Eco-Industrial Parks: Toward Inclusive and Sustainable Industrial Development

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ECO-INDUSTRIAL PARK: CREATING SHARED PROSPERITY AND SAFEGUARDING THE ENVIRONMENT

INCLUSIVE AND SUSTAINABLE INDUSTRIAL DEVELOPMENT


© 2016 by the United Nations Industrial Development Organization The opinions and information contained are the responsibility of the author and should not necessarily be considered as reflecting the views or bearing the endorsement of UNIDO. Although great care has been taken to maintain the accuracy of information herein, neither UNIDO nor tis Member States assume any responsibility for consequences which may arise from the use of the material. Designations such as “developed”, industrialized” and “developing are intended for statistical convenience and do not necessarily express a judgement about the stage reached by a particular country or area in the development process. The mention of firm names or commercial products does not constitute an endorsement by UNIDO. This document represents work in progress and I intended to generate comment and discussion. The views expressed herein are those of the author and do not necessarily reflect the views of the United Nations Industrial Development Organization. This document may be freely quoted or reprinted but acknowledgement is required.


Eco-Industrial Parks Toward Inclusive and Sustainable Industrial Development

Creating shared prosperity and safeguarding the environment



Foreword Director of the Department of Environment

“UNIDO promotes the mainstreaming of Eco-Industrial Parks in developing and emerging economies. Such parks have significant potential for unleashing inclusive and sustainable industrial development.� One of UNIDO’s contributions to the Sustainable Development Goals is facilitating the establishment of eco-industrial parks. They combine the driving of industrialization and the transfer of technologies with environmental gains and social responsibility. The global trend of rapidly increasing resource consumption and waste generation is caused by a globally expanding industrial sector. If the current business-as-usual practices are sustained, scientists estimate that by 2050 three planets Earth will be needed. Thus, eco-industrial parks promote circular economy, water resource conservation, recycling and the sound management of waste as well as the utilization of industrial synergies. Stephan Sicars


UNIDO ECO-INDUSTRIAL PARKS CONTRIBUTE TO THE SDGs UNIDO’s eco-industrial park approach represents an inclusive and sustainable development strategy seeking to meet the Sustainable Development Goals (SDGs).

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TABLE OF CONTENTS Section 1 – UNIDO Approach towards Eco-Industrial Parks............................ 6 1.1 Local Solutions to Global Challenges............................................ 6 1.2 What is an Eco-Industrial Park......................................................7 1.3 Why UNIDO is supporting Eco-Industrial Parks............................. 9 1.4 Current Trends and Key Lessons................................................. 11 1.5 UNIDO Methodology................................................................... 12 Section 2 – Snapshot of Country Projects.................................................... 14 2.1 Asia: China, India, Vietnam.................................................... 16-21 2.2 Africa: South Africa...............................................................22-23 2.3 South America: Colombia...................................................... 24-25 Section 3 – Partnership of Upscaling...........................................................26 2.1 Towards Minimum Requirements.................................................26 2.2 Towards National Programmes.................................................. 28


Section 1 – UNIDO Approach towards Eco-Industrial Parks

“Eco-Industrial Park (EIP) developments contribute to better integrate industries in the cities through the creation of shared economic opportunities, improved ecosystems and innovative avenues for responsible business. EIP’s underscore to achieve the triple bottom-line benefits: economic, environment and social.” Smail Alhilali, Industrial Development Officer

1.1. Local Solutions to Global Challenges It is widely recognized today that industrial growth is needed in developing and emerging economies to alleviate poverty, deliver goods and services, create jobs, and raise living standards. However, this same industrial activity is also responsible for consuming material resources, water and energy at an unsustainable rate, and emitting toxins, pollutants and waste in levels greater than the earth’s ecosystems can absorb. In order to find solutions for the global challenges of climate change and water and resource scarcity and in order to protect human societies and the environment, it is necessary to find solutions at a local level that make the most efficient use of existing resources. Thus, making use of the geographic proximity of enterprises in order to pool and exchange resource streams is the way forward. This pooling and sharing concept is broadly and successfully used in other contexts of daily life including carpooling, online platforms to trade used products as well as house sharing in order to reduce waste and save resources. 6


1.2. What is an Eco-Industrial Park Nature uses symbiosis that consists in interactions between different organisms that live in close physical association, typically to the mutual advantage of those organisms. This proven approach can be applied to industries. “Industrial symbiosis” means that traditionally separate industries engage in a collective approach to gain competitive advantage involving physical exchange of materials, energy, water and/ or by-products. If enterprises in industrial parks are organized in a synergistic manner that mimics natural systems so that ‘waste’ from one company becomes a resource for another company, they can evolve into Eco-Industrial Parks, applying this concept of industrial symbiosis. By doing so, they can facilitate the transfer and adaptation of green technologies, the creation of environmental knowledge, the application of resource efficient production methods as well as the reuse of waste energy and waste materials.

