State of Play PCP & PPI piloting in FP7 and CIP Horizon 2020 perspectives Lieve Bos European Commission

Transcription

1 State of Play PCP & PPI piloting in FP7 and CIP Horizon 2020 perspectives Lieve Bos European Commission DG CONNECT (Communication Networks) F2 unit ( Innovation )

2 Why(1)? To get best value for money solutions developed for public sector challenges Health care Climate Change Energy Efficiency Transport Security Public sector efficiency Public sector is faced with important challenges. Addressing these, often requires public sector transformations for which no commercially stable solutions exist yet. In many cases, solutions are near the market and would be provided if clear requirements/sufficient demand expressed by the market (PPI) In other cases, still R&D required to de-risk technology, still different competing solution approaches to compare before committing to deploy (PCP) Public procurement is 'the tool' that enables the buyers to steer industrial R&I to its needs. However, public procurement driving R&I from demand side is underutilised in EU.

3 PPI Public Procurement of Innovative Solutions When Challenge requires solution which is almost on the market or already on the market in small quantity but not meeting public sector requirements for large scale deployment yet. No R&D involved (R&D already done, or no R&D needed to solve problem) What How Public sector acts as launching customer / early adopter / first buyer for innovative products and services that are newly arriving on the market (not widely commercially available yet) Public sector acts as facilitator establishing a buyers group with critical mass that triggers industry to scale up its production chain to bring products on the market with desired quality / price ratio within a specific time. After potentially a test / certification / labelling, the buyers group buys a significant volume of solutions.

4 PCP - Pre-Commercial Procurement When Challenge requires R&D to get new solutions developed. Problem clear, but pros / cons of several potential competing solutions not compared / validated yet. No commitment to deploy (PPI) yet. What How Public sector buys R&D to steer development of solutions to its needs, gather info about pros / cons of alternative solutions to be better informed to make specs for a follow-up PPI possibly later, to avoid supplier lock-in (create competitive supply base) Public sector buys R&D from several suppliers in parallel (comparing alternative solution approaches), in form of competition evaluating progress after critical milestones (design, prototyping, test phase), risks & benefits of R&D (e.g. IPRs) shared with suppliers to maximise incentives for wide commercialisation

5 Why(2)? To shorten time to market & provide first customer reference for innovations Normally functioning procurement market (e.g. in US, Asia): 2,5% of innovator type customers (PCP) Who invest in R&D with suppliers ($50Bn/Y in US <-> 2,5Bn/Y in EU) 16% of early adopters (PPI) Market Share % 100% 75% ICT public procurement market in Europe: 0,5% of innovator customers (PCP) 5% of early adopters of new tech in e-gov (PPI) PCP H2020, SF PPI CEF, SF PPI H2020, SF CEF = Connecting Europe Facility SF = Structural/Cohesion Funds H2020 = Horizon % 25% Innovators 2,5% Early Adopters 13,5% Early Majority 34% Late Majority 34% Laggards 16%

6 Why(3)? To create growth and jobs 'in Europe' How? PCP-PPI combo PCP to steer the development of solutions towards concrete public sector needs, whilst comparing/validating alternative solution approaches from various vendors PPI to act as launching customer / early adopter / first buyer of innovative commercial end-solutions newly arriving on the market Applied R&D / Pre-commercial Procurement (PCP) Public Procurement of Innovative Solutions (PPI) Phase 0 Curiosity Driven Research Phase 1 Solution design Supplier A Supplier B Supplier C Supplier D Phase 2 Prototype development Supplier B Supplier C Supplier D Phase 3 Original development of limited volume of first test products / services Supplier B Supplier D Phase 4 Deployment of commercial end-products Diffusion of newly developed products / services Supplier(s) A,B,C,D and/or X Also normally multiple sourcing here to keep competition going Because of split between PCP and PPI: PCP falls outside WTO rules & proc directives (can encourage job creation 'in Europe'), even if the large scale PPI that may come afterwards would not be exempted

7 PCP based on good practice Procure R&D in steps (solutions, prototypes, test series) to reduce risk and give also SMEs a chance Grow size of tasks gradually, make bridge from ideas to first test product, procurer = first customer reference Risk-benefit/IPR sharing with suppliers Less risk procurer, commercialisation opportunity suppliers Separate PCP PPI combo, competition also in R&D phase Better value for money: Competition after PCP for PPI + competition during R&D -> higher quality products + reduces first unit acquisition cost with 20-30%* Sharing R&D costs with other procurers Cooperation across borders can help develop a European market, common standards etc * 'Competitive Dual Sourcing', Jacques Gansler, 7/10/2007. Based on analysis from Annex G, 'International Armaments Cooperation in a era of coalition security', report US Defence Science Board, August 1996

