SCIS Podcast Episode 6: Hot Turkey

Anthony Colclough: Hello and welcome to Urban Reverb, the SCIS Smart Cities Information System podcast. I'm Anthony Colclough. Today I'm speaking to Esra Demir who has been working in Turkey on the demo side of the CitiFied project in Soma and the Remourban project in Eskisehir. These building retrofit and district heating system projects aimed to seriously reduce energy consumption and met with many successes. However, a number of issues, including an attempted military coup, through hurdles in the projects’ paths. Good morning Esra.

Esra Demir: Morning!

AC: How are you getting on?

ED: Good, good, thank you. How are you?

AC: Just another fantastic day. Please tell me a little bit about your role in the project.

ED: I Esra Demir, a part of the Demir energy company. We are a company that helps local governments to act about climate change and we also are involved in a lot of projects with Horizon2020 or other European Commission projects. We are the leader of the demo site. After the project started, we were not involved at the beginning, but after the project started they realised that they needed some kind of a flexible small company that can cooperate the work done between all these big institutions and big public companies. Because most of the companies are public and they are not very flexible. They cannot even travel whenever they want, so there was a need. So we became the demo site leader after the project started, like a year ago. The main objective of the project is to reduce the energy consumptions of the district. There are 81 buildings in the district and Soma is a district where coal is the main source of economy in the town, so the demo site is being heated by a coal based boiler. But the local government there started to use the waste heat of the thermal power plant located in the city and they want to penetrate to all the city with this waste heat, the district heating system. So they already started the investments before the project but they want to make a progress there. And the public institution who owns the demo site, they really wanted to go on with the interventions as soon as possible. So they have planned the passive interventions like building retrofitting, placement of the lighting systems, roof insulation, facade insulation, and also building integrated photovoltaic systems. There was going to be a trial of low temperature district heating systems. The heating system would be on the walls of some of the dwellings that are chosen. That would be one of the innovations of the demo site. And the other innovation was going to be the RTP [Reinforced Thermoplastic Pipe] pipes that were going to be used in the transmission line within the demo sites. Because it's a huge area that, it's like 160,000 square meters area. But the condition theory of the buildings are 41,000, so, there's a lot of recreational area and the pipeline was going to be really long like 11 kilometres, I think. So the main goal is to reduce the energy consumption by 78 percent and reduce carbon dioxide emissions by around 66 percent. This was going to be achieved by mainly switching coal of course. After the passive interventions.

AC: And large-scale projects like these inevitably run into challenges along the way. Could you tell us about some of the difficulties you faced in this project?

ED: I don't know where to start. As you mentioned, it’s a huge challenge. And as soon as the project started, the owner of the demo sites wanted to finish all of the interventions. And they have started building retrofitting and some of the interventions like investments of the solar collectors and all those stuff. But then there were a lot of bureaucratic challenges. The other partners were not aware of the fact that the thermal power plant that owns the demo site was in the pipeline for privatisation. That was the first challenge. After the sixth or seventh month of the project, the thermal power plant was privatised. After the privatisation of course the demo site have been divided into two, and the smaller part stayed in public, and the demo site was also still public. So we had to wait a lot of months just to see what will happen, what are the decisions going to be made, how are to be the management structures of the new company. We didn't know a lot, so we had to wait a lot. Then there was another setback of the transfer of the authorisation of the district heating system. It was owned by the township municipality, but after 2014 March, just before, just one day before the project started, the authorisation was transferred to the metropolitan municipality by law. So we had to wait for them to get together and tell how the transfer is going to be made and everything. They had to solve among themselves some of the management issues. So we had to wait for them. Then, I don't know if you heard, but the political instability of the attempted coup happened. We were just about to start the tendering processes. Everything was settled and we were just about to start the tendering processes. But then all the public investments had to be stopped. We waited for that. So we mostly had bureaucratic issues. And at the end we ended up doing 20% of the passive interventions. And the new management, after several changes of management, the new management decided not to go on with the rest of the investments. So we are just going to monitor a few buildings that have left for us. We managed hard to get people commitments in the project because so many people changed in the companies, the public institutions especially. So we had to go and tell them, every time new people in front of us, we had to tell them again and again and again. Then they said that they would support us and would do everything but within a few months they are gone. So, there were a lot of setbacks.

AC: That sounds like a lot of setbacks. How did you deal with this decidedly adverse scenario, and what advice would you give to other projects setting off on the same path?

