# Assessing the Degree of Sustainability Integration in Canadian Public Sector Procurement
## 4 Key Findings
### Finding 3: There Is Limited Consideration for Total Cost of Ownership when Looking at Price  
One common misconception is that sustainability is expensive. Traditionally, in an interest to ensure fiducary responsibility through meaningful stewardship of taxpayer dollars, procurement has been focused on securing the best price, commonly believed to be the lowest initial price. Pricing can be misleading. The initial price does not include the total costs associated with acquiring, using, and disposing of a product or service [32]. Elements with financial implications not typically included in price can range from maintenance, expected lifespan, reparability, energy usage, as well as disposal costs. Typically, ignoring these costs feeds into lower quality and shorter-lived products.  
Given this, it is evident that for meaningful evaluation, procurers require an understanding and comparison of TCO. Lack of understanding around TCO keeps pricing elements hidden and distorts pricing data. A focus on price, excluding total cost of ownership, can lead to the selection of a bidder with pricing that is in fact higher than competitors', and consequently poor stewardship of taxpayer dollars.  
We found only two, or 4%, of RFPs made mention of TCO. Despite this mention of TCO, neither of the two RFPs requested any data that would enable the full costs to be calculated. The first RFP (see Figure 15a) mentioned TCO in the section on winning bid criteria but did not mention it again in the RFP and did not factor it into the evaluation system. There were also no requests for relevant data, such as energy usage estimates, that might support a total cost of ownership calculation.  
Although the second RFP (see Figure 15b) for a printing device had more detail surrounding total cost of ownership, it seemed to have limited understanding of TCO. It lacked requests for material data, including expected energy usage, lifespan, and ability to upgrade, yet was focused on increasing discounts and lower pricing.  
In order to provide an example of the impact of using TCO, we used an EPEAT calculator tool that allows users to compare EPEAT-certified products with their non-certified counterparts. The calculator demonstrates the environmental benefits and shows users the overall cost savings through reduced energy use [33]. To demonstrate this point, we used an RFP for computing devices, requiring 3419 desktop computers and 1716 laptop computers. This RFP does not list any considerations or requirements for sustainable-certified products. Using the EPEAT calculator and an imposed requirement for silver-level certification, we found a cost savings of $350,000 on energy usage alone. Given that there are a number of other elements associated with total cost of ownership, including lifespan, reparability, and disposal, we expect that using TCO would provide significant savings to any organization.  
We would expect to see similar benefits of using TCO in other categories. In a 2006 study of Leadership in Energy and Environmental Design (LEED) certified schools, researchers found that energy costs were 33% lower than conventional design [34]. The same study found that water use was reduced by 32%, and maintenance savings in LEED-certified buildings was $8/square foot. This cost reduction was attributed to the higher quality materials used, and reuse of many materials, which also  
Figure 15: (a) IT municipal RFP incorporating Total Cost of Ownership (TCO) (1). (b) IT municipal RFP incorporating TCO (2).  
lowers disposal costs. This example demonstrates the benefit of having a clear understanding of total cost of ownership.