By Darian Macey, April 2 2025
Environmental sustainability is now front and centre in Defence procurement – a shift no contractor can afford to ignore. The Department of Defence’s adoption of the Environmental Sustainable Procurement (ESP) Policy means that “business as usual” is over when it comes to tenders. The Australian Government is insisting that the goods and services it buys actively reduce greenhouse gas emissions and promote circular economy practices. From 1 July 2024, all major Defence construction projects (>$7.5M) must comply, and by 1 July 2025 this will extend to areas like ICT, furniture and more ([1]). In short, sustainability isn’t a “nice-to-have” – it’s now a core requirement for winning work with Defence.
Why Sustainability Is Now Central in Defence Procurement
What’s driving this strong push? In part, it’s Australia’s broader climate commitments and a recognition that Defence’s massive spending power can move markets. Defence’s Security and Estate Group (SEG) – which oversees bases and infrastructure – has clear sustainability goals to cut emissions, reduce waste, and support circular economy initiatives. The new ESP Policy puts these goals into practice by baking environmental considerations into procurement. Sustainability is no longer an afterthought or a tick-box; it’s weighted in tender evaluations and contract deliverables.
The policy’s aim is to ensure purchases reduce emissions and increase materials circularity ([1]). For Defence suppliers, this translates to concrete expectations: use greener materials, cut waste, and track your environmental performance. All Defence tenders for major projects now explicitly ask bidders to demonstrate how they’ll deliver on sustainability. This is being implemented through changes like a revamped Tender Schedule, which is entirely focused on environmental sustainability.
New Tender Schedule – The Four Key Sustainability Areas
If you’re preparing a Defence tender response, expect to find a Tender Schedule: Environmentally Sustainable Procurement (typically Schedule L) in the returnable schedules. This is where you must describe your environmental sustainability practices across four specific areas. These four pillars mirror what the Commonwealth’s Sustainable Procurement Guide and policy define as crucial factors ([2]):
Alignment with the Sustainable Procurement Guide
The Commonwealth’s Sustainable Procurement Guide (2024) is the playbook for buying green. Defence expects bidders to align with it – essentially proving you’re following government best practices in procurement. In practical terms, this means demonstrating you’ve considered environmental factors at every stage (planning, sourcing, contract performance) and that you have policies or certifications in place that echo the guide’s principles ([2]). For example, you might reference having an ISO 14001 environmental management system, using life-cycle analysis in design, or adhering to sustainable supply chain standards. Show that sustainability is built into your business processes, not just this one bid.
When addressing Schedule L, be specific under each of these five headings. For instance, under Energy Efficiency, you might write “I will be installing 5-star energy-rated appliances and solar panels capable of offsetting 20% of the building’s electricity use”. Under Circularity, you could note “All formwork plastic will be 100% recycled content, and we have a plan to recycle 90% of construction waste”. Think of this section as telling Defence exactly how you will meet their green objectives, in concrete terms.
Walking Through the ESP Reporting Tool (Construction Version)
For construction projects, Defence has introduced an ESP Reporting Tool – essentially a spreadsheet template – that you’ll complete as part of your tender (and update during the project if you win). I’ve seen the construction version of this tool, and it’s quite detailed. Don’t panic – it’s there to guide you on what information to provide. Here’s what you should be ready to include in that template:
The key with the ESP Reporting Tool is: gather your data early. Reach out to your suppliers and get those recycled content percentages, product certifications, and (if needed) carbon footprints. The form is quite comprehensive, but if you have the info on hand it’s straightforward to fill. It essentially creates a quantified sustainability snapshot of your bid – something the evaluators will pore over. Completing it thoroughly demonstrates professionalism and credibility. As a contractor, you signal “I know exactly how my choices translate into sustainability outcomes.” That confidence can set you apart.
Crafting a Strong Sustainability Response (What Good Looks Like)
Let’s talk about how to make your sustainability response truly stand out (in the right way). I’ve seen a fair share of tender responses, and there’s a stark difference between fluff and substance in this domain. Avoid vague ESG statements at all costs. Don’t just say “We care about the environment and will comply with all regulations” – that won’t win you any points (and frankly, every bidder will say that). Instead, be as concrete and specific as possible. In fact, one tip I always give is: imagine your response is being graded on how measurable and evidence-based it is.
