The chapter details the main components of the existing circular economy strategies and initiatives promoted by the Spanish Government, Castile and León Autonomous Community and the city of Valladolid, Spain. The chapter also identifies actors, policies and co‑operation tools across urban and rural areas that can foster the circular economy. Finally, it describes the main challenges the city of Valladolid is facing in its transition from a linear to a circular economy.
The Circular Economy in Valladolid, Spain
OECD Urban Studies
2. Assessing and unlocking the circular economy in Valladolid, Spain
Abstract
An ongoing agenda on the circular economy at the national level
The Spanish Circular Economy Strategy to 2030 (España Circular 2030) was developed in 2018 but has not yet been approved. The Spanish Circular Economy Strategy (2018[1]) was jointly promoted in 2018 by the Ministry of Agriculture and Fisheries, Food and the Environment (Ministerio de Agricultura, Pesca y Alimentación) and the Ministry of Economy, Industry and Competitiveness (Ministerio de Economía y Competitividad). An inter-ministerial commission formed by nine ministries1 and the Economic Office of the President at that time contributed to it, together with the autonomous communities and the Spanish Federation of Municipalities and Provinces (FEMP). After the election in November 2019, the inter-ministerial committee added new ministries (e.g. the Ministry of Education and Vocational Training, Ministerio de Educación y Formación Profesional) to the nine previous ones, while each ministry faced organisational changes in their areas of responsibility.2 The strategy has a long-term vision that is expected to be implemented through short-term action plans, enabling the required adjustments to complete the transition by 2030 (Box 2.1). The National Action Plan for 2019-20 attached to the strategy foresees a budget of EUR 630 million for 4 thematic areas (production and design; consumption; waste management; secondary materials and water reuse) and 3 cross-cutting areas (awareness and participation; research and development; and employment and training) (Government of Spain, 2018[1]).
Box 2.1. The Spanish Circular Economy Strategy process
A key step for the development of the national strategy on the circular economy was the Pact for a Circular Economy, engaging the main economic and social stakeholders in Spain in circular business models. The pact was the result of a workshop organised in 2017 by the Ministries of Agriculture and Fisheries, Food and Environment and of Economy, Industry and Competitiveness. It gathered European Union (EU) officials, national, regional and city-level representatives, institutions specialised in the circular economy and civil society organisations (Government of Spain, 2018[1]). By September 2019, a total of 347 stakeholders adhered to the pact. Adherence remains open to new stakeholders.
The signatory party of the Pact for a Circular Economy committed to boost the transition to a circular economy through ten actions:
1. Reduce the use of non-renewable resources and promote the reuse of secondary materials.
2. Foster product life cycle analysis and eco-design.
3. Promote the application of the principles of the waste hierarchy.
4. Advance innovation and efficiency in production processes.
5. Encourage sustainable consumption patterns.
6. Endorse a responsible consumption model through transparency measures and eco‑labels.
7. Establish institutional channels to create synergies between public administrations, the scientific community and economic and social stakeholders.
8. Disseminate the importance of transitioning towards a circular economy.
9. Promote the use of common indicators to measure the grade of advancement of the circular economy.
10. Include social and environmental impact indicators derived from the companies’ actions.
In 2018, following the pact, the Spanish Circular Economy Strategy incorporated almost 2 000 observations from autonomous communities, the Spanish Federation of Municipalities and Provinces (FEMP) and citizens. A circular economy inter-ministerial commission was created during the elaboration process of the strategy. It is planned that the inter-ministerial commission will continue to meet at least once a year to evaluate and monitor the implementation of the national strategy. The inter-ministerial commission created a working group for autonomous communities responsible for forming other working groups to further implement the strategy. Lastly, one of the actions of the Declaration of Climate Emergency (Acuerdo de Consejo de Ministros por el que se aprueba la Declaración del Gobierno ante la emergencia climática y ambiental), approved by the Spanish Government in January 2020, calls to “to promote the circular economy in economic sectors and economic and industrial processes and to adopt the Circular Economy Strategy and a Waste Law that will address, among other issues, the problem of single-use plastics, in order to achieve the "zero residue" goal on the 2050 horizon.”
Source: Government of Spain (2018[1]), España Circular 2030, Estrategia Española de Economía Circular, http://www.miteco.gob.es/images/es/180206economiacircular_tcm30-440922.pdf (accessed on 31 May 2019); Ministry for Ecological Transition and the Demographic Challenge (2018[2]), Información pública de la estrategia Española de Economía Circular, https://www.miteco.gob.es/es/calidad-y-evaluacion-ambiental/participacion-publica/Residuos-2018-Nota-sobre-proceso-informacion-publica-estrategia-espanola-economia-circular.aspx; Government of Spain (2020[3]) Acuerdo de Consejo de Ministros por el que se aprueba la Declaración del Gobierno ante la emergencia climática y ambiental, https://www.miteco.gob.es/es/prensa/declaracionemergenciaclimatica_tcm30-506551.pdf (accessed 26 February 2020); Ministry for Ecological Transition and the Demographic Challenge (2020[4]), El Gobierno declara la emergencia climática, https://www.miteco.gob.es/es/prensa/200121cmindeclaracionemergencia_tcm30-506549.pdf (accessed 20 February 2020).
The Spanish Circular Economy Strategy reflects the objectives of the EU Circular Economy Package and identifies priority sectors (Box 2.5). The national strategy has 12 general strategic objectives and aims to reduce by 30% the national consumption of materials in relation to the gross domestic product (GDP) by 2030, taking 2015 as the reference year. A specific objective of increasing material efficiency (e.g. reducing raw materials used during production) has been incorporated in 2019. The government focuses on five sectors: construction, agro-food, industry, tourism and consumer goods. Strategy’s results will be monitored and evaluated through indicators that reflect those defined by the EU, in order to enhance consistency between the two approaches. Furthermore, eight specific indicators, corresponding to the areas of the National Action Plan, complete the monitoring system. These indicators concern: production and consumption; secondary raw materials; repair, reuse and recycle; water reuse taxation; research, innovation and competitiveness; participation and awareness; and employment and training (Table 2.1).
The Spanish National Urban Agenda includes the promotion of the circular economy as one of its ten strategic objectives. The Spanish Urban Agenda (Agenda Urbana Española, AUE) is a strategic voluntary document, which pursues the achievement of sustainability in urban development policies in Spain, promoted by the Ministry of Development in 2019 (2019[5]). The fourth objective of the Spanish Urban Agenda consists of “sustainable management of resources and favouring the circular economy” (Ministry of Development, 2019[5]). Currently, EUR 1 362 million from the urban axis of the European Regional Development Fund (ERDF) in Urban Sustainable and Integrated Development Strategies are available to finance projects related to Strategic Objectives of the Spanish Urban Agenda, including favouring the circular economy (Ministry of Development, 2019[5]). In 2020, the Ministry of Transport, Mobility and the Urban Agenda and the Spanish Federation of Municipalities and Provinces (FEMP) created a permanent forum of cities (Foro Ciudades) for bilateral meetings between national and local governments on the Urban Agenda.
Table 2.1. Indicators for monitoring the Spanish Circular Economy Strategy
Source: Government of Spain (2018[1]), España Circular 2030, Estrategia Española de Economía Circular, http://www.miteco.gob.es/images/es/180206economiacircular_tcm30-440922.pdf (accessed on 31 May 2019).
In order to guide municipalities and provinces towards the transition to a circular economy, the Spanish Federation of Municipalities and Provinces (FEMP) developed a Circular Economy Local Strategy Model (Modelo de estrategia local de economía circular) (2019[6]). The strategy model is a non-binding document made for and by municipalities and provinces as guidance to advance towards circularity and sustainability in several sectors. The document is strictly linked to the 2030 Agenda for Sustainable Development (Box 2.2). In a decentralised system such as in Spain where there are more than 8 131 municipalities (INE, 2020[7]), each municipality can develop its own sustainability programme, according to its needs and capabilities. The strategy defines four strategic axes of work and identifies cross-cutting areas:
Use of natural resources: Consists of actions to prevent and reuse secondary materials and of sustainable waste management.
Water consumption management: Involves optimising the water supply and sewage networks and the reuse of wastewater.
Urban spaces sustainability: Promotes a preventive and regenerative urban planning approach to recover old city districts, to enhance resilience and energy efficiency and sustainable mobility in order to comply with the EU and World Health Organization standards for air quality.
Healthy habits and spaces: Aims to foster healthy territories (e.g. rural and urban sustainable development, healthy habits), responsible consumption and the minimisation of food waste.
Cross-cutting areas: Consist of measures across sustainable and innovative public procurement; development and implementation of new digital technologies; transparency and shared governance; and communication and awareness-raising.
The FEMP’s Circular Economy Local Strategy Model provides a self-assessment questionnaire to enable each municipality to measure how advanced it is in terms of circularity. The methodology applied in the strategy starts with a diagnosis stage. This stage consists of a “yes/no” questionnaire listing the strategy’s 175 actions detailed in 4 strategic axes and 25 measures. According to the FEMP Circular Economy Local Strategy Model, each municipality, looking at the number of actions that are in place, can evaluate its level of circularity: low (0-1 actions), moderate (2-3 actions), high (4-5 actions), very high (6‑7 actions). This diagnosis can be the first step in the elaboration of a circular economy programme at the local level and the design of a monitoring plan (FEMP, 2019[6]).
