Water Europe has released a new policy report, "Public Procurement: Outcomes-Driven Public Procurement to Achieve a Water-Smart Economy in a Resilient Europe," calling for a major shift in how the European Union approaches public procurement. The report highlights the untapped potential of procurement to drive innovation, sustainability, and fair competition—particularly in the water sector, which plays a crucial role in addressing environmental and societal challenges.
Public procurement represents nearly 14% of the EU’s GDP and is a key channel for deploying EU Structural and Investment Funds. Despite its importance, procurement policies often focus narrowly on cost, overlooking opportunities to incentivize smarter, more sustainable solutions. Water Europe argues that by adopting an outcomes-driven procurement model, the EU can accelerate the delivery of high-performing water services, improve ecosystem protection, and promote the uptake of innovative technologies—while ensuring long-term value for citizens, industry, and the environment.
The report offers practical recommendations for embedding innovation into procurement without creating new categories, such as introducing challenge-based tenders and pre-commercial frameworks that engage companies early in product development. It also advocates for shifting procurement evaluation toward non-price criteria, including water efficiency, social and environmental impact, and lifecycle performance.
Water Europe emphasizes that tenders should be aligned with the EU’s water policy objectives and assessed beyond capital cost (CAPEX) by considering the total cost of ownership (TOTEX). This would encourage more sustainable infrastructure investment and help deliver compliance with environmental standards while stimulating innovation.
Water Europe emphasizes that tenders should be aligned with the EU’s water policy objectives and assessed beyond capital cost (CAPEX) by considering the total cost of ownership (TOTEX)
The report also urges caution in applying “Buy European” strategies. While supporting the growth of EU-made water technologies, it warns that strategic autonomy must not become a barrier to accessing the best available global solutions. Achieving a Water-Smart Society requires flexibility to adopt technologies that meet the highest performance standards, regardless of origin.
Another key concern is the limited participation of small and medium-sized enterprises (SMEs), often excluded due to complex procedures and high administrative burdens. The report proposes a “Procurement Readiness Rating” to help SMEs better compete, mentorship programs to build capacity, and simplified documentation for smaller contracts. These measures, Water Europe notes, could help close the gap between innovation and market adoption, especially for micro-enterprises with strong track records in public procurement.
Finally, the report calls for greater agility in the procurement process. The current pace, particularly in the water sector, is seen as a barrier to private sector engagement, efficiency, and rapid adoption of new technologies. Water Europe recommends including sanitation services in the “special sectors” list under Directive 2014/25/EU—recognizing the interconnected nature of water supply and sanitation and enabling a more integrated, circular approach.
Water Europe presents this policy paper as a strategic roadmap to modernize public procurement across the EU. The report emphasizes the need for an outcomes-driven approach that empowers public administrations to play a more active role in achieving water-related policy goals.
By focusing on long-term value, encouraging innovation, and removing barriers for SMEs, the recommendations aim to transform procurement into a tool that delivers environmental, social, and economic benefits. Aligning procurement practices with EU water objectives will be essential to building a more competitive, sustainable, and resilient Europe—one that is equipped to lead the transition to a Water-Smart Society.
