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Leaders in the design, implementation and operation of markets for electricity, gas and water.
Modern Waste Management for Kosovo
Workshop no 6 July 26 2007
Contractual and financial issues for waste management
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Environmental Regulation
Why do we need environmental regulation?
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Bhopal Union Carbide
• 03/12/1984, an explosion at the Union Carbide factory caused a gas cloud to escape from the facility
• The cloud contained Methyl Isocyanate, highly toxic organic compound used in pesticides, rubber and adhesives
• 4,000 local residents killed, health problems for 50,000 to 500,000, still persist today
• The cause resulted from neglected safety procedures (because of budget cuts). Safety measure were in place but not functional.
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Bhopal Union Carbide
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The Love Canal chemical waste dump
• 1920 Hooker Chemical turned an area in Niagara Falls into a municipal and chemical dump site
• By 1953, the site was filled and sealed with a thick layer of red clay to prevent escape of chemicals
• A housing and school project was developed which involving excavating into the dump site, called love canal
• The dump site contains carcinogenic dioxins and a total of 248 species of chemicals (mainly pesticide residues & chemical weapons research)
• Chemicals had entered homes, sewers and yards
• More than 900 families were moved from the area.
• Hooker’s parent company had to pay over € 230 million for cleanup and management of the dump site.
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London Smog 1952
• December 1952, London suffered from the heaviest smog (industrial fog) ever known (visibility dropped to a few meters)
• It lasted until March 1953 and made worse by light winds, high moisture, increased coal burning (because of the cold winter)
• Particulate matter reached 56 x normal levels. Sulphur dioxide was 7 x normal levels and promoted acid rain in London
• The smog killed approximately 12,000 people, mainly children, the elderly and the ill. Cause of death, breathing in acidic aerosols that cause irritation and inflammation
• This disaster resulted in the Clean Air Acts 1956. Government introduced smokeless zones, cleaner fuels and located power stations in rural areas. Tall chimneys were introduced to encourage dispersion of the gaseous emissions (sulphur dioxide etc)
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London Smog 1952
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London Smog 1952
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Environmental Regulation in Waste
Government (Department of Food, Environment & Rural Affairs
(DEFRA)
Sets waste policy,strategy and targets
Waste ManagementLicensing
PPC PermitsStatutory consultee withPlanning Departments
ENVIRONMENT AGENCY (main body) & LOCAL PLANNING DEPARTMENT
Enforcement oflicence conditions
Develop test protocol,monitoring etc
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Environmental Regulation (UK)
• In the UK [sic], the government set up the ‘Environment Agency’, as the primary environmental regulator.
• Environment Agency vision:
• "We are the leading public body for protecting and improving the environment in England and Wales [UK]. It's our job to make sure that air, land and water are looked after by everyone in today's society, so that tomorrow's generations inherit a cleaner, healthier world."
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Environment Regulation (European)
• Public authorities regulate in the public interest to achieve a variety of goals:
− ensure fair and competitive market price
− to protect human health and the environment
− to provide safety (e.g. health & safety during operations)
− to stimulate innovation, new practicesBetter Regulation, EC 2006
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Environment Regulation in Kosovo
• EAR funded institutional support for environmental management (MESP)
• MESP will be the primary environmental regulator, developing policy, strategy and importantly regulations for enforcement− MESP develops Environmental Action Plans for Kosovo to
improve environmental awareness and reduce pollution of the environment
− Enforcement roles for both ministry and municipal staff− Develop and improve infrastructure for waste management
and other environmental sectors
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Environment Regulation in Kosovo
The present waste management system does not record data on waste generation, collection, treatment, recovery, and disposal in a comprehensive and structured way. Although about 90% of the urban population have garbage collection, it is generally of poor standard….. In contrast, less than 10% of rural areas are covered by garbage collection. The fee payment collection is very low (30-40 %). Out of a total of 29 municipal landfills, 26 are rehabilitated and the European Agency for Reconstruction (EAR) and other donors have supported the reconstruction or construction of 9 additional regional landfills (Kosovo Environmental Action Plan 2006-2010)
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Commission’s 6th Environmental Action Programme
• Set out 4 key environmental priorities:− climate change
− nature and biodiversity
− environment and health and quality of life
− natural resources and waste
• Better use of resources, greater efficiency and more sustainable waste management in the future
• Decoupling of waste production and economic growth
• Waste management to reduce greenhouse gas emissions in the coming years (i.e. restricting waste types, gas collection and treatment etc)
15Background to economic issues in waste management
Principles embodied in all Central European countries:
1. The User Pays
2. The responsibility for municipal waste issues – collection, disposal – is generally with the Municipality.
3. It is up to the Municipality to provide the relevant services on its own, or
to contract it out.
