PCP - Europrogs
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Transcript PCP - Europrogs
Pre-Commercial Procurement (PCP)
From FP7 WP2013 into H2020
Lieve Bos
(lieve.bos AT ec.europa.eu)
European Commission
DG CONNECT F2 unit (“Innovation”)
Rationale
RTD expenditure as % of GDP
3,5
3
2,5
2
1,5
1
0,5
0
Public sector is faced with
important challenges. Often
public sector transformations
require innovative solutions,
and forward looking public
procurement strategies
However, public procurement of
R&D is underutilised in EU
versus other parts of the world
EU
US
R&D Procurement
Basic +applied R&D funding
Public expenditure in Europe is
higher than in other parts of the
world (47% of EU-25 GDP)
But 20 times less is spent on
preparing the public sector for
future challenges: R&D
procurement in EU (~2,5 Bn€)
versus US (~50Bn€)
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
– Public sector buys R&D to steer development of solutions to its
needs, gather knowledge about pros / cons of alternative solutions,
to avoid supplier lock-in later (create competitive supply base)
How
– 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
PCP and PPI
complementary
Smart PCP/PPI combination enabling:
– Price/quality products that better fit public sector needs
– Better take-up/Wider commercialisation of R&D results
–
Price/quality products that better fit public sector needs
–
Earlier customer feedback for companies developing solutions
–
Better take-up/Wider commercialisation of R&D results
Public Procurement of
Innovative Solutions (PPI)
R&D / Pre-commercial Procurement (PCP)
Phase 0
Curiosity
Driven
Research
Phase 1
Solution design
Phase 2
Prototype
development
Supplier A
Phase 3
Original development
and testing of ltd volume
of first products
(COM/2007/799 &
SEC/2007/1668)
Supplier B
Supplier B
Supplier C
Supplier C
Supplier D
Supplier D
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
PCP Win-win for all
stakeholders
Politicians
Suppliers
- Better products
- Economies of scale
- Wider market size
- Shorter Time to market
-First buyer in early R&D
-Shared risks & benefits
- Quality of public services
- Focus on political priorities
- New lead markets
- Improve innovation climate
- Increase export
- Global competitiveness - Attract foreign investment
- Increase employment
Pre-commercial
Procurement
Get the ‘Best Product’…
- Address ‘public market innovation failure’
- Shape product development to public needs
- Increase technology knowledge
- Reduce risk in commercial tendering
- Favour supplier competition
- Reduce cost of procurement
- Reduce risk of innovation
… at the ‘Lowest Price’
- Pooling of resources
- Economies of scale
- No licensing costs
- ‘First time right’ product
- ‘EU interoperable’
- Attractive to venture capitalists
- Reduce unforeseen expenditure
Procurers
Example PCP-like project in
Healthcare
www.nic.nhs.uk
Potential £160m
p.a. saving
Potential £19m p.a. saving
Potential £30m p.a. saving
£4,000 per HCAI avoided
Potential £17m p.a. saving
6
Potential Value to NHS:
The NIC has supported the development of innovations to improve the quality of the
patient experience and generate significant cost savings to the NHS (£236m).
Value to the economy:
With the support of the NHS National Innovation Center (NIC), a number of
innovations have been able to attract significant funding (£290m).
PCP example on CO2 emissions
Carbon capture – Norway
Statoil/Gassanova
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 foreseen for 2014 (open to whole market again)
Status of PCP implementation
across Europe
Update November 2012 status
Framework identified
Awareness Raising Working on and/or pilots
Exploring possibilities framework in preparation
SILVER
Malta
Latvia Slovenia
Romania
Greece
Cyprus
Bulgaria Estonia
Luxembourg
Slovakia
Czech Republic
Switzerland
Pilots
started
Denmark
V-CON
Iceland
Sweden
Ireland
Lithuania
Finland
Poland
Spain
CHARM
Netherlands
UK
Belgium
Hungary
France
Portugal
Italy
Austria
Germany
SMART@FIRE
Norway
Projects in dotted-line are cross-border EC funded PCPs:
SILVER: EC co-funded PCP pilot started January 2012 (Supporting Independent Living of Elderly through Robotics)
CHARM: EC co-funded PCP pilot started September 2012 (Common Highways Agency Rijkswaterstaat Model)
V-CON: EC co-funded PCP pilot started October 2012 (Virtual Construction of Roads)
SMART@FIRE: EC co-funded PCP pilot started November 2012 (Integrated ICT solutions for Smart Personal Protective
Equipment for Fire Fighters and First Responders)
More Info about national PCP initiatives in Member States: http://cordis.europa.eu/fp7/ict/pcp/msinitiatives_en.html
More info about EU funded cross border PCP projects: http://cordis.europa.eu/fp7/ict/pcp/projects_en.html
Wp2013 calls in FP7/CIP
Cross-border PCPs & PPIs
EC co-financing for
in ICT sector
€32,5 M of EC support for cross-border PCPs in FP7-ICT-2013
An open call for joint PCPs addressing any area of public interest (CP-CSA for PCP grants)
Objective 11.1, Call 10: Proposals for joint PCPs can relate to for example public sector needs for
