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2. partner meeting in Ausgburg (D) – CURIOST

 |  Category: SPCleantech News

EU INTERREG Central Europe project: Circular design and development of Sustainable products in 4 key sectors in Central Europe

Representatives of 11 institutions from 7 countries met on 26-27.11.2024 in Augsburg (D) to discus the results of the first 6 months of EU funded project CURIOST.

Project CURIOST is funded by INTERREG Central Europe Programme and aims at enabling SME and small mid-caps to exploit their potential in innovative sustainable product development and profit from matching business cases in the 4 key sectors which are highly relevant in partner regions:

  • Mechanics and mechatronics
  • Packaging
  • Plastic
  • Construction and building

CURIOST project integrates two-fold approach which aims to develop a comprehensive strategy targeting its uptake by minimum 140 SME and small midcaps, followed by transformation of this strategy into an action plan developed and adopted by policymakers to serve local businesses. It´s main goal to initiate the change in all sectors of the partner regions in Central Europe which will result in creating universal solution of matching business cases, which will accelerate the green transition in the Central European economy.

Within the CURIOST project, each project partner should participate in activities that provide understanding of current situation in product development in four targeted sectors, including gaps and challenges analysis and capitalization of best practices and benchmark in sustainable product design in Central Europe. These activities will give deliverables of Activity 1.2, namely:

  • 1.2.1 Assessment of market status and readiness for sustainable products in the 4 sectors

The partnership assesses and gains insight about the maturity level and readiness of the market regarding the design and development of sustainable products, in the sectors relevant in the partner regions. The result flows into the development of the strategy in A1.3.

  • 1.2.2 Evaluation of current business models

Already implemented circular business models will be evaluated (key success factors) and categorized according to their type. Further, its applicability as blueprint or reference for SME + small midcaps in the 4 sectors will be analyzed and summarized in fact sheets, to be shared among the companies.

AIM OF THE ANALYSIS

Various circular business models have been developed over the last decade. They integrate digital and hybrid (e.g. additive manufacturing) technologies, which foster their implementation. Such models are already applied to a different extent in the 4 sectors mechanics & mechatronics, plastics, packaging and construction & building, but mainly in large manufacturing businesses in Europe and beyond.

For a better understanding and a common starting point, the partners will assess the current market status in the partner regions and the readiness for sustainable product design and development in the 4 sectors. For that purpose, the activity leader UEBA will create a matrix of key performance indicators that reflect the market status of the 4 sectors. All partners collect the KPIs for the sectors relevant in their region, and UEBA will consolidate the results.

The outcome forms one of the corner stones for the development of the strategy for sustainable product development in SME + small midcaps, in activity A1.3.

Further, already realized circular business models for sustainable products will be collected and analyzed. The key success factors will be identified and the potential of transferability to SME + small midcaps, as well as the transferability between the 4 sectors will be assessed. Finally, the results will be consolidated and grouped in the following four categories that have developed over the last few years:

  • Cycling (keeping materials in the cycle with reuse, refurbishment, recycling),
  • Extending (longer product life through circular design, maintenance and repair),
  • Intensifying (sharing products intensifies its use phase),
  • Dematerialising (service and software solutions instead of hardware).

Summary:

  • The readiness of businesses for sustainable design and product development varies in countries such as Austria, Croatia, Germany, Hungary, Italy, Poland and Slovakia according to various factors, including political conditions, technological infrastructure, workforce education and availability of funds. Austria and Germany are among the leaders in sustainability thanks to their long-term environmental policy and high investment in research and development. In both countries, businesses are at the forefront of implementing green and innovative solutions, including in industries that include manufacturing and technology. These countries are known for their extensive sustainability programs and are actively involved in international projects focused on green innovation.
  • Croatia and Hungary, on the other hand, show a slightly lower level of preparedness. Although they have a growing interest in sustainable development, limited investment and a less developed technological base are often an obstacle. However, these countries are experiencing improvements, mainly thanks to programmes co-financed by the European Union, which support small and medium-sized enterprises in adopting sustainable practices. Poland is also trying to catch up with its western neighbors, but faces challenges related to its high dependence on traditional forms of energy and slower adaptation to new technologies.
  • Italy is characterized by a diverse economy, where some manufacturing sectors are showing significant efforts to reduce their ecological footprint through innovative and eco-friendly solutions. On the other hand, the industrial regions of Italy face challenges associated with traditional production methods and a limited number of initiatives to modernize them. Slovakia faces challenges similar to those of Hungary and Croatia, with the gradual adoption of the principles of sustainable development. Opportunities here are often combined with EU support, which makes it possible to implement more environmentally sound strategies.
  • Due to these factors, Austria and Germany can be assessed as the most prepared for sustainable design and product development, followed by Italy, which is at the intermediate level of readiness. Croatia, Hungary, Poland and Slovakia have potential, but they need more significant investment and an improved legislative framework to support the green transition.