4. The user of the service (household, commercial premise, …) owes the cost for the service (as a fee) to the Municipality.
MS
Example Tyrol: 700.000 population, 9 political districts…
Innsbruck-Stadt Bezirk LandeckBezirk Im st Bezirk LienzBezirk Innsbruck-Land Bezirk ReutteBezirk Kitzbühel Bezirk SchwazBezirk Kufstein
MS
Gem einde Sölden ABV SÖ M itte lgebirgeAAV Großache Süd
AW V Unterland
Gem einde Reutte AW V K itzbühelAW V Innsbruck-LandABV W esttirol
AW V Reutte Stadt Innsbruck
ABV der Region 10ABV Osttirol
AEV Kufstein
…9 waste management districts (2 single municipalities)MS
Case study: Waste Management Council Western Tyrol
70.000 inhabitants
54 municipalities (2 district capitals @ ca. 10.000 inhabitants)
District capitals run waste collection service by own means
All other municipalities have contracted waste collection services out; 5-year contracts + yearly extension are typical
4 private waste collection companies are active in the area
The municipalities are organized in a Waste Management Council, founded in 1984
The Council owns and operates a central landfill (in future: a waste treatment centre).
MS
MS
How does the whole thing work there ?
Municipality 1 Mun. 2 Mun. 3 Mun. 4
Waste Management Council
waste fee
€ per month
Private operator
Private collection companies
Waste collection (and similar services)
Waste disposal (operation of landfill…)
€ per t
20Background to economic considerations in waste management II
Principles… continued:
5. Certain commercial and institutional waste generators may take back the responsibility for collection and disposal from the Municipality. They turn into "self-disposers".
6. The differentiation between
„household waste“ (which remains under the Municipality´s responsibility in any case) and
„commercial waste“ (which might be disposed of under the self-responsibility of the relevant generator, eg. a supermarket chain)
usually is done according to quality and/or amount.
MS
…and what about regulation ?MS
There is no economic regulator.
Collection tariffs are subject to the law of the market.
Disposal (landfill) tariffs are subject to approval by local government.
Landfills have indivi-dual tariffs (reflecting their individual cost) and defined catchment areas.
Deponie JochbergDeponie Roppen IIDeponie Sölden
Deponie R iederbergM VA Kem pten Deponie Ahrental
Deponie Lavant
Sanitary landfill
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Municipal waste fee – example Vienna
Landlord
Residual waste
€ 3,16
52 weeks
164,3 € per household and year
Waste paper White glass Coloured glass
€ 0,00 € 0,00 € 0,00
Metals Plastics Biowaste
€ 0,00 € 0,00 € 0,00
Waste fee
Municipality
finances in addition to collection services (of residual waste and recyclables) other services like a infoline, free delivery of compost, etc.
MS
23Waste management charging principles and practice
1. The User Pays
2. KISS – Keep It Simple Stupid
It reduces administration efforts
It reduces regulatory requirements
Transparency counts in the long turn.
3. Tariff should incorporate / represent an incentive to support
the system´s policy – in Europe the „3 R´s“
4. Tariffs are due on a regular (monthly to yearly) basis
5. No differentiation between collection and disposal cost.
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Tariff types for Municipal Waste Management
1. Tariffs per household
2. Tariffs per household, considering also number of persons
3. Tariffs depending on floorspace
4. Tariffs depending on volume
5. Tariffs depending on weight
6. Tariffs depending on value of property
7. Tariffs depending on distance to disposal
8. …and combinations thereof (usually 1/2/3 combined with 4/5):
MS
Tariff types 4 + 5 fulfil the request of providing an incentive to support the system´s policy (i.e. to use recycling opportunities…) but: A split-up of the fee in "basic (fixed)" & „top-up (variable) fee" is recommended.
