Niko Korpar, 16.10.2017
This case study presents a practical example of developing sustainable smart cities of the future. By telling the story of the Slovenian city of Maribor and its ambitious plan to become a “circular city”, it also touches upon the challenge of managing transformations in large public institutions and changing the prevalent linear way of thinking and operating within an organization to a circular one. It also shows how highly motivated individuals capable to promote innovation and collaboration can induce change from the inside.
Maribor – a city that keeps on reinventing itself
Maribor is the second largest city in Slovenia with about 120.000 inhabitants. It is the economic and cultural centre of Northeast Slovenia, surrounded by ski slopes on one side, and vineyards on the other. While seemingly a quiet and quaint town, Maribor has a long history of ups and downs, of changes and crises.
Its industrial history began in the middle of the 19th century. The steady growth of factories and output was interrupted twice by two world wars, which also altered Maribor’s historically multicultural character. After the new socialist state Yugoslavia was established, Maribor quickly became one of its major industrial centres and experienced large-scale migration of workers from the countryside.
A downturn came after Slovenia declared independence in 1991. Due to bad management practices, outdated technologies and especially, the loss of the Yugoslavian market, the industry collapsed in the 1990’s, and has never fully recovered. Many people faced long-term unemployment and years of heavy industry left were not kind to the local environment. Maribor has since turned towards tourism, sports and arts, becoming the European capital of culture in 2012. Despite these efforts, the economic crisis in 2008 delivered another blow to the economy, and to the Municipal budget.
As a result, relations between the Municipality and its citizens gradually worsened and the population began steadily declining due to a lack of jobs. It became clear that changes in governance and strategy were sorely needed.
Dr. Andrej Fištravec, a university professor of sociology, elected as Mayor in 2014, promised to revive the city’s economic, social and environmental condition. To fight persistent unemployment, lack of investments and decreased fiscal capabilities, the Mayor’s team focused on attracting foreign investors.
At the same time, Maribor’s waste management system needed an upgrade to handle the ever-increasing amount of waste and meet the demands of new national and European legislation on waste handling.
The general public did not support constructing new landfills or waste incinerating plants, thus the challenge, which gradually became an opportunity, was to find an alternative solution. As Igor Kos, the Mayors advisor responsible for the city’s sustainability strategy, explained, the Mayor’s team decided to listen to their citizens and try a different approach. The plan that gradually became to take form was to integrate material waste management processes with the city’s energy and water supply systems. By aiming to be both innovative and sustainable, the new municipal waste handling strategy was designed to solve several issues:
- Modernize and optimize Maribor’s waste management system
- Save costs by improving the municipal resource use efficiency and energy efficiency
- Increase cooperation between public utilities
- Provide additional organizational skills and technological know-how
- Position Maribor as a smart and green city of the future, attractive to both its inhabitants and to foreign investors
It was decided that the first step should be to optimize and increase the share of recycled waste by building a new sorting plant. However, the real challenge was deciding what to do with all the processed materials that would come out of the sorting plant. While trying to find a solution, the work group identified the circular economy, a framework for reducing material consumption and waste as one of the key future policy directions for the EU and in Slovenia.
Around the same time, several pieces of legislation on waste management and resource efficiency were introduced, both on the national and local levels. Slovenia was obliged to implement the European Union’s Circular Economy package (2015), the national Smart Specialization Strategy (2015) and Waste management program and waste prevention program of Republic of Slovenia (2016). Maribor also introduced its own Waste management strategy (2015), which already included circular economy as a key ingredient, and the Sustainable Urban Strategy of the Municipality of Maribor (2016), where the yet-unnamed circular economy project was outlined. All of these documents envision smart, green, and circular urban development models, thereby setting the boundaries for the decision-making space in which the Municipality found itself.
To comply with the general vision of development in the above-mentioned documents, an ambitious “circular” system for managing the flows of materials, energy and water was designed, but the key problem was how to implement it in light of the consequences of the economic crisis and especially, tight Municipal budgets. The Municipality was reluctant to invest in major projects and increase the burden on its taxpayers. Thus, new ways of financing the project needed to be found and already existing options explored – for example, the Municipality owned several industrial land sites that could be used as locations for the new sorting plant.
Public utilities, whose majority owner is Municipality, have tried to introduce sustainable programs in the past, but previously unseen opportunities for improvement could be capitalised on by going beyond the standard, linear approach. That the material, energy and water flows that circulate through the urban area could only be optimised if, for example, the waste handling utility became a partner of the local construction company. To oversee this transition, new models of cooperation, new knowledge and skills were needed. However, they were not readily available in the Municipality at the time. The following chapters elaborate on how this issue was eventually solved.
The green way forward
Mayor Andrej Fištravec was elected by promising to revitalize the city. Looking for an answer to the afore-mentioned challenges, the mayor, counsellor Igor and other members of his team started to cooperate with entrepreneur and circular economy expert Mirko Šprinzer to devise a new strategy, based on the framework of circular economy. In short, the circular economy is a model that attempts to reduce the amount of waste and increase resource use efficiency by keeping energy and valuable materials in a “closed loop”. The loop consists of various phases of production, consumption recycling and re-using. Business models, such as re-using, re-furbishing and upcycling secondary resources, establishing sharing platforms, etc. can be used to provide an economic incentive for becoming “circular”.
A circular approach for handling waste and energy streams was already outlined in the city’s Sustainable Urban Strategy (2016), which served as the strategic backbone of the project. It was supported by the need to improve the business operations of public utilities. Thus, the decision to adopt the circular economy as a solution was made due to a combination of factors that fell into place at the right time: new legislation, needing to identify new waste management solutions, transform public utilities, reduce costs and create new jobs in the city. Finally, due to being supported by both the Slovenian and European authorities, the circular economy was also slowly becoming known to the general public and the media.
