10.4.7 Waste management and mitigation costs and potentials

In the waste sector, it is often not possible to clearly separate costs for GHG mitigation from costs for waste management. In addition, waste management costs can exhibit high variability depending on local conditions. Therefore the baseline and cost assumptions, local availability of technologies, and economic and social development issues for alternative waste management strategies need to be carefully defined. An older study by de Jager and Blok (1996) assumed a 20-year project life to compare the cost-effectiveness of various options for mitigating CH₄ emissions from waste in the Netherlands, with costs ranging from –2 US$/tCO₂-eq for landfilling with gas recovery and on-site electrical generation to >370 US$/tCO₂-eq for incineration. In general, for landfill CH₄ recovery and utilization, project economics are highly site-specific and dependent on the financial arrangements as well as the distribution of benefits, risks and responsibilities among multiple partners. Some representative unit costs for landfill-gas recovery and utilization (all in 2003 US$/kW installed power) are: 200–400 for gas collection; 200–300 for gas conditioning (blower/compressor, dehydration, flare); 850–1200 for internal combustion engine/generator; and 250–350 for planning and design (Willumsen, 2003).

Smith et al. (2001) highlighted major cost differences between EU member states for mitigating GHG emissions from waste. Based on fees (including taxes) for countries with data, this study compared emissions and costs for various waste management practices with respect to direct GHG emissions, carbon sequestration, transport emissions, avoided emissions from recycling due to material and energy savings, and avoided emissions from fossil-fuel substitution via thermal processes and biogas (including landfill gas). Recycling costs are highly dependent on the waste material recycled. Overall, the financial success of any recycling venture is dependent on the current market value of the recycled products. The price obtained for recovered materials is typically lower than separation/reprocessing costs, which can be, in turn, higher than the cost of virgin materials – thus recycling activities usually require subsidies (except for aluminium and paper recycling). Recycling, composting and anaerobic digestion can provide large potential emission reductions, but further implementation is dependent on reducing the cost of separate collection (10–400 €/t waste (9–380 US$/t)) and, for composting, establishing local markets for the compost product. Costs for composting can range from 20–170 €/t waste (18–156 US$/t) and are typically 35 €/t waste (32 US$/t) for open-windrow operations and 50 €/t waste (46 US$/t) for in-vessel processes. When the replaced fossil fuel is coal, both mass incineration and co-combustion offer comparable and less expensive GHG-emission reductions compared to recycling (averaging 64 €/t waste (59 US$/t), with a range of 30–150 €/t (28–140 US$/t)). Landfill disposal is the most inexpensive waste management option in the EU (averaging 56 €/t waste (52 US$/t), ranging from 10–160 €/t waste (9–147 US$/t), including taxes), but it is also the largest source of GHG emissions. With improved gas management, landfill emissions can be significantly reduced at low cost. However, landfilling costs in the EU are increasing due to increasingly stringent regulations, taxes and declining capacity. Although there is only sparse information regarding MBT costs, German costs are about 90 €/t waste (83 US$/t, including landfill disposal fees); recent data suggest that, in the future, MBT may become more cost-competitive with landfilling and incineration.

Costs and potentials for reducing GHG emissions from waste are usually based on landfill CH₄ as the baseline (Bates and Haworth, 2001; Delhotal et al. 2006; Monni et al. 2006; Nakicenovic et al., 2000; Pipatti and Wihersaari 1998). When reporting to the UNFCCC, most developed countries take the dynamics of landfill gas generation into account; however, most developing countries and non-reporting countries do not. Basing their study on reported emissions and projections, Delhotal et al. (2006) estimated break-even costs for GHG abatement from landfill gas utilization that ranged from about –20 to +70 US$/tCO₂-eq, with the lower value for direct use in industrial boilers and the higher value for on-site electrical generation. From the same study, break-even costs (all in US$/tCO₂-eq) were approximately 25 for landfill-gas flaring; 240–270 for composting; 40–430 for anaerobic digestion; 360 for MBT and 270 for incineration. These costs were based on the EMF-21 study (US EPA, 2003), which assumed a 15-year technology lifetime, 10% discount rate and 40% tax rate.

