Circular Economy Index: Municipalities are becoming more efficient; the next stage of development is a change of the management model

Municipalities with the highest circularity scores are able to turn individual initiatives into a unified system, but further growth will be determined not only by new solutions, but also by changes in the management model and everyday habits of the public, according to the results of the second Circular Economy Index.

On Wednesday, September 9, the key findings of the second Latvian Circular Economy Index were presented to the public, and the municipalities with the highest results in the index categories – smart resource management, business and economic transformation, skillful management and public involvement – were honored.

The Circular Economy Index, developed by Latvian scientists and measured every other year, was first published in 2024. One of the key findings at the time was that municipalities do not lack individual circular initiatives even without a strategic methodological framework. Realizing that municipalities use the Circular Economy Index as a guide for implementing circularity, the focus was refined in the 2026 measurement, giving greater weight to solutions with structural impact, which make the transition to circular management not only faster but also more purposeful.

“The first index showed where we are on the circular economy map in Latvia. The second already helps to understand which activities have the greatest impact on accelerating the introduction of circularity. Thus, local governments, analyzing these results, can plan where to invest time, funding and human resources for a more meaningful result. The goal is no longer just to count activities, but to understand which of them have a lasting and structural impact,” says Agita Baltbārde, the initiator of the Latvian Circular Economy Index, a Member of the AS CleanR Grupa Board, and the Ambassador of the European Climate Pact in Latvia.

Municipalities are strong in efficiency; next step – a change of the model

“The results of municipalities’ self-assessment show relatively high achievements in the areas of waste sorting infrastructure, digitalization and energy efficiency of buildings. Municipalities are investing in the use of renewable energy sources, building renovation, digital document circulation and solutions that reduce resource consumption,” says Dr. oec. Dzintra Atstāja, a professor and leading researcher of the Circular Economy Index.

Circularity requirements are also increasingly used in public procurement, for example by focusing on the durability, repairability and reusability of products.

However, lower self-assessment scores are found in areas that require more significant changes in the business model. This is based on the choice of lease instead of purchase, the circulation of used goods, industrial symbiosis, as well as cooperation in research and innovation.

“The next stage of development is a shift from improving the efficiency of the current economic model to changing the model itself. This means making greater use of leasing, sharing, repair, and resource reuse, as well as systematically promoting innovation and industrial symbiosis. It is precisely in these areas that new business opportunities can also be created,” the researcher emphasizes.

Availability of opportunities does not mean change of habits

The Circular Economy Index consists of two complementary parts: a self-assessment by municipalities and a survey of residents, the integration of which into the Circular Economy Index was consulted by the University of Latvia. The survey of municipalities reflects the established processes, infrastructure, services and support instruments, while the survey of residents shows whether people see, use and consider these solutions necessary.

The results of the survey of residents show that the availability of services typical of the circular economy has remained or increased in many places, while changes in habits are slow. In addition, in some areas, the offer of municipalities and the priorities of residents do not yet match.

“Municipalities can invest in infrastructure, services and various support instruments, but the key question is whether people actually use them. If the offer does not match the needs and motivation of the population, even a good solution can go unused. Therefore, it is more important not only to create opportunities, but to understand how to make them a daily choice for people. At the same time, it is clear that civil society, or non-governmental organizations, can play an important role in developing new habits,” says Dr. sc. soc. Andris Saulītis, senior researcher at the Institute of Philosophy and Sociology at the University of Latvia.

For example, 58% of the surveyed residents believe that local governments should provide more financial support to organizations implementing circular economy initiatives – yet such support is provided in only 24% of cases. Meanwhile, 54% of those surveyed consider support for community cleanups and environmental improvement activities to be necessary, while local government activity in this area stands at 64%, exceeding public expectations.

Although environmental clean-ups are popular, in reality, the involvement of residents in clean-ups is passive – about 70% of respondents did not participate in them or did so very rarely

Methodology puts a greater emphasis on the systemic impact

To maintain data comparability, the 2026 index is based on the previous methodology, while specifying individual issues and their importance in the assessment. This year, more weight is given to systemic solutions with a higher impact on circularity, such as the targeted replacement of fossil energy sources with renewable sources, waste recycling and public involvement.

