Supporting councils to procure the innovation to deliver Net Zero

The need for transformational innovation

Achieving net zero is one of the fundamental challenges facing all elements of our society and economy. The challenge also brings opportunities to deliver significant benefits important to local places and people, including new high-quality jobs, healthier homes, more resilient communities and reduced household bills.
While everyone has a role to play, our local government institutions will be particularly pivotal, both in the direct impact they can deliver, and in the convening effect across their individual geographies.

Local Government Association research indicates that ninety-seven per cent of councils have an official target for reaching net zero for either the local authority itself, the broader locality, or both.

These commitments that Local Authorities have made, to meet net zero at scale and pace, can’t be achieved simply by doing the things that are currently happening, better; Local Authorities will also need to start doing better things. This obligation to take up new practices and processes implies that Councils will need to access and roll-out innovative solutions in significant volume and at unprecedented pace.

Although many of these required technological solutions are already available, Local Governments face a host of non-technical barriers and challenges to adopting these innovations. Innovate UK’s Net Zero Living Programme is working directly with authorities to identify and address these challenges.

One of the key emerging barriers relates to procurement. Procurement is a vital function of the public sector, involving dedicated professionals looking to balance complex considerations such as transparency and fairness, competition and value, and efficiency and impact, in order to make the optimal commercial decisions.

The innovation environment in particular moves quickly and it is very difficult for authorities to keep up with the potential of the latest breakthroughs. Councils also necessarily operate in a traditional and regulated environment which isn’t always conducive to swift technological adoption, or to contracting with smaller providers to buy less-proven solutions.

But all of this said, procurement need not be a barrier to delivering net zero innovation and in fact could be a profound enabler of more general positive change. Procurement, deployed as a purposeful, strategic tool, can see the most innovative and effective solutions rolled out rapidly to deliver the required carbon savings but also to drive social inclusion and sustainable local economic growth.

The impact of the new procurement act

In 2025, the rules governing public procurement are changing. The new Procurement Act went live on 24 February 2025 with the aim of creating a simpler, more flexible and effective procurement environment that drives innovation, delivers better outcomes and embeds transparency.

This regulatory change could be a catalyst that sees authorities:

• form new productive relationships with creative, nimble and dynamic SMEs
• get access to genuinely disruptive technology
• generate additional social value from authority spending
• deliver effective solutions at scale and drive out efficiencies with innovation

The vision would see small businesses across the country realise the opportunity to secure valued contracts with public sector organisations, kickstarting local economic growth and embedding innovation in public service delivery. The Government has set out these and other strategic priorities in its National Procurement Policy Statement.

The full potential of the new regulations is only likely to be realised though if the culture around procurement compliments and facilitates the flexibility embedded in the new processes. Cultural change is difficult, particularly so in large or established organisations, but the benefits could be enormous. The Net Zero Living Programme is working to identify and highlight the transformational processes and practices that could deliver on the potential of the new procurement regulations while maintaining the confidence and control in spending that Councils need.

You can follow the Net Zero Living programme as it delivers insights in this and other areas.

About the author

Kevin O’Malley is an Innovation Lead on the Innovate UK, Net Zero Living Programme. He is also a lead for the Contracts for Innovation pre-commercial procurement process, managing relationships with regional and local government with the aim of boosting procurement-led innovation.