Background and political strategy - Lolland Municipality

The following description of the background of Lolland municipality’s strong focus on energy and environmental projects is based on interviews with municipal employees involved. This analysis shows how willful commitment to strategic business development in energy and the environment can bear fruit.

High unemployment in the 90s

In the early 1990s Lolland’s different municipalities had very high unemployment, a large surplus of welfare clients, and a poor local economy. The self-image of being a peripheral area of community development which ran backwards became so critical that it triggered a backlash from various enthusiasts, politicians and institutions. Nakskov municipality conducted an economic framework management for all organizations and units, coupled with a decentralized decision making process in relation to own resources and areas of responsibility. It gave a big boost in accountability and worked as an incentive to implement new initiatives with the new transparency in budget and responsibilities.

After 84 years of political dominance from the Social Democrats a member of the Socialist People’s Party was elected as mayor in 1998. The mayor and city council decided to bring in people from the outside to help their organization to develop a common supply unit out of the existing 6 companies. Hence, Leo Christensen became project manager in Lolland municipality. The leading persons were engineers who were joined together in a separate development unit, while technicians from the supply companies were set to lead. The merging of companies, the development unit, alterations in the management structure and the appointment of a new accountant, lead to the discovery of major economic assets located in the facilities - now estimated at 4 billion DKK, and an equity of 800 million DKK for investments in new technology.

Investments in attracting business

Taxes were increased in 1998 to generate around 100 million DKK to provide a surplus for investment. The strategy was to preserve Nakskov as one of Denmark's 3 commercial harbors, together with and Kalundborg and Koge. There were proposals for the development strategy based on cheap labor in order to attract IT companies, but instead the municipality focused on the potential in environmental and energy development. With a large force of unemployed, but skilled laborers, and a connection to knowledge institutions, the municipality would stand strong.

The municipality bought Nakskov shipyard to provide space for an active start-up area for companies looking for a location, which could offer to reduce secondary costs. The 14,000 m2 of welding and painting workshops were especially suitable for large construction projects. This has prompted a number of companies to locate themselves here temporarily or permanently – among these, production of houseboats and use of storage for bridge building equipment. In 1998 Vestas was in need of a temporary area to produce the 23-meter wings - and it succeeded in getting engineers and architects to design a factory for Vestas, who wanted to rent the premises for a 5-year period. The municipality established an IT school, education of semi-skilled workers in the field of renewable energy, as well as a start-up centre for renewable energy facilities. They have attracted a number of renewable energy companies and facilities – among these wave-energy plants.

The municipality bought a farm with 750,000 m2 of land which was right next to the shipyard, now sold to commercial activity, hereafter the municipality have reserved 700.000 m2 and presently 1.5 million m2, in amendments to the local plan, to be used as agro-industrial areas.

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