As part of our series on the recently published JCT Design and Build Contract 2024 Edition (JCT D&B 2024), this blog looks at the sustainability and environmental provisions of the new contract.
Sustainability Under JCT D&B 2024
Under new clause 2.1.5, contractors are “encouraged” to suggest amendments to the project which “may” result in improvements in environmental performance or sustainability. New clause 2.2.2 states that contractors are to provide any information reasonably requested by employers in respect of the environmental impact of the supply and use of goods and materials.
If the above sounds familiar, this is because it mirrors the supplemental sustainability provisions of the JCT D&B 2016 edition – it has just been moved into the main body of the conditions. Many employers and contractors will no doubt be paying heed to the Construction Playbook and will be placing sustainability at the forefront of their design; they will also likely be wishing to accommodate measures that promote the net-zero carbon 2050 target set by the previous government. Contracting authorities in particular will wish to ensure that their mandatory environmental strategies are provided for in their building contracts.
In this context, the discretionary wording and apparent light-touch approach of the new sustainability clauses therefore mean that some form of amendment may be considered in order to ensure these objectives are met.
The Chancery Lane Project
The Chancery Lane Project (CLP) has produced over 100 precedent climate-related provisions some of which can be used in JCT contracts. Topics covered include:
- net zero carbon commitments;
- energy usage;
- waste reduction; and
- greener transport.
- modern methods of construction
This is an extremely useful tool that offers a broad selection of provisions that can supplement the environmental credentials of a project.
Procurement and KPIs
Employers may also wish to set environmental key performance indicators (KPIs) as a way of bolstering a project’s sustainability credentials. Under the Procurement Act 2023, certain government contracts will need to include publishable KPIs, including environmental ones. There are supplemental provisions in schedule 2 of the JCT 2024 D&B that deal with performance indicators and monitoring, but nothing specifically addressing publishable KPIs; no indication what they would look like; no indication how they are incorporated; and no detail on the consequences for non-compliance.
Concluding Points
There are a variety of methods whereby the environmental credentials of the contract can be strengthened. While the CLP is a very welcome resource for reducing emissions on a project and one of a number of approaches that can be employed, its clauses must also be adapted to the needs of the specific project and contract. There is now also an explicit exclusion of “fitness for purpose” in the JCT D&B 2024 at Clause 2.17.1.2. This naturally creates potential conflict with any sustainability provisions, requirements or KPIs that have been incorporated into the contract so particular care and attention will be needed when drafting to ensure they don’t fall foul of this explicit exclusion. No matter the approach taken to improve the sustainability and environmental credentials of the contract, we would strongly advise that legal advice should always be taken on how best to do this.
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