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Managing C&D Waste Recovery in EU: Economic Constraints & Recycling Cost Model

Explore the challenges and strategies for recovering construction and demolition waste in the EU under varying economic conditions, analyzing GDP ranges, industry turnover, SWM costs, market competition, and profitability. Investigate the impact of recycling on waste management costs and the dynamic interactions within the industry. Examine the role of technical regulations, market instruments, and effective government policies in shaping a sustainable waste recovery ecosystem.

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Managing C&D Waste Recovery in EU: Economic Constraints & Recycling Cost Model

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  1. Recovery of C&D waste Changing under different economic constraints

  2. EU: differences in GDP / cap~€ • 7.500-10.000 • Bulgaria, Poland, Hungary • 10.000-17.000 • Lithuania, Czech Rep., Latvia, Portugal, Greece, Cyprus, Slovenia • 17.000-21.000 • Spain, Italy, Germany, Estonia • 22.000-30.000 • Belgium, France, Austria, UK, Netherlands, Sweden, Denmark, Ireland, + Luxemburg

  3. Turnover P/c Eco-industry

  4. SWM& Rec ~ € 20,-/cap

  5. SW & Rec ~ € 50,-/cap

  6. SWM & Rec ~€ 250,-/cap

  7. Ratio SWM cost/GDP • GDP<20.000: 0,1 - 0,2 % • GDP>20.000: 0,5 - 1,0 % • Low: Estonia, Spain, Belgium • High: Slovenia, Denmark, Austria

  8. A guess • Prices for C&D waste recycling are about 1/3 of cost of waste management per capita, e.g.: • € 7,- at a level of € 20,- • € 17,- at a level of € 50 • € 70,- at a level of € 200

  9. A general model for cost accounting • Full costs: • Internal: • Process cost • Product costs and revenues • External “community” cost: • Generation of pollution & deterioration of renewables exceeding natural absorption level & Depletion of natural resources: • Difficult to count, change with wealth • Difficult to address: local, regional or global • For someone else or the next generation • Diluted

  10. Conservation of misery • Law on conservation of matter: • the GOOD, • the BAD and • the UGLY

  11. A dynamic arena of interacting parties • Consequences of goods with negative value • Recycling breakeven • Profitability regarding different public policy instruments • Choice of market match • Economy of scale • Economic depreciation of investments

  12. Consequences of goods with negative value • Cash flow + • Stock value - • Risk management +/- • Loss reward +

  13. Recycling Breakeven • Competition with other treatment chains (e.g. land filling or incineration): dominant competition • Built-in percentage of other treatment: BAD can become worse for residues

  14. Competing chains C -70 Transport -20 1 50% GOOD 2 Transport -40 R -20 40% BAD -40 10% UGLY ( = Community) Tipping fee -30 Landfill

  15. A guess • Prices for C&D waste recycling are about 1/3 of cost of waste management per capita, e.g.: • € 7,- at a level of € 20,- • € 17,- at a level of € 50 • € 70,- at a level of € 200

  16. Competing chains C -10 Transport -5 1 80% GOOD +3 PRICE ?? 2 Transport -5 R -20 20% BAD -5 10% UGLY (-100 = Community) Tipping fee -5 Landfill MAX PROFIT ??

  17. Low cost competition Wood, Metals, Plastics C -10 Transport -5 1 80% aggregate +3 PRICE 4,90 2 Transport -5 R -5 20% BAD -5 10% UGLY (-100 = Community) Tipping fee -5 Landfill MAX PROFIT 1,30

  18. After technical regulation C -25 Transport -5 1 70% GOOD +12 PRICE 19,90 2 Transport -5 R -20 30% BAD -20 10% UGLY -100 community Tipping fee -20 Landfill MAX PROFIT 2,50

  19. After technical regulation and taxing debris, wood, metal C -75 Transport -5 1 60% GOOD +2 PRICE 69,90 2 Transport -5 R -35 5% 40% BAD -70 5% UGLY -100 tax Tipping fee -70 Landfill, incinerator MAX PROFIT 3,10

  20. Selective Landfill ban for unsorted waste: BINGO C -104 Transport -5 1 60% GOOD +2 PRICE 99 2 R -35 X 5% 40% BAD -80 5% UGLY -100 = Tax Landfill MAX PROFIT 28,20

  21. Finding a match of markets • A. waste product markets • B. Resources markets (Energy and raw materials) B specific A Sophiticated

  22. Economy of scale collect Sort 3 end Sort 1 Sort 2

  23. Innovation and governmental reliability • When investing, parties want a “innovative” public policy guaranteeing change, to be able to invest; • After investment parties want a “reliable” public policy to have a optimal depreciation of their assets; • It would be a coincidence if all the parties would be in the same stage at the same moment: • countervailing lobbying causes delays

  24. Instruments of public authorities creating a artificial market • Technical regulations (IPPC, BAT) • Treatment regulations (BREF’s) • Economic measurements: grants and taxes • Economic actor: client, supplier, manager

  25. Effective regulation Thesis: • A combination of technical regulation and taxing the remaining external cost is sufficient for the creation of an effective diversified market • More is politics and can be used as temporarily accelerator

  26. Concluding remark:Design your system(-role) back to forth • Start in the future, count ten years back; • Question what scarce resources are and what can be paid; • Count internal and external cost; • Design the whole system of end-treatment, recycling and collection (In that order); • Find efficient rules for the play and roles for the players.

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