11.6.4 Market Pull ===

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The perception of an increasing durable demand for low-GHG products induces manufacturers to invest in decarbonisation strategies ( [[#Olatunji--2019|Olatunji et al. 2019]] ). Policies can support and accelerate this process by creating niche markets, stimulating demand for low-carbon products through procurement and financing and by addressing informational and other market barriers.

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==== 11.6.4.1 Public Procurement ====

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Governments spend a large portion of their budget on the provision of products and material through infrastructure development, general equipment, and miscellaneous goods. The OECD estimates that an average of 30% of general government expenditure goes to public procurements in OECD countries, representing 12.6% of GDP, which makes government a powerful market actor ( [[#OECD--2021|OECD 2021]] ). Public procurement can therefore create a significant market pull and be used to pursue strategic environmental goals ( [[#Ghisetti--2017|Ghisetti 2017]] ). Local, regional and national authorities can use their purchasing power to create niche markets and to guarantee demand for low-GHG products and material ( [[#Wesseling--2018|Wesseling and Edquist 2018]] ; [[#Muslemani--2021|Muslemani et al. 2021]] ). In some cases, governments will have to adapt government procurement policies that are not well suited for the procurement of products and services that focus on the decarbonisation benefits and longer-term procurement commitments of emissions-reducing technologies and projects ( [[#Ghisetti--2017|Ghisetti 2017]] ). Implementation can be challenged by the complexity of criteria, the lack of credible information to check GHG intensities and the added time needed for selection ( [[#Geng--2008|Geng and Doberstein 2008]] ; [[#Testa--2012|Testa et al. 2012]] ; [[#Bratt--2013|Bratt et al. 2013]] ; [[#Zhu--2013|Zhu et al. 2013]] ; [[#Cheng--2018|Cheng et al. 2018]] ; [[#Liu--2019b|Liu et al. 2019b]] ). To ease these hurdles, the EU commission has developed environmental criteria that can be directly inserted in tender documents ( [[#Igarashi--2015|Igarashi et al. 2015]] ; [[#European%20Commission--2016|European Commission 2016]] ). These criteria are voluntary, and the extent of their application varies across public authorities ( [[#Michelsen--2009|Michelsen and de Boer 2009]] ; [[#Bratt--2013|Bratt et al. 2013]] ; [[#Testa--2016|Testa et al. 2016]] ). In the Netherlands, companies achieving a desirable certification level under the national CO 2 Performance Ladder obtain a competitive advantage in public procurement ( [[#Rietbergen--2013|Rietbergen and Blok 2013]] ; [[#Rietbergen--2015|Rietbergen et al. 2015]] ). Globally, many countries have implemented green product procurement or sustainable procurement following Sustainable Development Goal (SDG) 12 – ‘Responsible consumption and production’ ( [[#UNEP--2017|UNEP 2017]] ). Public procurement is also developing at sub-national levels. For example, the state of California in the United States of America passed the Buy Clean California Act (AB 262) that establishes maximum acceptable global warming potentials for eligible steel and glass construction materials for public procurement ( [[#USGBC-LA--2018|USGBC-LA 2018]] ) (Box 11.4).

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