Case Jyvskyl Life cycle procurement Sharing the risks

Case Jyväskylä Life cycle procurement: Sharing the risks and savings SCI Network meeting, Malmö 19. 9. 2012 Sanna Ahvenharju, Gaia Consulting Oy Based on presentation by Mikko Lepo, City of Jyväskylä

Gaia team – at Your Service • 35 highly-educated experts – multidisciplinary and crosssectorial • Sustainability consultancy and business development since 1993 • Strategy and implementation partner • Over 400 clients in 5 continents • Offices in Finland, Switzerland, China, Ethiopia and Argentina 2

Construction of a campus of childrens’ facilities • School for grades 1 -9 • Day care centre • Special school for children requiring specific support • Altogether 1000 children, 180 personnel • Investment of 16 000 m 2, 35 M€ • 20 -23 years lifecycle, ~55 M€

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Timeline Project plan 2009 Procurement decision 1/2010 Competitive negotiation Tendering of procurement consultants 1 -2/2010 Procurement announcement 4/2010 Preselection of providers (5 -6/2010) Presentation of solutions (9 -10/2010) Tenders (1/2011) Final decisions (5 -6/2011) Signing of contracts (8/2011) Construction 3/2012 – 7/2015 Service until 2033

Aims of the procurement project 1. Efficiency and multifunctional use of space 2. Monitoring and reporting the set goals for functionality and condition of different spaces/facilities 3. Application of new technical solutions 4. Sustainable development and energy efficiency 5. Competitive financing for life cycle procurement and the legislative requirements of the process 6

Life cycle approach Lifecycle procurement Procurement of - usability, - functionality and - predefined conditions of a facility Feasibility study Project planning Procurement preparation Construction Use Maintenance 7

Risk assessment identified over 100 risks 8

Target values defined for different spaces 9

Contractual requirements, examples • The condition of buildings have to fulfill certain level of quality throughout their lifetime • Assignment of required response times - • Decrease service contract payments 1 €/m 2/day, if response is delayed Predefined maximum energy consumption - Costs for exceeding the limit are carried by the provider The potentially achieved savings are divided 50% / 50% between procurer and provider 10

Lessons learned • Innovation limited by the fact that many equipment requirements had to be specific in order to allow for quantitative comparison between tenders - Life-cycle contract allows for further development during later phases of the project • Energy and water contracting mechanism worked well – encouraged savings and new innovations • The reporting mechanisms and usability and functionality assessment mechanisms carry a potential for further service providers and innovations • The target levels for energy consumption could have been even more tight 11

Notes for the guide • 2. a - good project team • 2. g - funding from national programme • 3. f – performance targets • 5. a – procurement model • 6. a – use of incentives 12