In 2016, after a successful presentation in Brussels, the Municipality of Maribor unveiled project Wcycle. Based on the model of the circular economy, Wcycle envisions a new developmental model for Maribor as an urban centre in the field of integrated management of all generated waste, surplus energy and wastewater. It combines an integrated material, energy and water strategy for using processed waste, energy and treated water as resources for secondary activities, such as construction and heating. Furthermore, it requires collaboration between public utilities on mutual projects with the goal of recycling and recovering as many materials, water and energy as possible.
The first phase of the project will result in building a new, high-tech waste management plant, capable of sorting and treating up to 200.000 tonnes of waste per year for an urban area with about 150.000 inhabitants. It will increase the share of reusable waste from the current level of 14% to 44%. More efficient waste management will also lead to lower utility costs for citizens. The plant will be built on industrial land, owned by the Municipality, thereby revitalizing a degraded area on the outskirts of the city. At least 100 new green jobs will be created, including jobs for highly educated specialists.
To establish a circular movement of waste, recyclables, water and energy, Wcycle consists of 18 projects that will be carried out in cooperation between the Municipality of Maribor, waste management company Snaga, energy utility Energetika Maribor, transport company Marprom, public utility Nigrad and Mariborski vodovod, the company that oversees the city’s water distribution system. Together, these projects will form an integrated system, designed to maximize resource use efficiency and reduce the total amount of waste in the city.
In April 2017 the Wcycle Institute was formally established to provide technical and organizational skills, which, as Mr. Šprinzer admitted, were lacking in the Municipality. Its purpose is to provide support, oversight, technical services, planning, and all other activities needed to make sure the project is implemented correctly and that operations run smoothly, once it becomes operational.
Another organization that will carry out professional servicing and maintenance of Wcycle’s systems, oversee the functioning of its subsystems and improve their general efficiency is OPTcycle, a subsidiary company of Snaga, originally established for optimizing its waste management system.
The total costs of the project are estimated to be around 50 million EUR. They will be raised by using municipal funds, bank loans, public-private partnerships and European development funds. The time plan foresees the construction and launch of Phase 1 of the project in the year 2017-2018, and for Phase 2 by 2020.
Closing the loop
Wcycle’s circular economy model is based on so-called service pillars that carry out three separate, but interconnected circles of waste, energy and water collection recovery through various recovery operations. Recovery operators for specific project pillars are the public utilities already carrying out public services. The municipality will also support SME’s and NGO’s who will provide additional services, such as co-sharing, repairing and refurbishing consumer products. Cooperation between utilities within their own circles is crucial for for meeting the objectives: combining the processing of waste, surplus energy and recycled water to achieve maximal technical, technological, environmental, social and economic benefits.
Wcycle’s operational framework (source: Igor Kos, 2017, presentation)
The technical plan determines processes and technologies for all sections of the loop, beginning with collecting, recycling/re-using and waste and ending with carefully chosen ways in which recovered water, energy and materials will be used:
- Mixed municipal waste and bulky waste will be sorted into recylates and handed over for processing, or into light/heavy fraction materials which go into further recovery processes
- Collection and logistics of waste from the source (households) to further uses (recovery) will be optimized
- Heavy fractions from the sorting plant, construction and industrial waste will be processed into fillers and composites, which will be re-sold and re-used
- Excess heat from urban and production processes, non-contaminated biomass, energy sources from pyrolytic processes and biogas from fermentation will be turned into usable heat and electricity
- Return lines for recycled water for business and industrial districts, urban gardens, greenhouses and other purposes will be established
The city’s needs have the priority when decisions are made on where and when to use the recovered materials, water and energy. After those needs are met, these secondary resources may also be used for commercial activities.
The long road ahead
The city of Maribor is setting high goals in the area of processing waste from all sources of their generation, however Wcycle also has a regional and international dimensions to itself. As mayor Fištravec has pointed out, Maribor wants to become a regional leader – a circular hub for the circular economy – and cooperate with other municipalities nearby. Wcycle aims to make Maribor a center of innovation and set an example to other cities. By becoming an early adopter of the circular economy Maribor wishes to position itself among the smartest and greenest European cities. International recognition and a positive impact on life quality could incentivize more young professionals to stay in the city, which could have a multiplying effect on the local economy. What is more, because developing Wcycle requires dialogue and cooperation between various shareholders, the Municipality hopes to improve its relations with the NGO’s, civil society, research community, and other stakeholders.
Despite the early successes, there are still four main challenges connected to implementation and financing that will have to be addressed in the near future:
- Project management: Keeping with the deadlines, keeping costs stable, developing a communication strategy, avoiding scandals
- Management of public companies: making sure collaboration continues and that all partners remain focused on the outcome
- Funding: Securing sufficient funding, prudently managing the projects’ finances, attracting private investors
- Politicals: due to upcoming elections in 2018, building inclusive political support and maintain it to ensure that the project will survive a potential a change in the city’s government or coalition
Underlying all these open issues is the need is to continue working with the same high level of energy. Although the first phase of the project is already underway and has gained media attention and praise from circular economy experts throughout Europe, the second phase will require at least the same amount of leadership, as well as clear and effective communication to ensure continuous support from stakeholders and the general public, which has become wary of large-scale projects due to bad past experience. Undoubtedly, the people of Maribor have much to gain from Wcycle’s success and a successful ending to this story is in the interest of everyone involved. To stay updated on the state of the project, follow the links provided in Reference.
About the case study:
Aout project Wcycle: