1. Transfer of Environmentally Sound Technology to Reduce Transboundary Pollution in the Danube River Basin A UNIDO initiative in the Danube River Basin Implemented by GEF through the UNDP Presented by David Vousden, Project Evaluator

2. TEST Project: a Regional Initiative UNDP/GEF Pollution Reduction Programme in the Danube River Basin identified 130 major HOT SPOTS contributing to transboundary environmental problems Five participating countries: Bulgaria, Croatia, Hungary, Romania and Slovakia 17 Industrial Hot Spots highly polluting Danube River Basin were selected as pilot enterprises (food, pulp and paper, chemical, petrochemical, machinery and textile) National counterparts: UNIDO-UNEP Cleaner Production Centres in three countries

3. Project Landscape (the country perspective)  All target countries are in economic and political transition  Undergoing increasing industrial production and consumption  Experiencing growing environmental pressure  Changing social conditions and considerations THEREFORE – industries need to develop integrated services to pursue the simultaneous objectives of…  Competitive enhancement of their production and marketing  Improved social responsibility (workplace and landscape)  Environmental compliance (to meet market needs and national priorities)

4. Integrated TEST approach - The Tools Initial review of Company needs Environmental Management System practices and procedures for company’s environmental policy Cleaner Production Assessment preventive strategy to increase efficiency and reduce impacts Environmental Management Accounting financial impacts of environmental performance Environmentally Sound Technology Assessment Best available techniques and practices Sustainable Enterprise Strategy (SES) Adoption of above into performance objectives within business strategy

5. PROJECT OBJECTIVE – To work with selected pilot enterprises to demonstrate…..  Building of capacity and expertise within Cleaner Production Centres and related Institutes to implement TEST tools  Feasibility of industry compliance with environmental norms and social considerations while maintaining competitive edge  Bring pilot enterprises into compliance with EU Accessions & Danube River Protection Convention requirements  Capture the enhanced institutional capacity/knowledge as a resource for the region to assist further institutions and industrial enterprises

6. EXAMPLE – Bulgaria – Alcohol Production Plant PROBLEM(as identified by TEST assessment process)  Product = too poor quality for EU market  Discharging slops and liquid wastes  Gov’t threatening to shut down plant  Huge thermal energy loss from cooling water  ‘Hidden factory’ non-product costs >60% (waste products)  <30% production costs = alcohol!

7. EXAMPLE – Bulgaria – Alcohol Production Plant TEST SOLUTION  Change from sugar to cereal-based production  Higher quality product (for EU Market)  Reduced COD in discharge due to slops  Slop now valuable by-product as animal feed  Water in processing now recycled (Savings in water pumping and thermal losses)  5 other company plants impacting Danube to be similarly modified (effective replication of Pilot)

8. OVERALL PILOT ENTERPRISE GAINS  Reduction in investments and costs to companies in producing waste products  Change of LOSS to PROFIT by using or recycling wastes  Improved quality of products  Increased potential for marketing (higher quality plus environmentally friendly products)  Avoidance of fines, penalties and ill-will with compliance bodies  Improved/enhanced company profile and credibility

9. LESSONS LEARNED Providing company management with clear definition of source of their pollution problems Identification that this ‘hidden’ non-product ‘factory’ is a major financial drain to be addressed Companies relate cleaner production to increased savings, & more competitive company status and image in a wider market EU pre-accession landscape very beneficial to project objectives and delivery Economic drivers (EU pre-accession requirements) = stronger incentives than environmental ones CPCs and related Institutes gain a business advantage (a service to offer)

10. FINAL CONCLUSION OF EVALUATION Successful completion of training and knowledge transfer to industrial enterprises and to national counterpart institutions Considerable investments made by companies into cleaner production processes and environmentally sound technology Second phase recommended for replication and transfer to other industrial enterprises and Danube countries Need for low-interest investment loans to carry out major TEST options within companies (as part of second phase) Consider to be a BEST EXAMPLE of private sector engagement in the GEF IW portfolio

11. FURTHER INFORMATION  UNIDO  www.unido.org and follow links to Danube TEST pages  TEST Product descriptions and publications  www.unido.org/doc/26190  IW:LEARN website  www.iwlearn.net THANK YOU