Basic fee
top-up feeusually
depending on volume
≈ ⅔
≈ ⅓
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Tariff types for Municipal Waste Management
1. Tariffs per household…
…give no incentive eg. to recycle
MS
2. Tariffs per household, considering also number of persons,
and
3. Tariffs depending on floorspace
are both difficult being administered (quality of data !)
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Tariff types for Municipal Waste Management
4. Tariffs depending on volume
a) Measuring the produced waste volume(´real volume metering´)
b) Counting the emptyingof bins (´identification´)
MS
c) pre-paid bags (CH, A)5. Tariffs depending on weight
…sophisticated systems with a few practical problems…
however, where the weight of a single waste load can be taken easily (commercial !), weight should be taken as tariff basis !
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Example contract
• Contract between:− London municipality – Royal Borough of Kensington and Chelsea
− A private waste management contractor
• Waste collected from about 90,000 domestic and commercial premises
• Approximately 95,000 tonnes of waste per annum
• Household collection: twice a week, Monday to Friday
• Commercial collection: up to three times a day, seven days a week
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Collection contract example
• Contract elements included:
• General specification
• Waste collection specification− Collection days
− Collection amounts
− Commercial waste
• Recycling specification
• Street cleansing specification
• Container maintenance
• Bulky items handling
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General specifications
• General specification includes:− Annual Reporting
− Reporting and communication
− Meetings between municipality and contractor
− Contract monitoring
− Customer care
− Quality assurance
− Vehicles and plant
− Premises
− Environmental Performance
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Waste collection specifications
• Waste collection specification includes:− Category of waste and type of collection i.e. household, commercial and co-collections
(household & commercial)
− Collection timings (may be restricted in shopping areas)
− Operational requirements (general)• Health and safety requirements
• Maintain clean and tidy waste storage areas
• Receive and resolve any operational complaints
• Collection timescales
− Operational requirements (household)• Collection twice a week
• Collections for dry recyclables and green waste sacks
• Deal directly with any complaints
− Operational requirements (commercial)• Increase commercial waste customers
• Premises to be served (customers)
• Deal with all operational complaints
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Waste collection specifications cont.
− Operational requirements (special collections)• Special collection service ‘too big for the bin’
• Service to households and businesses
• Maximise reuse and recycling of all collected waste
• Deal directly with any complaints
− Operational requirements (container transport)• Manage, maintain & repair all municipal containers
• Provide maintenance (regular and annual) schedules
• Deal with all operational complaints
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Recycling requirements
• Minimum recycling: 11,000 tonnes per annum (with less than 10% rejects)
• Collections to include− Paper and cardboard
− Glass bottles and jars
− Plastic bottles
− Cans and tins
• Kerbside collection – 63,000 households
• ‘Bring’ sites collection through service area
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Additional contract information
• Waste streams, domestic and commercial, sources of waste and quantities
• Collection timescales and vehicle routing
• Container identification, type, number and condition
• Collection days
• Oversize item collection
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Collection contract
• Contract awarded to SITA (Suez Environmental) for collection
• Collection contract – 15 years
• Cost of household collection €55.34/a
• Total of household disposal €52.66
• Total of cost for waste management €108
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Kosovo waste management
• Where have we come from?− Situation in 2000 much improved (EAR)
• Old dump site closed, restored
• Construction of new landfills complete
• Improved collection infrastructure
• Better environmental conditions and public health
− 2007 onwards• Financial sustainability
• Environmental improvements (LFG control, recycling..)
• Better environmental regulation & enforcement
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Focus on waste management
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Environmental strategy for Kosovo (2005)
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Kosovo Environmental Action Plan (2006)
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Kosovo Waste Management
Source: KEAP, 2006
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Why use it?
• Requirement under European legislation (you have to, common sense!)
• Provides useful information on the state of waste management in Kosovo
• Provided updated records for reviews
• Allows better determination of costs
• Breakdown of different waste streams, optimise collection efficiency
• Better determination of waste management fee/cost
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GRAPHIK
Example Macedonia (Source: NWMP)How can the public and the private sector work together for the good of all?