Box 2.2. The circular economy in cities and regions and Sustainable Development Goals
The 2030 Agenda for Sustainable Development, adopted in 2015 by United Nations (UN) member states, includes 17 Sustainable Development Goals (SDGs). The aim of the 2030 Agenda is to set a 15-year-long plan to end poverty and other deprivations while implementing strategies that improve health and education, reduce inequality, promote economic growth and tackle climate change.
The circular economy is an interesting implementation vehicle to SDG 12, pledging for more sustainable and responsible consumption and production patterns. Moreover, it is relevant for the achievement of SDGs 6 (water), 7 (energy), 11 (sustainable cities and communities), 13 (climate action) and 15 (life on land) (Figure 2.1).
Figure 2.1. The circular economy in cities and regions and Sustainable Development Goals
Source: OECD (forthcoming[8]), The Circular Economy in Cities and Regions, Synthesis Report, OECD Publishing, Paris.
The SDG 12 is composed of 11 targets and 13 indicators (Table 2.2).
Table 2.2. SDG 12 targets and indicators
Source: UN (2019[9]), Goal 12: Sustainable Development Knowledge Platform, https://sustainabledevelopment.un.org/sdg12 (accessed on 7 February 2020).
The OECD programme “A Territorial Approach to the SDGs” has developed a comprehensive indicator framework to measure where cities and regions stand on their SDG implementation path. Specifically regarding SDG12, the programme has identified three indicators to measure the progress of this goal (Table 2.3).
Table 2.3. OECD indicators for a territorial approach to SDG12
Note: Functional urban areas are economic units characterised by a city (or core) and a commuting zone that is functionally interconnected to the city. A city is a local administrative unit (i.e. LAU for European countries, such as municipality, local authorities, etc.) where at least 50% of its population live in an urban centre. An urban centre is defined as a cluster of contiguous grid cells of 1 km2 with a density of at least 1 500 inhabitants per km2 and a population of at least 50 000 inhabitants overall.
The Territorial Level 2 (TL2) in the OECD classification refers to regional administrative regions officially established in each country.
Source: OECD (2020[10]), A Territorial Approach to the Sustainable Development Goals: Synthesis report, https://dx.doi.org/10.1787/e86fa715-en and OECD (2012[11]), Functional Urban Areas by Country, https://www.oecd.org/cfe/regional-policy/functionalurbanareasbycountry.htm.
Sources: UN (2019[9]), Goal 12: Sustainable Development Knowledge Platform, https://sustainabledevelopment.un.org/sdg12 (accessed on 7 February 2020); OECD (2020[10]), A Territorial Approach to the Sustainable Development Goals: Synthesis Report, https://dx.doi.org/10.1787/e86fa715-en.
Circular initiatives in the Castile and León Autonomous Community
Several initiatives are set in the Castile and León Autonomous Community to promote the transition to a circular economy. Since 2015, the circular economy was included as part of the government’s programme as a means to boost the regional economy (Castile and León Environment Department, 2018[12]). Afterwards, several initiatives followed:
Strategy: The Castile and León 2020-30 Circular Economy Strategy is under elaboration. The strategy’s elaboration process started in 2016 with the creation of a group of experts and the presentation of a roadmap, which included the following steps: participation structure; analysis of available resources, strategic sectors and actors; identification of needs and existing instruments; actions and monitoring indicators (Castile and León Environment Department, 2018[12]). The region is characterised by three main economic activities: livestock, mining and the bio‑economy. The bio-economy has a key role in the strategy as a potential way to replace imported non-renewable materials. Increasing productivity of material use will be key for the region (using less, reusing more). Finally, the strategy presents several objectives related to a change of the economic, productive and consumption models, such as: going beyond waste management solutions; reducing virgin material use, by replacing them by secondary bio-based materials; increasing reuse; promoting local commerce, as one of the main promoters of the circular economy; and advancing in the work through a sectoral approach.
Research: The regional circular economy strategy identified six priority sectors and four priority action themes for the circular economy. The priority sectors are: agro-food; automotive; health and quality of life; tourism and heritage; energy and environment; and habitat. Priority action themes include: research on eco‑innovation; waste as a resource conception; new consumption models; capacity building, awareness and participation; financing; and monitoring and socioeconomic impact measurement (Castile and León Environment Department, 2018[12]). In 2018, Castile and León has included the circular economy in the ongoing EU Research and Innovation Strategies for Smart Specialisation (RIS 3) project. A material flow analysis has been performed despite the lack of proper data indicators at the regional level.
Capacity building: During 2017-19, the regional training and support programme in research, development and innovation called Centr@tec delivered eight workshops on the circular economy to businesses and entrepreneurs based in the region. The workshops focused on: eco-innovation, new business models, organic matter and bio-economy, waste as a resource, the automotive sector, the building sector, agro-food business opportunities and industry and raw materials (Castile and León Environment Department, 2018[12]). The Natural Heritage Foundation of Castile and León Autonomous Community also organises training on Green Public Procurement (Natural Heritage of Castile and León, 2018[13]). The “Circular Lab” offers co-working and entrepreneurship spaces in the city of Valladolid, as well as capacity building programmes for entrepreneurs.
Awareness-raising: A number of initiatives are in place, such as: the “Circular Deals” events, which aim to identify barriers to the circular transition in the regions; and the “Living Lab, which promotes sustainable consumption actions among citizens.
Circular economy initiatives in Valladolid, Spain
In Valladolid, circular economy-related activities are promoted by the Department of Innovation, Economic Development, Employment and Trade and by its technical arm, the Agency of Innovation and Economic Development. The agency’s main goals are to promote the city’s economic and sustainable development and support employment, entrepreneurship and innovation. Since 2017, the agency is in charge of developing a circular economy’s strategic lines of work. The agency considers the transition towards a circular economy key to achieving the goal of reducing waste, while creating new jobs and enhancing innovation (Agency of Innovation and Economic Development, 2019[14]). Since June 2019, the new municipal government has included the definition of a circular economy strategy as one of its 2019-23 programmatic objectives (Agency of Innovation and Economic Development, 2019[14]).
The city of Valladolid promotes circular economy projects through municipal grants. In 2017 and 2018, the municipality launched two calls for projects to finance circular economy initiatives aiming to stimulate local businesses and entrepreneurial activities, while raising awareness on the circular economy. The local government-financed a total of 61 projects (22 and 39 respectively in 2017 and 2018), allocating a budget of EUR 960 000 (EUR 400 000 and EUR 560 000 in 2017 and 2018 respectively). The municipality financed between 40% and 85% of the project’s total cost. The beneficiaries of the grants were private companies, associations of private companies, non-profit entities or research centres based in the municipality of Valladolid (Annex A). An additional EUR 600 000 are assigned for 2019-21 (this amount represents 0.17% of the annual budget of the city). The financing rules for the 2019-20 calls have been updated, foreseeing co-funding (10%) by winning projects and a 2-phase grant transfer whereby 80% is granted in the starting phase of the project and the pending 20% is granted after showing the project’s results (in previous calls 100% of funding was given at the beginning of the project). Examples of other financing instruments for the circular economy and ongoing related initiatives are illustrated in Box 2.3.
Box 2.3. Financing instruments for the circular economy: International practices
There are several initiatives (at the local, national and international levels) that seek to accelerate the transition to a circular economy by improving access to funding for circular economy projects:
Revolving funds: The city of Amsterdam, Netherlands through the Amsterdam Climate and Energy Fund (ACEF) and the Sustainability Fund invested in more than 65 projects related to climate, sustainability and air quality for a total of EUR 30 million. The revolving funds allow to reinvest revenues within 15 years to fund additional sustainable energy production, energy efficiency or circular economy projects. Each of the funded projects must contribute to the aims of the Sustainability Agenda approved by the City Council in 2015. Regarding the nature of the financing, the ACEF provides funding in the form of loans, warranties and/or share capital, subject to a maximum of EUR 5 million per project.
Venture capital and growth capital: The London Waste and Recycling Board (LWARB) supports circular businesses through the Circular Economy Business Support Programme. The venture capital fund supports circular economy small- and medium-sized enterprises (SMEs) in various steps of start-up financing and in scaling up businesses that are already in the market. Moreover, the LWARB, through the Circularity European Growth Fund 1 operated by Circularity Capital, seeks investment opportunities in circular businesses with proven cash flow and profit, which need significant capital to scale up.
Loans and funds: The European Investment Bank (EIB) offers medium- and long-term loans for large scale circular economy projects and indirect financing through local banks and other agents for smaller projects, particularly related to SMEs. Other new circular economy project models can also be financed by the European Fund for Strategic Investments (EFSI),3 and InnovFin4. In 2020, the EIB within the Urban Agenda Partnership for the Circular Economy launched the “Circular City Funding Guide” to provide an overview of available financing tools to cities, businesses and stakeholders wishing to advance towards a circular economy. Different types of financing tools are organised under the following categories: guarantees, equity, debt, grants and alternative funding sources.
Bonds: Private banks are showing an increasing interest in the circular economy transition. In 2019, for the first time, a private Italian bank issued a “sustainable bond” for circular economy projects (EUR 750 million were allocated to this end). A Dutch bank plans to allocate EUR 1 billion in the next 5 years to finance circular projects with the objective of saving 1 million tonnes of CO2 in 5 years. Selected projects receive an initial circular assessment and are guided in the identification of circular opportunities. The network FinanCE, created in 2014, gathers commercial and public banks and institutional investors interested in supporting the circular transition.
Source: C40 Cities (2016[15]), C40 Good Practice Guides: Amsterdam - Sustainability Fund and Amsterdam Climate and Energy Fund, http://www.c40.org/case_studies/c40-good-practice-guides-amsterdam-sustainability-fund-and-amsterdam-climate-energy-fund (accessed on 6 June 2019); London Waste and Recycling Board (2019[16]), London Waste and Recycling Board Website, http://www.lwarb.gov.uk/ (accessed on 6 June 2019); EC (2019[17]), Improving Access to Finance for Circular Economy Projects, http://dx.doi.org/10.2777/983129; EIB (2019[18]), The EIB Circular Economy Guide: Supporting the Circular Transition, http://www.eib.org/attachments/thematic/circular_economy_guide_en.pdf (accessed on 2 August 2019); London Waste and Recycling Board (2019[19]), Circular Economy Investment for Businesses in London, http://www.lwarb.gov.uk/what-we-do/circular-london/circular-economy-investment-for-businesses/ (accessed on 5 August 2019); OECD (2019[20]), OECD Highlights of the 1st OECD Roundtable on the Circular Economy in Cities and Regions, OECD, Paris; Urban Agenda Partnership for Circular Economy (2020[21]), The Circular City Funding Guide, European Investment Bank, https://www.circularcityfundingguide.eu/ (accessed on 6 February 2020); OECD (forthcoming[8]), The Circular Economy in Cities and Regions, Synthesis Report, OECD, Paris.
To be eligible, circular economy-related projects were requested to create jobs and economic return in the city of Valladolid. Criteria for eligibility were the following: promotion of employment; economic and social dimensions; technical and methodological quality; environmental relevance; eco-innovation and eco‑design; innovative character; quantitative and qualitative impact scope; diversification of the supports; and priority products (bio-plastics and food waste). The same criteria were applied for the project selection in the 2019-20 call for grants (detailed in Annex B). However, new aspects such as textile and rubber were incorporated as priority sectors to be considered by applicants, in addition to the previous ones, such as plastics, bio‑plastics and food waste. During the first year of the grant in 2017, a total of 23 projects out of 38 were selected. The 15 projects that were not selected did not meet the quality criteria, measured through predefined thresholds. In the second year, in 2018, the number of applications increased up to 60. This was due most probably to greater awareness on the topic, as well as to improved application conditions (e.g. longer period to respond to the call). In 2019, a total of 32 projects were selected from 70 candidate projects.
Circular economy-funded projects in Valladolid concern a number of sectors, such as waste, water and energy. Projects focus on different areas such as: i) education and training, through developing skills and human capital (e.g. artisan practices; workshops and mentoring); ii) dissemination, consisting of raising awareness and bringing the concept of the circular economy into everyday life (e.g. sharing and reuse products and goods); iii) research studies, producing data on the status quo and potential of the circular economy in the city that can inform public policy decisions (e.g. a study on business and citizens’ awareness level towards a circular economy or a guide on how the use of recycled waste from the construction and demolition sector can be included in the city’s public tenders); and iv) implementation projects, consisting in fostering new technologies (e.g. bioenergy, solar panels, reusing pistachio industry waste), strengthening citizen participation (e.g. an online platform to share experiences) and creating a circular economy community (e.g. mentoring and networking events). An evaluation study on the results of the programme is ongoing, however, the municipality has expressed the need for establishing synergies across projects and scaling them up (Valladolid City Council, 2018[22]).
The municipality fosters the connection between stakeholders through supporting networking events. The Circular Weekend, one of the municipal circular economy grant-awarding projects, consists in a two-day event hosted on the premises of the municipality, to promote peer-learning, launch circular ideas, share existing business models and create a network of people interested in pushing forward the circular economy approach. In the 2017 and 2018 editions, the event hosted almost 100 participants offering presentations, workshops and mentoring sessions. The Circular Weekend has been an opportunity to connect local stakeholders and stimulate new projects. For example, some of the award-winner projects (Annex A) applied to the municipal call for grants after participating in the Circular Weekend. In March 2019, the municipality gathered all the winning projects from 2017 to present their main results and share them with the 2018 winners. The most recent Circular Weekend took place in June 2019 and attracted 50 participants (Valladolid Municipality, 2019[23]).
In 2018, the Agency of Innovation and Economic Development developed a Circular Economy Roadmap for the city of Valladolid, as a result of the experience of municipal grants. The Circular Economy Roadmap sets objectives and related actions (Table 2.4). The roadmap is the result of good practices collected through circular economy projects that benefitted from municipal grants since 2017, as well as from exchanges with other cities and networks (e.g. Covenant of Mayors, Eurocities, Michelin Cities, Spanish Network of Intelligent Cities-RECI, etc.).
Table 2.4. The Circular Economy Roadmap: Objectives and actions
Source: Own elaboration based on Valladolid Municipality (2018[24]), Valladolid Roadmap towards a Circular Economy.
A Circular Lab aims to build capacities amongst entrepreneurs. In particular, the Circular Lab benefits from exchanges with other cities in Portugal and Spain (Valladolid Municipality, 2019[25]). It provides entrepreneurs and start-ups specialised in circular economy businesses with operational resources (physical spaces, networking, etc.); it helps develop adequate skills and create a favourable attitude among entrepreneurs towards new professional opportunities and business ideas; it promotes the integration of the circular economy in the entrepreneurial culture and innovative ideas in all phases of the value chains, through the creation of new products and processes. The Circular Lab was created in 2019. It is managed by the Agency of Innovation and Economic Development of the City of Valladolid. Further, another Circular Lab is managed by the Natural Heritage Foundation of Castile and León Autonomous Community. Circular labs are EU-funded projects. In addition, the local government grants awards to bachelor’s and master’s thesis that focus on ten topics that the city identified as strategic, including the circular economy.
The analytical framework
The analytical framework used in this report is based on three dimensions that help to identify tailored solutions for cities and regions willing to transition from a linear to a circular economy (Figure 2.2):
The level of advancement of cities and regions in the transition to a circular economy: Advanced, In progress, Newcomers.
Tools and instruments for the transition according to the 3Ps Framework: People, Policies and Places.
Roles of cities and regions to promote, facilitate and enable the circular economy.
Figure 2.2. OECD analytical framework: Level of advancement, tools and roles
Source: OECD (forthcoming[8]), The Circular Economy in Cities and Regions, Synthesis Report, OECD Publishing, Paris.
According to the level of advancement towards the transition to a circular economy, it is possible to identify three clusters of cities and regions:
Advanced: Cities and regions that have developed and put in place circular economy strategies. These cities show strong innovative initiatives, as well as a firm political will in favour of a circular economy. An important future priority for these cities would be to build metrics for measuring progress and evaluating their policies in place. Brussels and the Flanders region (Belgium), Paris (France), Amsterdam (Netherlands) and London (United Kingdom) belong to this cluster.
In progress: Cities “in progress” are those that are taking actions towards the circular economy, following ad hoc initiatives. Cities or regions in this cluster have recently set specific programmes on the circular economy and/or are starting their implementation. They are less advanced compared to the pioneers, but they have already taken key steps towards a circular economy. This is the case of Rotterdam (Netherlands), the Metropolitan Area of Barcelona (Spain) and Glasgow (United Kingdom), amongst others.
Newcomers: Cities in this cluster recognise the relevance and potential of the circular economy and they are exploring options for implementation. These cities have already achieved good results in waste recycling levels (Oslo, Norway); water reuse (Granada, Spain); have signed political commitments to advance towards a circular economy (Milan and Prato, Italy); are starting to develop a circular economy strategy (Groningen, Netherlands; Umeå, Sweden); or have included the circular economy in broader policy plans (Helsinki and Oulu, Finland). These cities see in the circular economy a means for reducing environmental impacts in cities while increasing attractiveness and competitiveness. The city of Valladolid is included in this cluster.
Each city and region, regardless of their level of advancement, can identify the conditions needed to transition to a circular economy, making sure that people are engaged, policies are co‑ordinated and that linkages across places are set to close the loops (3Ps Framework) (OECD, 2016[26]):
People: The circular economy is a shared responsibility across levels of government and stakeholders. As such, it is key to identify the actors that can play a role in the transition and allow the needed cultural shift towards different production and consumption pathways, new business and governance models. For example, the business sector can determine the shift towards new business models (e.g. renting, reusing, sharing, etc.). Citizens, on the other hand, make constant consumption choices and can influence production.