new ICT solutions in healthcare, inclusion, e-government, transport, energy efficiency,
environment, security, education etc (€4M: 1 project)
Targeted calls for joint PCPs in specific areas of public interest (CP-CSA for PCP grants)
Objective 5.1.(d), Call 10 - Personalised Health - Active Ageing (€8M)
up to 1 on personalised care for co-morbid patients
up to 2 on mobile ehealth services
Objective 11.3, Call 10 - High quality cloud computing for public sector needs (€10M: 1 project)
Objective 11.2, Call 11 - More efficient, affordable digital preservation (€5M: up to 2 projects)
Objective 8.2, Call 11 - Technology enhanced learning (min €5,5M)
Call deadlines: call 10 (15 Jan 2013), call 11 (16 April 2013)
€10 M of EC support for cross-border PPIs in CIP-ICT PSP-2013 (EC proposal)
Targeted calls for cross border PPIs in specific areas of public interest (PPI pilot grant)
Objective 3.2 – ICT for health and active ageing
€5M for one or more projects in ehealth,
€5M for one or more projects in ICT for active ageing
Call opens January 2013: Call deadline May 2013 (tbc)
CP-CSA for PCP grant
FP7-ICT-2013
Support for consortia of public purchasers planning joint
cross-border PCP on topics of common European interest
- Bring radical improvements to the quality and efficiency
of public services with breakthrough solutions
Typical duration PCP project 3-4 years, projects WP2013 start end 2013
-> target solutions to be deployed 2017 at earliest
- Reduce fragmentation public sector demand and create
opportunities for leadership in new markets for industry
EU contribution (CP-CSA): combination of
– CSA (max 30% of total grant): Reimbursement of eligible costs for preparation,
management and coordination of the joint PCP call for tender (100% funded)
– CP: Reimbursement of max 75% of the eligible costs for the development of the
new ICT solutions procured through the joint PCP (for financing the R&D to
be performed by the bidders selected via the joint PCP)
* CP-CSA = combination of CP and CSA funding within the same EC grant agreement
10
Conditions PCP calls
FP7-ICT-2013
Min 3 mutually independent contracting authorities from 3 #
countries + other stakeholders (except potential suppliers)
CSA part grant
– Defining joint specs + setting up/managing joint PCP procurement process
– Awareness Raising, experience sharing (incl. training for public purchasers),
dissemination of results, contribution to standards/regulation to remove
obstacles for introducing PCP innovations in the market
CP part grant
– Execution of 1 joint cross-border PCP tender (addressing 1 jointly agreed
challenge, all procurers in consortium sharing the costs to finance R&D
together, one entity in consortium executing the PCP procurement)
– To explore possible alternative solution paths for the targeted improvements
in public sector services + testing of the solutions against a set of jointly
defined performance criteria.
Funding regime
CSA part: max 100% of coordination costs (max 30% of total grant)
CP part: Max 75% of price for joint PCP procurement
PCP only covers R&D, not deployment of commercial volumes of solutions
11
Funding rate for CP part
Private entities that are potential suppliers of solutions for
the PCP in the CP part cannot participate as beneficiaries
Private entities that are not potential suppliers, but buyers contracting authorities (CAs) under procurement directives can participate as beneficiaries
Type 1 beneficiaries: CAs eligible for 75% rate in CP part
– Non profit ‘public’ bodies (e.g. local/regional/national authorities
considered contracting authorities under proc. Dir. 2004/18/EC)
– Secondary and higher education establishments and research orgs (in
their capacity as potential buyers, not suppliers of new solutions)
– SMEs (not potential suppliers but buyers of solutions, e.g. SMEs
owned/controlled by the public sector to provide public services that are
subject to public procurement directives)
Type 2 beneficiaries: CAs eligible for 50% rate in CP part
– Other type of beneficiaries (e.g. ‘private’ larger-than-SME entities that
are not potential suppliers but buyers of solutions for the PCP and are
considered contracting authorities under procurement Directives: e.g.
large utilities subject to 2004/17/EC)
12
Funding rate for CP part
If all project partners that are contributing financially to the
cost of the joint PCP are type 1 beneficiaries
– Then max reimbursement rate for costs under CP part = 75%
If all project partners that are contributing financially to the
cost of the joint PCP are type 2 beneficiaries
– Then max reimbursement rate for costs under CP part = 50%
If there is a mix of type 1 and type 2 beneficiaries that are
contributing financially to the cost of the joint PCP, the
maximum reimbursement rate for the PCP procurement cost
under the CP part will lie in between 50% and 75%
– and will be calculated taking into account that the maximum
reimbursement rates for the financial contribution of type 1
versus type 2 beneficiaries towards the total PCP procurement
budget is 75% versus 50% respectively.
13
Example CP-CSA
for PCP grant
How to use EC
PCP support?
