ESP Policy for Construction: SESP and Reporting Explained
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NationalEnvironment

Environmentally Sustainable Procurement Policy for construction contractors

Commonwealth construction tenders of $7.5 million or more now come with an environmental plan you submit and metrics you report. The ESP Policy asks for actual data, including from your trade partners, at least twice a financial year on longer contracts.

The Obligation
$7.5m
Construction services scope threshold
EvidenceSupplier Environmental Sustainability Plan
DeadlineTwice yearly, plus completion
OwnerDepartment of Climate Change, Energy, the Environment and Water (DCCEEW)

What is the Environmentally Sustainable Procurement Policy?

The Environmentally Sustainable Procurement Policy is a Commonwealth procurement policy run by DCCEEW. It applies to construction services of $7.5 million or more, and to ICT goods, textiles, furniture, fittings and equipment of $1 million or more. Tenderers submit a Supplier Environmental Sustainability Plan, and winners report climate, environment and circularity metrics.

$7.5m
Construction services threshold since 1 July 2024
$1m
Products threshold since 1 July 2025
2
Minimum yearly reports on multi-year contracts
3
Contracts with a SESP, 2024-25 progress report
Who It Applies To

Commonwealth Buyers

Non-corporate Commonwealth entities and prescribed corporate Commonwealth entities must apply the policy. Other Commonwealth entities are encouraged to adopt it.

Head Contractors On Construction Services

It applies to new approaches to market for construction services at or above $7.5 million including GST, conducted in Australia. Individual procurements from a panel are caught when they meet the threshold.

Trade Partners

A head contractor must record and track the data for its subcontractors and get it from them accurately and on time. In practice each trade partner (subcontractor) supplies materials, recycled content and waste data for its package.

Fit-Outs And Product Supply

ICT goods, textiles, and furniture, fittings and equipment at or above $1 million are in scope. A construction job that delivers over $1 million of those products reports the products metrics as well.

What the Environmentally Sustainable Procurement Policy asks for.

Supplier Environmental Sustainability Plan
Required at tender
Becomes a schedule to the contract for the successful tenderer
Option A: Sustainability Rating
Green Star 4-star minimum, or IS rating
Used when the buyer sets a rating. Green Star must include the Climate Positive pathway and relevant circularity credits; IS at Australian best practice
Option B: Embodied Carbon
NABERS 4-star, or data
Either the certification, or the proportion by dollars of low embodied emissions materials and tonnes CO2-e avoided
Option B: Waste Recovery
Report, no set %
Proportion by tonnes of construction materials recycled or recovered from total waste generated
Option B: Recycled Content
Report, no set %
Proportion by dollars, percentage by mass, and how much is Australian made
Policy-Wide Metrics
All contracts
Innovations delivered, SESP commitments met and any third-party environmental certification held

What you report, and when.

At least twice per financial year on multi-year contracts

Completed Reporting Template

To the contracting Commonwealth entity

At contract end

End Of Contract Report

To the contracting Commonwealth entity

On construction completion

Certification Evidence (Option A Or NABERS)

To the contracting Commonwealth entity

As reported to the buyer

Supplier Data For Whole Of Government Reporting

To DCCEEW, submitted by the buyer through its reporting tool

Evidence To Keep
  • Signed SESP And Reporting Template
  • Rating Certificate (Green Star, IS Or NABERS Embodied Carbon)
  • Materials Purchase Records By Value And Quantity
  • Global Warming Potential For Low Embodied Carbon Materials
  • Waste Dockets Showing Total Waste And Tonnes Recovered
  • Recycled Content Proportion And Origin For Each Product
  • Innovation Description And Contract Manager Confirmation
Where Teams Get Caught

Reporting Estimates

All metrics data reported must be actual rather than estimated. Forecast quantities from the tender stage do not satisfy the template, so collect dockets and invoices as the work happens.

Assuming There Is A Percentage To Hit

The policy sets no fixed recycled content or waste percentage: reported data builds a baseline first, and your own SESP commitments are what you are held to. Read what you promised in the SESP, because the contract manager confirms whether it was delivered.

Starting Trade Partner Data Too Late

The head contractor is responsible for the data from its subcontractors. Global warming potential figures and recycled content by product are hard to recover later, so write the requirement into each package at award.

In Catchment

How Catchment manages the Environmentally Sustainable Procurement Policy.