Policies: The circular economy requires a holistic and systemic approach that cuts across sectoral policies. As somebody’s waste can be a resource for somebody else, the circular economy provides the opportunity to foster complementarities across policies. The variety of actors, sectors and goals makes the circular economy systemic by nature. It implies a wide policy focus through integration across often siloed policies, from environmental, regional development, agricultural and industrial ones. Identifying these key sectors and possible synergies is the first step to avoid the implementation of fragmented projects over the short-medium run, due to the lack of a systemic approach.
Places: Cities and regions are not isolated ecosystems, but spaces for inflows and outflows of materials, resources and products, in connection with surrounding areas and beyond. Therefore, adopting a functional approach going beyond the administrative boundaries of cities is important for resource management and economic development. Linkages across urban and rural areas (e.g. related to bio‑economy, agriculture and forest) are key to promote local production and recycling of organic residuals to be used in proximity of where they are produced, to avoid negative externalities due to transport. At the regional level, loops related to a series of economic activities (e.g. to the bio-economy) can be closed and slowed.
As a result and in accordance with predefined short-, medium- and long-term objectives, cities and regions can play a role as promoters, facilitators and enablers in the transition from a linear to a circular economy. In practice:
Cities can promote the circular economy as illustrated by the roadmaps and strategies set out in cities like Brussels (Belgium), Paris (France), Amsterdam (Netherlands) and London (United Kingdom). These strategies identified priorities, promoted a number of concrete projects and engaged stakeholders.
Cities can facilitate connections across business, citizens and levels of government. They help direct and facilitate contacts, inform about existing projects, provide soft and hard infrastructure for new circular businesses. The city of Phoenix (United States), for example, created together with the Arizona State University a Resource Innovation and Solutions Network (RISN) Incubator for accompanying businesses in the shift towards a circular economy. In 2017, the city of Paris, France, launched a circular economy incubator, hosting 19 start-ups.
Cities can enable the circular economy transition to happen by providing the appropriate governance and economic tools. Cities can set up incentives, catalyse funds, adapt regulations, etc. For example, the London Waste and Recycling Board (LWARB) in London (United Kingdom) proposed to develop a venture capital fund, seeking private sector partners to join; the city of Amsterdam (Netherlands) created a revolving sustainability fund for businesses to pay back within 15 years with a very low interest rate.
This analytical framework applied to the case of Valladolid, Spain, will identify the main opportunities and challenges (Chapter 2) as well as tailored policy recommendations to promote, facilitate and enable the circular economy (Chapter 3).
People and firms: A circular community-enhancing innovation
In Valladolid, there is an emerging community of circular entrepreneurs that could act as thematic “ambassadors”. The circular economy municipal grants in 2017 and 2018 have been an important driver to create a circular economy community in Valladolid. According to this community, made by entrepreneurs, micro and small businesses and civil society, the municipal grant served to stimulate innovation, prototypes and projects, while sharing the risks related to these types of experimental activities. Even if the group is still relatively small in size, it can act as a catalyst of change to spread the message to their fellow citizens and other businesses.
The circular entrepreneurs are developing new business models and practices to stimulate the transition towards a circular economy (see Annex A). For example, by:
Promoting reuse and recycling of goods and products. Some projects, for example, focus on the recycling of laptops’ batteries and extinctors’ components or the reuse of electronic material. While reducing waste sent to landfill, the major issue is the lack of a profitable market for these secondary products.
Connecting actors for the supply and demand of secondary material, through an online platform (app) that aims to connect waste producers (supply side) and companies looking for waste as a resource (demand side), so for them to get in touch and reach an agreement, either as a free transfer or by setting a price.
Developing a certification for circular economy-related industrial processes. Local businesses’ representatives consider that a certificate awarding circular economy activities could stimulate businesses, while informing the administration during the selection process of a public tender. This certification could be complete or partial, considering the different phases of the production (e.g. eco‑design, use of recycled material, etc.). The development of a protocol on the requisites to obtain the circular certification is ongoing.
Stimulating eco-design. Several projects focus on eco-design: from electrical appliances to a modular design for products’ components to be easily reused.
Civil society organisations and consumer associations are also fostering the transition to the circular economy. During 2018 and 2019, the Federation of Neighbourhood Associations of Valladolid (Federación de Asociaciones Vecinales de Valladolid) created an online circular observatory to share information on the circular economy and monitor citizens’ level of engagement. The organisation also developed an online “monitoring game” to promote reuse, raise awareness on the circular economy and signal the location of second-hand objects (Federation of neighbourhood associations of Valladolid, 2019[27]).
Technical and non-technical knowledge on the circular economy can be built by universities, research centre and technological parks. The University of Valladolid (UVa) and the Technological Agricultural Institute of Castile and León (Instituto Tecnológico Agrario de Castilla y León, ITACYL) collaborate on bio-economy research projects, while a project on the circular economy is underway. The UVa and the University of Salamanca work together on solutions for digitalising the agro-food sector’s value chain. A metabolism study by the University of Valladolid supported the preparation of the food strategy of the city (Lomas and Carpintero, 2017[28]). The University School of Agricultural Engineering (Escuela Universitaria de Ingeniería Agrícola, INEA) created a composting plant to reuse agricultural waste, a bank of seeds, a bank of farm implements and a food bank to be shared among producers and to minimise food waste. The school also contributed to creating a shop located in the centre of Valladolid to promote local zero-km food. Several foundations (e.g. CARTIF, CIDAUT) promote research and pilots on biomass, biotechnology and waste valorisation to reuse materials in the building and automotive sectors. All these activities pave the way for further engagement on the circular economy, both in terms of building knowledge and stimulating collaboration with the public and the private sectors.
The technological clusters and the business sector in Valladolid and in Castile and León can contribute to the transition to a circular economy. The Innovative Business Cluster on Efficient Construction (Agrupación Empresarial Innovadora para la Construcción Eficiente, AEICE) gathers more than 100 partners within the construction value chain. The cluster aims to foster innovation and find collaborative solutions amongst their partners and other private and public stakeholders, while promoting circular economy practice amongst its members. In 2017, the AEICE committed to the reuse of construction and demolition waste. The Agency of Innovation and Economic Development supported the AEICE in the development of the “Guide for the use of recycled aggregates” (AEICE, 2018[29]) that provides recommendations to the Valladolid municipality on how to include recycled aggregates in public tenders (e.g. introducing the condition of replacing natural aggregates by artificial ones). The cluster’s project “Bio-Economy: A Bio-economy strategy for the food industry of Castile and León” (BioEconomIA: Estrategia de Bioeconomía para la Industria Alimentaria de Castilla y León) aims to help its member companies adopt circular economy strategies. This is promoted by the Association of Food Industry in Castile and León (Asociación de la Industria Alimentaria de Castilla y León, VITARTIS), which represents 47% of the agro-food regional sector and aims to increase the sectors’ productivity with a special focus on bio-economy (VITARTIS, 2019[30]).
The artisan sector can play an important role in the transition from a linear to a circular economy. The sector can be particularly key in reusing and repairing activities that require specific skills, for example in the textile sector. Moreover, as argued by the Regional Centre of Entrepreneurs, which gathers around 1 000 small companies (<10 employees), companies increasingly use recycled materials in their production processes. However, there are several obstacles related to the regulation (e.g. lengthy process to obtain permits) and the price of products and goods that might be not competitive.
The Chamber of Commerce of Valladolid developed capacity building programmes on the circular economy. In 2018, the Chamber of Commerce launched a master course in “Digital transformation and the circular economy”. The curriculum included product life cycle analysis, eco-design, circular value chains and data mining (Valladolid Chamber of Commerce, 2019[31]). The aim of the master, beyond building specific skills on the circular economy, was also to increase awareness among professionals. The Chamber of Commerce, together with research partners, is creating consulting models for companies willing to adopt circular economy processes.
Policies: Identifying sectors holding potential for the circular economy
All sectors are concerned in a circular economy, but some have higher potential. Often the circular economy in cities and regions is seen as a synonymous of waste recycling but it is more than that. Cities and regions in their circular economy strategies have identified key sectors that show the greatest potential in terms of economic, social and environmental benefits. These sectors include built environment, food, water, and textile amongst others. According to local specificities, cities and regions are setting up circular economy initiatives for less traditional sectors, such as fashion and culture.
Making a sector “circular” implies rethinking value chains and production and consumption processes. “Circularity” implies that any output can be an input for something else within and across sectors. It aims to: make products and goods last longer through better design; produce goods using secondary and reusable materials, and renewable energy, while reducing atmospheric emissions; produce and distribute products locally and consume them in a conscious and sustainable manner; and transform waste into a resource (Figure 2.3).
Figure 2.3. Circularity within and across sectors
Source: OECD (forthcoming[8]), The Circular Economy in Cities and Regions, Synthesis Report, OECD Publishing, Paris.