Compared to thermal and biological processes which only affect future emissions, landfill CH₄ is generated from waste landfilled in previous decades, and gas recovery, in turn, reduces emissions from waste landfilled in previous years. Most existing studies for the waste sector do not consider these temporal issues. Monni et al. (2006) developed baseline and mitigation scenarios for solid waste management using the first order decay (FOD) methodology in the 2006 IPCC Guidelines, which takes into account the timing of emissions. The baseline scenario by Monni et al. (2006) assumed that: 1) waste generation will increase with growing population and GDP (using the same population and GDP data as SRES scenario A1b); 2) waste management strategies will not change significantly, and 3) landfill gas recovery and utilization will continue to increase at the historical rate of 5% per year in developed countries (Bogner and Matthews, 2003; Willumsen, 2003). Mitigation scenarios were developed for 2030 and 2050 which focus on increased landfill gas recovery, increased recycling, and increased incineration. In the increased landfill gas recovery scenario, recovery was estimated to increase 15% per year, with most of the increase in developing countries because of CDM or similar incentives (above baseline of current CDM projects). This growth rate is about triple the current rate and corresponds to a reasonable upper limit, taking into account the fact that recovery in developed countries has already reached high levels, so that increases would come mainly from developing countries, where current lack of funding is a barrier to deployment. Landfill gas recovery was capped at 75% of estimated annual CH₄ generation for developed countries and 50% for developing countries in both the baseline and increased landfill gas recovery scenarios. In the increased incineration scenario, incineration grew 5% each year in the countries where waste incineration occurred in 2000. For OECD countries where no incineration took place in 2000, 1% of the waste generated was assumed to be incinerated in 2012. In non-OECD countries, 1% waste incineration was assumed to be reached only in 2030. The maximum rate of incineration that could be implemented was 85% of the waste generated. The increased recycling scenario assumed a growth in paper and cardboard recycling in all parts of the world using a technical maximum of 60% recycling (CEPI, 2003). This maximum was assumed to be reached in 2050. In the mitigation scenarios, only direct emission reductions compared to the baseline CH₄ emissions from landfills were estimated – thus avoided emissions from recycled materials, reduced energy use, or fossil fuel offsets were not included. In the baseline scenario (Figure 10.8), emissions increase threefold during the period from 1990 to 2030 and more than fivefold by 2050. These growth rates do not include current or planned legislation relating to either waste minimization or landfilling – thus future emissions may be overestimated. Most of the increase comes from non-OECD countries whose current emissions are smaller because of lower waste generation and a higher percentage of waste degrading aerobically. The mitigation scenarios show that reductions by individual measures in 2030 range from 5–20% of total emissions and increase proportionally with time. In 2050, the corresponding range is approximately 10–30%. As the measures in the scenarios are largely additive, total mitigation potentials of approximately 30% in 2030 and 50% in 2050 are projected relative to the baseline. Nevertheless, the estimated abatement potential is not capable of mitigating the growth in emissions.

Figure 10.8: Global CH₄ emissions from landfills in baseline scenario compared to the following mitigation scenarios: increased incineration, CDM ending by 2012 (end of the first Kyoto commitment period), increased recycling, and high landfill CH₄ recovery rates including continuation of CDM after 2012 (Monni et al., 2006). The emission reductions estimated in the mitigation scenarios are largely additional to 2050. This figure also includes the US EPA (2006) baseline scenario for landfill CH₄ emissions from Delhotal et al. (2006).

The baseline emission estimates in the Delhotal et al. (2006) study are based on similar assumptions to the Monni et al. (2006) study: population and GDP growth with increasing amounts of landfilled waste in developing countries. Baselines also include documented or expected changes in disposal rates due to composting and recycling, as well as the effects of landfill-gas recovery. In Delhotal et al. (2006), emissions increase by about 30% between 2000 and 2020; therefore, the growth in emissions to 2020 is more moderate than in Monni et al. (2006). This more moderate growth can be attributed to the inclusion of current and planned policies and measures to reduce emissions, plus the fact that historical emissions from prior landfilled waste were only partially considered.

Scenario development in both studies was complemented with estimates on maximum mitigation potentials at given marginal cost levels using the baseline scenarios as the starting point. Monni et al. (2006) derived annual regional waste-generation estimates for the Global Times model by using static aggregate emission coefficients calibrated to regional FOD models. Some modifications to the assumptions used in the scenario development were also made; for example, recycling was excluded due to its economic complexity, biological treatment was included and the technical efficiency of landfill-gas recovery was assumed the same in all regions (75%). Cost data were taken from various sources (de Feber & Gielen, 2000; OECD, 2004; Hoornweg, 1999).

As in the EMF-21 study (US EPA, 2003), both Delhotal et al. (2006) and Monni et al. (2006) assumed the same capital costs for all regions, but used regionalized labour costs for operations and maintenance.

Delhotal et al. (2006) and Monni et al. (2006) both conclude that substantial emission reductions can be achieved at low or negative costs (see Table 10.4). At higher costs, more significant reductions would be possible (more than 80% of baseline emissions) with most of the additional mitigation potential coming from thermal processes for waste-to-energy. Since combustion of waste results in minor fossil CO₂ emissions, these were considered in the calculations, but Table 10.4 only includes emissions reductions from landfill CH₄. In general, direct GHG emission reductions from implementation of thermal processes are much less than indirect reductions due to fossil fuel replacement, where that occurs. The emission reduction potentials for 2030 shown in Table 10.4 are assessed using a steady-state approach that can overestimate near-term annual reductions but gives more realistic values when integrated over time.

The economic mitigation potentials for the year 2030 in Table 10.5 take the dynamics of landfill gas generation into account. These estimates are derived from the static, long-term mitigation potentials previously shown in Table 10.4 (Monni et al. 2006). The upper limits of the ranges assume that landfill disposal is limited in the coming years so that only 15% of the waste generated globally is landfilled after 2010. This would mean that by 2030 the maximum economic potential would be almost 70% of the global emissions (see Table 10.5). The lower limits of the table have been scaled down to reflect a more realistic timing of implementation in accordance with emissions in the high landfill gas recovery (HR) and increased incineration (II) scenarios (Monni et al., 2006).

It must be emphasized that there are large uncertainties in costs and potentials for mitigation of GHG emissions from waste due to the uncertainty of waste statistics for many countries and emissions methodologies that are relatively unsophisticated. It is also important to point out that the cost estimates are global averages and therefore not necessarily applicable to local conditions.