“Results of the first index revealed an asymmetry between the circular solutions implemented by municipalities and the habits of residents in using them, so this year significant attention was paid to public involvement. Informing is not enough – a change in habits can only be achieved when residents are practically involved and the opportunities created become part of people’s daily lives. That is why this year we also honored municipalities that have achieved the highest scores in individual categories of the index, because their examples show how a systemic approach works in practice,” explains Baltbārde.

Six municipalities in the group of leaders

The results of the Circular Economy Index are presented in two divisions – groups from the waiting to the leaders, as well as categories that reflect the success of municipalities in specific areas.

The groups are formed according to the total number of points: leaders – over 650 points; experts – 550–649 points; practitioners – 450–549 points; conscientious – 350–449 points; waiting – under 350 points

In contrast to 2024, when there were two municipalities in the group of leaders, this year six are ranked in the highest group: Daugavpils City (765), Valmiera Municipality (736), Cēsis Municipality (704), Dienvidkurzeme Municipality (665), Rīga City Municipality (657) and Liepāja City Municipality (654).

Ten municipalities made it to the group of Experts, followed by 16 municipalities ranked as the Practitioners, nine municipalities as the Conscientious, and one municipality was the Waiting.

“The examples of the leader group show that a successful initiative does not guarantee long-term change in itself. It begins at the moment when the solution becomes a permanent practice, is linked to other municipal instruments and can be developed further. Leaders are united not by everyone doing the same thing, but by the ability to make each municipality’s chosen solutions work as a system,” says Dr. oec. Dzintra Atstāja, the leading researcher of the Latvian Circular Economy Index.

 Four categories, four leadership emphases

The leaders in the four circularity categories were also honored separately. In smart resource management, the highest score was earned by Liepāja City with 802 points, as it stood out with a wide and interconnected set of solutions that include the use of biomass for heating, solar panels and electric cars, as well as the use of secondary materials and long-lasting procurement.

The leader in business and economic transformation is the Valmiera Municipality with 780 points, as it provides an environment where entrepreneurs can practically implement circular principles: use shared and workshop infrastructure, receive knowledge and support, and build cooperation at the local and even international level.

Valmiera Municipality also earned the highest score (767) in the category of public involvement, putting the emphasis on practical public involvement: workshops, educational programs, a circularity center and other solutions that can be used in everyday life.

Riga City, with 774 points, earned the highest score in skillful management by embedding circular economy principles not only in individual projects but also in a comprehensive circular economy strategy, procurement requirements, sectoral regulations, funding, and other governance instruments.

From measurement to action

The aim of the index is to understand as precisely as possible in which direction it is possible to grow and how to achieve the best result and the most positive impact with the available resources. At the same time, it helps municipalities understand what investments can achieve the highest efficiency in circularity, as well as assess resident’s reaction to and involvement in municipal initiatives.

“The results of this year mark a five-step development path. First, identify existing activities and resource flows. Second, connect energy, mobility, waste, procurement and business solutions. Third, strengthen circularity principles in strategies, regulations and financing. Fourth, involve administration, capital companies, entrepreneurs, science, communities and residents. Fifth, turn successful pilot projects into permanent services and municipal practices. The next step is not more individual projects, but more connected solutions,” says Atstāja.

The full results of the Circular Economy Index will soon be available on the website cleanrgrupa.lv.

About the Circular Economy Index

The Latvian Circular Economy Index is the first science-based tool in Latvia that allows to assess the circularity of municipalities and compare their performance. The first measurement was carried out in 2024. In 2026 it was compiled for the second time. The index combines two perspectives – self-assessment of municipalities and assessment of residents – analyzing 4 areas: smart resource management, transformation of business and economy, public involvement and skillful management. This year’s index included all 42 Latvian municipalities, while 3,108 respondents participated in the representative survey of residents.