ED: Maybe it would have been ended like two or three years ago. But we really went to Brussels to talk about the new situations and get the approval of European Commission for some of the situations that were two years ago. Then we had to go there again and negotiate for some other things. If we weren't there I think it would, the whole process would have ended like two years ago. Because nobody within the other institutions would go there to talk about what is going on and get their support. And they wouldn't be able to even go to do the traveling probably. And there are also language barriers in most of the public institutions, so we were needed for that also. Now when I look back, I don't know if it's good that we were here or it would have been better if we were not. Because we worked a lot with our project coordinators to keep things going. We pushed it really hard, but it might have ended two years ago. But still, at least we have some things that we can monitor and report and there are a lot of, lots of lessons learned from our case. I think, I don't know if it's going to be the next question, but one of the most important things starting a project is doing a really good risk analysis at the beginning.

AC: Risk analysis, got it. So what kind of adjustments would you make to the risk analysis in future projects of this kind?

ED: In Soma I don't really know the answer to this question, because most of the setbacks are from the central government. The change of the legislation's or the privatisation issue. If you go to the local government, probably they would be very positive and try to be involved in another project. But when we think about all the things that have happened it was really the central government who managed all these new legislations and everything. So I don't know. If you ask me, if you go to another city, we are already doing it. We have had a lot of projects after this CityFied one. And we are trying to push the local governments, or the other partners to put all the risks on the table at the beginning, so that we wouldn’t face… There will be many, many problems during the process of course. Because it's a demo site and there are lots of things that change, but some risks that you cannot do anything about, we should manage to know them before.

AC: Right. And from a policy point of view, are there any legal or administrative changes that you think could lend to the success of future sustainability efforts?

ED: Autonomous, more autonomous local governments would be a great help, actually. Because there are a lot of things that they can do nothing about, and it seems that it is getting more centralised nowadays in Turkey. So they should have the power to decide some of the things themselves. There are some decisions that directly involves the local government, but the central government makes some legislations and leave the local governments out of the process for some decisions. For example, in some development plans, like the area development plans, the central government tries to keep the local government out of the decision making process. So that's one of the most important things. And they can also work hand-in-hand with the citizens and everything. So when the decision is made by central government, they don't even know what the locals wants for their city. So in terms of citizen engagement, it is more interesting to have local governments taking most of the decisions.

AC: Citizen engagement is obviously vital to the success of such projects. Was there active effort to engage citizens in this endeavour?

ED: Yes, we began at the beginning, but we had to stop at some point. We couldn't do some surveys among the tenants because there were the rumours of the privatisation and most of the tenants were working for this public institution. They were paying rent to live there, so we couldn't even do some of the surveys. But we had some stakeholder meetings and they were really keen on especially the district heating system, the use of the waste heat instead of coal. They were really pleasant about it because the air quality is not very well in the city when you think about there's a thermal power plant. And, since coal is mined within the city, natural gas is not there because it's not feasible to go there, and it's also a fossil fuel. So people were really keen on the project because they were also aware that they wouldn't do any investment and their comfort level would go up. But we couldn't do much about that either, because of all the other things.

AC: In Europe, most cities have the advantage of other national demo sites that they can communicate or even coordinate with, but I suppose in Turkey there are not many European projects happening?

ED: No, actually there are some Turkish cities demo sites. There is the one in Eskişehir, Tepebaşı, within the Remourban project. And we were there yesterday, actually, and the demo site is almost finished.

AC: Could you tell me more about the Turkish Remourban demo site? When did it get going?

ED: This was done after the CityFied. We had a contact with this local government Tepebaşı and they worked really hard to be involved in a smart city project. And there is also a new one that starts at like a year ago, MatchUp. There is Antalya metropolitan municipality in that.

AC: So you're involved in quite a few smart city projects?

ED: Yes. Both of them. And we are also involved in other projects, not smart city projects, but cultural heritage or green infrastructure, within the Horizon2020. So these were all with the help of the experience of the Cityfied project.

AC: So in the Remourban project, did the same kinds of issues you mentioned with regard to CityFied arise?

ED: In the Remourban project there were a lot of difficulties for the local government. It was a small township local government without too many resources, but they somehow managed to do everything within the description of action within the proposal. So they've tried really hard. They have building integrated photovoltaic systems, a lot of buildings have been retrofitted in terms of insulation, roof insulation, façade insulation. Solar collectors have been installed, district heating system, pellets boiler have been put in the system. They used to use natural gas, and there is this… So I'm not a very technical person, so, but there is a heat pump also. As far as I can remember, four electric busses, 22 hybrid cars, 30 ebikes. They are all set and almost finished. And they have already started doing some of the monitoring. So it's in the last two years of the project, so they have already started. It was a very difficult journey for them, to tell you the truth, because of the legislations, the procurement processes that they had to go through and everything, but they were really committed to do everything they can.

