Europe Is Already Building for Value. Just Not Always
Europe does not lack knowledge about how to build good infrastructure. There is just lack of consistency in applying it.
Across the continent, public authorities, cities and national agencies already have access to tools that measure what really matters: durability, carbon impact, maintenance cost, safety performance and long-term value. In many places, these tools are used actively.
Despite this, in many countries and quite often, projects still end up being awarded mainly on price. This contradiction in value vs. cost is the core of Europe’s infrastructure problem. On paper, Europe is a global leader in sustainable and responsible procurement. In practice, however, cheapest-first logic still dominates many decisions across many European countries.
Let’s take a quick look at what is already in place.
Europe’s Legal Framework Already Supports Value-First Decisions
Since 2014, EU public procurement rules have allowed authorities to award contracts based on the “economically most advantageous tender”. This framework explicitly supports evaluating bids based on life-cycle cost, environmental impact, quality and performance.
In other words, European law does not require lowest price. It allows, in fact encourages value-based decisions. What this means is: the framework exists, the tools exist, the permission exists. The question then is, how often are these truly used.
Nordic Cities Show What Value-First Looks Like in Practice
Some of Europe’s most advanced cities have moved well beyond price-oriented procurement.
In Oslo, major public construction projects are required to operate as low or zero-emission sites. Contractors are evaluated on climate performance, machinery standards and operational efficiency.
In Stockholm, Helsinki and Copenhagen, sustainability and life-cycle thinking are embedded into public procurement frameworks. Bids are assessed not only on cost, but on long-term environmental and operational impact.
These cities treat infrastructure as a system that must perform for decades, not as a short-term purchase. And the results show in lower emissions, better asset performance and higher public trust.
Life-Cycle Costs Are No Longer Experimental
Life-cycle costs are often discussed as if it were a theoretical phenomenon. It is not.
Countries like Sweden, the Netherlands, Germany and Finland already use LCC models in public works tenders. These models calculate not just the construction cost, but also maintenance, energy use, rehabilitation, and end-of-life expenses. When applied properly, they frequently overturn “cheap(er)” bids and reveal which proposals are actually economical over time.
Research from OECD and EU bodies consistently shows that assets designed with durability and maintenance in mind reduce total costs by 30 to 50 percent over their lifetime.
That is not ideology or myth. It is plain, simple arithmetic.
Even Conservative Systems Are Testing Value-Based Models
Value-first procurement is not just limited to Nordic frontrunners in Europe. In Greece, pilot public sector projects using life-cycle costing and environmental criteria have shown how broader assessment can change competitive outcomes. Offers that looked expensive at first became the most cost-effective when long-term impact was included.
Similar pilots exist in Italy, Spain and Central Europe, often supported by EU funding programmes. The pattern is clear: when value is measured, behaviour changes.
So Why Does Cheapest-First Still Win?
If the tools exist, why do so many projects still default to lowest price? Three reasons appear again and again.
- First: the political risk. Lowest price is easy to defend. Value-based decisions require explanation.
- Second: institutional capacity. Life-cycle analysis and sustainability-scoring require skills, data and systems that not every authority/country has fully developed.
- Third: short-term pressure on authorities. Budgets are annual. Elections are short. Infrastructure construction takes long. The incentives rarely align.
So, the decision-makers resort to what feels safe: the lowest number on a spreadsheet.
Is Europe Caught Between Knowledge and Habit
This is what we need to assess objectively and accept – that will be a decisive first step towards addressing this uncomfortable reality.
Europe knows how to build better infrastructure. It has proven models. It has legal frameworks. It has successful case studies. But old habits still dominate too many decisions. And that gap between knowledge and practice is costing Europe billions. In maintenance. In emissions. In congestion. In safety. In lost competitiveness.
This leads us directly to the next question: What actually happens when cheapest-first thinking takes over? That is where the real cost begins. And that is what the countries and all players in the infrastructure industry need to work on changing together – collectively.
Note: Stay tuned for our next article in this series where we will dive into why Europe cannot afford the cheapest-first thinking and what we can do, collectively, to bring about this shift from cheapest-first to value-driven thinking.
References:
- International Institute for Sustainable Development – IISD (2022). https://www.iisd.org/articles/deep-dive/advancing-green-public-procurement-and-low-carbon-procurement-europe-insights
- European Commission, Guidance on Public Investment into Sustainable Infrastructure Projects (2022). https://single-market-economy.ec.europa.eu/document/download/98b904a2-d688-4592-aaf6-a76ead62b7c8_en
- Orfanidou, Varvara & Rachaniotis, Nikolaos & Tsoulfas, Giannis & Chondrokoukis, Gregory. (2023). Life Cycle Costing Implementation in Green Public Procurement: A Case Study from the Greek Public Sector. Sustainability. 15. 2817. 10.3390/su15032817.
- Kahlenborn, Walter; Christine Moser; Joep Frijdal and Michael Essig 2011: Strategic Use of Public Procurement in Europe – Final Report to the European Commission MARKT/2010/02/C. Berlin: adelphi.