Why a smarter approach?

Eindhoven aims to be an energy-neutral city by 2045. In order to achieve this, the municipality's own buildings have to become more energy-efficient and more sustainable. This aim is achievable because a lot of sustainable technologies have already been developed. However, these technologies are not being applied in practice. One of the factors preventing their implementation is the traditional way of thinking and working when it comes to procurement and financing. Some general examples of this include1):

  • At present investment in sustainable solutions is often not profitable. As a result of the current short-term focus and the small scale of projects (one building, one technology, few parties involved) the payback times are rarely achieved. This makes it difficult to make up attractive business cases.
  • Sustainable technologies that have been implemented successfully are often not applied on a larger scale when their implementation has been made possible through subsidies. Scaling up such technologies is as challenge since there is no economically viable long-term business model in place.
  • In the current approaches, price is often a very important criterion in the procurement process. This can stand in the way of quality.
  • This focus on price and short-term competition is hampering innovation; there is not enough incentive for commercial players to invest in real innovation. For example, authorities are unable to purchase new technologies when there is only one party that can offer them.
  • Procurement processes are often micromanaged to reduce risks. There is a tendency to measure performance by requiring solutions to meet prescribed specifications. These specifications are based on known and proven technologies. This minimizes space to learn and try really new innovations.
  • Sustainable technologies as such are not attractive enough for most people and organizations. The promise of ecological benefit alone is usually not enough to drive adoption, even with the outlook on a profit on the long run. The benefits of sustainable solutions in everyday life and work are often not clear, so people tend to choose solutions that are perceived as more directly relevant to them.

The barriers mentioned above are slowing the adoption of sustainable innovations. In order to stimulate innovation and to help ensure the city becomes energy neutral by 2045, the Municipality of Eindhoven is adopting an innovative approach to procurement for the Stadhuistoren and surrounding area, based on the following principles: a systems approach, quality in the long term and cooperation between different (market) parties. Further information will be available on the Exploration Days on 27 November and 2 December 2013.

TurTur Innovation Transitions