AC: Brilliant. So everything is in good order?

ED: Yes, yes. Yes, they have managed to do, to finish everything.

AC: So how replicable are these solutions that you've been piloting? Do you see them catching on and spreading throughout Turkey?

ED: In terms of technology, it's not a big issue, it can be easily adapted. But there are some setbacks about cultural… Let me say, social acceptance issues. For example, we are doing all these investments within the publicly owned demo sites, but it would not be very easy to do that with privately owned residential buildings, to get the tenants or owners approval. And there are unions in most of the European countries within the tenants, so you get to get in touch with only an institution, for example, instead of private people, like, one by one. So it wouldn't be very easy to do that in Turkey. And, in terms of awareness of the results of the interventions, we might need to work a little bit more to convince them, probably. In Spain they also say that there are a lot of issues with awareness and stuff like that. We have a lot of Spanish cities that are involved in different projects, or in other countries. But still it would be a little bit more difficult probably.

AC: In terms of business models and financing, were there any interesting ideas that came out of the project, or any innovative methods used?

ED: We have looked at ESCO [Energy Saving Contract] models, which are not very popular, not very, which are not used much in Turkey. But since most of the demo sites are owned by public institutions, they try to find the bridge funding. Most of the interventions are paid by European Commission, but it takes time to get all those payments. Maybe you do the investment and might take even two years to get European Commission payment. So they went for bridge funding for those kind of investments. But we have been looking at all the other cities experiences about financing and it seems that since we are owned by public companies, we couldn't use those innovative solutions because of the procurement the legislations as well. They have to go for tenders and bid to the companies that offers the lowest amount of money and those kind of things. Which makes it tricky to get the high quality that you prefer in these kind of projects. And we have had lots of issues about that too, because some of the contractors didn't understand what we are requiring from them in terms of commissioning and other things, so we had to get help from other contractors who have knowledge about these kind of things. That was difficult.

AC: I've seen in other projects the success of using metrics like social value, ecological sustainability, etcetera, as well as price to really get the best out of the tendering process. Is that something that could work in your context?

ED: Yes, but the procurements legislation is the setback there, because they requires for the lowest amount of money. So maybe there's a need to change the legislation. And in terms of green procurement, there should be studies done in terms of green procurement processes within the public institutions and some kind of setup. The Turkish government is also doing that but it takes really long to get to a point.

AC: How are you working on communicating the findings of your project so that other cities can benefit from the results when undertaking their own actions?

ED: It was not really easy, actually. It is very important that the other cities get know what has been done within a smart city project. Which is not, there are not much smart city projects within the country. So it would have been much smoother and easier. But the political situation in Turkey is not, it's not letting people talk easily. It's not very comfortable to talk about, to talk to different cities. For example, the municipality of Soma, who started the project first is the government party, but the metropolitan municipality is the opposition party, so they had a lot of issues when they were transferring the authority from one to another. So it was not very easy thing. So they didn't get to learn the experience that others have that much, because they were dealing with other issues among themselves. So it's not very easy, but we have managed to talk about the projects and the lessons learned or the experiences that they had in different occasions. Like there are unions of municipalities, that's a lot of municipalities get together and start working about, for example, climate change or health issues within the cities or other stuff. We manage to get into their meetings. We have had some really good questions there, and a lot of cities are approaching us right now to be involved in European Commission projects, because they are also aware that you learn a lot from the other cities of the consortium. It's not a one-way journey, so you learn a lot from them, you get to see their interventions. The setback is the language barrier in the Turkish municipalities. So people who know English, they are already so booked up with other things that they cannot manage to go to the meeting always. So it's a setback, but they learn a lot.

AC: Great and so are there opportunities or really positive outcomes that have resulted from the European projects that you've been involved in?

ED: Yes, yes there are. If we have more European projects, probably we will be able to push the government a little bit harder to adapt some regulations that would make it easier for cities for a low carbon future. Some of the institutions in the government already is aware of that and it will be more easy for us to get in touch and work closely with them and share the experiences of these projects.

AC: In terms of easy wins, was there any decision you made that proved to be really helpful for the project and that you recommend to other cities?

ED: I'm not sure. Just being involved with the public and publicly owned demo sites made it easier for us to go on with the investments. Otherwise, if it were otherwise, it would have been more difficult. But other than that I don't think we have had such experience.

