While the UK has been in recession, Poland has just registered modest economic growth of 1.1%. When Poland joined the European Union in 2004, unemployment was at 20%, whereas now it is considered to have one of the fastest growing economies in Europe - fuelled by a desire for liberalised development of the private sector.
URS’ business model of following clients to support them in their growth has seen a substantial upturn in our environmental service provision in eastern Europe to such an extent that in spring 2009 we opened our first permanent office in Poland. As our clients began to be interested in the acquisition of companies and greenfield sites in Poland, we were initially asked to perform primarily general environmental consulting and environmental due diligence services.
Since this time, however, development and investment has resulted in the requirement for solutions to address historical contaminated land issues in accordance with local legal requirements, European directives and the corporate governance guidelines of private companies.
We first initiated a small network of local environmental consultant partners, who supported our multinational teams in local regulatory matters, language and cultural context. Support with property transactions and mergers and acquisitions soon spread to intrusive soil and groundwater investigations with a natural transition to remediation design and implementation.
In the early days of working in Poland, we found the local contracting pool limited. It was also variable in terms of technological quality and at times had an alternative opinion on what consisted of safe practices. This necessitated the importation of foreign labour and technology providers, which brought with it challenges with cost and mobilisation times. A switch to a more sustainable model of training and investing in local companies has become possible with an increase in workload. The changing tide of migration back to Poland also brings with it a newly skilled labour force and change in perspective of health, safety and the environment.
We continue to serve our client base with a combination of local and international subcontractors, and have had success in certifying local drilling and remediation companies to our own and client subcontractor accreditation requirements in eastern Europe. To date, we have found that fully qualified environmental laboratories are still difficult to find in some countries and local consultants typically continue to work with chemical laboratories outside of their home nations.
The demand from our client base was initially driven by the strong environmental awareness of foreign-owned, mostly multinational companies. The largest client sectors in Poland have been in the manufacturing, oil and gas and defence industries. Our local presence and understanding of the business drivers and regulation in the country itself has enabled us to cost effectively deliver remediation solutions while drawing up the best practices of the wider world.
Many investment sites have been previously state-owned properties, which are often located within complex industrial areas with a chequered environmental legacy. For sites such as these, details of historical operations and practices may be difficult to obtain, as desktop information via public databases is limited. In our experience, local Polish authorities are keen to establish a positive, professional working relationship, and – as for all works – the value of local connections cannot be underestimated.
Another observation from working in Poland is the historic practice for authorities to ‘overlook’ selected environmental and safety non-compliance issues for existing businesses in eastern Europe, or for the method of dealing with non-compliance to have been associated with the payment of fines as opposed to investment in remedial measures.
This practice was most noticeable for those that are state owned, but it is changing. Investors have concerns relating to the ability to understand opaque compliance with legislation or the ability to rapidly implement corrective measures and evaluate the financial implications associated with this. However, authorities are in general willing to work with the investor and his consultant on a long-term improvement plan, without imposing fines or penalties.
Acceptance of a proactive approach and implementation of novel or state-of-the-art technologies that are applied on a European or worldwide scale is widespread, in particular for new development projects. We use local experts to help introduce and maintain contact with the appropriate regulators. As a result, regulators seem to be prepared to discuss and negotiate on issues arising within the established regulations, such as the use of risk-based clean up, or alternatives to standard remediation practices.
In the near future, we expect to see a stronger focus on soil and groundwater investigations as local strategies on remediation are implemented and the pressure on remediation of contaminated sites increases. We anticipate a rapidly growing market in Poland as the harmonisation with European regulations continues to move forward.
Conventional remediation, such as ‘dig & dump’ and ‘pump & treat’ is already widely implemented via a skilled pool of local contractors in Poland. The European waste disposal regulations are being followed locally, although at times it may sometimes be difficult to gather all necessary paperwork and permits. Typically, conventional local construction companies who have adapted their service provision to expand into the remediation market currently perform clean up solutions. These companies may use staff who have gained experience internationally or partner with ‘foreign’ expertise by licensing technology or subcontracting the design of remediation plans from experienced engineering companies.
In our current experience, there are few local companies in eastern Europe specialising in groundwater remediation, not to mention innovative methods like enhanced natural attenuation, in-situ chemical oxidation or permeable reactive barriers. Sophisticated equipment for groundwater treatment, which is readily available in western Europe, may be difficult to find and may be imported from another country. This gap in the market is one that several consultants and contractors see as an attractive opportunity to expand their portfolio when domestic investment is constrained.
Over the past two years, URS’ business has grown significantly in Poland and has expanded to include construction management, remediation planning and supervision, environmental consulting, and health and safety consulting. With continued investment in eastern Europe, a drive for environmental services fuelled by transposition of European legislation and multinational company development continue to create opportunities that warrant evaluation in today’s economic climate.