To Solve the Waste Crisis, There Must Be Disincentives for Landfills
Most of the analyses on household waste are about comparing various technologies: incineration vs landfills, energy vs material recovery. This tilts the balance in favor of valorization rather than landfills and direct valorization (recycling) rather than indirect (energy) valorization.
A more innovative approach, used in a recent research study by IEFE, Bocconi's Institute for Energy and Environmental Economics, is to compare different scenarios of urban waste management, each with a different mix of collection, treatment, and disposal of solid waste. This approach makes sure that the mass balance constraint is met, i.e. it guarantees that all waste residua are treated in some way and either end up in a landfill or re-enter the production cycle, net of what one loses through evaporation.
Our analysis has taken into consideration of two fictitious cities, one small, producing 150.00 tons/year of waste, one big, producing 750,000 tons/year, and it has led to several considerations.
The first, often not properly investigated, concerns the returns of various solutions. Returns tend to decrease with the increase in the level of separation. In other terms, we can expect that the cost of disposing a kilo of plastic or paper is not a given quantity, but it varies with the intensity of collection for each material.
A second consideration deals with the perspective of the analysis. From a social point of view, in addition to direct costs incurred to treat different fractions of waste, and the benefits deriving from the marketing of byproducts, the external costs relative to air pollutants, as well as the external benefits deriving from the emissions avoided because of the substitution of production cycles by the recovery of energy and materials, must be taken into account for each scenario. In terms of industrial costs, scenarios based on street collection have lower costs (€103-112/t for the small city) than those based on household collection (€168-181/t for the small city).
Shifting from industrial to external costs, the analysis allows us to refute the commonly held view according to which direct recovery is environmentally preferable to incineration. The net total effective cost, for the small city, is around €51/t in the scenario with street collection and 35% of recycling, €46/t in the case of street collection and 50% recycling, but doesn't go below €70/t in scenarios with household collection and high levels of recycling.
All the scenarios considered are steps forward anyway with respect to the Italian status quo, but this derives from the fact that the traditional solution, based on the landfill, faces growing constraints because of land scarcity. Without the "scarcity cost" component, economic evaluation would not warrant with absolute certainty the desirability of treatment and recovery over landfill disposal. In other words, if there were no limits on the opening of new landfills, the latter, even including external costs, would represent the least costly solution of waste disposal. But once the land scarcity constraint is factored in, things change.
This conclusion is important, especially in the light of the tendency of market operators not to preempt the crisis, but to dive into it as soon as the first difficulties over finding new landfill sites arise. Until that moment, the landfill exerts an effect of unfair competition, because those who can continue using it do not have any incentives to switch to alternative, and more costly, solutions, especially if these imply politically difficult choices.
To avoid the repetition of other waste crises, we need to put in place a preventive strategy that leads the way out of landfills, by introducing disincentives to accelerate the exhaustion of this inferior waste management option.