Zero Waste Business Case
DRAFT for EXPERT REVIEW
Submitted to:
Environmental Standards Branch
C/O 3rd floor, 2975 Jutland Rd
Victoria BC
V8W 9M1
Attn: Jennifer Maxwell
[email protected]
Submitted by:
Innes Hood, P.Eng
Innes Hood Consulting Inc.
338 East 14th St
North Vancouver, BC
V7L 2N6
Tel 604 988-0444
Email [email protected]
In association with:
Earthvoice Strategies,
Kelleher Environmental
May, 2013
1
Zero Waste Business Case: Final Report
Table of Contents
Glossary ......................................................................................................................................................... 6
Acronyms ...................................................................................................................................................... 6
Summary ....................................................................................................................................................... 8
Context ...................................................................................................................................................... 8
Scope and Methods .................................................................................................................................. 8
Results ....................................................................................................................................................... 8
Introduction ................................................................................................................................................ 10
Objectives ............................................................................................................................................... 10
Scope of Analysis..................................................................................................................................... 10
Zero Waste Approach to Increased Diversion ........................................................................................ 12
Provincial Waste Management Hierarchy .......................................................................................... 13
Data limitations ....................................................................................................................................... 14
Report Structure ..................................................................................................................................... 14
Methodology............................................................................................................................................... 15
Overview of Collection, Recycling and Disposal Process in BC ............................................................... 15
Analytic Framework ................................................................................................................................ 17
Materials Quantification Methodology .................................................................................................. 19
Material Forecast ................................................................................................................................ 19
Disposal by Material (2010) ................................................................................................................ 22
Diversion by Material (2010) .............................................................................................................. 22
Disposal and Diversion Forecast by Scenario...................................................................................... 23
Incremental Diversion by Material and Scenario (2025) .................................................................... 24
Incremental Diversion by Milestone Period ....................................................................................... 26
Economic Analysis Methodology ............................................................................................................ 28
Assumptions ........................................................................................................................................ 28
Data Sources for Costs and Revenue .................................................................................................. 29
Municipal Costs ................................................................................................................................... 29
Commodity Revenue........................................................................................................................... 30
Industry Stewardship Costs & Revenues ............................................................................................ 30
Material Diversion in the Zero Waste Scenarios................................................................................. 31
Costs and Revenue by Material and 5Rs Activity ................................................................................ 31
2
Zero Waste Business Case: Final Report
Calculation of Costs and Benefits........................................................................................................ 34
Employment Impact Methodology ......................................................................................................... 34
Input-Output Multipliers..................................................................................................................... 34
Reuse-Recycling-Recovery: Jobs-Per-Tonne-of-Material Ratios ......................................................... 35
Energy and GHG Impacts ........................................................................................................................ 36
Human Health and Toxicity Impacts ....................................................................................................... 38
Results ......................................................................................................................................................... 39
Economic Business Case ......................................................................................................................... 39
Distributional Impacts ............................................................................................................................. 41
Sensitivity Analysis .............................................................................................................................. 41
Job Creation and Economic Impact Results ............................................................................................ 42
Direct, Indirect and Induced Impacts .................................................................................................. 42
Downstream Impacts .............................................................................................................................. 44
GHG and Energy Impacts ........................................................................................................................ 45
Zero Waste Business Case Results Summary .......................................................................................... 45
Discussion.................................................................................................................................................... 47
Distributional Impacts ............................................................................................................................. 47
Impact of Increased Diversion on Landfill Costs ................................................................................. 48
Leakage ............................................................................................................................................... 48
Conclusions ................................................................................................................................................. 49
Recommendations .................................................................................................................................. 49
References .................................................................................................................................................. 51
Appendix: Local Government Survey on Waste Management Costs and Practices ................................... 54
3
Zero Waste Business Case: Final Report
List of Tables
Table 1: Business Case for Zero Waste Summary ........................................................................................ 9
Table 2: Recycling, Reuse and Remanufacturing Sector Categories ........................................................... 18
Table 3: Materials Quantification Task List ................................................................................................ 19
Table 4: Waste Forecast by Sector (2010 – 2025); Business as Usual Scenario ........................................ 20
Table 5: Waste Forecast by Sector (2010 – 2025); 62% Diversion Scenario .............................................. 20
Table 6: Waste Forecast by Sector (2010 – 2025); 81% Diversion Scenario .............................................. 21
Table 7: Disposal Tonnage by Material, (2010).......................................................................................... 22
Table 8: Diversion by Material (2010) , [tonnes] ....................................................................................... 23
Table 9: Percent of 2010 Disposed Tonnes Which Will Be Diverted by 2025 ............................................ 24
Table 10: Scenario Two Incremental Diversion by Category and Segment, 2025 (Tonnes) ...................... 25
Table 11: Scenario Three Incremental Diversion by Category and Segment, 2025 (Tonnes) ................... 26
Table 12: Scenario Two Incremental Diversion by Milestone Year and Material ...................................... 27
Table 13: Scenario Three Incremental Diversion by Milestone Year and Material ................................... 27
Table 14: Economic Impact Analysis Task List ............................................................................................ 28
Table 15: Material Allocation by 5Rs Activity ............................................................................................ 31
Table 16: Unit Costs and Revenues by Material and Activity ..................................................................... 33
Table 17: Calculation of Net Costs & Benefits ........................................................................................... 34
Table 18: Employment Impact Task List ..................................................................................................... 34
Table 19: Input Output Multipliers, (Jobs per $1 million)........................................................................... 35
Table 20: Input Output Calculation ............................................................................................................ 35
Table 21: Downstream Jobs-Per-Tonne-of-Material Ratios ....................................................................... 36
Table 22: GHG Emissions from Waste Diversion Options Compared to Landfilling, Including Carbon Sinks
(tonnes CO2e/tonne), Scenario 2 and 3 ..................................................................................................... 37
Table 23: Energy Savings from Waste Diversion Options Compared to Landfilling (GJ/tonne), Scenario 2
and 3 ........................................................................................................................................................... 38
Table 24: Human Health and Ecosystem impact by 5R activity [kG/ Tonne material] .............................. 38
Table 25: Calculation of Incremental Economic Benefit (Cost) of Higher Waste Diversion ....................... 39
Table 26: Economic Benefits (Costs) of Higher Waste Diversion Scenarios (Relative to BAU in 2025) ($
millions)....................................................................................................................................................... 40
Table 27: Summary of Expenditures and Revenues by Scenario (Relative to BAU in 2025) ($ millions)... 41
Table 28: Public Sector versus Private Sector Costs of Higher Waste Diversion ........................................ 41
Table 29: Sensitivity Analysis on Economic Benefit (Cost) ......................................................................... 42
Table 31: Scenario Two Job Creation and Economic Impacts in Material Collection and Processing ........ 43
Table 32: Scenario Three Job Creation and Economic Impacts in Material Collection and Processing ..... 44
Table 33: Full Time Equivalent Job Impacts on Downstream Reuse, Recycling and Recovery Sectors ...... 45
Table 34: GHG and Energy Impacts of Zero Waste Strategy in 2025 [GJ].................................................. 45
Table 35: Zero Waste Business Case Summary Results (Relative to BAU, 2025)....................................... 46
Table 36: Trends in Cost Shifting from Implementation of Zero Waste Strategies Compared to Landfilling
.................................................................................................................................................................... 47
4
Zero Waste Business Case: Final Report
List of Figures
Figure 1: Scope of Zero Waste Analysis ..................................................................................................... 12
Figure 2: Zero Waste Economic and Employment Impacts Process Map.................................................. 15
Figure 3: Solid Waste Process Map (Scenario 1) ........................................................................................ 16
5
Zero Waste Business Case: Final Report
Glossary
Zero waste
A solid waste management policy framework that goes beyond recycling to focus
first on reducing waste and reusing products and then recycling and
composting/digesting the rest.
Reduce
The first priority within a “5Rs” waste management hierarchy of reduce, reuse,
recycle, plus recover and residual management. The objective of this strategy is
to reduce by as much as possible the amount or toxicity of material that enters
the solid waste stream and also the impact on the environment of producing it in
the first place.
Reuse
The second waste management priority is to ensure that materials or products are
reused as many times as possible before entering the solid waste stream.
Recycle
The third waste management priority is to recycle as much material as possible.
Recovery
The fourth waste management priority is to recover as much material and/or
energy from the solid waste stream as possible through the application of
technology.
Residuals management
The fifth waste management priority is to provide safe and effective residual
management. This activity takes place once the solid waste stream has been
reduced by efforts under the first 4 Rs, through the application of technology
primarily in the form of well-designed and secure landfills.
Direct effects
Direct effects are the direct impact on wages, GDP and FTEs of increased industry
output within that industry. For example, a waste hauler would experience
directly the impact of increased output with the Waste Management industry.
Indirect effects
Indirect Effects measure the value of additional economic demands that the direct
economic activity places on the supplying industries in the region. When firms
produce goods or conduct business, they must make many purchases. Some of
these are from suppliers in the area.
Induced effects
Induced effects accrue when workers in the direct and indirect industries spend
their earnings on goods and services in the region. Induced effects can also be
called household effects.
Downstream jobs
Downstream sectors are those that experience an economic impact due to
changes in the flow through of material inputs to their business. In this sense, the
reuse, remanufacturing and recycling reliant industries are downstream of the
collection, landfill and processing sectors. They see an economic impact due to
changes in the availability of collected materials, which represent a throughput
for their operations. An example of a downstream company is a glass bottle
manufacturer that receives recycled glass to transform into a new product.
Acronyms
5Rs
Hierarchy of reduce, reuse, recycle, recovery and residuals management
6
Zero Waste Business Case: Final Report
BAU
CR&D
EPR
FTE
GDP
GHG
GJ
ICI
MRF
WTE
Business as Usual
Construction, renovation and demolition
Extended producer responsibility
Full time equivalent
Gross domestic product
Greenhouse Gas
Giga Joule
Industrial Commercial and Institutional
Material recovery facilities
Waste to energy
7
Zero Waste Business Case: Final Report
Summary
Context
As British Columbians, we recycle more today than we ever have before. We are also throwing more
into the landfill than we ever have before. Based on current trends, by 2025, British Columbians will
generate approximately one million tonnes more landfill waste every year than we do today. That
increase in garbage is expected to raise municipal waste management costs by $120 million per year.
But increasingly, we are finding better ways to extract the value from materials in the waste stream,
which creates new economic opportunities and jobs.
“Zero Waste” is a solid waste management policy framework that goes beyond recycling to focus first on
reducing waste and reusing products and then recycling and composting/digesting the rest. Many
communities across Canada, the US and globally (including many in BC) have explored or adopted zero
waste principles (including Metro Vancouver). This study seeks to answer the question, “Is there a
business case for a zero waste strategy in British Columbia?” It examines the economic, jobs, energy,
greenhouse gas emissions, and other environmental impacts for British Columbia of one business as
usual and two alternative waste diversion scenarios in 2025.
Scope and Methods
“Waste” has five possible pathways, known as the waste prevention hierarchy, or the “5Rs”: reduce,
reuse, recycle, recover, residuals management. Residuals management is landfilling in most cases, so
when we talk about “waste diversion” we mean directing waste down one of the other four pathways:
reduce, reuse, recycle, or recover.
This study compares estimated societal costs and benefits of two higher waste diversion scenarios
compared to one business as usual scenario in 2025. The three waste scenarios used in this analysis
were derived from the BC Stats report, Solid Waste Generation in British Columbia 2010 - 2025 Forecast
(2012). The business as usual scenario assumes a status quo approach to waste management in BC with
diversion rates remaining constant at 43% over the study period from 2010 to 2025 and a focus on
recycling as the primary diversion strategy. Scenarios Two and Three are based on diversion strategies
that incorporate the 5Rs. Scenario Two assumes an increased diversion rate to 62% in 2025 while
Scenario Three assumes an 81% diversion rate in 2025.
For each scenario, materials were allocated proportionally across the 5Rs using professional judgment to
arrive at the total target diversion rate. Costing by 5Rs activity and material was developed from primary
research combined with available data sources. Material diversion forecasts were combined with 5R
costs and benefits to estimate the net benefit of implementing the zero waste strategy.
Results
This study demonstrates that there is a positive business case for increasing waste diversion. This study
also demonstrates that there are significant societal benefits as a result of increased diversion including
new jobs, increased GDP, reduced GHG emissions, and reduced environmental and human health risks.
8
Zero Waste Business Case: Final Report
The key findings of this study are summarised in Table 1 as follows:




The costs to local governments/taxpayers for waste management are projected to increase from
$377 million per year in 2010 to $450 million per year in 2025, should the waste diversion rate
remain at the current 43%.
There is a positive business case for implementing a Zero Waste Strategy for BC. Depending on
how aggressively it is implemented (i.e., 62% vs 81% diversion), by 2025 a Zero Waste Strategy
will produce between $56 million and $126 million of annual net economic benefit1; will create
between $27 million and $89 million in new annual GDP and generate between $755,000 and
$2.5 million in new annual income tax revenue for BC.
Reduce, reuse and recycling produces greater societal benefits than energy recovery or disposal.
The business case for zero waste is strengthened if supporting policies are developed that
encourage the creation and retention of remanufacturing facilities within BC, and prevent
leakage to other jurisdictions.
Table 1: Business Case for Zero Waste Summary
Summary
Net Economic Benefit
New GDP
New Jobs
New Revenue to Province
(Income tax)
GHG reductions
Projected Net Annual
Benefits in 2025
$56 to $126 million
$27 to $89 million
304 to 1,005
$756,000 to $2.5
million
1,047 to 2,277 kT/yr
1
The net economic benefit represents the net savings to the waste management system as a whole for scenarios
two and three compared with the business as usual scenario. If the net economic benefit is positive, the overall
economic cost of waste management has been reduced relative to BAU. If the net waste management benefit is
negative, the overall economic cost of waste management has increased relative to BAU. See “Economic Business
Case”, page 38 for a detailed explanation of the calculation of net economic benefit.
9
Zero Waste Business Case: Final Report
Introduction
The BC Ministry of Environment retained Innes Hood Consulting Inc. to develop a business case for zero
waste in British Columbia. One business as usual (BAU) and two alternative scenarios are developed.
The business as usual scenario assumes a status quo approach to waste management in BC with
diversion rates remaining constant at 43% over the study period from 2010 to 2025. Implementation of
a 5Rs strategy is used to achieve increased diversion rates. Scenario Two assumes a diversion rate of
62% by 2025, while Scenario Three assumes an 81% diversion rate by 2025.
Objectives
The objective of this analysis is to provide an estimate of the costs and benefits of increasing waste
diversion in BC. The analysis includes financial metrics, employment and environmental impacts,
relative to the business as usual scenario. Specifically, the analysis includes:








Assessment of potential diversion quantities by material and 5Rs strategy:
o Reduction,
o Reuse,
o Recycling,
o Recovery, and
o Residuals management.
Incremental direct solid waste management costs from 5Rs activities.
Incremental direct solid waste management revenues and expenditures from:
o Sale of recyclables,
o Reduction and reuse, and,
o Disposal cost reductions.
Distributional implications of who pays, and commentary on how costs shift from public sector
to private sector.
Energy and GHG impacts for the waste management sector.
Incremental government revenue resulting from waste and material management (personal,
corporate).
Incremental changes in the provincial gross domestic product (GDP).
Employment impacts including changes to wages and full time employment equivalent numbers
for:
o Direct jobs,
o Indirect jobs, and
o Induced jobs.
Scope of Analysis
The scope of the analysis is presented in Figure 1. This analysis is bounded spatially within British
Columbia and temporally by materials and financial transactions that occur after a product has been
10
Zero Waste Business Case: Final Report
consumed and before the material is re-manufactured. Waste streams include residential, ICI and CR&D
sectors. On the downstream side, the analysis is bound once material is sold into secondary markets.
Specifically, the analysis includes:





Costs of waste collection and disposal to define the baseline or business as usual scenario,
Effects on the generation of waste through implementation of reduction and reuse activities,
Industry stewardship collection and processing costs,
Costs and revenues from shifts from local government disposal or recycling of material to
industry stewardship programs, and
Costs and revenues from waste to energy processing of recovered material.
The analysis excludes a number of items such as:






Costs of consuming the original good;
The economic activities arising from re-manufacturing activities that occur primarily outside
British Columbia;
Household time and other household costs for sorting, washing and cleaning diverted material;
The externality cost of extracting and processing virgin material for the manufacturing of goods
and services, however, the energy and GHG impacts of re-use versus virgin material is
addressed;
Wider economic effects, such as impacts of a zero waste strategy on the rate of inflation, effects
on competitiveness and trade patterns; and
Administrative and compliance costs required by the Provincial government to develop and
enforce additional waste reduction and diversion strategies.
11
Zero Waste Business Case: Final Report
Extract Virgin
Material
Primary
Manufacture
Distribution,
Wholesale &
Retail
Reduce
Consumption
Scope of Analysis
Reuse
Collection
EPR/Recycle
Recover
Residuals
Sale of
Material
Waste to
Energy
Landfill/
Incineration
Remanufacture
into new
products
Figure 1: Scope of Zero Waste Analysis
Zero Waste Approach to Increased Diversion
A zero waste policy framework has been applied to structure the logic applied within this analysis. Zero
waste is a solid waste management policy framework that goes beyond recycling to focus first on
reducing waste and reusing products and then recycling and composting/digesting the rest. Many
businesses now operate in a zero waste mode, and have found that the efficiencies realized by reducing
waste to a minimum save money and increase efficiency, thereby increasing profitability. Many
12
Zero Waste Business Case: Final Report
communities across Canada, the US and globally (including many in BC) have explored or adopted zero
waste principles (including Metro Vancouver) which generally include a combination of:



Re-designing the way resources and materials flow through society;
Eliminating subsidies for raw material extraction and waste disposal;
Hold producers responsible for their products and packaging from “cradle to cradle”.
Zero waste generally involves a commitment to three objectives:



Maximizing upstream waste reduction through product re-design; Zero Waste or green
purchasing and producer responsibility;
Maximizing mid-stream longevity (through reuse, repair and durable design) and
Maximizing downstream resource recovery (recycling and composting/digestion) – keeping
material out of landfill and EFW (which Zero Waste proponents oppose)
These objectives are generally achieved through four broad policy instruments:




Incentives and disincentives to encourage waste reduction;
Extended producer responsibility and design for environment (DfE);
Green Purchasing and
Community building.
Provincial Waste Management Hierarchy2
The provincial waste management strategy is based on the “5Rs” hierarchy of reduce, reuse, recycle,
recovery and residuals management. This hierarchy has been used to allocate waste quantities into
diversion streams for each of the zero waste scenarios, to enable estimates of expenditures or revenues.
Consistent with the 5Rs hierarchy, the first priority is to reduce the amount or toxicity of material that
enters the solid waste stream. The second priority is to ensure that materials or products are reused
before entering the solid waste stream. The third priority is to recycle as much material as possible. In
this analysis, recycling activities can occur either through municipal collection programs, financed by taxpayers, or through stewardship programs funded by industry and producers.
The next priority effort within the hierarchy is to recover as much material and/or energy from the solid
waste stream as possible through the application of technology. This element depends on the nature
and size of the solid waste stream, the availability of technology, demand for its products, political
acceptability and the environmental, social and economic impact of applying that technology. Waste-toenergy (WTE) facilities achieving greater than 60% energy efficiency are considered recovery. In the
current analysis, for recovery, utilisation of waste-to-energy has been assumed. The final priority is to
provide safe and effective residual management. This activity takes place once the solid waste stream
has been reduced by efforts under the first 4Rs, through use of well-designed and secure landfills or
through incineration (<60% energy efficiency). For certain classes of solid waste, thermal treatment may
first be applied to change chemical properties, reduce volume and/or generate energy.
2
BC Ministry of Environment (1994).
13
Zero Waste Business Case: Final Report
Data limitations
Results of this analysis are based on published data and surveys of a selection of waste management
professionals. It was observed through the course of this study that there are limitations to the data
consistency and quality that impact the accuracy of the results. These limitations are discussed
throughout the report. To address the data limitations, a sensitivity analysis is applied to the results to
assess the impact of data uncertainty on the robustness of the overall conclusions.
Report Structure
The remainder of this report is structured into the following sections:




Methodology,
Results,
Discussion, and
Conclusions.
14
Zero Waste Business Case: Final Report
Methodology
This section presents the methodology, data sources and assumptions used to calculate the economic
and employment impacts for each projected waste scenario. A process map to illustrate the tasks
completed is presented in Figure 2. The process defined in this analysis was reviewed for consistency
with the literature.3
Figure 2: Zero Waste Economic and Employment Impacts Process Map
Overview of Collection, Recycling and Disposal Process in BC
The waste management sector in BC is complex with a large number of private and public sector players.
The roles of public sector versus private sector players vary by location, making generalisations for the
industry difficult. A high-level process map of the waste management system is presented in Figure 3 to
illustrate the current approach to waste management practices in BC. The services provided by the
waste management industry include:


3
Collection and transportation of waste and materials;
Operation of transfer stations, recycling facilities and landfills;
OECD, (2005).
15
Zero Waste Business Case: Final Report


Processing ,including composting and anaerobic digestion for organics; and, cleaning, sorting,
grading and baling for other materials; and,
Sale of materials to secondary markets.
There is significant diversity in the collection and diversion practices and responsibilities in different
regional districts throughout the province. Most of the single-family (78%) and multi-family households
(80%) in BC receive curbside collection of solid waste and recyclables from their municipal or regional
government4. The cost of this service is recovered either through property tax or on the basis of a user
fee and may be provided by the local government or contracted out to private sector waste
management firms.
In contrast, industrial, commercial and institutional (ICI) and construction, renovation and demolition
(CR&D) waste collection is handled primarily through private haulers who pick up waste and recycling on
a fee for service basis. Waste that is collected by municipal collection or private haulers is taken to
either landfills or to transfer stations where the material is compacted and sent to landfills. Landfill
ownership may be either public (regional district or municipal) or private. While most landfills are
regulated there are a number of private unregulated landfills in the province for which no data is
available.
Recycled materials collected from both the residential sector and the ICI sector are sent to material
recovery facilities (MRFs) who clean, sort, grade and bale the materials. This material is then sold,
either to markets within the Pacific Northwest or overseas, primarily to China.
Figure 3: Solid Waste Process Map (Scenario 1)
4
Glenda Gies and Associates (2012).
16
Zero Waste Business Case: Final Report
While this process map covers the majority of material, it is not exhaustive. For example, scrap cars or
heavy duty equipment have not been included within the scope of the current assignment. Leakage
from the system is discussed in later sections of the report. Reduction in consumption and re-use is not
captured within this process map since these activities reduce the material input.
Analytic Framework
Recent studies5 identify the value chain for materials diverted from the landfill by three component
industries: recycling industries; recycling reliant industries; and the reuse and remanufacturing
industries (Table 2). Using this value chain, materials flow first through recycling industries (which
collect, process and recover materials); then downstream through either a corresponding recycling
reliant industry (focused on primary production, processing the material into a new form); or through
the reuse and remanufacturing industries. Materials not diverted flow to the landfill, and for the
purposes of this study, recovered materials flow to waste to energy facilities. Based on this model:





5
Materials that are reduced and no longer flow into the economy represent a reduction in
economic activity and reduce the overall volume in the value chain. This is most immediately
seen in a reduction in collection activities and associated output for this sector;
Materials reused are assumed to flow into reuse and remanufacturing industries;
Materials recycled are assumed to flow into recycling-reliant industries;
Recovered materials flow into waste to energy facilities;
Residual volumes are zero in this analysis since it analyzes the impact of the incremental change
in landfill diversion between the business as usual scenario one and the two zero waste
diversion scenarios, which have higher diversion rates and hence zero incremental residual
volumes.
DSM Environmental (2009).
17
Zero Waste Business Case: Final Report
Table 2: Recycling, Reuse and Remanufacturing Sector Categories
Recycling Industries
Recycling Reliant Industries
(Demand Side)
 Government Staffed
Residential Collection
 Private Staffed Recycling
Collection
 Compost/Organics Processor
 Materials Recovery Facilities
 Recyclables Material
Wholesalers
 Plastics Reclaimers
6
6
 Glass Container
Manufacturing Plants
 Glass Product Producers
 Nonferrous Secondary
Smelting and Refining Mills
 Nonferrous Product
Producers
 Nonferrous Foundries
 Paper and Paperboard
Mills/Deinked Market Pulp
Producers
 Paper-based Product
Manufacturers
 Pavement Mix Producers
(asphalt and aggregate)
 Plastics Product
Manufacturers
 Rubber Product
Manufacturers
 Steel Mills
 Iron and Steel Foundries
 Other Recycling
Processors/Manufacturers
Reuse & Remanufacturing
Industries
 Computer and Electronic
Appliance Remanufacturers
 Retail Used Merchandise
Sales
 Wood Reuse
 Materials Exchange
Services
Ibid.
18
Zero Waste Business Case: Final Report
Materials Quantification Methodology
The tasks to develop the materials forecast are summarised below (Table 3). The results of this analysis
are used as input to the financial analysis and business case preparation.
Table 3: Materials Quantification Task List
Task
Compile quantities forecast by
segment and material
Forecast disposal and diversion
by scenario
Allocate diversion by 5Rs
strategy
Description
BC Stats developed a forecast of quantities that includes an estimate of
material by sector. The analysis evaluates three diversion scenarios
including the business as usual 43% diversion scenario and 2 alternative
scenarios (62% and 81% diversion).
The information above is disaggregated to estimate materials generated,
diverted and disposed by
 Segment,
 Milestone year,
 Waste diversion scenario (business as usual - 43%, 62%, 81%
diversion), and
 Material category.
Allocation of diverted tonnages by 5Rs strategy is provided using
available data from the literature on reduction and reuse, recycling,
recovery and residuals management, and available program performance
information for recycling, organics diversion and disposal.
A description of these tasks is presented below.
Material Forecast
Material quantities by segment, milestone year and diversion scenario have been developed as part of
the BC Waste forecast7. These estimates provide the basis of the current analysis and are presented in
Table 4 to Table 6.
7
BC Stats (a) (2012).
19
Zero Waste Business Case: Final Report
Table 4: Waste Forecast by Sector (2010 – 2025); Business as Usual Scenario
Table 1 - Scenario One: Status Quo
Tonnes
2010
2011
2012
2013
2014
Disposal
2,911,510 2,943,938 2,995,723 3,041,572 3,091,659
Residential
1,274,971 1,288,622 1,304,672 1,321,830 1,340,199
ICI
1,141,990 1,158,994 1,179,840 1,198,845 1,220,700
CR&D
494,550 496,322 511,211 520,896 530,761
Diversion
1,934,910 1,954,541 1,991,441 2,023,522 1,775,605
Residential
771,200 779,024 793,731 806,518 707,300
ICI
992,807 1,002,879 1,021,813 1,038,274 886,381
CR&D
170,904 172,638 175,897 178,731 181,924
Product Stewardship
242,398 245,241 248,209 251,527 539,124
Total Generated
5,088,819 5,143,719 5,235,373 5,316,621 5,406,388
Diversion Rate
43%
43%
43%
43%
43%
8
2015
3,134,815
1,358,868
1,238,466
537,481
1,512,590
602,052
726,044
184,494
834,836
5,482,241
43%
2016
3,180,175
1,377,723
1,257,402
545,049
1,533,232
610,268
735,933
187,031
846,542
5,559,948
43%
2017
3,218,388
1,396,868
1,272,076
549,444
1,546,484
615,538
742,030
188,915
858,255
5,623,127
43%
2018
3,243,954
1,415,952
1,282,042
545,960
1,553,534
618,336
744,943
190,254
870,004
5,667,491
43%
2019
3,263,630
1,435,143
1,288,985
539,501
1,556,437
619,482
745,726
191,230
881,797
5,701,864
43%
2020
3,288,795
1,454,270
1,297,778
536,747
1,563,426
622,256
748,604
192,566
893,590
5,745,811
43%
2021
3,312,212
1,472,889
1,304,855
534,468
1,570,745
625,161
751,656
193,927
905,314
5,788,271
43%
2022
3,337,599
1,491,322
1,313,054
533,223
1,580,355
628,980
755,893
195,482
916,896
5,834,850
43%
2023
3,366,728
1,509,552
1,322,638
534,537
1,592,982
634,002
761,684
197,296
928,364
5,888,074
43%
2024
3,395,050
1,527,561
1,332,601
534,888
1,605,511
638,984
767,433
199,094
939,693
5,940,254
43%
2025
3,422,322
1,545,330
1,343,098
533,893
1,617,546
643,770
772,938
200,837
950,861
5,990,728
43%
2,699,688
1,179,651
1,065,762
454,275
1,879,809
750,711
861,398
267,700
902,744
5,482,241
51%
2,657,323
1,160,587
1,050,516
446,220
1,928,546
770,012
872,674
285,860
974,079
5,559,948
52%
2,614,959
1,141,523
1,035,271
438,165
1,902,227
786,005
875,096
241,126
1,046,872
5,623,127
53%
2,572,595
1,122,459
1,020,025
430,110
1,975,536
826,122
902,207
247,207
1,060,464
5,667,491
55%
2,530,230
1,103,395
1,004,780
422,055
2,039,337
864,811
924,308
250,217
1,073,838
5,701,864
56%
2,487,866
1,084,331
989,534
414,000
2,112,061
904,918
950,176
256,967
1,087,539
5,745,811
57%
2,445,501
1,065,267
974,289
405,945
2,183,297
944,634
974,485
264,178
1,101,201
5,788,271
58%
2,403,137
1,046,203
959,043
397,890
2,258,614
985,041
1,001,055
272,519
1,114,803
5,834,850
59%
2,360,772
1,027,139
943,798
389,835
2,340,254
1,026,353
1,030,449
283,452
1,128,501
5,888,074
60%
2,318,408
1,008,075
928,552
381,780
2,421,162
1,067,447
1,060,232
293,483
1,141,966
5,940,254
61%
2,276,043
989,011
913,306
373,725
2,500,770
1,108,165
1,090,378
302,227
1,155,137
5,990,728
62%
Table 5: Waste Forecast by Sector (2010 – 2025); 62% Diversion Scenario
Disposal
Residential
ICI
CR&D
Diversion
Residential
ICI
CR&D
Product Stewardship
Total Generated
Diversion Rate
8
2,911,510
1,274,971
1,141,990
494,550
1,934,910
771,200
992,807
170,904
242,398
5,088,819
43%
2,869,146
1,255,907
1,126,744
486,495
2,028,324
811,286
1,034,574
182,465
246,249
5,143,719
44%
2,826,781
1,236,843
1,111,498
478,440
2,156,054
859,613
1,087,773
208,668
252,538
5,235,373
46%
2,784,417
1,217,779
1,096,253
470,385
2,272,557
906,915
1,136,400
229,242
259,648
5,316,621
48%
2,742,052
1,198,715
1,081,007
462,330
2,115,317
844,331
1,020,631
250,355
549,019
5,406,388
49%
Spreadsheet provided by Dan Schrier, BC Stats, November 15, 2012
20
Zero Waste Business Case: Final Report
Table 6: Waste Forecast by Sector (2010 – 2025); 81% Diversion Scenario
Disposal
Residential
ICI
CR&D
Diversion
Residential
ICI
CR&D
Product Stewardship
Total Generated
Diversion Rate
2,911,510
1,274,971
1,141,990
494,550
1,934,910
771,200
992,807
170,904
242,398
5,088,819
43%
2,791,967
1,219,849
1,096,300
475,817
2,105,399
847,296
1,064,960
193,143
246,354
5,143,719
46%
2,672,423
1,164,728
1,050,611
457,084
2,309,720
931,417
1,148,280
230,023
253,229
5,235,373
49%
2,552,879
1,109,606
1,004,922
438,351
2,502,765
1,014,490
1,226,999
261,276
260,976
5,316,621
52%
2,433,336 2,313,792 2,194,249 2,074,705 1,955,162
1,054,484 999,363 944,241 889,119 833,998
959,233 913,544 867,855 822,166 776,477
419,618 400,886 382,153 363,420 344,687
2,422,268 2,206,020 2,330,829 2,144,140 2,233,176
987,767 904,141 959,002 944,027 992,432
1,141,434 980,789 1,021,900 972,845 996,459
293,067 321,089 349,928 227,268 244,284
550,784 962,428 1,034,871 1,256,610 1,331,911
5,406,388 5,482,241 5,559,948 5,623,127 5,667,491
55%
58%
61%
63%
66%
1,835,618
778,876
730,788
325,954
2,372,730
1,066,242
1,047,858
258,630
1,347,370
5,701,864
68%
1,716,074
723,754
685,099
307,221
2,520,232
1,141,249
1,102,755
276,229
1,363,642
5,745,811
70%
1,596,531
668,633
639,410
288,489
2,666,140
1,215,845
1,156,068
294,227
1,379,921
5,788,271
72%
1,476,987
613,511
593,720
269,756
2,815,864
1,291,079
1,211,577
313,208
1,396,258
5,834,850
75%
1,357,444
558,389
548,031
251,023
2,971,258
1,367,076
1,269,738
334,444
1,413,006
5,888,074
77%
1,237,900
503,267
502,342
232,290
3,126,184
1,442,921
1,328,367
354,895
1,429,373
5,940,254
79%
1,118,356
448,146
456,653
213,557
3,280,180
1,518,481
1,387,471
374,227
1,445,246
5,990,728
81%
21
Zero Waste Business Case: Final Report
Disposal by Material (2010)
Disposal by material was estimated using Provincial waste estimates (Table 7). These estimates have
been updated to a 2010 baseline based on the change in material disposed between 2006 and 2010.
9
Table 7: Disposal Tonnage by Material , (2010)
Material
Organics
Paper
Plastics
Multi-material
Textiles & rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Total
Res
[Tonnes]
509,334
215,575
172,439
103,889
71,249
67,955
33,921
33,137
29,544
24,830
12,513
7,949
1,282,336
ICI
[Tonnes]
314,507
258,682
156,857
73,335
48,313
28,542
103,087
39,536
35,062
51,489
8,817
15,547
1,133,774
CR&D
[Tonnes]
6,018
144,976
149,644
3,853
12,899
83,897
53,264
39,481
494,033
Total, 2010
[Tonnes]
823,841
480,275
329,296
177,224
119,562
241,474
286,652
76,526
64,606
76,319
34,229
23,496
83,897
53,264
39,481
2,910,142
Diversion by Material (2010)
An estimate of diversion by material was developed for 2010 using diversion estimates published by BC
Stats (Table 8).
9
BC Stats, 2010.
22
Zero Waste Business Case: Final Report
10
Table 8: Diversion by Material (2010) , [tonnes]
Material
Organics
Paper11
Plastics
Multimaterial
Textiles &
rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Total
Diversion
Rate [%]
21%
41%
3%
Quantity
[Tonnes]
457,235
892,696
67,497
0%
0
3%
4%
11%
7%
3%
0%
7%
0%
0%
0%
0%
67,497
78,383
241,681
148,057
63,142
0
161,121
0
0
0
0
2,177,308
100%
Disposal and Diversion Forecast by Scenario
The Provincial Waste Forecast (Table 4 to Table 6) provides an estimate of increased diversion and
extended producer responsibility by scenario (Table 9). This estimate was used to forecast quantities of
waste diverted by scenario and category.
10
11
BC Stats, 2007
Paper is further broken down into newsprint (10.7%, mixed paper (15%), Cardboard & boxboard (15.3%).
23
Zero Waste Business Case: Final Report
Table 9: Percent of 2010 Disposed Tonnes Which Will Be Diverted by 2025
Material
Res
Diversion
(%)
Scenario Two
ICI
CR&D
Diversion
Diversion
(%)
(%)
Res
Diversion
(%)
Scenario Three
ICI
CR&D
Diversion
Diversion
(%)
(%)
Organics
50
50
-
85
85
-
Paper
35
35
25
70
70
60
Plastics
30
30
-
80
80
-
Multi-material
30
30
-
55
55
-
Textiles & rubber
20
20
-
40
40
-
Other
30
30
25
65
65
60
Wood
10
10
25
30
30
60
Ferrous
10
10
25
45
45
60
Glass
10
10
-
30
30
-
Renovation
15
15
-
35
35
-
Non-Ferrous
10
10
25
45
45
60
Haz-waste
35
35
-
75
75
-
Concrete
-
-
25
-
-
60
Drywall
-
-
25
-
-
60
Asphalt
-
-
25
-
-
60
36
32
30
71
66
60
Total
For some materials (specifically paper grades) the percentage of diversion by material shown for the
base case and Scenario Two has already been exceeded in Greater Vancouver12. Alignment of the
provincial diversion estimates with data available at the regional district is recommended to enhance
the accuracy of subsequent analysis.
Incremental Diversion by Material and Scenario (2025)
The incremental material diverted from landfill was estimated by combining the disposal tonnage by
material (Table 8) with the diversion scenarios provided by the Province (Table 9). The results are
summarised in Table 10 and Table 11. These estimates are within 12% of the diversion scenarios
developed by the Province in its Waste Forecast Study.
12
Metro Vancouver, 2012
24
Zero Waste Business Case: Final Report
Table 10: Scenario Two Incremental Diversion by Category and Segment, 2025 (Tonnes)
Material
Organics
Paper
Plastics
Multi-material
Textiles & rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Total
Res
[Tonnes]
254,667
75,451
51,732
31,167
14,250
20,387
3,392
3,314
2,954
3,725
1,251
2,782
0
0
0
465,071
Provincial Estimate of Scenario Two
ICI
[Tonnes]
157,254
90,539
47,057
22,001
9,663
8,563
10,309
3,954
3,506
7,723
882
5,442
0
0
0
366,890
CR&D
[Tonnes]
0
1,504
0
0
0
36,244
37,411
963
0
0
3,225
0
20,974
13,316
9,870
123,508
Incremental
Diversion, 2025
[Tonnes]
411,921
167,494
98,789
53,167
23,912
65,193
51,112
8,231
6,461
11,448
5,358
8,224
20,974
13,316
9,870
955,470
1,087,000
25
Zero Waste Business Case: Final Report
Table 11: Scenario Three Incremental Diversion by Category and Segment, 2025 (Tonnes)
Material
Organics
Paper
Plastics
Multi-material
Textiles & rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Total
Res
[Tonnes]
432,934
150,903
137,951
57,139
28,500
44,171
10,176
14,912
8,863
8,691
5,631
5,962
905,832
Provincial Estimate of Scenario Three
ICI
[Tonnes]
267,331
181,077
125,485
40,334
19,325
18,553
30,926
17,791
10,518
18,021
3,968
11,660
744,991
50,338
31,958
23,689
Incremental
Diversion, 2025
[Tonnes]
700,265
335,590
263,437
97,473
47,825
149,709
130,889
35,015
19,382
26,712
17,338
17,622
50,338
31,958
23,689
296,420
1,947,242
CR&D
[Tonnes]
3,611
86,985
89,786
2,312
7,740
2,157,000
Incremental Diversion by Milestone Period
A linear extrapolation is assumed for achieving the increased diversion from 2011 through 2025 by
scenario, (Table 12 and Table 13). This represents the incremental diversion relative to business as
usual. Three materials forecasts are used for conducting the economic analysis by combining unit costs
with the incremental diversion estimates summarised in the tables below.
26
Zero Waste Business Case: Final Report
Table 12: Scenario Two Incremental Diversion by Milestone Year and Material
Material
Organics
Paper
Plastics
Multi-material
Textiles & rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Total
2011
2015
2020
2025
[Tonnes] [Tonnes] [Tonnes] [Tonnes]
27,461 137,307 274,614 411,921
11,166
55,831 111,663 167,494
6,586
32,930
65,859
98,789
3,544
17,722
35,445
53,167
1,594
7,971
15,942
23,912
4,346
21,731
43,462
65,193
3,407
17,037
34,075
51,112
549
2,744
5,487
8,231
431
2,154
4,307
6,461
763
3,816
7,632
11,448
357
1,786
3,572
5,358
548
2,741
5,482
8,224
1,398
6,991
13,983
20,974
888
4,439
8,877
13,316
658
3,290
6,580
9,870
63,698 318,490 636,980 955,470
Table 13: Scenario Three Incremental Diversion by Milestone Year and Material
Material
Organics
Paper
Plastics
Multi-material
Textiles & rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Total
2011
2015
2020
2025
[Tonnes] [Tonnes] [Tonnes] [Tonnes]
46,684 233,422
466,843
700,265
22,373 111,863
223,727
335,590
17,562
87,812
175,625
263,437
6,498
32,491
64,982
97,473
3,188
15,942
31,883
47,825
9,981
49,903
99,806
149,709
8,726
43,630
87,259
130,889
2,334
11,672
23,343
35,015
1,292
6,461
12,921
19,382
1,781
8,904
17,808
26,712
1,156
5,779
11,559
17,338
1,175
5,874
11,748
17,622
3,356
16,779
33,559
50,338
2,131
10,653
21,306
31,958
1,579
7,896
15,793
23,689
129,816 649,081 1,298,161 1,947,242
27
Zero Waste Business Case: Final Report
Economic Analysis Methodology
The tasks used to develop the cost and revenue analysis are summarised in Table 14.
Table 14: Economic Impact Analysis Task List
Task
Compile unit costs and
revenue by activity and
material
Forecast province-wide
costs and revenues
Sensitivity analysis
Assess distributional
impacts
Estimate energy impacts
Estimate incremental tax
revenues
Forecast changes in the
Provincial GDP
Description
A spreadsheet capturing unit cost estimates for the materials identified in the
materials quantification forecast was developed. Unit costs are estimated for
5Rs activities. The analysis applies an incremental cost approach to capture
the difference in costs between the BAU scenario (assumed to be disposal or
recycling) and the zero waste diversion scenarios (assumed to have higher
diversion rates and moving up the waste management hierarchy).
The unit costs and revenues are applied to the materials forecast at the
provincial level to provide an estimate of incremental waste management
costs and revenues by waste management activity and material.
Sensitivity analysis is completed on a range of data inputs such as costs as well
as commodity values to assess the robustness of the results.
The trends regarding costs on 5Rs are identified within the zero waste
scenarios at a qualitative level.
Energy impacts include changes in trucking, as well as opportunities for waste
to energy in the zero waste scenarios.
Incremental provincial government tax revenues, personal and corporate,
resulting from waste and material management under diversion scenarios two
and three are estimated based on estimates of employment impact and
changes to private sector activity using input-output results.
The incremental changes to provincial GDP under diversion scenarios two and
three are estimated using Provincial input-output multipliers.
Assumptions
Assumptions have been applied to simplify the analysis as necessary. Where assumptions are made,
they are generally conservative in nature to limit perceived bias of the results. Sensitivity analysis is
completed to assess the impact of these assumptions on the results. Simplifying assumptions made in
completion of the economic analysis are summarised below:





Unit costs and revenues are assumed to be constant across the period 2010-2025. Available
unit cost and revenue figures were gathered from a wide variety of sources as explained above;
as far as reasonably possible they were obtained for 2011, but some are for 2010 and others for
2012. As a result the cost and revenue estimates over the period 2010-2025 are approximately
equivalent to being calculated in real 2011 dollars; there is no discounting.
Transportation costs are assumed to be included in collection costs.
Depot and transfer costs are assumed to be included in processing costs.
Promotion and education costs are assumed to be included in EPR collection and processing
costs.
Administrative costs are assumed to be included in collection, landfilling and processing costs.
28
Zero Waste Business Case: Final Report






Reduction and reuse related costs are reflected as cost savings from avoidance of the need to
manage materials within traditional waste management systems.
Avoided costs are a combination of collection, landfilling, processing and waste-to-energy costs
depending on the waste diversion strategy assumed adopted for a given material type.
Recovered materials flow to waste-to-energy facilities which provide a revenue source from the
sale of thermal energy.
Municipal and private sector costs associated with collection, landfill, and processing are used as
proxies for industry revenues. However, due to confidentiality, it was not possible to fully
define costs by actor.
Revenue from the sale of recyclables is typically shared between the client (local government or
a private sector company in the case of the ICI or CRD sectors) and the waste management
company collecting the recyclables. However, due to confidentiality, it was not possible to
obtain accurate data on the average revenue split. For the purposes of this study, it has been
assumed that the waste management company retains 50% of the proceeds from the sale of
recyclables which increases its revenues. The other 50% is returned to the client thereby
reducing its costs.
Industrial structure and linkages are based on 2004 and 2008 data respectively (the most recent
data available). This assumes that the technology of producing goods and services, input
patterns and relative prices of goods and services remain unchanged, and that there are no new
products that might require a different production technology or input mix.
Data Sources for Costs and Revenue
Estimates of waste management costs by material and activity were developed from publicly available
reports supplemented by data gathered from a representative sample of regional districts and
municipalities across BC and commercial commodity value research. The data sources reviewed to
develop the cost analysis are summarised in the references. In addition to the literature review, waste
management experts and service providers were contacted to provide pricing and market insights, and
are footnoted throughout the document.
Municipal Costs
Local governments representing approximately 70% of the province’s population were surveyed to
provide costs and insights regarding collection, processing and recycling costs and practices. The survey
tool used to interview local government staff is presented in the Appendix. Responses were obtained
from the following jurisdictions representing approximately 45% of the province’s population:







Abbotsford
Capital Regional District
Kamloops
Surrey
City of North Vancouver
District of North Vancouver
West Vancouver
29
Zero Waste Business Case: Final Report


Vancouver
Regional District of Nanaimo
It is recognised that these jurisdictions represent urbanised areas of the province, and that more remote
locations may have different cost structures. This uncertainty is reflected in the sensitivity analysis
completed in subsequent sections of the report. Notwithstanding these limitations, utilisation of data
obtained directly from municipalities ensures a robust data set. As part of this survey, it was confirmed
that landfill post closure and siting costs are incorporated into tippage fees provided.
Commodity Revenue
Commodity revenues are volatile as they are dependent on global markets which fluctuate for
unpredictable reasons over time. For example, by mid-summer of 2012, prices for paper in particular
had dropped by 50% from the values reported in the winter of 2011. This rapid and substantial change
illustrates the volatility of materials markets which must be taken into consideration in the long term
projection of impacts of different diversion scenarios. Interviews with stakeholders in the preparation
of this document further emphasized the need to use a standardized commodity revenue source based
within the Pacific Northwest. As such, a combination of pricing sources has been used to address price
volatility, including:





Estimates of commodity prices for recyclables,13
Data from a recent Recycling Marketing Study carried out for Metro Vancouver,14
Ontario metal prices (given that metal prices are reasonably consistent across Canada),
Ontario Blue Box program costs (because per material costs are broken out by activity based
costing research, and will not be substantially different to BC, even though BC has a deposit
return system for beverage containers and Ontario does not) 15, and
Encorp Pacific program costs16.
To capture the volatility experienced from late 2008 to summer 2011, data from the years 2007-2012
was used (where available) to identify average unit commodity revenues. As noted previously, these are
assumed to be constant throughout the period 2010-2025. In addition, sensitivity analysis has been
performed on commodity values.
Industry Stewardship Costs & Revenues
EPR collection and processing costs for printed paper and packaging were based on the estimates used
in setting the 2012 fees for the Ontario residential printed paper and packaging Blue Box program which
are based on 2010 cost inputs17. The rationale for using this information is it provides accurate and
comprehensive data split out by material from an ongoing residential printed paper and packaging EPR
program. The per material costs are allocated through activity based costing studies carried out at a
13
recyclingnetworks.net
Metro Vancouver, (2012).
15
Stewardship Ontario. (2012).
16
Encorp Pacific. (2012)
17
Stewardship Ontario. (2012).
14
30
Zero Waste Business Case: Final Report
number of single stream and multi stream residential recycling programs throughout the province of
Ontario and show that costs for collecting and recycling some residential plastic packaging materials are
substantially more than the costs of managing paper and metals. Collecting and recycling PET and HDPE
is economically attractive, as solid, high value markets are available for both these materials.
A major new EPR program for residential printed paper and packaging is being launched in BC in May,
2014, whereby producers will finance the full cost of the residential printed paper and packaging
collection and recycling system, thereby taking the costs away from taxpayers and municipal budgets.
Material Diversion in the Zero Waste Scenarios
Incremental diversion activity by material for the zero waste scenarios is presented in Table 15.
Incremental diversion assumes that in the business as usual scenario, the material would have gone to
landfill, whereas, within the zero waste scenarios, that material is being diverted into a 5Rs stream.
Increased diversion is achieved through reducing and reusing organics and other materials, combined
with increased industry stewardship for printed paper and packaging (residential and ICI) and any other
materials. The allocation of material by 5Rs stream is based on an assessment of material and diversion
strategy. This diversion strategy was reviewed and updated by the Client to ensure consistency with
waste management objectives. Changes to the diversion strategy have a significant impact on the zero
waste business case. Further analysis to optimise the zero waste business case is recommended.
Table 15: Material Allocation by 5Rs Activity
Reduce
Organics
Paper
Plastics
Multi-material
Textiles &
rubber
Other
Wood
Ferrous
Glass
Renovation
Non-ferrous
Haz-waste
Concrete
Drywall
Asphalt
25%
10%
10%
10%
10%
Reuse
Recycle
20%
10%
%
75%
90%
90%
70%
80%
20%
10%
10%
10%
10%
30%
10%
10%
10%
10%
40%
20%
90%
100%
60%
90%
80%
Recover
Residuals
management
20%
50%
90%
50%
90%
90%
Costs and Revenue by Material and 5Rs Activity
Table 16 shows the unit costs and revenues derived from the above sources and used in the financial
model. The sensitivity analysis assesses the impacts of variations in these costs. The table shows that
31
Zero Waste Business Case: Final Report
diversion of high value plastics (PET and HDPE), office paper and metals (particularly aluminum)
contribute to the business case for the zero waste strategy. In a fully costed and allocated analysis,
diversion of mixed plastics contributes a net high cost to the system. Diversion of residential plastic
packaging will become part of a full residential industry stewardship program for printed paper and
packaging in May, 2014. A range of industry stewardship programs were reviewed to assess costs and
revenues. Due to the diversity in program structure, there is significant variation in the costs of industry
stewardship programs.
Average multi-material collection and processing costs have been assigned to all plastics, paper and
metals collected in multi-material programs, as these materials will be picked up together. In a fully
costed and allocated system, collection and processing costs are actually different for each material
based on density and level of processing required to make the materials suitable for sale to end
markets.
32
Zero Waste Business Case: Final Report
Table 16: Unit Costs and Revenues by Material and Activity
Landfill Costs ($/tonne)
Collection
Organics - Leaf and Yard
Waste
Organics - Food Waste
and Kitchen
Plastic- PET
Plastic HDPE
Plastic - Other
Aluminum
Non ferrous metals Other
Wood Contaminated
Wood Clean
Paper - ONP
Paper - MWP
Paper - Clean Office Paper
Paper - OCC
Landfill
Fees
BAU,
Total
Industry Stewardship Programs ($/tonne)
Collection Costs
Costs
Revenue
Industry
Steward
ship,
Total
Industry
Steward
ship
Savings
(Costs)
Relative
to
Landfill
$98
$107
$205
$98
$98
$107
$205
$98
$92
$107
$199
$117
$325
$422
-$97
$296
$92
$107
$199
$117
$325
$435
-$110
$309
$92
$107
$199
$117
$325
$0
$325
-$126
$92
$107
$199
$68
$325
$2,433
-$2,108
$2,307
$92
$107
$199
$68
$325
$3,294
-$2,969
$3,168
$44
$60
$104
$44
$103
$0
$103
$1
$44
$60
$104
$44
$103
$0
$103
$1
$92
$107
$199
$112
$325
$73
$252
-$53
$92
$107
$199
$112
$325
$86
$239
-$40
$92
$107
$199
$112
$325
$179
$146
$53
$92
$107
$199
$112
$325
$107
$218
-$19
33
Zero Waste Business Case: Final Report
Calculation of Costs and Benefits
The unit costs and recycling revenues are combined with incremental materials forecast to estimate
incremental waste management benefits (cost savings) from implementation of the zero waste strategy.
Benefits (costs) are calculated as follows:
Table 17: Calculation of Net Costs & Benefits
BAU total = BAU collection + BAU landfill costs
Industry stewardship total = Industry stewardship costs – Industry stewardship revenue
Industry stewardship net benefits (costs) = BAU total – Industry stewardship total
WTE net benefits (costs) = BAU collection – WTE cost – recycling collection
Employment Impact Methodology
The tasks undertaken to estimate employment impacts from implementation of the zero waste strategy
are summarised in Table 18. Employment is assumed to result from the flow of materials into B.C.
materials management streams and recycling streams both within and outside of B.C.
Table 18: Employment Impact Task List
Task
Select input-output
multipliers
Assess and apply Jobs-pertonne-of-material ratios
Description
Input-output multipliers are applied to expenditures. Direct, indirect and
induced wages as well as GDP and full time equivalent jobs were determined
for each material type.
Jobs-per-tonne-of-material ratios are assessed to estimate the downstream
impacts of recycled materials re-entering the economy that are not captured
using the input-output analysis. These ratios were applied to the volumes of
materials quantities to estimate downstream employment impacts associated
with the reuse, remanufacture, recycling or incineration of each material.
Input-Output Multipliers
Input-output multipliers assess the effects on the economy of an exogenous change in final demand for
the output of a given industry. The input-output multipliers yield data on the direct impacts of
increased industry output on wages, GDP and full time equivalent (FTE) jobs, as well as the indirect
impacts on upstream suppliers and induced impacts as a result of employee spending. Indirect effects
measure the additional economic value generated for industries that are suppliers to the waste
management and remediation sector within B.C. Induced effects are a result of employees spending
their earnings on goods and services (assumed to be in BC).
An example of a company that may experience indirect effects of increased output within the waste
management industry would be the vehicle mechanics that service the waste hauler's trucks. There are
numerous examples of companies that may experience induced effects of increased output within the
34
Zero Waste Business Case: Final Report
waste management industry, as employees are free to spend their income where they choose. One
possible example is local restaurants, where employees may wish to spend incremental income.
Downstream sectors are those that experience an economic impact due to changes in the flow through
of material inputs to their business. In this sense, the reuse, remanufacturing and recycling reliant
industries are downstream of the collection, landfill and processing sectors. Downstream sectors receive
an economic impact due to changes in the availability of collected materials, which represent a
throughput for their operations. An example of a downstream company is a glass bottle manufacturer
that receives recycled glass to transform into a new product.
The input-output multiplier for waste management and remediation services used for this analysis is
presented in Table 19. It includes waste-to-energy services. These multipliers do not capture all of the
downstream impacts of the zero waste strategy. Specifically, reuse, remanufacturing and recyclingreliant industries are not captured. For those impacts, a jobs per tonne of material estimate has been
used, as described in the next section.
Table 19: Input Output Multipliers, (Jobs per $1 million)
Direct
Indirect within
Province
Induced (with Safety
Net)
18
Wages
0.31
0.11
GDP
0.63
0.2
FTEs
6.41
2.56
-
0.1
1.5
In general, input-output multipliers are applied to output or revenue data for a given industry sector in
order to estimate associated impacts on wages, GDP and jobs. For this study, a proxy has been
developed to approximate incremental industry revenues for collection and processing activities (Table
20).
Table 20: Input Output Calculation
Approximate incremental
industry revenues
=
(Incremental Collection Cost) + (Incremental Landfill Cost) +
(Incremental Industry Stewardship Collection and Processing
Cost) +(Incremental Waste-to-Energy Cost) +
50% * (Incremental Revenues from the Sale of Recyclables)
Reuse-Recycling-Recovery: Jobs-Per-Tonne-of-Material Ratios
Reuse, remanufacturing and recycling-reliant industries as well as recovery are downstream of the