Various sectors can be taken into account when it comes to fostering the transition from a linear to a circular economy in Valladolid, Spain. According to the results of the OECD Survey on the Circular Economy in Cities and Regions (2019[32]), the municipality identified the following sectors as of interest for a circular economy strategy in Valladolid: land use and spatial planning, manufacturing industry, waste, textile, mobility, water, food and beverage, retail, sanitation and construction and demolition (Figure 2.4). Below, specific attention will be dedicated to those sectors that more prominently stand out from the discussion with various stakeholders in Valladolid. This is key to establish the role of the “do-ers” (e.g. entrepreneurs, SMEs, private companies, CSOs, etc.) in the transition from a linear to a circular economy and foresee coherent policies for the future. Information on the sectors included in other cities’ and regions’ circular economy initiatives is presented in Table 2.5.
Figure 2.4. Sectors of interest for a circular economy strategy in Valladolid, Spain
Source: Own elaboration based on the city of Valladolid’s answers to the OECD (2019[32]) OECD Survey on the Circular Economy in Cities and Regions.
The city took the first step to identify the economic sectors that have potential for the circular economy. The city financed a study called “Valladolid is Circular” (Enviroo, 2019[33]), in order to identify the potential of specific economic activities, such as: agriculture, public administration, hospitality industry, education, manufacture of other non-metallic minerals, metallurgy, retail industry, energy supply, real estate activities, food industries and manufacture of motor vehicles, trailers and semi-trailers. The evaluation took into account three factors: value added, job creation and environmental impacts (e.g. water and energy consumption, waste production, etc.). Agriculture is considered the sector with the biggest potential for the circular economy, driven mainly by its environmental impacts. Public administration ranked second mainly because of its importance as the main employer in the city (21 370 employees); followed by the hospitality sector for its value-added contribution to the local economy (6.71% of the total) (Enviroo, 2019[33]). The study concluded with some recommendations, such as:
Carrying out an innovative public procurement procedure adding social and environmental clauses in tenders.
Promoting the implementation of environmental management systems in companies through information and training.
Labelling of products according to the circular economy criteria.
Favouring waste separation, exploring linkages among sectors and identifying existing barriers to reuse and recycling.
Promoting the Life Cycle Analysis (LCA) of products and carbon footprint reduction strategies.
Raising awareness through ad hoc campaigns, for example in schools in Valladolid.
The 61 projects that benefitted from the municipal grants in 2017-18 focus on the following sectors: energy (portable solar kit; use of hydrogen as an alternative fuel); waste (improving the selective waste collection system using real-time data; exchange platform of secondary materials; compost and bio-fertilisers from farming waste; micro-recycling, reducing waste in the catering industry; biodegradable prototype packaging); water (reuse of rainwater in public institutions; network of water dispensers; educative games), and; building (cradle-to-cradle products development) (Annex A).
Table 2.5. Example of sectors included in circular economy initiatives at the subnational level
Source: OECD (forthcoming[8]), The Circular Economy in Cities and Regions, Synthesis Report, OECD Publishing, Paris.
Waste
The municipality is responsible for the waste management system in Valladolid. By law,5 the local government is responsible for providing waste collection and treatment services. The municipality has implemented a selective household waste collection system that collects organic and non-organic waste separately. Regarding non-organic waste streams, the separate collection of paper, glass, batteries and domestic oil is carried out in individual containers. Plastic and metallic packaging are separated in Valladolid’s waste treatment centre (Centro de Tratamiento de Residuos de Valladolid, CTR) where all collected waste is treated. Different companies, registered under the Integrated Management System, provide waste containers and waste collection vehicles. This is the case of ECOVIDRIO for glass and Ecoembes for paper, carton, plastic and metallic packaging (Box 2.4). The municipality has also created five “clean spots” (Puntos limpios) where households can deploy toxic or voluminous residues. Valladolid is one of the three municipalities in Spain that finances the waste management system through the general taxation system (Fundació ENT Catalunya, 2018[34]). In 2015, the local government removed the waste tax6 that had been in place from 2013 to 2015. This tax used to collect EUR 10 million per year (Valladolid Municipality, 2015[35]).
The Business Confederation of Valladolid (Confederación Vallisoletana de Empresarios, CVE) runs a pilot project to reduce waste management costs by fostering separate collection. Information related to the quantity and quality of waste produced by the companies participating in the project was shared with the waste department of the municipality of Valladolid in order to re-organise the waste collection system in a more efficient way by using real-time data and to put in place a penalty system in case of misbehaviour. Other circular economy initiatives related to the waste sector are detailed in Annex A. One example is the platform for the exchange of secondary materials developed by the Valladolid Business and Professionals Association (Asociación de empresas y profesionales, EDUCA).
Box 2.4. Circular economy initiatives by the Ecoembes
Ecoembes is a non-profit environmental organisation responsible throughout Spain for promoting and managing the system for recycling household packaging waste. Ecoembes gathers more than 12 000 companies that by law (Ley 11/1997 de 24 de abril, de Envases y Residuos de Envases, Law on Packaging and Packaging Waste)7 are requested to finance a system of selective collection and recycling of household packaging.
Ecoembes promotes the circular economy through several initiatives in Spain:
The CircularLab: The lab promotes collaboration with companies, public administrations and citizens of the Autonomous Community of La Rioja (Spain) to develop best practices in all phases of the packaging life cycle, from eco-design to its reintroduction to the consumption cycle through new products.
La Victoria neighbourhood: In 2018, the City Council of Valladolid and Ecoembes started a pilot project of the circular economy in the neighbourhood of La Victoria. The objective of the project is to achieve separate collection by 60% by 2030, in line with the European objectives. The initiative began in March 2018 and concluded in April 2019. The percentage of waste disposed of for selective collection rose from 32.8% of the total in March, when the campaign began, to 51.3% in April 2019.
Recycling 5.0 project: Launched in 2019, the project aims to encourage recycling through an application that allows citizens to connect their mobile phones to the containers. The user will take a picture of the bar code of each bottle deposited in the yellow bin and link the action with the QR code present in the container. The system digitally registers all the activities and, depending on the amount of bottles recycled, it provides users with credits to be exchanged products or services that contribute to achieve sustainability goals. Four municipalities, two universities and a hospital in Catalonia are piloting the project.
Sterling project: It consists of the installation of ten intelligent yellow containers for plastic containers and cans on the Valladolid Campus. These containers are equipped with filling, temperature and humidity sensors. Through an app, the containers are able to automatically identify the users who use them. Each time the Sterling container is used, the user will receive a Sterling point. Each month, participants who have accumulated ten or more Sterling points can win one of the three gift cards (equivalent to EUR 20) offered by the project organisers. The project benefitted from municipal grants launched in 2018.
Source: Ecoembes (2019[36]), Homepage, https://www.ecoembes.com/es (accessed on 7 June 2019); The Circular Lab (2019[37]), The Circular Lab (2019), Homepage, http://www.thecircularlab.com (accessed on 7 June 2019); European Circular Economy Stakeholder Platform (2018[38]), Citizen Participation and Circular Economy: A Pilot Project in the City Hall of Valladolid, https://circulareconomy.europa.eu/platform/en/good-practices/citizen-participation-and-circular-economy-pilot-project-city-hall-valladolid (accessed on 7 June 2019); Valladolid Municipality (2018[39]), “El Ayuntamiento y Ecoembes impulsan un proyecto piloto de economía circular para lograr el correcto depósito del 60% de los residuos en un año”, http://www.valladolid.es/es/actualidad/noticias/ayuntamiento-ecoembes-impulsan-proyecto-piloto-economia-cir (accessed on 7 June 2019); University of Valladolid Website (2019[40]), Homepage, http://comunicacion.uva.es/export/sites/comunicacion/98240de9-350c-11e9-b081-d59857eb090a/ (accessed on 7 June 2019).
Valladolid has been a pioneer in introducing organic waste separation in the metropolitan area. Organic waste collection, the responsibility of the municipality, started two decades ago in Valladolid and a facility upgrade has been planned. After the collection process, the organic waste is treated, producing compost and stabilised bio-waste. The compost produced is used in the rural areas located in the surroundings of the composting plant, predominantly to grow cereal. This compost is of low quality and cannot be certified in ecological terms.8 As such, it can be reclaimed for free by local producers. A tender for constructing a modern composting plant is under preparation. The new plant will increase the quality of the compost and make it profitable. It will be located in the outskirts of Valladolid and should be operative by 2020. So far, there is no waste resources plan to define clear goals and vision although a draft plan has been elaborated aiming to move up the waste hierarchy following the EU approach (Box 2.5). The draft plan is expected to be approved by July 2020.
Box 2.5. The EU’s approach to waste management
In the last 30 years, the European Union (EU) waste policy has aimed to reduce negative environmental and health impacts through the creation of an energy and resource-efficient economy and to limit the amount of waste generation associated with economic growth.
The Waste Framework Directive is the cornerstone of EU waste policy. The directive established a five-step waste hierarchy. Waste prevention and reduction is the top priority, followed by reuse, recycling and other forms of recovery, with disposal (e.g. landfill) as the last resort. EU waste legislation aims to move waste management up the waste hierarchy (Figure 2.5).
Prevention: Successful waste management is able to prevent waste generation in the first place. Waste prevention and reduction are increasingly important as the global population and demand for finite natural resources increases.
Reuse: Consists of the repeated use of products or its components for the same purpose for which they were designed (e.g. refrigerators, ink cartridges).