“An Eco-Industrial Park is a community of manufacturing and service businesses located on common property. Members seek enhanced environmental, economic and social performance through collaboration in managing environmental and resource issues and, thus, engaging into an industrial symbiosis.”*

* Lowe, E. 1997. "Creating By-Product Resource Exchanges for Eco-Industrial Parks, Journal of Cleaner Production, Volume 4, Number 4 7


Section 1 – UNIDO Approach towards Eco-Industrial Parks

Collaborative business opportunities through synergies

Minimized business, environmental and social risks

Increased resource efficiency resulting in reduced costs

Less waste in landfill

Strong local economy and recruitment attractiveness

Meeting government regulations and community expectations

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1.3. Why UNIDO is supporting Eco-Industrial Parks Eco-Industrial Parks are particularly valuable in developing and emerging countries as they foster economic and social growth whilst safeguarding the environment. It rejects the trade-off between economic growth and the environment. Thus, eco-industrial development integrates business and environment to create economic opportunities and improved eco-systems as well as innovative avenues for business.

Successful eco-industrial parks are able to generate positive impacts on the local and regional economic performance by enabling new and innovative business opportunities, increasing regions and company’s competitive advantage, as well as saving costs due to reductions in waste, resource and energy consumption.

Social benefits are directly created by eco-industrial parks through new employment possibilities and increased educational and training programmes. The quality of life of local communities increases as a direct result of general infrastructure provisions and enhanced quality of education as well as implementation of health and safety standards for employees and workers.

Negative environmental impacts caused by industrial operations are tremendously reduced through environmental management and pollution prevention systems. By following circular economy principles and fostering industrial synergies, eco-industrial park’s management can support companies in their efforts to increase their resource efficiency through reduced raw materials, water and energy consumption. 9


Section 1 – UNIDO Approach towards Eco-Industrial Parks

UNIDO Global Assessment Survey 12 countries, including 33 industrial parks

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1.4. Current Trends and Key Lessons Models of eco-industrial parks have previously been showcased in various studies mostly focusing on developed countries. Thus to examine existing regional differences and global trends, UNIDO has surveyed 33 examples of eco-industrial parks in 12 developing and emerging economies (Cambodia, China, Colombia, Costa Rica, Egypt, El Salvador, India, Morocco, Peru, South Africa, Tunisia and Viet Nam). During the survey it became evident that there is a great need to clearly define minimum requirements of what an eco-industrial park actually entails. This is important since some industrial parks have labelled themselves as “eco� without meeting core characteristics of eco-industrial parks. In this regard, government support in terms of a comprehensive eco-industrial park strategy is crucial, whereby monitoring needs to be regulated and enforced in order to assess compliance with environmental and social standards. Some current trends of industrial parks relate to composition and clustering. Hence industrial parks with good infrastructure and joint provision of services, meeting the needs of companies, are more likely to attract investments and ultimately to generate a collective competitive advantage. Another key lesson is that eco-industrial parks simultaneously require innovations in business relations, between companies, and resource flows. This indicates that when planning a new eco-industrial park it is important to manage industrial symbiosis directly from the beginning to optimize the location of companies and stimulate by-product exchange.

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Section 1 – UNIDO Approach towards Eco-Industrial Parks

1.5. EIP Methodology: 5 Pillar Approach

Enterprise level resource efficiency

Collective resource efficiency

UNIDO follows a holistic EIP methodology that covers five different pillars ranging from approaching companies on an individual level over industrial symbiosis concepts and the inclusion of infrastructural, management and zoning structures: In the following, different measures that are typical for the respective pillar are mentioned.