collection, landfill and processing sectors. These sectors receive an economic impact due to changes in
the availability of collected materials, which represent a throughput for their operations. These sectors
are different in many ways from traditional waste management industries as they may not purchase
their materials from industries that can increase or decrease their production according to demand.
18
Stats Canada (2008)
35
Zero Waste Business Case: Final Report
Furthermore, the industry structures for remanufacturing or recycling-reliant industries vary a great deal
from the structures of their counterparts that rely on virgin materials or traditional approaches.
As a result, employment impacts in the reuse, remanufacturing, and recycling-reliant industries are not
well represented by input-output analysis. Instead, estimates for these impacts are established by
utilizing ratios for jobs per tonne of material, developed by assessing other recycling studies.19,20,21.
Multipliers are applied to data for tonnage of materials in the two zero waste diversion scenarios. In
order to maintain a conservative estimate in cases where multiple data sources exist, the lower value
has been selected (Table 21). These ratios are then applied to the data for tonnage of diverted materials
that are recycled under each scenario.
Table 21: Downstream Jobs-Per-Tonne-of-Material Ratios
Activity
Study #
Organics
Paper
Plastics
Multi-material
Textiles & rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Reuse &
remanufacture
Recycling Reliant
1
2
3
1
2
3
n/a
n/a
n/a
-
0.4
-
n/a
n/a
n/a
-
1.8
4.16
-
-
20
-
9.3
10.3
-
6.2
-
-
-
2.5
-
8.5
7.35
-
-
9.24 / 2.5
-
-
-
-
-
2.5
-
2.8
2.8
-
-
2.8
-
-
20
-
-
4.2
-
-
7.35
-
2.6
7.85
-
6.2
-
-
-
-
-
-
20
-
-
4.12
-
-
-
-
-
-
-
-
-
0.02
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Note: Study #
1
2
3
Morris & Morawski (2011),
Institute for Local Self-Reliance (1997),
Tellus Institute (2011)
Energy and GHG Impacts
Two approaches were utilised to estimate energy and greenhouse gas emissions. A simplified analysis
was developed to estimate the direct impacts of the 5Rs strategy. In this approach, energy and
emissions that occur within BC are estimated based on changes to trucking of material under the
different diversion scenarios. In accordance with IPCC guidelines, CO2 from landfills is greenhouse gas
neutral. In addition, since the Province requires methane capture in all landfills with more than 10,000
tonnes per year of disposal, the methane from additional material is assumed to be zero.
19
Morris & Morawski (2011),
Institute for Local Self-Reliance (1997)
21
Tellus Institute (2011)
20
36
Zero Waste Business Case: Final Report
The second approach to calculating GHG emissions uses a lifecycle perspective that also captures the
upstream benefits of using recycled material instead of virgin resources. Emission factors for
greenhouse gas emissions and energy were extracted from Environment Canada’s WARM model 22. This
model provides a streamlined life-cycle approach to characterise GHG and energy impacts of waste
management activities. The incremental GHG emissions are presented in Table 22. Incremental energy
impacts are presented in Table 23. These factors were combined with tonnage by material to estimate
GHG and energy impacts.
Table 22: GHG Emissions from Waste Diversion Options Compared to Landfilling, Including Carbon
Sinks (tonnes CO2e/tonne), Scenario 2 and 3
Material
Newsprint
Fine Paper
Cardboard
Other Paper
Aluminum
Steel
Copper wire
Glass
HDPE
PET
Other Plastic
Food Scraps
Yard Trimmings
White Goods
22
Reduce
0
0
0
0
0
0
0
0
0
0
0
-1.04
0.09
0
Recycling
-1.53
-4.38
-3.54
-3.98
-6.51
-1.2
-4.11
-0.12
-2.29
-3.64
-1.82
0
0
-1.48
Recovery
1.16
-1.22
-0.33
-0.75
0
-1.04
0
0
2.87
2.15
2.65
-0.78
0.34
-0.27
ICF, 2005
37
Zero Waste Business Case: Final Report
Table 23: Energy Savings from Waste Diversion Options Compared to Landfilling (GJ/tonne), Scenario
2 and 3
Newsprint
Paper
Cardboard
Other Paper
Aluminum
Steel
Copper
Glass
HDPE
PET
Food Scraps
Yard Trimmings
White
Goods/Electronics
Reduce
0.9
2.4
1.7
1.6
0.04
0.04
0.04
0.04
0.04
0.04
1.7
0.8
Recycling
6.5
15.8
8.5
9.5
87.4
12.6
71.7
1.7
64.4
85.3
0
0
Recovery
2.7
2.2
2.3
2.2
0.07
11.0
0.05
0.04
6.5
3.4
0.7
0.9
23.9
8. 7
Human Health and Toxicity Impacts
A range of human health and eco-system impacts occur from generation, diversion, transport,
processing, and disposal of waste. Impacts include common air contaminants (CO, SOx, NOx,
particulate, VOCs and NH3). In addition, hazardous air pollutants such as mercury, dioxins and furans
occur from a range of waste management options. In general, reduce and re-use have negligible human
health or toxicity impacts, while, recovery and residuals have the highest human health impacts. To
quantify human health and ecosystem impacts, multipliers developed by Metro Vancouver23 have been
used.
Table 24: Human Health and Ecosystem impact by 5R activity [kG/ Tonne material]
Recycling & Composting
Landfill
WTE
Human Health Impact
(eToluene)
-945
60
105
24
Ecosystem Impact
(Herbicide equivalents)
-2
<0.1
2
23
Metro Vancouver, 2011
A detailed description of the human health and environmental impacts is presented in the Metro Vancouver
(2011) report.
24
38
Zero Waste Business Case: Final Report
Results
This section presents results from the economic and job impact analyses of the implementation of
higher waste diversion scenarios.
Economic Business Case
The economic business case is calculated using the equation in Table 25. Benefits are summed across
material types to arrive at the net economic benefit (cost) for the waste management system at the
provincial level within the province of BC in 2025. The net economic benefit represents the net savings
to the waste management system as a whole for scenarios two and three compared with the business as
usual scenario. If the net waste management benefit is positive, the overall economic cost of waste
management has been reduced relative to BAU. If the net waste management benefit is negative, the
overall economic cost of waste management has increased relative to BAU.
Table 25: Calculation of Incremental Economic Benefit (Cost) of Higher Waste Diversion
Incremental
economic
benefit (cost)
of higher
waste
diversion
=
incremental diversion of material x
[ % reduced x net reduction benefit (cost)
+% reused x net reuse benefit (cost)
+% diverted to Industry Stewardship x net Industry Stewardship benefit (cost)
+% diverted to WTE x net WTE benefit (cost )]
Table 26 shows the financial benefits (costs) for scenarios two and three. Implementation of scenario
two will have an annual net benefit of $56 million by 2025. Implementation of Scenario Three will have
an annual net benefit of $126 million by 2025.
It should be noted that the fundamental difference between industry stewardship and other programs is
who pays for the program, and who manages the program. In all cases where diversion is achieved
through industry stewardship programs, costs of existing programs are generally shifted to producers
and consumers and away from municipalities and tax payers. There is an assumption that producers
who pay for industry stewardship programs will endeavour to make them as economical as possible
because of competitive pressures while meeting environmental and other performance targets.
Based on this analysis the following observations are made:
1. Those materials with the most significant economic benefit in support of zero waste include
organics, high value plastics (PET and HDPE) and non ferrous metals. All papers are also an
important focus because of the volumes involved and anticipated demand from end markets
over the long term. Focusing policy tools on these materials is recommended in development
and implementation of policies at the provincial level.
2. A number of jurisdictions have implemented organics recycling programs throughout BC.
Evaluation of these initiatives is recommended to understand program costs and impacts.
39
Zero Waste Business Case: Final Report
3. Implementation of the PPP is scheduled to commence in 2014 and will cover plastics and nonferrous metals. Program monitoring and evaluation by the stewardship agencies is
recommended to ensure costs are comparable to other jurisdictions.
4. Average residential printed paper and packaging EPR costs have been applied based on available
data. This has a significant impact on the business case for industry stewardship programs in
general and for plastics in particular. It is recommended the industry stewardship costs for PPP
be explored in more detail to confirm the assumptions used in the current analysis.
Table 26: Economic Benefits (Costs) of Higher Waste Diversion Scenarios (Relative to BAU in 2025) ($ millions)
Material
Organics
Paper
Plastics
Multi-material
Textiles & rubber
Other
Wood
Ferrous
Glass
Renovation
Non-Ferrous
Haz-waste
Concrete
Drywall
Asphalt
Total
Scenario Two
[$ millions]
$34.7
$1.1
$16.2
-$1.5
$1.8
-$8.2
$0.7
-$0.5
-$0.3
$0.2
$13.3
-$5.7
$1.7
$1.3
$0.8
$55.6
Scenario Three
[$ millions]
$59.1
$2.2
$43.1
-$2.8
$3.5
-$18.9
$1.8
-$2.0
-$0.8
$0.5
$43.1
-$12.3
$4.0
$3.2
$1.9
$125.6
40
Zero Waste Business Case: Final Report
A breakdown of expenditures and revenues by scenario is presented in Table 27.
Table 27: Summary of Expenditures and Revenues by Scenario (Relative to BAU in 2025) ($ millions)
Scenario Two
[$ millions]
Scenario Three
[$ millions]
$53
$98.4
-$20.4
$114.6
$198.8
-$35.4
-$131
-$0.2
-$298.5
-$20.5
Material Revenue
$56.4
$147.7
WTE
Total Revenue (2)
Net Revenue (1+2)
-$0.6
$55.8
$55.6
-$1.6
$146.1
$125.6
Expenditures
Solid Waste Collection
Tippage
Recycling Processing
Industry stewardship
Costs
Total Expenditures (1)
Revenue
Distributional Impacts
Allocation of the benefits of the two waste scenarios between public sector and private sector is
summarised in Table 28. Implementation of Scenario Two will reduce public sector costs by $33 million
per year (in 2025), while implementation of Scenario Three will reduce public sector costs by $70 million
per year (in 2025).
Table 28: Public Sector versus Private Sector Costs of Higher Waste Diversion
Direct Economic
Benefits (Costs)
Public sector
Private sector
Total
Net Benefit (Cost)
relative to BAU
BAU, 2025
($450)
($750)
($1,200)
Scenario Two, 2025
[$ millions]
$(417)
$(727)
$(1,150)
$55.6
Scenario Three
[$ millions]
$(380)
$(694)
$(1,086)
$125.6
Sensitivity Analysis
Sensitivity analysis was carried out to determine which factors caused a significant change in the
forecast results if their values were varied. Table 29 below shows the results of the analysis compared
to the base case. Based on this analysis, the business case remains positive for all variables tested.
Furthermore:

The model is insensitive to changes in commodity values and collection fees. For example, for
scenario two, a -25% change in commodity values causes net costs to increase by $0.2 million
compared to the base case
41
Zero Waste Business Case: Final Report



The model is sensitive to changes in landfill fees. The impact of landfill fees rising to $184/tonne
was explored since this is expected to occur by 2015 for Metro Vancouver due to the impact of
reduced landfill volumes driven by increased recycling and the banning of organic waste from
landfills25. For scenario two, instead of net costs of $55.6 million there would be a net benefit of
$108 million.
The model is moderately sensitive to processing costs with a 25% change resulting in a 29%
change in the benefits.
The model is relatively insensitive to changes in WTE costs which are not shown for that reason.
Table 29: Sensitivity Analysis on Economic Benefit (Cost)
Scenario Two
Scenario
Three
Base Case
$55.6
$125.6
Commodity Commodity Landfill Fee
Values
Values
=
(-25%)
(+25%)
$184/tonne
$55.3
$55.8
$108
$124.8
$126.5
$225
Collection
Fees
(+25%)
$50.5
Processing
Costs
(-25%)
$72.8
Processing
Costs
(+25%)
$38.2
$112
$162
$89.1
Job Creation and Economic Impact Results
Direct, Indirect and Induced Impacts
Implementation of a zero waste strategy has a positive benefit in terms of wages, GDP and jobs. By
2025 Scenario Two annually stimulates $12.2 million in additional wages, $27 million in additional GDP
and over 300 full time jobs. Scenario Three produces approximately three times that impact26, with $40
million in additional wages, $89 million in incremental GDP and over 1,000 additional jobs. In all cases,
direct impacts are roughly two thirds of the total, while indirect impacts are roughly 25 percent, and
induced impacts make up the remaining 10 percent. Impact on wages, GDP, full time employment,
output and provincial income taxes are shown in Table 30 and Table 31.
25
Sinoski, K.
The relationship is non-linear because the percentage composition of the different material types varies from
Scenario 2 to Scenario 3 and the economic impact per tonne of incremental diversion varies by material type. For
example, organics make up a higher percentage of the incremental diversion in Scenario 2 than in Scenario 3.
Hence in Table 26, although the total volume of incremental waste diverted roughly doubles, the economic benefit
from organics only increases by about 50% since the volume of organics incrementally diverted only increases by
about 50%.
26
42
Zero Waste Business Case: Final Report
Table 30: Scenario Two Job Creation and Economic Impacts in Material Collection and Processing
Direct impact
Wages [$ million]
GDP [$ million]
FTEs
Indirect impact
Wages [$ million]
GDP [$ million]
FTEs
Induced impact
Wages [$ million]
GDP [$ million]
FTEs
Total impact
Wages [$ million]
GDP [$ million]
FTEs
Provincial Taxes [$
million]
2015
2020
2025
$3.0
$6.1
62
$6.0
$12.2
124
$9.0
$18.3
186
$1.1
$1.9
25
$2.1
$3.9
50
$3.2
$5.8
74
$$1.0
15
$$1.9
29
$$2.9
44
$4.1
$9.0
101
$8.1
$18.0
203
$12.2
$27.0
304
$0.25
$0.50
$0.76
43
Zero Waste Business Case: Final Report
Table 31: Scenario Three Job Creation and Economic Impacts in Material Collection and Processing
Direct impact
Wages [$ million]
GDP [$ million]
FTEs
Indirect impact
Wages [$ million]
GDP [$ million]
FTEs
Induced impact
Wages [$ million]
GDP [$ million]
FTEs
Total impact
Wages [$ million]
GDP [$ million]
FTEs
Provincial Taxes [$
million]
2015
2020
2025
$9.9
$20.1
205
$19.8
$40.3
410
$29.7
$60.5
615
$3.5
$6.4
82
$7.0
$12.8
164
$10.6
$19.1
246
$$3.2
48
$$6.4
96
$$9.6
144
$13.4
$29.7
335
$26.8
$59.5
670
$40.3
$89.2
1005
$0.83
$1.66
$2.50
Downstream Impacts
The Jobs-Per-Tonne-of-Material ratios allow an analysis of the downstream impacts of materials
diverted from landfill and entering the reuse, recycling and recovery sectors. Only direct job impacts are
assessed in this case (Table 32). By 2025, Scenario Two leads to more than 2,000 additional jobs in
downstream sectors. This is almost seven times greater than the corresponding impact of the diversion
strategies on direct jobs in the collection and processing sectors. Scenario Three leads to more than
4,800 jobs, almost five times the corresponding direct jobs impact in collection and processing.
Many more jobs are estimated to be created in the downstream sectors because the reuse,
remanufacturing and recycling-reliant industries are much more labour-intensive than the collection,
landfill, processing and waste-to-energy sectors. The 2011 Tellus Institute study27 examined the impact
of recycling on the US economy. It reports that waste disposal is the least labour intensive of the
various waste management activities, generating the fewest jobs per ton of waste (0.1 jobs per 1,000
tons). This is due to the fact that the capital intensive equipment used at disposal facilities can handle
large tonnages with few employees. Materials collection generates more jobs than disposal but still
relatively few. Processing of organics (0.5 jobs per 1,000 tons) and recyclables (2 jobs per 1,000 tons)
are somewhat more labour intensive. Manufacturing using recycled materials as inputs creates a
27
Tellus Institute (2011).
44
Zero Waste Business Case: Final Report
relatively high number of jobs per 1,000 tons, varying by material type from about 4 jobs per 1,000 tons
for paper as well as iron and steel manufacturing, to about 10 jobs per 1,000 tons for plastics
manufacturing. Although relatively small tonnages of material are involved, municipal solid waste reuse
and remanufacturing activities are particularly job intensive owing to the labour required for
disassembly, inspection, repair/refurbishment, reassembly, and testing. It must be noted that not all
downstream jobs would be located in BC due to the impact of leakage.
For many material types, remanufacturing of the recycled materials is done outside of BC. For example,
paper has almost no recycling capacity in BC (less than 1 percent). As an example, the last recycled
newsprint mill in BC (Catalyst Paper) closed within the last two years. The magnitude of the potential
increase in downstream jobs shows the importance of government policies that encourage the creation
and retention of remanufacturing facilities within BC.
Table 32: Full Time Equivalent Job Impacts on Downstream Reuse, Recycling and Recovery Sectors
Scenario Two
Scenario Three
2015
2020
2025
669
1,604
1,338
3,208
2,008
4,813
GHG and Energy Impacts
The GHG and energy savings from implementation of the zero waste strategy are summarised in Table
33. Taking a global perspective, GHG emissions reductions would be 1,047 KT/year or 2,277 KT per year
by 2025 for scenarios two and three respectively, while energy savings would be 10,535 GJ/year or
26,629 GJ/year by 2025 for scenarios two and three.
Table 33: GHG and Energy Impacts of Zero Waste Strategy in 2025 [GJ]
Scope
GHG Savings [Kilo
tonnes]
Energy Savings
['000 GJ]
GHG Savings [Kilo
tonnes]
Energy Savings
['000 GJ]
Scenario Two
Scenario Three
33.6
72.6
465
1000
1,047
2,277
10,535
26,629
Within BC
Global
Zero Waste Business Case Results Summary
A summary of the economic, job creation and environmental benefits of implementing a zero waste
strategy is summarised in Table 34. Based on these results, the business case is favourable.
45
Zero Waste Business Case: Final Report
Table 34: Zero Waste Business Case Summary Results (Relative to BAU, 2025)
Triple Bottom Line
Summary
Scenario Two (62%
diversion rate)
Scenario Three
(81% diversion rate)
Public Sector Benefits
(Costs) [$ million]
Private Sector Benefits
(Costs) [$ million]
Direct Economic Benefits
(Costs) [$ million]
Change in GDP [$ million]
$33
$70
$23
$56
$56
$126
$27
$89
Jobs Created (Destroyed)
(FTEs)
304 (direct, induced
and upstream indirect)
1,005 (direct, induced
and upstream indirect)
Downstream Jobs Created
(Destroyed) (FTEs)
Greenhouse Gas Emissions
Reduced [KT/Year]
Human Health Impacts
[KT/year e toluene]
Ecosystem Impacts
[KT/year Herbicide
Equivalents]
2,008 (downstream)
4,813 (downstream)
1,047
2,277
947
1741
1
3
46
Zero Waste Business Case: Final Report
Discussion
Distributional Impacts
The trends regarding expenditures on 5Rs, landfilling, recycling and industry stewardship programs are
identified within the zero waste scenarios. Table 35 below provides a qualitative analysis of trends in
the shifting of costs among consumers, producers and government. A challenge in developing a
quantitative assessment of the impacts is the lack of information on the distribution of costs among
industry segments. A second issue is the dynamic nature of landfill fees wherein a reduction in waste
sent to landfills might in some cases result in an increase in tippage fees due to the fixed costs
associated with landfill operations. The impact of this issue will depend on landfill size and annual
throughput.
Table 35: Trends in Cost Shifting from Implementation of Zero Waste Strategies Compared to Landfilling
5R Strategy
Reduce
Reuse





Recycle (industry
stewardship)



Recycle (Municipal)



Recovery

Residuals


Distributional Impact
Economic activity in waste management sector is reduced.
A reduction in waste will prolong the life of the landfill, but may result in
an increase in the disposal cost per tonne of waste.
Local government costs are reduced; this could result in savings or other
benefits for taxpayers.
Potential for diversification of local private enterprise.
A reduction in waste will prolong the life of the landfill, but may result in
an increase in the disposal cost per tonne of waste.
In areas where households pay a per capita landfill fee, costs shift from
local government and taxpayers to producers and consumers.
Industry stewardship may promote product design changes that lead to a
reduction or change in materials which positively impact the amount and
type of waste generated.
A reduction in waste will prolong the life of the landfill, but may result in
an increase in the disposal cost per tonne of waste.
Costs are shifted within local government from landfilling to recycling.
Depending on commodity prices, local governments may receive revenue
from the sale of valuable materials.
A reduction in waste will prolong the life of the landfill, but may result in
an increase in the disposal cost per tonne of waste.
Costs of waste to energy are generally lower than for landfilling, resulting
in reduced costs for local government and taxpayers.
Where a significant portion of landfill costs are fixed, lower tonnages
being landfilled may not benefit net costs as much because the fixed costs
will have to be distributed over a lower volume of material being
landfilled; this may increase the fee per tonne of landfilling, particularly at
small landfills
Lower residual waste disposal rates may increase the cost per tonne of
waste to operate a landfill; however, the life of the landfill will be
prolonged, reducing costs associated with siting and establishing new
landfills
47
Zero Waste Business Case: Final Report
Impact of Increased Diversion on Landfill Costs
In estimating the costs and benefits of increased diversion, we have assumed the avoided landfill fee is
constant and equal to the current average landfill cost of $107/tonne. Sensitivity analysis included the
impact of increasing landfill costs to $184/tonne which is seen to be significant and based on projected
costs of landfilling in Metro Vancouver in 2015 based on achieving a 70% diversion rate28. It is beyond
the scope of this work to examine the market dynamics of avoided landfilling and the impacts on landfill
costs since this is a long term marginal cost issue related to the cost of the next increment of landfill
capacity compared with other alternatives such as waste to energy. The impact of increased landfill
diversion is likely to increase landfill costs meaning that our assumption is a conservative one.
Leakage
Leakage is defined for the purpose of this study as waste material that is produced in BC and is disposed
of or diverted without creating economic returns within the province. According to this definition,
leakage includes:




Illegal dumping since it generates no economic activity.
Material that is exported from BC to landfills outside BC, since the value of the material is lost to
BC and the tippage fee is also paid to an entity outside BC.
There is also reverse leakage – or inflow – occurring. For instance, plastic bottles purchased in
the United States and carried back into BC are not eligible for deposit returns, but may be
processed through a municipal blue box or ICI recycling program
Exporting of material by BC processors for re-use in international markets is not leakage, since
there is economic activity from sorting and collection and the processors receive revenue from
selling the product.
By its nature, estimating the quantities of leakage is difficult. No data was identified to estimate the
amount of illegal dumping, but it is not expected to be significant. Similarly waste exports were
identified for the ICI sector in Abbotsford, but no data on the quantities was obtained. It was not
possible to identify other regions in the province where exporting waste is occurring, but a reasonable
estimate is 50,000 to 100,000 tonnes/year.
28
Ref http://www.richmondreview.com/news/176033441.html
48
Zero Waste Business Case: Final Report
Conclusions
Overall, higher waste diversion through implementation of a zero waste strategy will produce
substantial societal benefits. Scenario Two will have an annual net benefit of $55.6 million by 2025.
Implementation of Scenario Three will have an annual net benefit of $126 million by 2025. These
benefits accrue almost equally between the private sector and the public sector. In addition to the
positive economic impacts, implementation of the zero waste strategy will also have positive job
creation, GDP and GHG impacts. By 2025 Scenario Two stimulates $12 million in additional wages
annually, $27 million in additional GDP annually and just over 300 full time jobs.
Scenario Three produces approximately three times that impact, with $40 million in additional wages
annually, $89 million in incremental GDP annually and over 1,000 additional jobs. In all cases, direct
impacts are roughly two thirds of the total, while indirect impacts are roughly 25 percent, and induced
impacts make up the remaining 10 percent.
The potential for creating direct downstream jobs in the reuse, remanufacturing, and recycling-reliant
industries is even greater. By 2025, Scenario Two leads to more than 2,000 additional jobs in
downstream sectors. This is almost seven times greater than the corresponding impact of the diversion
strategies on direct jobs in the collection and processing sectors. Scenario Three leads to more than
4,800 jobs, almost five times the corresponding direct jobs impact in collection and processing. For
many material types, remanufacturing of the recycled materials is done outside of BC. The magnitude of
the potential increase in downstream jobs shows the importance of government policies that encourage
the creation and retention of remanufacturing and recycling-reliant facilities within BC.
It should be noted that this number of jobs is small in relation to the full BC economy (which has an
employment base of 2.5 million), and the benefits are minimal unless the downstream jobs can be
located in BC. Development of a remanufacturing industry in BC utilising the most significant materials
(paper, plastics, ferrous and non ferrous metals) is critical to increasing the economic benefits of a zero
waste business case.
Recommendations
Based on the analysis completed, the following recommendations are submitted for consideration:
1. The business structure of a particular EPR program has a significant impact on the cost of
program delivery. Ensuring that costs are minimised to industry and consumers will reduce
backlash from program implementation. Further analysis on this issue is recommended.
Sensitivity analysis revealed that a different mix of zero waste strategies could positively impact
the business case for zero waste. Further analysis to optimise the zero waste business case is
recommended.
2. Materials quantification forecasts highlight inconsistencies in data collection procedures and
material forecasts developed at the provincial level versus at the regional districts.
Implementation of a consistent material quantification methodology is recommended to
support improved decision making and policy analysis.
49
Zero Waste Business Case: Final Report
3. Costing of 5Rs activities highlights that accessing municipal data is frequently a challenge due to
confidentiality requirements. Development of data sharing policies is recommended to improve
the transparency of subsequent analysis and to assist municipalities to ensure that pricing across
jurisdictions is fair and competitive and that provincially, investment in waste management
activities is based on defensible cost data.
50
Zero Waste Business Case: Final Report
References
AECOM, Economic Benefits of Recycling in Ontario, 2009.
BC Ministry of Environment. Guide to the Development of Regional Solid Waste Management Plans for
Regional Districts. Retrieved from http://www.env.gov.bc.ca/epd/mun-waste/waste-solid/sw-mgmtplan/guideplan/pdf/guide-swmplan.pdf , December 1994.
BC Ministry of Environment, BC Municipal Solid Waste Tracking Report, 2006.
BC Ministry of Environment, Economic Impacts of the BC Recycling Regulation, 2008.
BC Stats, Recycling in BC, 2007.
BC Stats, 2004 British Columbia Economic Multipliers, 2008.
BC Stats, BC Solid Waste Flow, 2006 Summary Report, 2010.
BC Stats, Electronic Waste Recycling in BC, 2009.
BC Stats, Filling the Landfills, 2012.
BC Stats (a), Solid Waste Generation in British Columbia 2010 - 2025 Forecast, 2012.
BC Stats (b), Municipal Solid Waste 2010 - 2025 Fact Sheet, 2012.
Carpet America Recovery Effort, California Carpet Stewardship Plan December, 2011.
City of Burnaby, Solid Waste and Recycling by-law (no. 13052), 2012.
City of New Westminster, Automated Single Stream collection Program Report from Engineering
Department, May 2, 2011.
City of Red Deer, Solid Waste and Recycling Bylaw No. 3464, 2011.
City of Vancouver Solid Waste Management Branch, Solid Waste Division Report, 2012.
Container Recycling Institute, Returning to Work: Understanding the Domestic Jobs Impacts from
Different Methods of Recycling Beverage Containers December, 2011.
DSM Environmental, The U.S. Recycling Economic Information Update Recycling Economic Information
(REI) Update. Prepared for the Northeast Recycling Council, 2009.
Duncan Bury Consulting, Overview of stewardship and EPR job and economic impact studies, 2012.
Eco Canada, Solid Waste Management Labour Market Research study, 2010.
Encorp Pacific. 2011 Annual Report. http://www.return-it.ca/ar2011/index.php, 2012.
European Environment Agency. The Role of Recycling in the Green Economy, 2011.
51
Zero Waste Business Case: Final Report
Gardner Pinfold Consulting. Prepared for Ministry of Environment Environmental Quality Branch
Economic Impacts of the BC Recycling Regulation, 2008.
Garry Horn, 2004 BC Economic Multipliers and How to Use Them, 2008.
Glenda Gies & Associates, Current System for Managing Residential Packaging and Printed Paper in
British Columbia. Prepared for Multi-Material British Columbia, 2012.
ICF Consulting, Determination of the Impacts of Waste Management Activities on Greenhouse Gas
Emissions, 2005.
Institute for Local Self-Reliance Washington, DC. Retrieved from http://www.ilsr.org/recycling-meansbusiness, 1997.
Larsen, A.W. et al. Diesel consumption in waste collection and transport and its environmental
significance, Waste Management & Research, 2009:27; 652-659, 2009.
Local Economy Policy Unit. U.K Jobs From Recycling: Report on Stage II of the Research, 2004.
Metro Vancouver (a). Management of Municipal Waste in Metro Vancouver, 2009.
Metro Vancouver (b). Environmental Lifecycle Assessment of Waste Management Strategies with a Zero
Waste Objective, 2009.
Metro Vancouver. Recycling Market Study, May 2012.
Metro Vancouver. Waste Composition and Energy Content Projections, 2012.
Morris, J. & Morawski, C., Returning to Work: Understanding the Domestic Jobs Impacts from Different
Methods of Recycling Beverage Containers. Prepared for the Container Recycling Institute, 2011.
National Recycling Coalition. U.S. Recycling Economic Information Study, 2000.
North Carolina Department of Environment and Natural Resources. Recycling in North Carolina –
Momentum Towards Sustainable Materials Management August, 2011.
Organisation for Economic Co-operation and Development. Analytical Framework for Evaluating the
Costs and Benefits of Extended Producer Responsibility Programmes, 2005.
Randall W Jackson. Recycling and Remanufacturing in Input-Output Models, 2008.
Recycling Council of Ontario. Economic Benefits of Recycling, 2012.
recyclingnetworks.net (http://www.recyclingmarkets.net/)
Region of Peel. Onboard Weigh Scales: A Multi-Family Weight-Based Waste and Recycling Generation
Pilot, 2009.
52
Zero Waste Business Case: Final Report
Sinoski, Kelly. Metro Vancouver board rejects proposed drop in garbage fees for 2013. Vancouver Sun.
October 29, 2012.
Stats Canada Catalogue no. 15F0046XDB. Provincial Input-Output Multipliers, 2008.
Statistics Canada. Waste Management Industry Survey: Business and Government Sectors,2008,
Catalogue 16F0023X. Retrieved from http://www.statcan.gc.ca/pub/16f0023x/16f0023x2010001eng.pdf, 2010.
Stewardship Ontario. 2012 Fee Calculation Tables. http://www.stewardshipontario.ca/bb-consultationarchives, 2012.
Tellus Institute; Sound Resource Management for Natural Resources Defense Council. More Jobs, Less
Pollution, 2011.
US Environmental Protection Agency. Standard Volume to Weight Conversion Guide.
http://www.epa.gov/smm/wastewise/pubs/conversions.pdf, 2012
Zero Waste Community. Unfinished Business: The Case for Extended Producer Responsibility, 2012.
53
Zero Waste Business Case: Final Report
Appendix: Local Government Survey on Waste Management Costs and
Practices
Municipal and/or Regional Collection Description
Single family (curbside) Garbage collection


Contract or municipal crew?
2011 $/tonne? if not available then:
o 2011 collection costs (contract or operations)
o 2011 tonnages
Single family (curbside) Recycling collection

Contract or municipal crew? 2011 $/tonne? if not available then:
o 2011 (net) collection and processing costs (contract or operations)
o 2011 tonnages
Single family (curbside) Green Bin collection


Contract or municipal crew?
2011 $/tonne? if not available then:
o 2011 collection costs (contract or operations)
o 2011 tonnages
Multi-Residential Recycling collection


Contract or municipal crew
2011 $/tonne? if not available then:
o 2011 collection costs (contract or operations)
o 2011 tonnages
Landfill Disposal
 2011 $/tonne?
Organics Disposal
 2011 $/tonne?
Recyclables Processing




MRF – contract or municipal crew?
2011 tonnes processed?
2011 tonnes marketed?
2011 $/tonne? if not available then:
o 2011 collection costs (contract or operations)
o 2011 tonnages
 Historical market prices (up to past 5 years)?
Any information on



Private sector ICI garbage and/or recycling collection costs (by tonne or by lift - typical lift size)?
Private sector DLC collection costs (by tonne or by lift – typical lift size)?
Private Sector Multi-Res garbage and/or recycling collection costs (by lift - ask typical size or by
tonne)?
54
Zero Waste Business Case: Final Report