Most SMEs treat the Carbon Reduction Plan as a bid-stage hurdle: write it, submit it, win or lose, move on. For a growing number of central government contracts, that's only half the story. The Cabinet Office's Carbon Reduction Contract Schedule, introduced under PPN 01/24, can carry carbon obligations straight through delivery, not just through procurement.
It's easy to miss because it isn't PPN 006. PPN 006 is the pass/fail condition of participation that gets a supplier through the door on contracts worth more than £5 million a year. The Carbon Reduction Contract Schedule is a separate, optional set of terms that a contracting authority can attach to the contract itself once you've won it. Where it's used, the carbon conversation doesn't end at award. It becomes a term you're held to for the life of the deal.
What the schedule actually asks for
According to the published guidance, the schedule is meant to be used selectively, where it's "proportionate to its value and objectives", with contracting authorities pointed towards higher-emission categories such as fleet, construction, ICT and facilities management. Where it is applied, three things typically follow:
- A Net Zero commitment. Suppliers acknowledge the Government's 2050 Net Zero Target and commit to their own target date that is the same as or earlier.
- A contract-specific reduction plan. This sits alongside, not instead of, any CRP already submitted under PPN 006. Suppliers who didn't need a CRP at bid stage because the contract fell under the £5m threshold can still be asked to produce one within the first year of delivery.
- Annual reporting. Suppliers reassess emissions each contract year and report Scope 1, 2 and 3 figures against a standard table, flagging where emissions are concentrated and what's being done about it.
Some versions of the schedule go further, with an optional gain-share mechanism that rewards suppliers who beat their reduction target, calculated against UK ETS carbon pricing and capped as a percentage of contract value. That part is explicitly optional and down to the individual authority, so don't assume it applies unless your contract documents say so.
Why this matters if you only budgeted for the bid
The practical risk for an SME is treating the CRP as a one-off document rather than a live obligation. If your contract includes this schedule, the numbers you submitted at tender don't just sit in a drawer. You're expected to revisit them annually, show whether you're tracking against your own stated reduction trajectory, and report in a format the authority can audit. Falling short doesn't necessarily end the contract, but it can trigger a remediation plan and put your performance record on file for the next bid.
It's also a reminder that the underlying PPN 006 requirement hasn't gone anywhere. PPN 026 changed how social value is scored and took carbon out of that particular assessment, but it left the Carbon Reduction Plan condition of participation exactly where it was. Whether or not a given contract carries the delivery-stage schedule, you still need a CRP that measures your Scope 1, Scope 2 and relevant Scope 3 emissions against the official DESNZ conversion factors and sets out a credible path to net zero.
What to check before you sign
If you're shortlisted for a contract above the fleet, construction, ICT or facilities management thresholds the guidance flags, read the contract schedule itself, not just the invitation to tender. Look for whether the Carbon Reduction Contract Schedule has been attached, what reduction percentage has been inserted into the template, and whether reporting is annual or on some other cycle. These details vary by authority and by contract, because the schedule is built to be tailored rather than used as a fixed default.
CarbonVerified measures your emissions against the current DESNZ conversion factors and produces a Carbon Reduction Plan in the PPN 006 format, so the figures you submit at bid stage are the ones you can stand behind if a contract later asks you to report against them. There's a free PPN 006 audit tool to check an existing plan, a one-off Single-Bid Pass at £99 for a single tender, and a Pro tier at £190 a year for businesses bidding more than once. The results are self-verified, built for you to check your own numbers before you submit them, not a substitute for reading the contract terms you're about to sign.