And for Kosovo: How can the involvement of the private sector be facilitated in a controlled, beneficial and sustainable way? (…on a level playing field…)
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MSW collection in Kosovo: Status quo
Collection of Municipal Solid Waste is presently within the responsibility of POE´s (Publicly Owned Enterprises)
Main problems POE´s are confronted with:- Poor economical status, which to some extent is due to- low willingness to pay of certain customer groups (actually result of an institutional shortcoming: Fees – also for disposal – are to be collected by POE´s).
Presently there is strong pressure from the private sector to enter the market.
The private sector focuses on ´profitable´ customers (where willingness to pay is out of question): Institutional waste generators (KFOR, …), commercial & industrial enterprises.
MS
43
MSW collection in Kosovo: Status quo II
POE´s fear that loosing the “cash cows” they have got pre-sently (ICI industrial, commercial & institutional generators) might make it even more difficult to provide a proper service in the area of household waste, and other (street cleaning…)
WWRO is issuing licenses for waste collectors.
WWRO´s competence is limited presently to POE´s. However private contractors are already active, either informal or being equipped with permits issued by MESP.
What to do ?
MS
Construction & Dem olition
W aste (C & D )M in ing waste
Agricu ltura lwaste
Sewage sludge
Household Waste
Mun icipal So lid Waste (MSW )
Bulky waste
Dry Recyclab les
Kitchenwaste
Biodegradable waste
Industrial, Com m ercial & Institutional Waste (ICI)
Catering waste, organic production residues
Public service waste
Hazardous waste Hazardous waste
Healthcare waste
End-of-lifevehicles
Green waste from gardens
MS
45
What sorts of waste are we talking about ?
“Municipal Solid Waste” is defined in UNMIK regulation No 2004/49 as…
solid waste, not being hazardous waste, medical waste or toxic waste, from household, commercial, institutional or industrial sources and processed wastes.
MS
46
Waste from households
Bulky waste
End-of-life vehicles
“Illegal dumpsites”
C & D waste
…
Certain recyclables
Commercial waste
Certain institutional sources (KFOR, UNMIK, …)
Certain industrial sources
…
There are more & less “profitable” waste streams…MS
47MSDon´t miss opportunities: System-free collection of cardboard
No investment needed, no increase of cost:
Use standard compaction trucks
Decrease number of trips (with waste loads) to landfill
Save disposal fee…
…turn a 5,26 €/t minus in a 5 €/t plus in your books
KLMC will enjoy less leachate (and gas) production
Enhance your image (waste hauler waste manager)
If you don´t do it today, your competitor will start with it tomorrow.
48
So what to do ?
POE´s continue to collect…
…WASTE, not FEES
Municipalities take – according to Kosovo Waste Law – the responsibility for waste management service provision
Main role of Municipalities (which may aggregate to larger, regional associations)
• Development and implementation of policy including setting and control of targets
• Creation of public awareness, conduction of information campaigns
• Setting and collecting of waste fees.
Waste collection services are tendered out in a controlled way – POE´s will compete with private contractors on a level playing field
Disposal costs charged to municipalities
Landfills may transfer to regional associations at a later stage.
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49
Final thoughts…
• Funding for main infrastructure is largely complete
• On-going costs & future investments must be funded by operational revenue (waste tariff, fees)
− Current levels are about 60%, not sustainable
• Must find better ways to pay bills− Political will
− Electronic payment through the banks
− Increase number of payments points
− Stimulate and encourage payment of utility bills
• With sound financial footings, the industry can develop to provide Kosova with a sustainable, progressive waste management sector
Final comments on the workshop´s day 2
Affordability of present waste fees (collection + disposal): Is it really the matchmaking point in Kosovo ?
If that is the case: No option left than to keep the service level as it is (or reduce it even further…)
BUT: Current figures do not support this assumption. Waste fees are supposed to be affordable when not exceeding 0.6 – 1 % of GNDI 1).
GNDI Kosovo: ~ 1.100 € / person, yr (source: IMF 2)).
Range of typical waste fees in Kosovo: 50 – 100 € per household, yr.
1) Gross National Disposable Income 2) International Monetary Fund
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Final comments on the workshop´s day 2
So isn´t rather collectability of fees (which comes along with a – understandably limited – willingness to pay) the core problem of Kosovo´s entire waste management system ?
If that really is the case:The institutional set-up has to be adopted in a suitable way.
If the relevant changes can be delivered, the present service level can be maintained, and in the mid to long term service levels can be improved sustainably…
MS
