Smart cities, smart islands and investment platforms

The Ministry of Regional Development and EU Funds of the Republic of Croatia and the European Investment Bank organized the Smart Cities & Islands Investment Platform Conference in the City of Hvar. The full-day conference on smart investment took place on 17 June.

The conference was focused on the prospects of smart cities, smart islands and investment platforms in the EU; investment platforms – combining financing for smart cities in cohesions countries and creating a Croatian platform for smart cities and islands. The terms smart city and smart island refer to the areas with fully sustainable and highly efficient buildings, facilities, utilities, technological development and transport infrastructure.

The first panel discussion – on the prospects of smart cities, smart islands and investment platforms in the European Union – included paricipation of Vazil Hudák, EIB Vice-president, Gabrijela Žalac, Minister of Regional Development and EU Funds, and D. Julije Domac, EU Covenant of Mayors Board member and FEDARENE President.

“Can digital technologies combined with renewable sources of energy now bring along full democratization of energy production, provide access to private capital and create a situation in which literally every individual in the world is both a producer and a trader of energy? Today, things mostly take place virtually nowadays, and applications have become magic wands for solving all problems. If there are applications helping you invest in stocks, look for a restaurant, or pay for a parking place, why there would be no application helping us invest in renewable energy sources? asked Domac. He added – Last year, the global consumption of energy went up by 2.3% – the highest growth recorded in this decade. Fossil fuels still account for most of the total consumption, although the use of solar energy grew by 31% and the growth of wind energy use is similar. As a result, the global emissions of CO2 grew by 1.7% in 2018. This is not the only global challenge we are now facing. While the cities and regions of the European Union have taken this global challenge, we in Croatia have not fully recognized it yet”.

The Covenant of Mayors is the European Commission’s most successful initiative, with more than 9,000 cities participating in it. Helping cities prepare their projects is very important. Julije Domac also announced the European City Facility, intended for helping cities prepare their energy efficiency, renewable energy sources and climate change projects up to EUR 60,000 worth. Its importance it not just financial, but also political. “This way, explains Domac, cities will achieve the importance they deserve and will increase their visibility; after all, it is on the city level that changes can and are taking place”.

Also, it is the cities that are trying to secure their funds; in order to raise the money, they often must run into debt. This is why cities are increasingly recognizing new, so-called alternative financing models. An excellent example is the national project of the Croatian County Association, Let’s Build Croatia. At the initiative of the North-West Croatia Regional Energy Agency, the project – focused on construction of buildings and infrastructure was proposed to the Government of Croatia.

Adalbert Jahnz, member of the Cabinet of European Commission Vice-president Maroš Šefčovič, put this subject back to the EU level. He pointed out “In any case, the idea of smart islands and smart cities is also part of the fight against climate change. One of the European Union’s proposed goals is to make the EU climate-neutral by 2050, which means sustainable, relying on renewable sources of energy. Not just the western members, but the EU in general, without exceptions. This is the direction the smart cities and smart islands have already taken”.

The goals are not small, and the funds will certainly be less. The next fiscal perspective will see reduced EU funding, so we must be prepared for it, explained Minister Gabrijela Žalac. “A 6% reduction awaits the Cohesion Policy and Common Agricultural Policy in the new financial period. I find it very bad because the Cohesion policy is what gives us an added value. We will have to fight here both at the Council of Ministers level and at the European Council level. On the other hand, the funds for the integrated territorial investment will grow”.

Vazil Hudák, Vice-president of the European Investment Bank, concluded the discussion – “We are facing two major challenges. We must make the EU more competitive while at the same time working on the cohesion within the EU. These are the two crucial challenges that we are facing and that we must overcome together”.