If you’ve ever watched a headteacher on a shoestring budget juggle two shifts of students per day – as their aren’t enough rooms for a one-shift timetable – in detoriating buildings, you’ll understand why PPPs in Croatia’s education sector matter, not just for infrastructure development but for people. Croatia’s most instructive case is in Varaždin County, where a portfolio of PPP school projects realised in 2007 shifted the conversation from “How do we patch this?” to “How do we keep standards high for 20–30 years?” That same discipline around defining, monitoring, and sustaining standards is exactly what EU needs as it scales energy renovation of public buildings.
What are Public-Private Partnerships (PPPs)?
A Public-Private Partnership is a long-term contract where a public authority defines what it needs (e.g., eight new classrooms and a sports hall), while a private partner is responsible for how it’s delivered and kept in shape: financing, designing, building, and maintaining the facilities. Instead of paying everything upfront, the public side pays an availability fee over time—usually 20–30 years—adjusted for performance; if the building isn’t available or standards slip, payments fall. Think of it as a service contract for a school’s whole life, not just for the first day of class.
Why schools?
In the mid-2000s, many schools in Varaždin County lacked capacity and sports halls and ran in two shifts, meaning that some students would have classes in mornings, others in the evenings, as there wasn’t enough capacity to accommodate all the children in need of education simultaneously. PPPs allowed the county to bundle multiple investments into a single, bankable programme and to lock in maintenance obligations for decades, so the day-to-day burden wouldn’t fall on headteachers whenever a boiler failed or a window broke. Bundling also made it natural to define common standards (lighting, thermal comfort, safety) and report on them, a useful practice for monitoring energy-performance KPIs later.
The flagship: Varaždin County’s school programme
From 2006 to 2007 the county procured a bundled package of school upgrades and sports halls under availability-based PPP contracts. Contracts ran for roughly 25–30 years and covered financing, design, construction, and maintenance of reconstructions, extensions/upgrades, and newly built halls, with the county paying an indexed monthly availability fee and applying deductions for under-performance.
What changed on the ground?
Speed and scale: Bundling enabled simultaneous upgrades with multiple schools moving from a chronic shortage of usable classroom shortages to adequate capacity, and a wave of new sports halls being built faster than one-by-one budgeting would allow.
Standards and predictability. In the PPP model the private partner bears full maintenance responsibility, and the county’s payment is availability-based with penalties if performance slips. For schools, this resulted in fewer ad-hoc fixes and faster responses. Crucially for energy renovation, PPPs require measurable outputs and routine verification—exactly the mindset needed to specify and monitor energy performance (with periodic reporting and corrective actions.
This developed a foundation for one-shift schooling, meaning there is enough classroom space for all students to attend school at the same time. The use of PPPs for deep renovation showed how by adopting a standardised approach and aggregating smaller projects together with long duration contracts (long payback periods) that include whole life costs of buildings, a long-lasting problem can be efficiently solved in few years. PPPs weren’t the only tool used, but they were a catalyst for demonstrating that counties can finance these types of infrastructure projects by themselves. By 2024–2025, Varaždin County aimed to become the first in Croatia to ensure single-shift operation across all county-founded primary schools, completing the process with the help of national and EU funding sources that were unavailable back in 2006, thus closing the remaining capacity gaps. The arc is clear: PPPs jump-started capacity and standards; ongoing programmes are finishing the job. The same lifecycle approach now underpins energy efficiency planning in Croatia: scheduling staged retrofits (envelope, HVAC, controls), building in performance baselines and M&V, and policing response times so savings persist.
Was Varaždin’s PPP approach successful?
On infrastructure and service quality: Yes. Within a short window, the county delivered modernised schools and sports halls with clear obligations. That raised the bar on pedagogical standards and created asset/data baselines that have made later energy-efficiency upgrades easier to scope and measure.
On public finance and governance: Here the answer is more nuanced. PPPs commit the public secotor to multi-decade availability payments, this is not a flaw, but a feature that demands planning and contract management. Indexation rules and penalty clauses only work if they are monitored and enforced. The same is true for energy performance: if nobody watches the KPIs, savings erode.
Ultimately, as a system-level intervention to raise standards quickly and keep assets in good shape, the Varaždin school PPPs delivered. The model’s discipline (maintenance first, penalties real) is as important as the new gyms communities enjoy after school hours. As Croatia scales up the energy renovation of public buildings, that same discipline—clear outputs, lifecycle budgeting, measurement and verification, and rapid fault response—will separate sustained savings from short-lived wins.
What can others learn?
1. Bundle wisely. Grouping several schools under one PPP brings consistency, speed, and bankability. The same approach can bundle energy-efficiency measures to reach scale.
2. Pay for outcomes. Availability payments with deductions create incentives that traditional procurement often lacks. Add energy KPIs (kWh/m², comfort hours) and verify them.
3. Keep the lifecycle view. A school isn’t “delivered” on opening day; it’s delivered every day for 25–30 years. Plan staged energy upgrades without derailing operations.
4. Build public capacity. PPPs aren’t “outsourcing the problem”—they’re contracts you must manage. Counties need people (or advisors) who read KPIs, enforce deductions—and understand energy systems and M&V.
5. Blend tools. PPPs can start the engine; national/EU programmes can complete one-shift schooling and fund energy retrofits. Mix grants, EPC-style clauses, and green loans to deliver verified savings.
How LEVERAGE Accelerator can support
Municipalities rarely have in-house expertise in PPP structuring, risk allocation, value-for-money assessment, KPI design, or long-term performance monitoring—and even fewer possess the capacity to translate energy-efficiency objectives into bankable and enforceable outputs supported by credible M&V systems.
The LEVERAGE Accelerator bridges this gap by helping public bodies structure and aggregate potential projects, identify and apply suitable de-risking instruments, and prepare investment-ready portfolios that are both attractive to private investors and affordable for public procurers.
Beyond technical support, the LEVERAGE Accelerator also facilitates the entire process, guiding partners through project definition, financial structuring, and contractual setup—ultimately building confidence on both sides and ensuring projects are sustainable, transparent, and deliver measurable public value.
Closing thought
If you judge PPPs only by the first-day photo, you’ll miss the point. Varaždin’s schools and halls show that delivery + upkeep beats delivery alone. Prepared transparently, procured competitively, and managed hard, these contracts solve long-standing problems fast and keep solving them for a generation. The next step is clear: use the same standard-focused discipline to drive energy renovation of public buildings—so today’s good schools become tomorrow’s great, low-energy schools.