Annex: Assessment of the current state using a matrix of key performance indicators

D.1.2.2 Evaluation of current business models

Already implemented circular business models will be evaluated (keysuccess factors) and categorized according to their type. Further, its applicability as blueprint or reference for SME + small midcaps in the 4 sectors will be analyzed and summarized in fact sheets, to be shared among the companies.

INTRODUCTION TO CIRCULAR BUSINESS MODELS

The basic principle of the circular economy is to use resources for as long as possible by minimizing the need for materials and energy, as well as the waste and emissions of a given economic system. Through reuse and recycling, recycling of products and raw materials, and resource-efficient product design (ecodesign), resource consumption and waste can be reduced at the same time. The concept of the circular economy focuses on the entire value chain or the entire life cycle of a product and includes the extraction of resources and raw materials, product design, the production of intermediates and products, and the use and subsequent recycling of materials.

The main objectives of the circular economy:

  • Using resources for the longest possible time horizon.
  • Saving primary materials.
  • Minimize waste generation.
  • Minimize greenhouse gas emissions.

Business models in the circular economy represent innovative approaches that go beyond traditional linear patterns of production and consumption. They aim to create value by minimizing waste and maximizing the use of resources, through the reuse, recycling and recovery of materials. In this chapter, we will focus on the principles, strategies and forms of circular models that enable companies to improve sustainability, efficiency and competitiveness in a dynamic economic environment.

Factsheets for SMEs in 4key sectors

This section formulates proposals for factsheets (examples) for the four key areas of the project.

3.1.1   ANALYSIS OF S3 STRATEGIES OF PARTICIPATING REGIONS/COUNTRIES

Further on, project partners made research and analysis of national and European regulatory framework. The Strategic Framework provides overview of relevant European and national regulations, policy documents and S3 strategies for respective project regions and available targeted sectors (mechanics & mechatronics, plastic, packaging, construction and building), linked to the topic of the CURIOST project. It consists of aggregation of transnational policies and strategies for 7 partner countries in the CURIOST Interreg Central Europe project and it shows the relevant current policy status towards circular economy and sustainable product development in area of Central Europe.

Therefore, Activity 3.1. of creating Integrated strategic framework has two deliverables:

> D 3.1.1 Analysis of S3 strategy of the participating regions/countries (NUTS0/2)

> D 3.1.2 Analysis of latest legal + policy framework on EU level.

Activities A1.1 and A3.1 are the foundation for future CURIOST Action Plan which will be prepared in a manner of transnational cooperation between project partners. The CURIOST Action Plan will recommend key measures to support the uptake of sustainable product development solutions by SME and small midcaps in four targeted manufacturing sectors and will be addressing policy makers and governance institutions. This jointly developed action plan will have ‘regional chapters’ summarised for each partner region which will encompass strategic results and deliverables of A1.1 and A3.1. Such action plan will be project and communication objective which will serve to inform public policy on topic, to change the opinion of certain stakeholders and to raise public awareness on specific issues.

  1. Strategic policy focus at regional/national level

At the beginning of the CURIOST project, project partners recognized the specific context in which the project is embedded such as circular economy, sustainable product development, fostering innovations and transformations of SME and small midcaps, digitalization and support for development of regional ecosystems. Therefore, the project partners analysed strategies, policies and action plans on the topics of Smart Specialization Strategies, Circular Economy and Innovation relevant in their respective country or regions, which will provide status overview for the area of Central Europe. This chapter offers transnational aggregation of policies relevant to CURIOST project topic.