Here are some dos and don’ts from my perspective:
| Title | DON’T | DO |
|---|---|---|
| Detail | Offer empty platitudes like “we are committed to sustainability” without detail. | Explain how exactly you are committed. For example: “We have a policy to source at least 20% recycled materials for all our projects, and in this tender we’ve identified X, Y, Z materials that together will make 25% of the build from recycled sources.” |
| Tailoring | Just copy-paste your company’s generic ESG statement. Evaluators can smell boilerplate a mile away. | Tailor your response to the project. Address each of the five areas in Schedule L with project-specific detail. |
| Quantify | Use buzzwords without context. Saying “We will apply circular economy principles” means little on its own. | Provide quantifiable targets. E.g. “We will divert 95% of construction waste from landfill by segregating recyclable materials – targeting at least 500 tonnes of waste recycled.” |
| Evidence | Rely solely on your own assertions. | Use supplier data and third-party proof. Cite EPDs, GECA, or statements like: “Our concrete contains 30% fly ash, cutting CO₂ by 100 kg/m³.” |
| Value | Ignore value-for-money by focusing only on being “green.” | Make the business case. Emphasise how your solution saves on energy, maintenance, or disposal over the life of the asset. |
| Integration | Treat sustainability as a separate add-on to your bid. | Embed sustainability across your solution. Link to methodology and risk: “On-site crushing reduces landfill waste and haulage.” |
In sum, a strong response is concrete, data-driven, and project-specific. It avoids generic claims and instead reads like a roadmap of how you’ll deliver tangible environmental outcomes. It’s honest about trade-offs but highlights win-wins. If you follow this approach, you won’t just comply with the ESP requirements – you’ll make a compelling case that your bid is the one that will help Defence meet its sustainability targets. And believe me, that can be a major differentiator.
Featuring Innovative Sustainable SMEs in Your Bid
One of the smartest ways to strengthen your sustainability response is to bring in the right partners – especially innovative Australian SMEs with cutting-edge sustainable products. Defence wants to see industry, including smaller players, contributing to its goals. As a contractor, showcasing that you’ve teamed up with specialist suppliers who offer environmentally superior solutions can give you an edge (and frankly, it helps those SMEs get a foot in the door – a win-win I love to see). Let me highlight two great examples of such SMEs you should consider featuring in your tenders: Transmutation and DEFY Design. These are exactly the kinds of companies that align with Defence’s sustainable procurement push and can help you score higher on those Schedule L criteria.
Transmutation – Turning Waste into High-Strength Rebar Chairs
Transmutation is a South Australian innovator that exemplifies circular economy principles in action. They have pioneered a process to recycle a notoriously hard-to-recycle waste stream – powder-coating residue (the waste powder from industrial painting) – and turn it into a new type of plastic. Their flagship product for the construction industry is a 50/65mm rebar chair (the little plastic support that holds reinforcing steel mesh in concrete). Normally, rebar chairs might be made of virgin plastic or even steel, but Transmutation’s are made from 100% recycled plastic recovered from industrial waste. In fact, they’ve teamed up with Dulux to take up to 120 tonnes of leftover powder-coating powder and “mutate” it into these chairs ([4]).
Why should you include Transmutation’s product in your bid? For starters, it hits several ESP sweet spots:
| Title | Key Message |
|---|---|
| Recycled | Transmutation’s chairs are made from over 90% recycled waste content. That alone helps fulfill recycled content commitments. Every chair specified is material diverted from landfill. |
| Certified | These chairs are GECA certified (Good Environmental Choice Australia), a recognised third-party eco-label. GECA confirms the product is sustainable, fit-for-purpose, and ethically made. Say in your bid: “We will use Transmutation’s GECA-certified recycled plastic bar chairs.” |
| Proven | They are tested and engineered for strength – reportedly sturdier than virgin plastic. They meet Australian Standards for concrete reinforcement supports. Sustainability here comes with no compromise on performance. |
| Low Carbon | Using recycled plastic means a much lower embodied carbon footprint than new plastic, and avoids waste to landfill. Include this kind of impact statement: “This project will use X tonnes of recycled plastic in the foundation chairs, eliminating Y tonnes of waste.” |
| Aligned | This directly supports SEG’s waste reduction and circular economy goals. Transmutation offers a visible, credible sustainability win – an Australian-made innovation that ticks all the boxes of the ESP Policy. |
To use Transmutation in a tender, you would simply specify their recycled plastic bar chairs wherever you’d normally list your reinforcing accessories. You can attach their product data sheet and GECA certificate as evidence. By doing so, you send a message: “We will not only meet Defence’s specs, we’ll exceed them by introducing a sustainable innovation that aligns with the ‘Reduce, Reuse, Recycle’ agenda.” It’s hard for a competing bid that offers a generic plastic chair to argue the same value. And it demonstrates you’ve engaged an SME innovator, which is something Defence is implicitly encouraging. I highly recommend giving Transmutation a call when preparing your environmental response – they can provide all the data (recycled content percentages, material traceability, etc.) that you might need for the ESP reporting tool and your narrative. In essence, they make it easy for you to verify your claims because they track their material from waste to final product.