Recycling: Reduces the amount of waste that ends up in landfill sites while cutting down on the amount of material needed from the natural environment. In 2016, Spain only recycled 29.7% of its municipal waste and this level stayed almost the same since 2010.
Energy recovery: Energy recovery reduces carbon emissions by replacing the use of fossil-fuel-based energy sources and substituting methane emissions generated in landfills. It is usually applied to different methods for converting waste into energy (e.g. electricity, steam and heating for buildings). However, energy recovery through incineration is often not the most efficient way of managing used materials. Life cycle analysis is encouraged to identify the net environmental benefits and damages of waste incineration. A total of 13% of municipal waste in Spain is used for energy recovery.
Disposal: Landfill is the least desirable option due to its numerous negative environmental impacts. The most severe is the production and release of methane into the air (25 times more potent than carbon dioxide). If converted to energy, the methane produced by an average municipal landfill could provide electricity to approximately 20 000 households for a year. In Spain, 56.7% of municipal waste was sent to landfill in 2016 (EAE, 2018[41]).
Figure 2.5. Waste hierarchy in the EU
Source: EC (2010[42]), Being Wise with Waste: The EU’s Approach to Waste Management, https://ec.europa.eu/environment/waste/pdf/WASTE%20BROCHURE.pdf (accessed on 29 November 2019).
In December 2015, the European Commission (EC) adopted a package to support the EU’s transition to a circular economy. The initiative was designed to contribute to “closing the loop” of product lifecycles through greater recycling and reuse and bring benefits for both the environment and the economy. Additional measures and updates followed in 2018 and 2019. The package included the EU Action Plan for the Circular Economy outlining 54 measures addressing various aspects of the circular economy and focusing on 5 priority areas (plastics, food waste, critical raw materials, construction and demolition, and biomass and bio-based products) as well as 4 legislative proposals amending the following legal acts: Waste Framework Directive; Landfill Directive; Packaging Waste Directive; Directives on end-of-life vehicles, on batteries and accumulators and waste batteries and accumulators, and on waste electrical and electronic equipment.
Source: EC (2010[42]), Being Wise with Waste: The EU’s Approach to Waste Management, https://ec.europa.eu/environment/waste/pdf/WASTE%20BROCHURE.pdf (accessed on 29 November 2019); EC (2008[43]), Directive 2008/98/EC on Waste (Waste Framework Directive) - Environment, https://ec.europa.eu/environment/waste/framework/ (accessed on 3 December 2019); EC (2015[44]), Closing the Loop - An EU Action Plan for the Circular Economy, https://eur-lex.europa.eu/resource.html?uri=cellar:8a8ef5e8-99a0‑11e5‑b3b7‑01aa75ed71a1.0012.02/DOC_1&format=PDF (accessed on 5 February 2020); EAE (2018[41]), Gestión de residuos y Economía Circular, http://marketing.eae.es/prensa/SRC_Residuos.pdf (accessed on 3 December 2019); OECD (forthcoming[8]), The Circular Economy in Cities and Regions, Synthesis Report, OECD Publishing, Paris.
Mobility
The municipality of Valladolid is promoting sustainable mobility. As a “lighthouse city”,9 the municipality is part of the European funded project REMOURBAN that aims to foster sustainability and improve citizens’ quality of life through energy efficiency, electric mobility and digital technology. As such, it aims at increasing low carbon mobility solutions by 5% in the short term and 25% in the medium term. This change should reduce CO2 emissions by half. The municipality is heading towards an electric public transport fleet, while also offering incentives to companies to use electric vehicles (e.g. to perform last-mile services, conform their business fleets or providing taxi services). The circular economy can stimulate the debate on sustainable mobility (green public transport, electric cars), reuse and dismantling of batteries and rechargers for green mobility and the interaction between land use and mobility to favour a more efficient use of the public space (e.g. car parking, green areas). For example, the city of Paris has planned to develop a local urban planning scheme that aims to preserve existing logistics facilities and to create 15 “urban logistics spaces” (Espaces Logistiques Urbains, ELU) to improve logistics and foster shared mobility services (Paris Municipality, 2017[45]).
Building sector
The European and national regulations are advancing towards a more sustainable building sector. The updated EU Energy performance of buildings directive (EPBD) (2018/844/EU), adopted in July 2018, establishes that by 2050 all national building stocks have to be zero-energy buildings. This means that the total amount of energy used by the building on an annual basis is equal to the amount of renewable energy created on the site (EC, 2018[46]). Countries will need to develop a National Energy and Climate Plan (NECP) that defines long-term renovation strategies. Indicative milestones for 2030 and 2040 have been established to assess and monitor progress. At the same time, the directive states that from 2021 all new buildings in the EU must be nearly zero-energy buildings (NZEB). Currently, EU countries need to perform energy-efficient renovations to at least 3% of the total floor area of the buildings owned and used by the central government (EC, 2018[46]).
In Valladolid, initiatives are in place to improve the energy performance of buildings and experiment with new schemes of district heating. Following the EU Energy Efficiency Directive (2012/27/EU), since 2014, the city has committed to make energy efficiency renovations in at least 3% of the city-owned buildings. The municipality set as a priority to maximise the energy efficiency of the public building stock, minimise under-utilised public buildings and generate energy consumption information in order to optimise the use in each building. As part of the EU project REMOURBAN, the municipality advanced in the energy rehabilitation of the 398 homes, with 1 000 inhabitants in a 24 000 m2 area. District heating and hot water are provided by biomass, while electricity is provided by photovoltaic panels installed in the facades of the buildings (Valladolid Municipality, 2017[47]). In some public buildings, such as the Regional Council and on the University of Valladolid campus, biomass is used for heat and hot water. In addition, the Circular Eco-design Centre has been launched in 2019 as a space for collaboration and co‑creation of eco-design innovation applied to the habitat and construction value chain (AEICE, 2019[48]).10 More information on existing circular economy initiatives in the building sector can be found in Annex A.
Water
Promoting drinking water, water reuse and raising awareness on the value of water can be part of a circular economy approach. In Valladolid, actions are carried out to: promote a plastic-free water culture; reuse water for irrigation in public institutions; and use green infrastructure. The reduction of single-use plastic is promoted through the creation of a network of water dispensers in Valladolid and an online map to share their location. Water reuse is fostered through the development of a rainwater collection system in public institutions such as schools. The aim is twofold: reducing the risk for flooding and reusing rainwater to irrigate schools and urban gardens. A third aspect promoted in the sector is raising awareness among students (from school to university) on green infrastructure and the importance of the water cycle in Valladolid.
Hospitality sector
The hospitality sector shows high potential for applying the circular economy approach. The study “Valladolid Circular” (Enviroo, 2019[33]) identified challenges and opportunities for the sector within the circular economy. One of the most prominent issues is the production of waste. As such, the sector is responsible for 70% of organic waste or mixed waste. There is room for improvement in terms of separate collection and energy efficiency. As such, several initiatives are already in place in hotels, restaurants and bars, in order to: i) reduce single plastic use and food waste; ii) create a new business model to recover and transform organic waste collected from bars and restaurants in the city, through waste treatment, and; iii) apply the product-as-a-service business model to the sector offering rental of equipment and machinery for the hotel/restaurant sector. The hospitality sector is likely to generate value added and job creation. Specific circular projects related to the hospitality sector are listed in Annex A.
Places: Fostering urban-rural synergies for the circular economy
The regional bio-economy and the municipal food strategies hold potential in fostering urban-rural synergies. The Municipal Food Strategy (Alimenta Valladolid, 2018[49]) intends to improve the co-ordination between urban and rural areas and create employment opportunities whereby the city can act as an agro-incubator for responsible consumption and local production. It foresees the creation of a “land bank” (banco de tierras) that the municipality could rent to local producers at affordable costs. The eco-markets located in the city and its surroundings (e.g. the ecological market located at the Centre of Environmental Resources, Centro de Recursos Ambientales, PRAE) are a first step to bring local production to city customers. Moreover, the municipality is planning actions to improve the measurement, tradability and quality of organic waste from urban (e.g. hotel and restaurant sector) and rural areas. The Castile and León’s Bio-Economy Strategy (Government of Castile and León, 2019[50]) is the first regional bio-economy strategy in Spain. One of the objectives is to promote the demand and development of markets related to the bio‑economy. This can affect the city of Valladolid. Further details on the Castile and León’s Bio‑Economy Strategy and the Municipal Food Strategy are provided in Box 2.6.
Box 2.6. The Castile and León’s Bio-Economy Strategy and the Municipal Food Strategy
The Castile and León’s Bio-Economy Strategy (Programa de Bio-Economía Circular de Castilla y León) foresees four main lines of action:
1. Foster public-private research and technological development.
2. Raise awareness on the bio-economy.
3. Develop a regional supply of bio-economy products and services.
4. Promote the demand and development of markets related to bio-economy.
The Food Strategy of Valladolid (Estrategia Alimentaria de Valladolid) defines 6 areas of action, covering 13 measures and setting out a total of 66 actions to be implemented in the period 2019-23:
1. Protection and revitalisation of the productive potential of Valladolid’s agricultural land.
2. Access to healthy, ecological, diverse and quality food.
3. Promotion of local distribution networks.
4. Culture of responsible food.
5. Food waste prevention.
6. Good governance and inter- and intra-administrative co‑ordination.
The strategy aims to create a municipal food council formed by the local sectoral actors (public, private and civil society organisations) that have been contributing to the strategy since 2017. The future municipal food council will be responsible for monitoring the implementation of the strategy’s goals. The strategy will map the relevant stakeholders that take part in the local agro-food sector and the existing economic and social networks among them to foster potential synergies throughout the sector’s value chain.
