5 December 2024

Industry and logistics as pioneers of the green transformation in Central and Eastern Europe

The green transformation is changing Europe’s economies. Industry and logistics play major roles in the process, spurred on by both governmental regulations and innovative companies driving and shaping this vital change. In its third edition, this year’s joint German Eastern Business Association (OA) and KLU conference provided the platform for businesses to discuss sustainable production and supply chains essential to a circular economy in Central and Eastern Europe and Central Asia.

This image shows a well-attended formal lecture or conference in an auditorium. A speaker stands at a podium on stage, addressing the audience.

Opening the conference, Dr. Immo Schmidt-Jortzig, Executive Director of Administration at KLU and Prof. Peer Witten, member of the Executive Committee and spokesperson for the Logistics and Transport Infrastructure Working Group of OA, remarked that we live in uncertain times due to the ongoing conflict in Ukraine, economic stagnation in Germany, and the climate crisis.

Prof. Alan McKinnon issued a stark warning in his keynote speech on “The Role of Logistics in a Resilient, Net Zero Europe,” saying that “we are on the brink of an irreversible climate disaster.” With logistics responsible for 10-12% of global CO2 emissions annually, an enormous undertaking was required for the sector to reach net zero. He also emphasized that the greening of the economy itself involves massive resource consumption and logistical demands, particularly in terms of infrastructure. Until now, this task has received little attention from industry, which has barely begun to grasp its scale.

He was also keen to impress that the path to reaching net also created “wonderful new commercial opportunities for logistics businesses” with regards to carbon capture and storage.

Circular economy in Central and Eastern Europe - best practices

The first panel discussion of the day then tackled the theme of the circular economy and best practices in Central and Eastern Europe.

Regarding circular economy in Eastern Europe, Frank Paasche, CEO of EEW Polska (subsidiary of EEW Group), said that the landfill ban for municipal waste in Germany set in force in 2005 was an important enabler for the circular economy and he added: “This is not yet achieved in Eastern Europe”. The EEW Group operates 17 thermal waste treatment plants in Central Europe, which recover energy from annually around 5 million tons of waste. The energy contained in the waste is used to generate process steam, district heating and electricity. These plants are an important element of a modern circular economy.

Torsten Weber, CEO of Remondis International, a subsidiary of the globally active recycling company, REMONDIS, explained that the extreme cost increases and the resistance of citizens' organizations, as well as some politicians, to the construction of waste management facilities by the private sector in parts of Eastern Europe continue to pose a challenge.

However, his company has good experience in Poland where they bought several coal-fired district heating plants. These will now be decarbonized by replacing them with new power plants that use pre-treated high-calorific waste that can no longer be recycled. “We will then use these plants to generate heat and electricity and also use a local fuel.”

green transformation opportunities and challenges

Obstacles to efficient supply chains, including insufficient transport infrastructure, such as a lack of ports and e-vehicle charging stations, in parts of Eastern Europe and Central Asia were discussed by the second panel, as well as green transformation opportunities in these regions.

A kind of boom is taking place in the Caucus and Central Asia due to their “emancipation from Russia,” explained Wolfram Senger-Weiss, CEO at logistics company Gebrüder Weiss, adding that entire supply chains have to be rethought. "What used to be decided in Moscow is now decided in Istanbul, Dubai or perhaps even Berlin."

Johannes Tenschert, Head of Sales and Business Development Germany for the Metrans Group, said business was in Eastern Europe was “developing magnificently” for Metrans which were heavily investing in freight terminal infrastructure in the region. Intramodal logistics, with its frequently short routes between terminal and depot, was also “predestined for electric trucks”, he explained, with Metrans also experimenting with hydrogen trucks.

Head of EECCA Board Projects at Rhenus, Dr. Alexandra Ogneva, whose company has also invested in e-trucks, said that her company had identified the warehouse sector in Eastern Europe as an area of green transformation investment. As well as several sustainable buildings in Poland, Rhenus had a logistics center in Prague which had been ranked by BREEM 2023 as the most sustainable industrial building in the Czech Republic.

electrification of railways and investment of government and banks

Further positive notes were struck by the panel on the electrification of railways and the investment of governments and banks in infrastructure projects in Eastern Europe and Central Asia.

Felix Danger, Managing Director of Select New Energies GmbH, spoke about the Adriatic, where the parent company SET Select Energy GmbH operates, and said that the banks there are more supportive of the creation of infrastructure in the maritime sector if cleaner energy sources are provided, e.g. methanol. “The banks have an obligation and a duty to invest more in infrastructure for decarbonized fuels.”

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