Option B Metrics As Targets

EnviroTrack

Adopting the built-in framework switches on the materials and waste categories. It creates ESP - Waste diverted from landfill as a report-only target, and names the recycled content and low embodied emissions requirements for you to set up as your own targets over the materials you report. Packages report entries against them each month with emission factors, so you hold actual data and not year-end estimates.

Trade Partner Data By Package

EnviroTrack

The policy makes you responsible for your subcontractors' data. Each package submits its monthly figures free of charge, and a reviewer accepts or sends back each section, with accepted periods locking.

A Half-Yearly Requirement For The Template

GovAssure

The framework includes Environmental Compliance Evidence, Environmental Management Plan (EMP) and ESP Annual Progress Data. Add your SESP and reporting template as your own Document requirements, setting the template to half-yearly to match the policy's two reports a year.

Rating Evidence Filed Against The Project

GovAssure

If your buyer chose Option A, Green Star has credit tracking in the app and an evidence pack (a ZIP of the documents filed against an adopted framework, with a manifest). For an IS rating or NABERS Embodied Carbon certificate, the Document Register holds the file with its revisions.

Exports For The Contract Manager

EnviroTrack

The figures export to PDF and spreadsheet, which gives you the record to complete the department's template. Catchment does not submit to DCCEEW's tool, which buyers use themselves.

Ready To Adopt In Catchment
Commonwealth Employment and Skills Policy (ESP) 2024
Targets and Commitments
ESP - Recycled content materials used
ESP - Low embodied emissions materials used
ESP - Waste diverted from landfill
Documents and Forms
Environmental Compliance Evidence
Environmental Management Plan (EMP)
ESP Annual Progress Data

Catchment lists this framework under that name for now. Adopting it on a project generates these targets and documents, which you can edit to match your contract.

Environmentally Sustainable Procurement Policy questions.

What does ESP stand for in Commonwealth procurement?

It stands for the Environmentally Sustainable Procurement Policy, a procurement connected policy administered by DCCEEW. Its focus areas are climate, environment and circularity, supporting Australia's move to a net zero and circular economy.

What is a Supplier Environmental Sustainability Plan?

A SESP is a plan you submit with your tender, using the template in the approach to market. It records your environmental commitments and either a sustainability rating or base metrics, along with questions about your organisation. If you win, it becomes a schedule to the contract.

What is the difference between Option A and Option B?

The buyer decides at planning stage. Option A applies when the procurement must achieve a sustainability rating, namely Green Star or Infrastructure Sustainability. Option B applies to all other construction services and uses base metrics, including an optional NABERS Embodied Carbon certificate of 4-star or higher.

How often do suppliers report under the ESP Policy?

For contracts spanning multiple years, you and the buyer agree the frequency, with a minimum of twice per financial year and again at the end of the contract. The data must be actual, not estimated. You may also be asked to give your SESP to DCCEEW.

Does the ESP Policy set recycled content targets?

No fixed percentages appear in the policy or its reporting framework. Reported metrics will establish a baseline, which the government says may be used to set targets later.

Is the ESP Policy the same as the Green Star requirement for Commonwealth offices?

They are separate. DCCEEW's guidance notes that under the Net Zero in Government Operations Strategy, a 4-star Green Star certification is required from 1 July 2026 for office space over $15 million purchased or constructed by or for the Commonwealth.

Connected Obligations
Green StarNational (Environment)IS RatingNational (Environment)Recycled First PolicyVIC (Environment)Climate ActiveNational (Environment)
Sources
  1. Environmentally Sustainable Procurement Policy (Department of Climate Change, Energy, the Environment and Water)
  2. Environmentally Sustainable Procurement Policy Reporting Framework (Department of Climate Change, Energy, the Environment and Water)
  3. Procurement Connected Policies (Department of Finance)
  4. Environmentally Sustainable Procurement Policy fact sheet (Department of Climate Change, Energy, the Environment and Water)
  5. Environmentally Sustainable Procurement Policy 2024-25 Annual progress report (Department of Climate Change, Energy, the Environment and Water)
  6. Environmentally Sustainable Procurement Policy (ESP Policy) (Department of Finance)
  7. ESP Policy application guidance (Department of Climate Change, Energy, the Environment and Water)

Reviewed 4 November 2026. General information to help you plan reporting, not legal advice. Policies change, so check the current version with the policy owner before you rely on it.

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