• Training of local RECP experts • Support of RECP audits • Clean Technology Assessments • Establishing Communities of Practice

• Inventory of process inputs and outputs • Creation of waste exchange platforms • Innovation workshops • Synergy project development (including financing and business models)

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Shared environment and utility services

• Inventory of requirements and utility management – power, fuel, water, effluent and waste • Integration of renewable and secondary sources • Design, construction, operation and maintenance of facilities • Business-like and performance based operation of facilities with full cost recovery

Spatial planning, zoning and built environment

Park management, operations and logistics

• Location choice – environmental and social impact assessment

• Environmental Management System for park operations

• Zoning, corridors and land use planning, including enforcement

• Shared use of facilities for e.g. warehousing, logistics

• Analyzing roads and transport connections for people and goods

• Joint training and meeting facilities

• Establishment of construction guidelines, e.g. building orientation, performance standards for buildings

• Shared employees’ transport

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Section 2 – Projects Overview

Project Countries: China, Colombia, India, South Africa, Vietnam

Donors: Global Environment Facility (GEF), Swiss State Secretariat for Economic Affairs SECO

Budget Range: US$ 2-4.5m

Duration: 1-3 years

Projects Overview

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Main Components in UNIDO’s Eco-Industrial Park Projects

Minimum requirements

Monitoring & evaluation

Demonstrations & synergy creation

Capacity building & awareness raising

Strategic plans for transformation

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Section 2 – Asian Region Snapshot: India

Nandesari

(MSME and Large size both)

Size: 214 Hectares No. of companies: 210

Special characteristics: Concentration of Petroleum, Chemical and Petrochemical estates around Dahej SIR, Rich natural resources and feedstock, ChemicalPort and Storage Facility – Common effluent disposal pipelines, solid waste disposal sites

Prevalent industries: Chemical, Pharma Intermediate, API Drugs, Dyes & Dyes Intermediate, Synthetic organic, Plasticizer, Pesticide, Engineering &Packaging (small & medium size mostly) Special characteristics: Only estate in Gujarat with organic hazardous waste destruction facility using plasma Incineration, Latest Advanced Technology of hydrodynamic cavitation used in CETP Dahej Size: 45,300 Hectares No. of companies: 98 Prevalent industries: Chemical, Pharma Intermediate, API Drugs, Dyes & Dye Intermediate, Pesticide, Petrochemical 16

Jeedimetla/Hyderabad Size: 1,300 Acres (established 1973) No. of companies: 1,500 Prevalent industries: Very DiverseEngineering, Pharma, Chemical, Plastics, Food & Agro, Furniture, Construction, Solar Energy Special characteristics: Large and very active industry association (500 members)


Pre-Selection Process “There are more than 300 industrial parks in the states of Telangana and Andhra Pradesh. An evaluation methodology with over 15 indicators (Qualitative and Quantitative) was developed and 10 parks were shortlisted through desk research. The team of experts visited the park and collected the data for evaluation and interacted with key stakeholders at each park.”

K S Venkatagiri Executive Director-Designate, CII Sohrabji Godrej Green Business Centre

Dr. Bharat Jain Member Secretary Gujarat Cleaner Production Centre

“Dahej and Nandesari Industrial estates are the most versatile estates of Gujarat, both for different reasons. Dahej is soon going to be the biggest industrial estate in Asia with a specialized Petroleum, Chemical and Petrochemical Investment Region being set up by the Gujarat Government. Nandesari is one of the oldest industrial estates set up in early stages of industrialization in Gujarat. Formed of small/medium scale chemical nature industries, Nandesari has an important share in the total industrial production of the state. Also the industries of the estate are highly proactive and keen to inculcate RECP in their practices.” 17


Section 2 – Asian Region Snapshot: Vietnam

Context Over the last ten years, Vietnam has experienced rapid economic growth driven mainly by the processing and manufacturing sectors. To facilitate the establishment of new industries, the government created industrial zones, which account for 40% of the national industrial output and 49% of the total export value of the country. However, industrial activities have also caused

Meeting during Resource Efficient and Cleaner Production Audit by the VNCPC 18

negative impacts on the environment and on human health. Inefficient management of resources has increased greenhouse gas emissions and has caused water and soil pollution. Despite efforts made by the Vietnamese government, many barriers have yet to be overcome to address industrial pollution in the country. The project aims to transform existing industrial zones into eco-industrial

Hoa Khanh Industrial Zone

parks, in which companies cooperate with each other and with the local community to reduce environmental impacts and production costs. In addition, clean and low-carbon technologies and practices are demonstrated within the industries to minimize greenhouse gas emission, the release of persistent organic pollutants and land based water pollution.

Hoa Khanh Industrial Zone


Resource Efficient & Cleaner Production Demonstration The project aims to improve the resource productivity and environmental performance of industries in the industrial zones. This will be achieved through the integrated application of resource efficiency and cleaner production techniques in enterprises as well as the creation of industrial synergies within the park.

“A core objective is to demonstrate the environmental and economic benefits of resource efficiency and cleaner production and encourage its adoption.”

