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7. PUTTING IT ALL TOGETHER -PRIVATEAND SOCIAL COSTS

7.1 Scenarios Discussed

It seems clear from Chapter 3 that the actual costs of recycling schemes vary considerably between types of scheme, and as far as kerbside collection is concerned, across different authorities (as Chapter 4 showed). In a recent response to criticisms of recycling, the Environmental Defense Fund in the US, accepting that kerbside collections might be relatively inefficient at present, made the point that:

Gaining efficiency in curbside recycling requires careful, objective testing of truck designs, vehicle routing, public education, collecting new materials, setting fees for residential waste management services to reward households that produce less waste, and other techniques. This is work that must be carried out at the local level, city by city. (Ruston and Denison 1996).

One has to cast doubt, therefore, given the local factors that will influence collection costs, upon an approach that seeks to compare schemes across different authorities. Different schemes collect different materials and have different rationales for doing so. The incremental costs to a scheme of including or not including one or other material are not uniform.

What we have sought to do in this Chapter is to understand the picture in terms of the options available to specific authorities. Building on the work in Chapters 4 and 6, we have tried to develop scenarios in such a way as we can model existing schemes against alternative schemes which rely more heavily on linear waste management options. We have concentrated on the kerbside recycling of dry recyclables (for which we have better data), and a comparison with the base case of simply landfilling or recovering through energy from waste only.⁴⁸

[⁴⁸ It is worth pointing out that the position of the Energy from Waste Association is that this should not happen, and that the appropriate deployment of the technology is in the wake of front-end materials recovery.]

7.2 Collection and Disposal to Landfill

The collection of residuals is, in all schemes, undertaken in refuse collection vehicles, typically of 24 tonne maximum weight. The load carried is typically of the order 10 tonnes, with a maximum of around 13 tonnes. Using the ten tonne figure, it is possible to impute a per tonne external cost for this. In this case, we can simply draw on the analysis carried out above. The externalities are between -£0.4 and -£21.8 for an 80 kilometre round trip.

For landfilling, under the assumptions of 12.5% oxidation at the cap, 50% gas collection efficiency and 35% engine efficiency (see Table 34 for more; if you need a copy of this table, please contact Waste Watch), the range of externalities is from £-14.6 to +£18.6.

It is not necessarily correct to be adding the results from landfilling and transport corresponding to particular sets of adders. The ranges in the adders to some extent reflect the variation in the contexts in which emissions occur. One might have good reason to believe that the impact of emissions from transport, and therefore the likelihood of externality adders being high or low, will be different to those from coal fired power stations which one may be assuming one is displacing. The significance of the assumptions embedded in the analysis are enormous, the more so as one entertains the possibility of 'high value' externality adders.

7.2.1 Summary

The financial costs of this route typically lie in the order of £25 and £35 for collection and disposal, respectively (including landfill tax). The externalities are summarised in Table 44. We have added in some estimates of transport externalities for longer trips.

Table 44: Externalities Associated with RCV Collection and Landfilling

7.3 Collection and Disposal to Energy from Waste Incineration

For the case of incineration, the option of simply disposing of all waste is one that has been publicly shunned by the Energy from Waste Association in its response to AWWW (see EfWA 1999), though this is put into context with statements concerning the need to consider what the BPEO might be. However, for the purposes of this analysis, we have looked at the externalities associated with such plants as though they were being used as the main form of waste treatment.

For the transport of the residuals, we have included smaller distances than were used for the landfilling scenario. We have also included some of the longer distances since it may well be that planning for energy from waste incineration in the future occurs at a more regional level (so that waste is received from a larger area). We know relatively little about public perceptions of incinerators in respect of their scale. There may be some trade off (from the perspective of the generation of externalities) between greater transport and disamenity externalities, and lost economies of scale, depending upon the nature of the community a plant is being designed to serve.

7.3.1 Summary

The private costs of incineration are generally of the order £45 for the gate fee plus collection costs. We estimate collection costs as being the same as for landfill (£25). The evolution of incineration gate fees may depend upon the way in which the PRN market evolves which in turn will depend upon the form of any revisions to the Packaging Directive. Also, efforts to recover bottom ash are likely to produce savings on avoided landfilling. The results for the externality analysis are shown in Table 45.

Table 45: Externalities Associated with RCV Collection and Incineration (£ per tonne MSW)

7.4 Collection at Kerbside and Recycling

7.4.1 Kerbside Materials Collection

The externalities associated with kerbside schemes can be measured in an absolute sense, or they can be measured relative to the 'baseline' situation in the UK. It seems clear from our discussions that in the financial context, some local authorities perceive the costs of collection of materials relative to what they would otherwise have had to do anyway. Hence, where waste is collected on alternate collections, the approach has been to assume that the costs of doing so are best accounted for through assessing the incremental change in costs resulting from the scheme. In other cases, where the collection is entirely separate, the situation is less clear. As discussed above, however, the more successful kerbside schemes do reduce the costs of collection of residuals through extracting materials that would otherwise have to be collected. For similar reasons, it seems appropriate to deduct from the absolute external cost of the kerbside collection the incremental reduction in the external costs of residuals collection which would occur anyway where materials are collected as part of the residuals collection.

It therefore becomes important to understand what occurs to the residuals collection as the recycling scheme's performance increases. Either the residuals round remains the same, but with less waste collected, in which case, the external costs associated with collection of residuals as calculated here hardly changes (even though the weight collected has fallen),⁴⁹ or the residuals round adapts to undertake slightly longer collection rounds to fill the vehicle. It seems likely that the former situation would apply only in the short term, yet it would be difficult to imagine complete 'one-for-one' substitution (not least because the situation is changing) in terms of the efficiency of collection of materials.⁵⁰ As such, taking a middle case, the RCV round can adapt to undertake journeys which are longer depending upon the success of the scheme, but not in a perfect manner. The total journey distance will change, but not in direct relation to a scheme's success, however, since the journey undertaken will be lengthened only by the extension of the collection part of the total journey (the journey to and from the collection round will not change at all). Thus, the change in distance travelled will be changed, in relative terms, incrementally. The change in externality per tonne of residual waste collected is therefore likely to become only incrementally more negative. For the purposes of our analysis, we will assume that it is unchanged (the assumption will hold best in the case where waste is collected in densely populated urban areas and transported considerable distances for final treatment.

[⁴⁹ In practice, there probably would be savings owing to marginal increased in fuel efficiency, and associated reductions in transport- related emissions. These are not accounted for in our model.

⁵⁰ Also, from the perspective of private costs, any savings that actually occur may not be passed on to local authorities until contracts are renegotiated. This highlights the need to integrate flexible terms into local authority contract specification to account for changing system performance.]

Suppose we look at a scheme that is collecting 100kg of dry recyclables per household covered (and this is typical of the dry recyclables schemes we have looked at). Suppose also that one assumes that the amount of waste generated by the average household for refuse collection is of the order 750kg (from MEL 1999). In this case, approximately 100/750 = 0.14 tonnes of each tonne of MSW which would otherwise be collected by the RCVs are being collected by the kerbside vehicles.

The kerbside vehicles we examined typically have a maximum axle weight of 7.5 tonnes with a payload of the order 2.5-3 tonnes (others are 11 tonne trucks with 4 tonne payloads). The actual collection part of the journey may be from 1-3 miles in urban areas, and anything from 3-15 miles in less densely populated areas. The journeys to the depot in the schemes we looked at averaged from 4-9 miles in urban areas to 8-14 miles in less highly urbanised areas. The possible range in journey distance would therefore be 9-43 miles, or between 14.4-68.8 km. The externalities associated with the collection of each tonne of waste collected on such rounds would be, for the 14.4 km round, between -£0.21 and -£11.66 and for the 68.8 km round, between -£0.39 and -£40.88. Note we have used 0.27 l/km as opposed to 0.32 l/km for both the 2.5 tonne and 4 tonne recycling payloads, reducing the per kilometre emissions from these vehicles relative to RCV emissions. Note also that one respondent operating a kerbside scheme explicitly mentioned the fact that vehicles were fitted with equipment to remove particulates from exhaust.

Tonne for tonne, it appears that the collection of a tonne of waste through kerbside schemes, in urban areas, is likely to give rise to higher transport externalities than the collection of waste for delivery to landfill. This is because of the higher density of collection in the case of collection of residuals. Since many externalities are (in this analysis) related directly to vehicle kilometres travelled, the more waste that is transported per vehicle, the less significant these externalities will become when expressed per tonne of material collected.

It has to be recognised that, as mentioned above, once the recycling scheme makes more than a marginal contribution to waste collection, the appropriate way to deal with transport-related externalities is to assume that some would otherwise have to be incurred through collection of waste in RCVs. Hence, one should properly subtract the avoided (negative) externality associated with RCV movements from the negative externalities associated with kerbside collection of waste (which has the effect of making the negative externalities associated with kerbside collection 'less negative'). Because of the lack of a complete 'one-for-one' substitution effect, it would probably be more reasonable to subtract only half (as a reasonable estimate) of the avoided RCV collection externality.

7.4.2 Transport to Reprocessors

More serious, in respect of transportation externalities, is the question of transport distances moved by secondary materials. One of the schemes we spoke to sends paper 160 miles, glass to reprocessors 147 miles and 205 miles away, steel to a plant 104 miles away, and aluminium cans 194 miles. If we weight these distances by the typical composition of dry recyclables (as a proxy for journey numbers made), we find that the average distance moved for these vehicles is some 162 miles. In this analysis, we use this as the typical distance moved for the purpose of calculating the per tonne externality. Clearly, this is a simplification as the transport arrangements for different materials (in terms of vehicle use, contracting out, etc.) will vary, as will the distances. The astonishing thing is that this is an authority which is short of landfill void, and for which disposal costs are high. The lack of outlets for materials in such areas reflects the (pre)dominance of large scale reprocessing facilities.

For a 162 mile (=259km) journey in which a haulage vehicle is used carrying some 20 tonnes of material, assuming the vehicle is not returning empty,⁵¹ then if we estimate fuel consumption at 0.5 l /km, we can make an estimate of the transport related external costs.⁵² These are estimated using the approach described in the previous chapter as between -£0.87 and -£45.44 per tonne of material.⁵³ We are not in a position to know whether these are typical distances. The policy implications of this type of movement - and we are speaking principally of glass and paper (because of their significance in collection) are not necessarily that one throws one's hands up in the air and despairs. Another way of looking at these figures is that they suggest a need for local reprocessing capacity, especially for glass and newsprint, to reduce the distances moved by these materials post kerbside collection. This has been discussed elsewhere (Ecologika 1998; Murray 1999; IWA 2000) in the context of strategies for economic regeneration. One would imagine that under positive scenarios for market development for recycled materials, the distance travelled to reprocessors would fall as regional capacities are developed.

[⁵¹ Where schemes are undertaking the transport of materials themselves, they are less likely to return full. The issue here may relate to whether the haulage is contracted out or carried out in-house. In the latter case, a full vehicle on the return journey seems more likely. On the other hand, the location of reprocessors may influence the decision concerning haulage.

⁵² One of the schemes we spoke with had done some work on these logistics. The 20 tonne vehicle did 6.5 miles to the gallon, so our approximation is a good one.

⁵³ We have not calculated this for a two-way journey since such haulage is, we understand, increasingly carried out by private companies who usually plan to make a return journey with other materials.]

These figures should be compared with the emissions from extraction and from the importation of materials estimated (albeit somewhat crudely) in the previous Chapter. It is clear that the air emissions alone from these activities associated with primary materials extraction and transport can substantially offset these transport movements. The major exception here is likely to be glass, many of the materials for which may be locally sourced. The extraction of these materials however creates site-related disamenities that are difficult to estimate (and in any case, it would be inappropriate to express these in 'per tonne' form).

7.4.3 Effects of Kerbside Recycling on Waste Management Costs

What has happened to the tonne of waste which was, in our 'baseline' scenarios, taken in its entirety either to a landfill or an incinerator? It has been partially separated. The separately collected fractions will be used in the manufacture of new products displacing primary materials. We saw in the previous Chapter that this can generate external benefits. Suppose again we look at systems that extract 100kg, 130kg and 150kg per household of a typical household waste stream of 1.2 tonnes per annum. This amounts to extracting, per tonne, the amounts of waste shown in Table 46. The external benefits in using this material as opposed to primary material are shown in Table 47. The potential benefits from recycling range from £3.25 to £91.68 at 100kg/hhld to £4.87 to £137.53 at 150kg/hhld.

Table 46: Material Removed from a Tonne of MSW under Different Rates of Material Recovery

NB: Assumes 1.2 tonnes MSW per household

Table 47: External Benefits Associated with Recycling at Different Rates of Material Recovery (£ / Tonne Of MSW, Calculated On Basis Of Material Diverted At Different Diversion Rates)

NB: No figures were generated for benefits from textiles recovery

When these materials are extracted from the typical MSW tonne, the amount of material landfilled falls, but its character changes. The nature of this change is shown in Table 48. The effect on landfill externalities is given in Table 49.