DEFY – 100% Recycled Plastic Panels for Fit-outs and Joinery
DEFY (Defy Design) is another exciting Australian SME that can help elevate your bid. Based in Sydney, DEFY produces durable HDPE panels made entirely from 100% recycled Australian plastic – think of large, solid boards that can be used in place of plywood, MDF, or virgin plastic sheets in various applications. These panels are quite versatile: they’re already being used in furniture, interior fit-outs, joinery, playground equipment, you name it. Essentially, whenever you need a robust sheet material, DEFY’s recycled panels could be an option. They come in standard sheet sizes (e.g. 2400 x 1200mm) and various thicknesses, making them a potential sustainable swap for things like wall linings, cabinetry, countertops, or outdoor furniture in Defence projects.
How does featuring DEFY benefit your tender? Much like Transmutation, in multiple ways:
| Title | Key Message |
|---|---|
| Recycled | DEFY’s panels are made from 100% post-consumer and post-industrial HDPE plastic waste, all sourced and manufactured in Australia. This maximises the recycled content metric in your bid. For example: “These panels are made of 100% recycled plastic, completely eliminating the need for virgin materials.” |
| Closed-Loop | DEFY operates a take-back program, enabling a cradle-to-cradle approach. Their products have an exit strategy to avoid landfill. You can say: “The supplier (DEFY) commits to reclaiming and recycling the material at end-of-life, ensuring zero waste.” This supports whole-of-life value and circular economy goals. |
| Durability | DEFY’s HDPE panels are tough, long-lasting, and water/chemical resistant. Suitable for uses like benchtops, lockers, and cladding in Defence settings. Using materials that don’t swell or require painting can reduce maintenance – a clear whole-of-life benefit. |
| Low Carbon | Recycled HDPE production uses far less energy than virgin plastic or composite boards. DEFY can supply life-cycle assessment data. Say: “Using DEFY’s recycled panels saves approximately X kg CO₂ per panel compared to conventional materials.” Local manufacturing also reduces transport emissions. |
| Sovereign | DEFY is Australian owned and operated. Featuring DEFY supports SME participation and local industry, aligning with the Australian Industry Capability framework. You can highlight: “By sourcing sustainable products from Australian SMEs, we support local jobs and environmental outcomes.” |
| Verifiable | DEFY tracks and documents all material sources and recycled content. They provide hard data for carbon, composition, and compliance – including pending GECA certification. This simplifies ESP reporting and ensures you can back up your claims with evidence, reducing risk during delivery. |
In your tender response, you could incorporate DEFY by specifying their panels for relevant parts of the project scope, and by name in your sustainability section. For instance: “For the interior fit-out, we will use DEFY’s 100% recycled HDPE panels for all cabinetry and wall cladding. This choice will inject approximately 2,000 kg of recycled plastic into the project, eliminating that amount of waste from landfill and avoiding the use of virgin plywood and laminates. DEFY’s panels come with a take-back guarantee, ensuring they will be recycled at end-of-life, which aligns perfectly with Defence’s circularity goals.” A statement like that (feel free to adapt the numbers to your case) is golden. You’ve just addressed materials, waste, and whole-of-life in one go, with a real example.
Aligning with Defence’s Goals – and Scoring Points
The beauty of highlighting solutions from companies like Transmutation and DEFY is that you’re directly aligning your bid with the Security & Estate Group’s sustainable procurement targets. Remember, SEG’s criteria are looking for exactly these kinds of outcomes: use of recycled materials, lower embodied emissions, waste reduction, and innovation in sustainability. By bringing in validated solutions, you are essentially “answering the exam question” in the most straightforward way. This can translate to higher evaluation scores.
In fact, bids that incorporate substantive sustainable content are likely to be scored more favourably under the new weighting. Defence has made it clear that sustainability will carry meaningful weight alongside cost, schedule, and capability. If, say, 10-15% of the tender evaluation is allotted to ESP criteria, you want to capture as much of that as possible. Proposing recycled plastic rebar chairs or 100% recycled fit-out panels gives evaluators concrete line items to award points to – you’re making their job easier to give you a high score. As noted in our internal community discussions, specifying best-in-class green products can “directly contribute to scoring well on materials sustainability criteria in SEG’s procurement assessments”. It shows you’re not doing the minimum; you’re proactively exceeding requirements.