Mr. Dong Tran Duy, General Director, Ministry of Planning and Investment Vietnam

Ms. Phuong Tran Thanh, National Project Manager of UNIDO’s Eco-Industrial Park Project Vietnam 19


Section 2 – Asian Region Snapshot: China

Context China has a large production industry and already several (eco-) industrial park projects spread all over the country. There are over 6,600 industrial parks in China, each with its own character, but only about 100 EIP projects, of which 26 have been chosen by the State Environmental Protection Administration (SEPA) as national EIP demonstration projects. Many industrial park managers do not have a common understanding of the concept and methods of developing an eco-industrial park but are eager to initiate such projects.

Kick-Off Ceremony in Zhenjiang 20

Emission control room in Zhenjiang


Benefits “As benefits of the RECP programme, we expect that we can build up a systematic network of relevant experts and that enterprises will have more advanced methods and a clearer idea of Cleaner Production, which will help them gain both social and economic benefits. Furthermore, employees will have a healthier way of life and better work conditions as well. Finally, the infrastructures will be improved in the park, the risk of industrial activities will be lowered, and SSZEIP itself will be a demonstration for Industrial Symbiosis in practice.”

Michelle Zhao Chairwoman Sino-Swiss Zhenjiang Eco-Industrial Park (SSZEIP)

Jie Yin, Chief of International Cooperation and Capacity Building Department, and her team, China National Cleaner Production Centre

“As major benefits of the implementation of RECP pilot project in Zhenjiang, the overall and individual capacity of the whole park and respective companies will be built and improved in resource efficient and cleaner production. The demonstration in pilot enterprises will show the real RECP benefits, which will encourage more enterprises to take actions towards cleaner production. The RECP network among enterprises coordinated by the newly established RECP center will bring all enterprises together to share experiences and results from practices and learn from each other in a continuous and solid way. The industrial symbiosis will be improved as well based on the information exchanged via the network, so as to foster eco-industrial development in Zhenjiang Economic and Technological Development Zone in China.” 21


Section 2 – African Region Snapshot: South Africa

Context South Africa is committed to promoting sustainable industrial growth through the improvement of production systems. Specifically the focus is on the adaptation of technologies and processes whereby natural resources are encouraged to be utilized more efficiently producing less waste. However, the country is still facing tremendous challenges particularly concerning air pollution in industrial hubs. As such, South Africa is currently the biggest source of emissions in Africa.

Industrial Zone in Gauteng Provice

Gauteng Province was identified as main intervention area during the pre-assessment phase of the project.

Industrial Park in Gauteng Province South Africa 22


Building Expertise In order to improve the park’s overall environmental performance, it is important to establish a dedicated expertise base on issues related to eco-industrial park developments, the project seeks to transfer knowledge with regards to best practices. Capacity building activities being conducted by targeting key national stakeholders, such as environment, energy and technical managers from manufacturing enterprise located within industrial zones as well as park management and local authorities.

Ndivhuho Raphulu, Director, National Cleaner Production Centre

“The National Cleaner Production Centre South Africa is very active in building expertise and raising awareness among key stakeholders in the country. As part of the project, Resource Efficient and Cleaner Production awareness trainings are offered to consulting professionals as well as representatives of industry and government institutions working in eco-industrial parks.�

Recycling Management within Industrial Park, South Africa 23


Section 2 – South American Region Snapshot: Colombia

Context Political and legal stability in the country, and its strong economic performance have placed the country as one of the fastest growing countries of the region.

sustainability. Services offered are education and training, technical assistance, advice and financial management projects, and promoting the transfer of clean technologies.

Nevertheless, many challenges remain with regards to the upscaling of existing industrial parks and the development of new eco-industrial parks. Counterpart The Centro Nacional de Produccion Mas Limpia y Tecnologias Ambientales (CNPMLTA) was founded in March, 1998, in Medellin, Colombia, in collaboration with the Swiss government and public and private Colombian institutions, in response to the need to support sustainable business development through the promotion of better terms of productivity, competitiveness and 24

Waste Water Treatment Facility in Eco-Industrial Park


Audit & Demonstration The environmental performance as well as the resource inflows and outflows are analyzed in participating tenants of the eco-industrial parks to build the basis for industrial symbiosis.