8 Policy debate that lead to EC activity on public procurement driving research & innovation 2006: Aho report recommended EC actions driving demand for innovations through public procurement 2007: Lead Markets Initiative and PCP communication 2008-today: Council conclusions and EP resolutions asking EC to support public procurement of research and innovative solutions 2010: Digital Agenda for Europe, Innovation Union and Regional EU2020 flagships calling also Member States for more PCP & PPI DAE: PCP key to double annual public ICT R&D spending from 5,5 to 11 Bn Innovation Union: from 2011, MS dedicate 10Bn per year on PCP and PPI Regional flagship: calls on regions to do PCP & PPI also via structural funds 2011: Revised industrial policy communication calling for innovation procurement in support of European industrial policy

9 EC support to PCP & PPI FP7/CIP piloting today H2020 tomorrow Why EC support needed? PCP /PPI in some EU countries but not spread across rest of Europe Defragmenting demand side for challenges of common European interest (common requirements setting, de facto standard creation) : EU calls for proposals for European networks of public procurers on PPI (e.g LMI in CIP) and on PCP (ICT theme in FP7) : EC support for PCP via FP7 and for PPI via CIP DG CNECT and ENTR are piloting support to PCPs by procurers (FP7 grant: co-financing up to 75% of the price of procured R&D) DG ENTR, ENV and CNECT are piloting support to PPIs by public procurers (via CIP grant: co-financing up to 20% of the price of the innovative solutions procured/deployed) DG RTD, ENER, MOVE supporting networking of procurers : Horizon 2020 (similar possibilities as before) EC can co-finance PCPs/PPIs carried out by grant beneficiaries EC or EU funding bodies (e.g. agencies) can carry out PCPs/PPIs on their own behalf or jointly with Member States

10 What does PCP/PPI piloting cover today in FP7/CIP Preparing joint PCP ONE joint PCP tender Intermediate Evaluation Selection Intermediate Evaluation Selectiona Commercial 10 Preparation proposals Funding FP7 PCP pilots Funding CIP PPI pilots P5 P4 P1 Choice between possible constellations for joint procurement P3 P2 Consortia of public bodies e.g. P1->P5 EU-Funding in FP7+ CIP 100 % for Networking and Coordination activities Max 75 % for cost of Joint PCP tendering (R&D Services) Max 20% for cost of joint or coordinated PPI tendering Product Idea Management/Coordination joint PCP max100% Supplier A Supplier B Supplier C Supplier D Supplier E Phase 1 Solution Exploration Product Solution Solution Idea Design Design PCP max 75% Supplier C Supplier D Supplier E Phase 2 Prototyping Supplier C Supplier E Phase 3 Original development of a limited volume of first products/services in the form of a test series Prototype Typical Product Innovation Life Cycle First Test- Products Dissimination PCP max100% PPI max 20% Tendering Coordination PPI Supplier A,B,C,D,E or X Phase 4 Commercialisation of products/services (commercial development) Commercial End-Products

11 Status of PCP implementation across Europe Update May 2013 status Awareness Raising Exploring possibilities Malta Working on framework Framework identified and/or Pilots in preparation Romania Ireland Cyprus Poland Bulgaria Iceland Luxembourg Slovakia Hungary Czech Republic Greece Slovenia Switzerland Latvia Estonia Lithuania Portugal Denmark V-CON Sweden Netherlands Pilots started SILVER Finland CHARM Belgium Spain Italy France Germany PRACE 3IP Austria Norway Projects in dotted-line are cross-border EC funded PCP projects that have started: SILVER: started January 2012 (Supporting Independent Living of Elderly through Robotics) CHARM: started September 2012 (Common Highways Agency / Rijkswaterstaat Model for traffic management of the future) V-CON: started October 2012 (Virtual Construction / Modelling of Roads) SMART@FIRE: started Nov 2012 (Integrated ICTs for Smart Personal Protective Equipment for Fire Fighters and First Responders) DECIPHER: started February 2013 (new applications based on Distributed EC Individual Personal Health Records) PRACE 3IP: started July 2012 (PRACE 3 rd phase on high energy efficient high performance computing) More Info about national PCP initiatives in Member States: More info about EU funded cross border PCP projects: UK DECIPHER