Moreover, by aligning with what SEG actually wants to achieve on a strategic level, you position your team as partners in Defence’s broader mission. It’s not just about one project; it’s about helping Defence move towards a greener future. That attitude, backed up by real actions, could very well be the tie-breaker in a close competition. Decision-makers have discretion, and if they see one bid genuinely embracing innovation with SMEs that advance Defence’s sustainability agenda, there’s a good chance they’ll favour it. As one of our Defence colleagues put it, by partnering with pre-vetted sustainable suppliers, you give Defence confidence that awarding you the contract will mean the project is delivered “in line with the letter and spirit of the latest government sustainable procurement policies”. And indeed, it can bolster your evaluation because it de-risks the sustainability component for them – they know you have expert help on board.
A Commercial Opportunity, Not a Compliance Burden
I want to conclude on this note: this shift is a commercial opportunity as much as it is a compliance requirement. It’s easy to moan about “more paperwork” or “new hoops to jump through,” but the savviest contractors will see the upside. This is your chance to differentiate your business in a crowded market. While some competitors might treat the ESP Policy as just another checklist item, you can leap ahead by fully embracing it and showcasing real capability in sustainable delivery.
Think about the trajectory of Defence spending – as of this year, infrastructure and estate projects are ramping up massively (over $40bn in pipeline) and sustainability is going to be a theme across all of that. Those who build a track record as the go-to sustainable contractors will not only win contracts now but set themselves up for a steady stream of work. By investing in relationships with innovative suppliers, building internal expertise in sustainable construction methods, and perhaps even developing your own IP in green solutions, you’re future-proofing your business.
The ESP Policy is essentially telling you what Defence values in its procurements going forward. If you align your value proposition accordingly, you’re speaking the client’s language. Yes, it requires effort to gather data and maybe tweak your supply chain, but it also adds value to your offer that can justify a premium. You can legitimately argue that your bid, while maybe slightly higher in upfront cost, delivers superior long-term outcomes (environmental and financial) that are worth it. That’s a competitive advantage.
Also consider the broader benefits: incorporating sustainable practices can lead to efficiencies and innovations that save you money or time. Less waste means less skip bins and hauling costs. Energy-efficient site offices mean lower diesel generator bills. Using local recycled products can shorten supply lines and reduce lead times compared to imported materials. There are many instances where the “green” choice is also the pragmatic choice.
Finally, there’s reputational capital. In the Defence sector, being known as a contractor who takes initiative on sustainability can differentiate you for clients and for partners. It opens up teaming opportunities (others will want you on their team to cover the ESP bases), and even outside of Defence, it’s increasingly valued by other government agencies and private clients too. In a few years, not having this capability could be a liability, so it pays to get on the front foot now.
The bottom line: Don’t just do the minimum to appease the ESP requirements. Use them as a springboard to showcase what you can really do. Bring fresh ideas, partner with the likes of Transmutation and DEFY, and deliver a response that convinces Defence “this is the team that will help us meet our sustainability commitments.” If you do that, you’re not only more likely to win the tender – you’re also contributing to something larger, positioning yourself as a leader in the new era of sustainable Defence infrastructure.
Ready to take the next step? I encourage you to explore DECNET’s updated sustainable supplier listings – we’ve compiled a range of verified eco-conscious products and services (including the SMEs mentioned above) that can give your bids an edge. Whether you need materials with recycled content, energy-saving tech, or eco-certified services, it’s a great place to find partners. And if you’re looking for guidance or examples of how to nail these new tender requirements, reach out to us at DECNET. We’re here to help the Defence contracting community succeed in this sustainability journey. Together, let’s turn these policy changes into opportunities for innovation and growth.
References
[1] – https://www.linkedin.com/pulse/new-policies-impacting-defence-contractors-environmentally-sustainable-tuhtc?trk=news-guest_share-article
[2] – https://www.dcceew.gov.au/sites/default/files/documents/sustainable-procurement-guide.pdf
[3] – https://transformacy.co.uk/articles/social-value-key-steps-to-writing-a-winning-response
[4] – https://www.abc.net.au/news/2023-11-09/robe-business-transmutation-recycles-dulux-powder-coating-waste/103078908
[5] – https://duluxpowders.com.au/information/transmutation-bar-chairs/
[6] – https://www.defydesign.org/defy-rhdpe-panels
Author: Darian Macey
Darian is a former Engineering Officer with the RAE with tertiary qualifications in Engineering and Project Management. He is a leading practitioner within Australia's NSI sector with previous employment in Government, project management and building contractor organisations.