Prepare action plan, project controlling

Management review, project evaluation and documentation, reassessment

Implementation & continuation

Planning & organization

Select options, document the assessment phase

Obtain commitment of top management

Conduct environmental, social and economic evaluation

Compile a CP team

Compile/prepare basic information, organizational chart, site map

Feasibility analysis Cross-functional tasks

Identify barriers and solutions to the assessment process

Generate CP options Assessing training needs Documentation

Conduct cause diagnostics

Initial assessment

First walk-through, eco-map, CP checklist Material & energy balance Preparation of process flow-chart Detailed assessment

Prepare basis production/consumption data, I/O Analysis, Legal Register, KPIs

Environmental policy List and implement ‘easy fixes’

Initial review summary, decide focus of detailed assessment

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Section 3 – Partnerships for Upscaling

“A standardized approach for developing new eco-industrial parks and retrofitting existing ones.” 3.1. Toward Minimum Requirements As part of UNIDO’s international survey on eco-industrial parks (see page 10), it was found that the concept of eco-industrial park is a valid and contemporary approach to the scaling-up of resource efficiency and cleaner production in existing and new industrial zones. However, due to conceptual misunderstandings of core principles reflecting such parks, best practices still need to be more systematically promoted and integrated within the planning, development and management of industrial zones. As such, numerous concepts and regional differences on what constitutes eco-industrial parks can be found with varying degrees of commonly identified technical characteristics. To streamline this trend, UNIDO has started stakeholder discussions, involving representatives from GIZ and the World Bank Group. This cooperation aims to consolidate minimum requirements based on different approaches and experiences in order to ensure a more standardized approach. This coordination exercise is not only important but also timely given the widespread differences when implementing eco-industrial park projects. This future framework can be applied to support the planning and development of new parks (Greenfield approach), as well as help to further develop and transform existing industrial zones into eco-industrial parks (Brownfield approach). Minimum requirements define eco-industrial parks in such a way that their performance exceeds national codes and regulations. Hereby, the focus is not only placed on companies but also on park management, which is crucial in achieving the overall goal of continuous environmental improvement, community connections and business success. 26


Industrial-urban symbiosis fosters inclusive and sustainable development through outward integration

Company • Resource Efficienct and Cleaner Production (RECP) • Low-carbon technology • Green chemisty • Renewable energy • Energy efficiency

Industrial Park

Sustainable Cities

Collective resource efficiency solutions and shared: • Resources • Infrastructure • Supply • Services

Sustainable symbiosis: • Waste Management • Recycle • Corporate Social Responsibility

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Section 3 – Partnerships for Upscaling

3.2. Toward National Programmes One of the main goals of the UNIDO approach is to upscale and expand resource efficient and cleaner production activities in order to surpass the borders of eco-industrial parks and incorporate these into the framework of a “Sustainable City”. In this framework, industrial, economic and social symbiosis can be achieved on a much more holistic level including all aspects of sustainable urban planning. Waste streams can be exchanged on a more regional scale making use of a wider range of infrastructure, logistics and recycling and waste-to-energy options. In addition, UNIDO promotes the development of national programmes on eco-industrial parks (e.g. in Latin American Countries/China). These programmes aim to link the existing local projects into a network of national stakeholders and facilitate the countries’ efforts undertaking a comprehensive and coordinated strategic planning of EIPs. Best practices and lessons learned can be exchanged in a supra-regional approach in order to establish RECP concepts in a more cost-effective, sustainable way and on a bigger scale. Finally, these projects will also support to integrate the outcomes into national policies and plans and explore further areas for collaboration with the private and financial sector. The goal is to finance, establish and upgrade industrial parks to eco-industrial parks in order to address the growing global challenges of climate change and resource scarcity.

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UNIDO Eco-Industrial Park Programmatic Framework

synergies

synergies

From pilot eco-industrial parks....

...towards sustainable cities and national programmes of eco-industrial parks 29


Section 3 – Partnerships for Upscaling

The Global Network for Resource Efficient and Cleaner Production (RECPnet)

74 members, 5 regional chapters Africa Arab states Asia and the Pacific Eastern Europe, Caucasus and Central Asia Latin America and the Caribbean

In the implementation of eco-industrial park projects, UNIDO closely cooperates with RECPnet members, which are organizations that, as a core activity, offer resource efficient and cleaner production services to industries and businesses in developing and transition economies. 30


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Siehe auch Handbuch „Corporate Design der Schweizerischen Bundesverwaltung“ Kapitel „Grundlagen“, 1.5 / Schutzzone www. cdbund.admin.ch

For more information on UNIDO’s Eco-Industrial Park Programme, please contact: Mr. Smail ALHILALI Industrial Development Officer Industrial Resource Efficiency Division – Department of Environment Email: S.Alhilali@unido.org


UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Vienna International Centre, P.O. Box 300, 1400 Vienna, Austria Telephone: +43 (0) 1 26026-0, Fax: +43 (0) 1 26926-69 Email: unido@unido.org, Internet: www.unido.org


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