  1. Transnational policy analysis
  2. Collection of support instruments and main challenges
  3. SWOT ANALYSIS 3.1.1.

3.1.2   ANALYSIS OF LATEST LEGAL + POLICY FRAMEWORK ON EU LEVEL

  1. EUROPEAN REGULATORY FRAMEWORK

For integrated strategic framework it is important to provide short overview of regulations that are binding for all member states equally. Some of them we referred to in this document are:

Action plans:

  • New Circular Economy Action Plan Regulations:
  • Eco-design for Sustainable Products Regulation Proposal
  • European strategy for plastics in circular economy

Sector specific:

  • Harmonised conditions for the marketing of construction products Regulation

Proposal

  • Packaging and packaging waste Regulation Proposal
  • Regulation on machinery
  1. Cross-country analysis of European directives implementation
  2. Conclusion of cross country analysis and SWOT analysis

For the purpose of providing European policies framework and current status of implementation, analysis is divided in two parts. First par encompasses regulations, action plans and strategies that are accepted on the European level and the cross country analysis provides analysis of relevant directives and their implementation in national legislations. Since some of the regulations are recently adopted and transition period for implementation is still ongoing, this framework will be regularly updated during the duration of CURIOST project with relevant information.

European union developed Circular Economy Action Plan and other relevant regulations to support transition towards circular economy and sustainable practices. Since great majority of companies across the entire European Union are SMEs and small midcaps, obligations are highly relevant for them to accordingly adjust their business models. Regulations analysed above are not just important for producers, but for consumers as well. Consumers are far more protected by creating better and longer living products, living in energy efficient housing, creating possibilities for innovation and living in a healthier environment. Certain challenges are encountered when imported products and distributors from non-EU countries are avoiding compliance with given policies. It can lead to market disturbances, endanger domestic production and consumer protection.

For cross country analysis, it is important to emphasize that member state accepted the provisions of European directives and implemented them into their national legislation through relevant domestic legislation frame. Sometimes the implementation depends on level of the relevant sector development, infrastructure or external factors which limits influence of proposed policies. What analysis showed is that in the partner countries there are different levels of implementation regarding plastics and packaging. While some countries are just about to introduce the deposit system for single use beverage packaging, such as Austria, Poland or Italy, other countries like Croatia, Slovakia and Germany already have systems established and successfully going on. Differences among countries on the matter are about level of development of waste management infrastructures, responsibility of legal entities who should conduct the collection, willingness of producers to adjust the pricing and amount of compensation for depositing. Introduced deposit system in Slovakia or Croatia showed high rates of depositing and recycling single used plastic containers (up to 90% in Slovakia) with positive environmental impact and awareness raising.

For the CSDD and CRD directives, even though in some countries like Austria or Italy digital tools, national frameworks and legislation are prepared to support companies in sectors with complex supply chain (mechatronics or plastics) and to make process easier with internal controls, stringent reporting and to assess the sustainability performance of companies more effectively. Countries like Hungary and Croatia (for CRD) do not have national equivalent which means companies should follow EU directives. Unfortunately, that can cause difficulties for domestic companies and compliance procedures due to lack of clear guidance.

Same applies for Common rules on promoting the repair of goods. Well established system in Austria and some parts of Germany, is awaiting implementation in reviewed member states, where national governments are required to promote repairs through repair vouchers or repair spaces.

As construction sector and possibilities of using recycled materials in the construction processes, Energy performance of buildings directive is highly relevant. Even though it proposes universal solutions, implementation depends on specific needs of each country. While Poland or Austria have already started renovation wave, developing one stop shops for energy performance of buildings, while others still manage to find a right path to implement the directive into national legislation. Success of implementation depends on country specific context, such as level of development of construction sector, infrastructural circumstances concerning new construction or renovation, skilled work force and external factors such as earthquakes in Croatia which produced issues of construction waste management.

Based on partners contributions and analysis of European regulations and directives, one SWOT Analysis Table was created, that reflects the transnational character of integrated strategic framework. It presents statements that emerged as relevant in individual countries analysis and underneath are countries/ regions to which the statement is applicable to.