12 CONNECT PCP pilots so far FP7-ICT-2009 (CSA) FP7-ICT+INFRA-2011/12 (CP-CSA) FP7-ICT-2013 (CSA& CP-CSA) Networking of procurers preparing for possible Joint cross-border PCPs Networking & joint cross-border PCPs future procuremnts ( 8M + 500K) but not procuring yet SILVER ( 3M) 3 e-health PCPs+1 network Robotics ageing well ( 10M) DECIPHER ( 3M) 1 Cloud computing PCP PRECO ( 500K) Services mobile health data ( 5M) ICT for health CHARM ( 2,8M) 1-2 Digital heritage PCPs P3ITS ( 500K) ICT for transport PROGR-EAST ( 500K) Egov apps for NMS Traffic Management V-CON ( 2,1M) Virtual construction road infra SMART@FIRE ( 1,6M) Embedded ICT firefighters PRACE 3IP ( 4,5M) Energy efficient HPC (min 5,5M) 1 elearning PCP ( 4M) Photonics/lighting PCP-A1 Two CPs requested to use PCP as mechanisms for competitive calls

13 Example projects around EU in Healthcare NHS UK Lombardia Italy Potential 19m p.a. saving Potential 30m p.a. saving 4,000 per HCAI avoided Potential 160m p.a. saving Potential Value PCP-like projects to NHS: Improve the quality of the patient experience and generate significant cost savings ( 236m). Value to the economy: A number of innovations have been able to attract significant extra investment ( 290m). PCP Niguarda Hospital Lombardy region 13 Easy-to-use automated universal system for moving hospital beds, with anticollision and safety systems, not needing guide lines or tracks even on non rectilinear routes PCP call for tender open

14 PCP example on CO2 emissions Carbon capture Norway Statoil/Gassanova Large project attracting large firms Regulatory requirement to seriously reduce CO2 emissions by 2016 without negative effects on health/environment, beyond what market is able to offer PCP started in 2011, currently comparing solution approaches of 5 vendors, time-to-market shortened Follow-up procurement for deployment in preparation for 2014 (open to whole market) More info on this case on:

15 Example EU funded cross-border PCP (DG CNECT) 7 Local and regional contracting authorities from 5 EU Member States carrying out this PCP jointly: city of Odense and region of Southern Denmark (Denmark), city of Västerås (Sweden), city of Vantaa and Oulu (Finland), city of Stockport (UK), city of Eindhoven (Netherlands). SILVER contracting authorities procure R&D services via the PCP to get robotics solutions developed and tested in the 5 participating countries that will allow by 2020 to care for 10% more elderly people living independently at home with the same amount of care staff. SILVER call for tender is 'OPEN NOW'. Potentially invited tenderers are invited to info meetings in March-April and to make offers by 12 June (see SILVER website and tender publication in OJEU)!

16 PPI examples In Europe Low carbon healthcare PPI started 2006 Introducing more energy efficient LEDs in network of over 20 hospitals in 8 EU countries (cross border PPI cooperation funded by EC/DG ENTR) 30% energy consumption saving 88% maintenance savings Total cost savings enable take-in of +10% patients For more info: UK brand name for PPI = Forward Commitment Procurement (FCP) Swedish environmental/energy efficiency PPIs done by NUTEK/STEM agency: (PPI is called teknikupphandling in Sweden) heating-ventilation-cooling of buildings public transportation (hydrogen busses) office blocks (sun shading, lighting) white appliances (washing machines, fridges) wind energy parks Result: Reduced the SE dependency on nuclear energy with 15% through PPIs in combination with product certification/labeling, take-up subsidies & tax incentives More on UK & SE PPI cases:

17 Example EU funded PPI network (DG ENER) 5 local authorities lead this project on early market engagement to encourage sustainable energy public Procurement (low carbon emission technologies): Barcelona (ES), Kolding (DK), Cascais (PT), London borough of Bromley and the Eastern Shires Purchasing Organisation (UK). Result: successful PPI procurement deploying various innovative products such as LEDs (over units), indoor and street lighting, energy efficient vending machines and electric mobility (e.g. electric mini bus), representing a total budget of around 80 million and involving over 200 municipal staff. The technical solutions retained will reduce energy consumption and CO2 emissions by 30-90%, accounting for an estimated reduction of 5.3 GWh/a.

18 Lessons learnt from CONNECT PCP piloting More promotion needed Not widely spread practice across Europe yet Procurers in countries that offer national PCP support for procurers have head start NCPs can help! Open market consultation at start projects essential Cross-checking perceived procurement needs against state-of-the-art Minimum project size / R&D budget Otherwise risking not enough impact / real R&D per contractor that participates in PCP Minimum 4 to 5 Mio EURO EU contribution per PCP It's possible, exciting to get new PCPs going Now first cross-border PCP call for tender launched (SILVER) SILVER market consultation attracted ~ 40 small robotics companies SMART@FIRE procurement need shared by +900 other fire brigades CHARM benchmarking expects 20% cost decrease in TMCs Now also some regular collaborative R&D projects asking to do PCP (competitive call)