AC: Okay, no easy wins. But to push the point, what are the important ingredients to getting things done well?

ED: I think commitment to the project is the first thing that comes to my mind. Because some institutions are involved in the project but they are just… ‘involved’. They don’t want to… They are not aware of how these projects are important for the experience and how it would change their way of doing business in the future, or… I think the commitment is the first thing, that the municipalities who are committed to the projects they really go further and achieve the results they wanted to achieve.

AC: Political commitment, got it. Are there certain solutions among those you’ve tried that you have seen real potential to scale up?

ED: Yeah, it depends. For example, photovoltaic solutions. It's not very easy, there are a lot of bureaucratic issues, but since it's a very sunny country the benefits are very known. People are aware of the benefits. Or the façade insulation or roof insulation, it's easy to adapt to these kind of interventions. Waste heat depends on the area that the demo site is located. Because if you don't have big factories that uses a lot of heat, or thermal power plants, it's not easy to adopt those kind of… It depends on the region that you're in. But other than that, solar collectors, PVs [solar panels], insulation, it's easy to adapt in Turkey. Because if you get the benefits, in the middle term usually, you get the benefits, but still you know you will benefit from it.

AC: Legislatively, I know that the decentralised nature of solar and other renewable energies can often pose difficulties. Was that what you found? Are there any legislative road blocks that ought to be moved aside?

ED: First you need to apply for permission to the local distributor. The setback in Turkey is I think they are making the bureaucracy a little bit complex because they are not sure about the infrastructure. The electricity infrastructure of the company, the grid. So there needs to be a lot of improvement in the grid. Then it will be easier in terms of legislations and everything. They make it harder to apply for the permissions. They have, I think they have put some tax on it, like a couple of months ago. They usually buy back the excess electricity that you produce but the bureaucracy is really complicated. And I think it's because, one of the reasons is because of the infrastructure. The other reason is the privatisation of the electricity distribution in the country. It is privatised recently, so they are not willing to localise the electricity production in the near future. But they cannot resist too much, so, too long, I mean, so it will be easier eventually. But within the next one to three years, I don't know if it's going to be easier.

AC: Esra Demir, thank you so much for joining me today and giving us all some insights into the fascinating work you're involved in.

ED: Thank you very much, you too. Bye bye.

AC: The rest of you stay put as we move into the analysis section. So Brooke, if you could just begin maybe by introducing yourself and then tell us what are the main policy messages that we can take from this account.

Brooke Flanagan: I'm Brooke Flanagan, project coordinator here at EUROCITIES, working on smart cities and environment projects. In terms of messages that we can take from this, lessons we can take from the experience here in Turkey, there are several. To summarise, national policy still has a very big impact on what is happening locally. Despite all the enthusiasm and ambition of cities and their residents and their stakeholders, national policy can still make or break some of these projects if it's not properly aligned with the same ambitions for deep retrofit. There are some other lessons that we can take from this as well, I think. One is that, also, the technology isn't necessarily really one of the main problems or barriers to building retrofit. There are still often issues and you need to make sure that you have the right measures for the right building retrofit. However, one of the main problems really is around people. This example really is very clear that citizen engagement, or the engagement of the residents, owners, occupants of the building is really important to a successful retrofit programme. They can very much make or break a project and the scope of that project. Also the depth of measures or the depth of energy saving that can be achieved as well. There are also some other issues I think that come through here, around getting the process right as much as possible. So really planning that in advance. And also the funding situation. I mean this is not something that's new to a building retrofit at all, but funding and financing can be quite challenging and you really need to try and get that all lined up before you start the process. And I guess the other thing is that there are often things that happen that are outside of your control that you can't always plan for, so despite having the most rigorous of risk assessments, sometimes something will come out of left field and you just have to deal with it when it happens. It's not always something that you can plan.

AC: This is obviously a particularly stark series of examples that we've heard, and it comes from this Turkish context. Do you think that the same issues are prevalent in the EU context, or would we say it's not really relevant for experience here?

BF: I think it's definitely relevant for what happens in the EU context. I'm hoping that an attempted coup isn't necessarily an issue that comes up in other member states. But, you know the issues around citizen engagement, around funding, around national policy, all of those are things that are barriers to deep retrofit in all the member states of the EU, and something that we really do need to be tackling if we're going to achieve our ambitions on climate change and limiting global warming to below 1.5 degrees.

AC: To find links to these projects, plus a full transcript of this episode, check out smartcities-infosystem.eu. And you can get in contact by emailing me at anthony.colclough@eurocities.eu