Table 48: Changes in Composition and Weight of Material under Different Rates of Kerbside Collection

Table 49: Externalities of Landfill under Different Scenarios for the Extraction of Materials from A Tonne of MSW

Note that, for landfill, even in the no energy recovery cases, the net change in externality is negative under the high externality adders scenario even though less material is being landfilled. This is a consequence of the fact that paper is being taken out of the landfill, and the assumptions in the landfill model effectively treat paper as a net sequester of carbon relative to the situation which occurs when the carbon cycle is allowed to take its course. On the other hand, less methane is generated too (so there are competing effects). In the energy recovery situations, in all cases, the change is negative. There is a trade off between the lost benefits attributed on the basis of less energy generated (because less pollution is being avoided) and the loss of a net sequester of carbon (contributing a net negative externality), and the positive effect of less methane generated. Note that these changes are small relative to the changes in the externalities associated with recycling. Note also that there has been a reduction in the energy generated by the landfill owing to the fall in methane generation. Between the 'no recycling' and 150kg per household scenarios, the decline has been from 98 kWh (59 kWh) to 90 kWh (54 kWh) (the figures in brackets are those which incorporate the 'lifetime' factor).

The net change in incineration externalities is given in Table 50. As with all numbers in this report, these should be treated with caution. Even if one accepted the earlier estimates, we do not trace through (in our model) changes in air emissions associated with the change in materials composition (and possibly, materials volume).

Table 50: Externalities of Incineration under Different Scenarios for the Extraction of Materials from a Tonne of Municipal Solid Waste

 The interesting points to note are the much larger net changes in externality (relative to what happened in the landfill case). These are a consequence of the fact that there is less steel available to be recovered, and the removal of paper (remember, there is not plastic being recycled in our scheme) reduces the energy generated from 2.08GJ to 1.85 GJ (an 11% reduction). Hence, the net change in external costs such as we have been able to measure them are 'more negative' for the case of incineration than for landfill.

The important question that arises is 'is this good or bad?' What has happened is that of two key sources of benefits under the assumptions made, one - the recovery of metals - is being carried out elsewhere, and another - the recovery of energy - is being affected by the loss of combustible paper. In practice, some of this might be offset by a reduction in flue gas emissions (though equally, loss of materials volumes might affect combustion efficiencies). If one were to pro-rate the air emissions externalities against the mass of waste combusted this would have the effect of reducing the net 'benefit loss' by some £10-£16 in the high adders scenario.

Some might argue that this constitutes an argument for not engaging in front-end recycling where incinerators are present. This, to some extent, is what happens in the Netherlands. On the other hand, the range of benefits from the recycling still, apparently, exceeds the lost benefits from incineration when the same externality adders are used.⁵⁴ There would appear to be a role for materials extraction pre-combustion. This largely supports the Energy from Waste Association's view expressed in its response to A Way With Waste (EfWA 1999):'We agree with the Government's view that recycling and composting should be considered before energy recovery - something that already happens in most cases.'

[⁵⁴ We can say this with some degree of confidence because the source of these benefits is the same.]

It is worth pointing out that although the decline in benefits due to recycling associated with energy from waste incineration are less than the decline associated with energy from waste landfilling, the absolute levels of benefits show different ranges. It would be dangerous, however, to draw the strong conclusion from this, even on the basis of our partial analysis, that incineration is environmentally 'better' than landfill. The numbers are suggestive, but the lack of any consideration of the many omitted pollutants (both incineration and landfill) cautions against drawing such conclusions. In addition, it is clear that there are distributional issues associated with the costs and benefits generated. It is important to emphasise that there is a direct trade-off here. The benefits attributed to incineration from recovery of steel are directly proportional to the benefits from metals recycling. The greater the benefit from recycling, the greater (within the significant limitations of our model) the benefits attributable to incineration for energy recovery. This means that at these higher benefit levels, the net improvement to metals recovery from recycling becomes much more significant.

7.4.4 Summary

The net effect of integrating kerbside recycling, relative to landfill only, is summed up below.

The net effect of integrating kerbside recycling, relative to 'incineration only,' is summed up below.

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