Source: Alimenta Valladolid (2018[49]), Valladolid’s Food Strategy, http://www.alimentavalladolid.info/ (accessed on 11 June 2019); Government of Castile and León (2019[50]), Castile and Leon’s Bio-economy Strategy, http://www.redei.es/images/2018/Estrategia_ICE_Bioeconom%C3%ADa.pdf (accessed on 11 June 2019); ITACYL (2019[51]), Plan de Impulso a la Bioeonomía Agroalimentaria para un Entorno Rural Competitivo y Sostenible en Castilla y León, http://www.itacyl.es/documents/20143/0/PlanImpulsoBioeconomiaAgroalimentaria_2019.pdf/34554980-e0c5-bcca-6420-b5c8ec857cd8 (accessed on 18 October 2019).
There are several examples of circular related activities in the agriculture sector in Valladolid and its surroundings. Some good practices from companies located in the surroundings of Valladolid have been identified in the agro-food and livestock sector. Practices consist in: reducing food waste and water consumption during the processing and packaging phases; donating food with visual defects to food banks and making it available to vulnerable families; reusing organic waste; reducing the use of chemical additives (INEA, 2018[52]). Other practices that can be linked to a circular economy approach consist in promoting urban agriculture.
Metropolitan co‑operation holds the potential to further strengthen service provision in a sustainable and circular way. The Association of General Urban Interest, former Urban Community of Valladolid (Comunidad Urbana de Valladolid, CUVA) aims to provide services in a co‑ordinated manner to the almost 410 000 inhabitants living in the metropolitan area of Valladolid. The 25 member municipalities are working together to better connect each other through public transportation, sharing wastewater treatment facilities, and in the implementation of the food strategy. At the metropolitan level, the circular economy can be fostered by identifying resource streams in the area, creating a community of practice and using public procurement to stimulate circular products, amongst others.
Governance challenges to design and implement the circular transition
Mostly, the challenges cities and regions are facing in building circular economies are not of a technical but of an economic and governance nature. Technical solutions exist and are well known. However, to implement them, information and financial resources are needed, as well as an updated legal frameworks. Often, a holistic vision is still missing because of siloed policies. Cultural barriers are still a very important obstacle (OECD, forthcoming[8]). Key governance challenges to design and implement the circular transition in Valladolid, Spain, are presented below.
The development and implementation of the circular economy strategy will demand more effective co‑ordination among municipal departments and a clearer definition of the allocation of roles and responsibilities. There are no institutional incentives for horizontal co-ordination at the technical level, nor specific co-ordination mechanisms or joint programmes amongst municipal departments. This can generate duplications and costs inefficiencies. For example, municipal departments agree that the design of bicycle lanes was a missed opportunity for collaboration across: urbanism, infrastructure and housing; citizen participation, youth and sports, and environment and sustainability departments. Further co-ordination will be needed across municipal departments in charge of environment, mobility, social and economic activities, in order to maximise synergies and investments for the circular economy.
Co-ordination across levels of government is needed to align the goals of national, regional and local circular economy strategies, as well as to adapt the regulatory (e.g. green regulation) and fiscal system (e.g. preventing double VAT charges for secondary material) to the transition to a circular economy. Some examples of coordination are the following: the National Co‑ordination Waste Commission involves national, regional and local authorities, represented by the FEMP. This commission integrates 12 technical working groups (one per waste stream), including a specific one on the circular economy. There is also an Inter-ministerial Committee for the Circular Economy.
The issue of scale is key for the circular economy to take place and to move from experimentation to business as usual. In the case of Valladolid, a total of 61 projects benefitted from municipal grants for the circular economy in 2017-18. Projects are related to different sectors and type of activities: from awareness-raising to knowledge building or technological development. Nevertheless, they are mostly carried out at the neighbourhood or individual scale. In order to achieve the expected social, economic and environmental impacts of the circular economy, these projects should be scaled up after the experimentation phase.
Policy coherence should be fostered and existing circular economy-related initiatives could benefit from greater coherence and a long-term view. Policy coherence is linked with the long-term vision of the city. Three main challenges can be identified:
Coherence across existing policies and plans: Valladolid is implementing different policies and programmes (e.g. Smart City Programme, urban sustainable mobility, green infrastructure, district heating, circular economy) that would benefit from a more holist approach and from greater co‑ordination to close loops. Currently, it is not clear how the abovementioned policies connect to one another in a coherent manner. For example, the New General Urban Plan (2019) that promotes a compact city model could be linked to various actions in complementary sectors that foster circularity in the city, from mobility to infrastructure.
Coherence across current and future circular projects: At the moment, there is the risk of delivering isolated circular economy actions while missing the long-term vision. It is unclear how the selected projects will contribute to the overall vision of the city of Valladolid.
Coherence across EU funded projects and circular economy-planned initiatives: The city relies heavily on European funds for policy innovation. However, initiatives can result in fragmented actions, which could be oriented short- to medium-term. The municipality conceives the European projects as a way of experimenting with new policies without using local taxpayers’ money and as an opportunity to foster public-private partnerships under the “consortium agreement” model. For example, the mentioned REMOURBAN project that focused on improving buildings’ energy efficiency was applied to the residential FASA district, a neighbour located in the South-East of the city, but was not integrated into a city-level strategy. The same happened with the biomass district heating system installed by the municipality in the FASA neighbourhood that was not part of a broader plan. The municipality would need to clarify how to maximise synergies between these initiatives and those planned within the circular economy approach.
Capacities in the municipality should be built to match the needs of the circular economy transition, in terms of skills and human resources. Adapting the responsible authorities’ capacity level to the complexity of the circular economy challenges is key. The Agency of Innovation and Economic Development in charge of the development of the Circular Economy Strategy, as well as of the implementation of several EU-funded projects on sustainability, mobility and energy efficiency is composed of a group of 17 motivated and competent people. It is expected that more staff would be needed to meet the workload on the circular economy (e.g. to support business, organise events, etc.). Similarly, given the multi-disciplinary nature of the circular economy, the municipality should evaluate whether the needs of the circular economy transition match the skills and human resources available within the municipality departments.
Efforts to improve the environmental, social and economic database are ongoing but there is room for improvement in terms of data availability and frequency. Data sources are fragmented across different agencies, e.g. the Urban Observatory (Valladolid en cifras), the “Air pollution control network of the city of Valladolid” (Red de Control de Contaminación Atmosférica del Ayuntamiento de Valladolid, RCCAVA), the waste treatment centre (Centro de Tratamiento de Residuos de Valladolid, CTR Valladolid), the housing institute (Sociedad Municipal de Suelo y Vivienda, VIVA), the environmental control section (Sección de control ambiental), the public bus company (Autobuses Urbanos de Valladolid S.A., AUVASA), and the water management company (Agua de Valladolid E.P.E., Aquavall). Data referring to the waste and energy sectors, which are key for the circular economy, are not publicly available or presented in a systematic way. The municipal information system (e.g. Valladolid en Cifras) does not provide updated public data on air pollution; waste production and recycling; water consumption and reuse; or flooding risks.
Information on the circular economy should be improved. There is a lack of understanding of the potential benefits of the circular economy and scarce interest from companies and citizens. More than 70% of companies in Valladolid of a total of 70 companies surveyed in 2018 declared that they do not know the meaning of the circular economy. They associate the term to minimising waste production, recycling and reusing and they state that they are already implementing these processes in a regular way (EDUCA, 2018[53]). On the other hand, 85% of consumers in Valladolid do not know what the circular economy means and only 52% of consumers expressed they “always” or “regularly” separate waste (EDUCA, 2018[53]). Citizens tend to feel no obligation to separate waste because they are already paying taxes for that (not linked to their waste generation). While separated collection is compulsory, there is no enforcement on waste collection. The lack of waste separation generates extra costs for the municipality at the collection and treatment steps.
Public funds to start and scale-up projects in relation to a circular economy are limited and access to other sources is not easy. The municipality subsidised 61 projects in 2017‑18. Most of the projects related to the circular economy (whether concerning a new design for more durable products, use of secondary material in production processes or transformation of waste into resources) still have an experimental nature. Their profitability is uncertain. Entrepreneurs face a high investment risks and maintenance costs (e.g. the costs of secondary materials compared to virgin ones). This situation adds to the fact that access to loans is not always guaranteed. As such, innovators rely on business angels willing to promote and finance circular economy projects, ethical banking (Fiare,11 Triodos),12 financial agencies (Finnova)13 or private equity firms. After this initial phase, the challenge for innovators is how to make their projects economically sustainable in the medium and long terms.