Example: €4 Mio CP-CSA for PCP grant
Max 30% (€1,2 Mio) for coordination costs - 100% funded
Other €2,8 Mio = EC contribution to the ICT R&D procured through the joint PCP
•
If type 1 consortium (75% rate) -> Total PCP value will be € 3,73 Mio (ex VAT)
•
If type 2 consortium (50% rate) -> Total PCP value will be € 5,6 Mio (ex VAT)
Consortium brings €0,93-2,8 Mio (+VAT): divided over e.g. 5
procurers in e.g. 3 year PCP -> each procurer invests ~ €100K/Y
Comparing various solution approaches from different vendors, defragmenting market to get
in long run also cheaper large volume purchases, sharing R&D cost/experience with other
procurers & EC: joint PCP cheaper/procurer than buying R&D from one supplier on your own
€1-2M per supplier to do the R&D work
Phase 1: Solution design
~10-15% PCP budget
~100-250K/supplier
~4-10 suppliers
P1
P5
P2
Preparation
Joint PCP
P4
P3
One Joint
PCP call for
tender
Consortia of
contracting
authorities (CAs)
P1->P5 (min 3)
Phase 2: Prototyping
~30-40% PCP budget
~500-750K/supplier
~3-6 suppliers
Supplier A
Phase 3: Original development –
operational testing
~50-60% PCP budget
~800K-2,3M/supplier
~2-4 suppliers
Supplier B
Supplier B
Supplier C
Supplier C
Supplier D
Supplier D
Supplier D
Supplier E
Supplier E
Supplier E
Supplier B
Obj. 11.1 & App. 6: specific requirements for EC co-financed joint
cross-border PCPs
Open dialogue with industry in preparation phase
– Announced widely, well in advance, at least in English
EU wide publication PCP call for tender, at least in English
All offers evaluated based on same objective criteria
– regardless of company size, geographic location of head office
Use functional/performance based specifications
– not prescribing specific solution approach
PCP covers phase 1 to 3, multiple companies in competition
– one framework contract/supplier with 3 specific contracts/phase
Tenders awarded based on best value for money
(not just lowest price) and market price (no State aid)
IPRs shared: ownership rights with companies, license free usage rights, right
to license, call back option, right to publish PCP results with procurers
Support Europe 2020 objectives of growth and job creation
– Majority of R&D and operational activities related to PCP contract, including
principle researchers working on PCP contract in Europe*
Avoid disproportionate qualification/financial guarantee
requirements: alternative (commercialisation plan in evaluation criteria)
* In EU Member States or Countries Associated to FP7
15
Important docs
proposal stage
CP-CSA for PCP
Work Programme FP7-ICT-2013, Call fiche
– Every CP-CSA on PCP has to comply with requirements on the PCP
procedure explained in Objective 11 & Appendix 6
Guide for Applicants for CP-CSAs for PCP !
– Guidance on how to prepare and evaluate proposals
– This is a GfA “specifically tuned” to the needs of CP-CSAs for PCP !
COM/2007/799, SEC/2007/1668 and FAQs on PCP website
– Contains the basics: why and how PCP
Expression of interest form & online networking platform
ICT proposers day
– Can help to find partners beyond traditional FP participants
Pre-proposal check
– Provides feedback on draft pre-proposal
16
EC support to
PCP & PPI
Today
– DG CNECT and ENTR (security) are piloting EC support to joint
cross-border PCPs done by min 3 public procurers from 3# MS/AC
•
FP7 CP-CSA grant, co-financing up to 75% of the cost of the procured R&D + up to
100% of the costs for preparing/coordinating/evaluating joint PCP
– DG ENTR and ENV are piloting EC support to joint/coordinated
cross-border PPIs. DG CNECT proposes similar in CIP PSP WP2013
(€10 Mio for PPIs in ICT for health/active ageing, done by min 3
public procurers from 3# MS/AC)
•
CIP grant, co-financing up to 20% of the cost of the innovative solutions procured /
deployed + up to 100% of the costs for preparing/coordinating/ evaluating PPI
Horizon 2020 proposal (2014…)
– PCP & PPI new funding instruments available across entire H2020
– 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
PCP/PPI synergies
for NCPs
PCP and PPI similar target beneficiaries
• Identify contracting authorities with need/ambition to
innovate (CO2 reduction, etc) and R&I budget
• Foresee also the links with other demand side instruments
(regulation, certification, standardisation, user take-up subsidies/tax
incentives, etc)
• Get their interest to network with colleagues across Europe
(sharing costs with others to benchmark state-of-the art together,
exploring potential and preparing for cross-border PCPs & PPIs)
Help explain benefits of PCP and PPI to procurers
• Quality/efficiency improvements public sector challenges
• Create opportunities for univs/ companies to work with first
potential customers in developing, testing and selling first
products
Background info
PCP website:
Info on calls, EU funded projects, background docs, FAQs, PCP
initiatives in Member States and Associated Countries etc
http://cordis.europa.eu/fp7/ict/pcp/home_en.html
Detailed info about PCP calls:
Calls page on PCP website links to all official call docs:
http://cordis.europa.eu/fp7/ict/pcp/calls_en.html
Info about PCP/PPI initiatives in MS and AC
http://cordis.europa.eu/fp7/ict/pcp/msinitiatives_en.html
Extra slides
currently open calls
More detailed info currently open calls
PCP