Valladolid, like other municipalities, needs to consider how fiscal and economic tools could incentivise the transition towards a circular economy. A range of economic and fiscal instruments can be used to shift behaviour towards greater environmental responsibility for citizens and business (Box 2.7). Local taxes (e.g. the waste tax) or specific incentives (e.g. discounts) can incentivise behaviour with regards to increasing separate collection. However, criteria for defining the level of taxation should be clear as well as the incentive for the citizens. This requires also enforcement measures. In Valladolid, a waste tax was introduced between 2012 and 2015 and then removed for political reasons.
Box 2.7. Examples of economic instruments for the circular economy
Economic instruments are tools for incentivising or disincentivising specific behaviours. For example, they could induce, by means of higher/lower prices, more sustainable consumption; value-added tax (VAT) exemptions can help businesses use green technologies; incentives on renewable energy can support its wider use. According to the European Energy Agency (2016), to date, efforts have been fundamentally focused on the area of energy, transport and climate, with limited action in relation to issues of pollution and resource use. However, there are several examples:
Discounts on taxes: in 2018, the city of Milan (Italy) developed actions to address food waste, including a 20% discount on waste tax for businesses (supermarkets, restaurants, canteens, producers, etc.) that donated their food waste to charities. The action is co-ordinated by different municipality departments (fiscal, environmental, food policy). Around 10 000 businesses have benefitted from this tax reduction, with an impact of EUR 1.8 million. The city of Shanghai (China) has offered VAT reductions to a recycling company working on the circular economy project of the city. The city of San Francisco granted discounts on their waste fees to businesses using separate sorting collection bins, which allowed San Francisco to become the city in the United States with the least amount of waste going to landfills. With the aim of stimulating the separate disposal of food waste, the city of San Sebastian (Spain) provided households with a specific organic waste collector located in the street and unlockable using a personal magnetic card. The use of this special bin is associated with a 15% reduction on the waste collection service fee. In order to get the discount, users must use this container at least 4 times a month for 10 of the 12 months of the year.
Differentiated tariffs: The Dutch Government implemented the DIFTAR system, a recollecting scheme based on differentiated tariffs in order to provide incentives to improve waste separation at source. This scheme enables authorities to charge for the generated amount of waste, while it rewards the effort of people who minimise waste and maximise separate collection. The system has been introduced in several small towns in the Netherlands as well as in some urban municipalities with over 100 000 inhabitants such as Apeldoorn, Nijmegen and Maastricht.
Source: Food and Agriculture Organization of the United Nations (2018[54]), Milan: A Comprehensive Food Policy to Tackle Food Waste, http://www.fao.org/3/ca0901en/CA0901EN.pdf (accessed on 7 June 2019); OECD (2013[55]), Scaling-up Finance Mechanisms for Biodiversity, https://dx.doi.org/10.1787/9789264193833-en; European Parliamentary Research Service (2017[56]), Towards a Circular Economy – Waste Management in the EU STUDY Science and Technology Options Assessment, http://www.europarl.europa.eu/RegData/etudes/STUD/2017/581913/EPRS_STU%282017%29581913_EN.pdf (accessed on 5 June 2019); San Sebastian City Council (2016[57]), San Sebastian City Council (2016), “Aprobada la bonificación del 15% en la tasa de basura por utilizar el quinto contenedor”, http://www.donostia.eus/home.nsf/0/DD2431ECEA04493EC1257F4D004D1232 (accessed on 5 June 2019); CNBC (2018[58]), “San Francisco leads the world when it comes to waste management”, http://www.cnbc.com/2018/07/13/how-san-francisco-became-a-global-leader-in-waste-management.html (accessed on 7 June 2019); OECD (forthcoming[8]), The Circular Economy in Cities and Regions, Synthesis Report, OECD Publishing, Paris.
The regulatory framework can be improved to allow circularity. Regulation for preventing food waste or towards clearer criteria to use waste as a resource have a supranational or national connotation. In Spain, there is a Food Waste Strategy and a Food Waste Panel for an early evaluation of food waste. Nevertheless, there is a discussion of a food waste methodology at the EU level, which will be incorporated in the national strategy. At the same time, according to waste regulations, Spanish authorities are making progress in evaluating organic by-products in order to reduce food waste and improve circularity.
Although environmental criteria have been added in public procurement, in practice, price is still the prevailing awarding criterion. The city has approved Municipal Ordinance 1/2018 to Promote Social Efficient Procurement: Strategic, exhaustive and sustainable. The ordinance includes environmental dimensions, entailing that the subject and pricing of municipal contracts should consider life cycle criteria or the most innovative, efficient and sustainable solutions. Expected impacts are related to reducing air pollution, using recycled material and promoting recycling. The municipality has incorporated environmental standards into the tenders to offer public land or old buildings for private investment. In the assessment of contracts, the awarding criteria make explicit references to the circular economy, in terms of use of raw materials, sustainable products, life cycle analysis, useful life, energy efficiency, less maintenance and more sustainable packaging. Nonetheless, the final decision is 60% driven by price and 40% driven by an “improvement criterion” (of which 20% is related to social aspects). Moreover, when introducing environmental criteria, there is the risk for tenders going empty or for companies complaining about the possible threat of anti-rivalry clauses, claiming that only big companies can meet some specific requirements. Finally, there are also difficulties in verifying the information provided by the participants to the tenders, when it comes to environmental dimensions.
Innovation in the business sector is key in the circular economy. However, there is a lack of start-ups in Valladolid that could contribute to this innovation. The economy of Valladolid is mainly characterised by the tertiary sector with little innovation capacity; agro-companies are located elsewhere in the region, while big automotive companies located in Valladolid have their headquarters abroad. As such, the latter do not take the lead in implementing circular changes in business models. The weak link with universities and research centres and the lack of incubators, jointly with endogenous social characteristics (e.g. ageing population), do not create a fertile environment for innovation.
Stakeholder engagement is still not fully exploited. Through the EU-funded projects and the Circular Weekend mentioned above, the city of Valladolid has been working towards greater stakeholder engagement, especially in terms of fostering information and participation. However, there is still room to further improve levels of stakeholder engagement and collaboration. For example, there is no real collaboration across public, private and academic actors. The local government could enhance collaboration with universities and companies in the area, and make the city available as a test-bed for technical and non-technical innovation.
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Notes
← 1. Ministry of the Presidency and Territorial Administrations; Ministry of Energy, Tourism and Digital Agenda; Ministry of Employment and Social Security; Ministry of Home Affairs; Ministry of Economy, Industry and Competitiveness; Tax Office and Public Function; Ministry of Health, Social Services and Equality; Ministry of Agriculture and Fisheries, Food and Environment; and Ministry of Publics Works.
← 2. The new composition is the following: Ministry of Agriculture, Fisheries and Food; Ministry for Ecological Transition and the Demographic Challenge; Ministry of Economic Affairs and Digital Transformation; Ministry of Education and Vocational Training; Ministry of Finance; Ministry of Health; Ministry of Industry, Trade and Tourism; Ministry of the Interior; Ministry of Labour and Social Economy; Ministry of Presidency, Relations with Parliament and Democratic Memory; Ministry of Science and Innovation; Ministry of Territorial Policy and Civil Service; Ministry of Transports, Mobility and Urban Agenda; and Ministry of Universities (Ministry of Presidency, 2020[60]).
← 3. For more information: www.eib.org/en/efsi/index.htm.
← 4. For more information: www.eib.org/en/products/blending/innovfin/.
← 5. Reglamento Municipal de Limpieza, Recogida y Eliminación de Residuos Sólidos Urbanos del Ayuntamiento de Valladolid and Ordenanza Municipal de Protección del Medio Urbano del citado Ayuntamiento.
← 6. For more information: https://www.valladolid.es/es/ayuntamiento/ordenanzas-fiscales/ordenanzas-fiscales-2013/ordenanza-fiscal-tasa-reguladora-servicio-recogida-residuos.
← 7. For more information: www.boe.es/buscar/pdf/1997/BOE-A-1997-8875-consolidado.pdf.
← 8. An example of existing environmental certifications is the ISO 14001 “Environmental Management System”. It provides practical tools for companies and organisations of all kinds looking to manage their environmental responsibilities in order to achieve the necessary requirements to get the certification https://www.iso.org/iso-14001-environmental-management.html.
← 9. The “lighthouse” cities are part of the EU Horizon 2020 project “SmartEnCity” which aims to develop a highly adaptable and replicable systemic approach for transforming European cities into sustainable, smart and resource-efficient urban environments. Other cities involved in the project are Sonderborg in Denmark, Tartu in Estonia and Vitoria-Gasteiz in Spain (SmartEnCity, 2019[59]).
← 10. Two projects are ongoing: “Habitarte”, a contest on eco-design of equipment for buildings for collective use; and “Eco design 4 Contract”, a guide for the implementation of eco-design processes in the “contract industry” (a growing example of the product-as-a-service business model that provides furniture as a service through signing a contract and providing all the furniture needed in an apartment for an agreed period of time) (AEICE, 2019[48]).
← 11. For more information: https://www.fiarebancaetica.coop/.
← 12. For more information: https://www.triodos.es/es.
← 13. For more information: http://web.finnovaregio.org/.