list of abbreviations used - banku augstskola · web viewdeveloped industrial symbiosis model and...
TRANSCRIPT
Natālija Cudečka-Puriņa
Ensuring municipal waste management
sustainability by administration of landfill
management companies
Doctoral Thesis
Discipline: management science
Sub-discipline: Business administration
Research Supervisor:
Prof., Dr.oec. Dzintra Atstāja
Riga 2018
Table of Contents
LIST OF ABBREVIATIONS USED 3
DEFINITIONS 6
INTRODUCTION 7
1. ENSURING WASTE LANDFILL SUSTAINABILITY 17
1.1. SUSTAINABILITY AND ITS CHARACTERISTICS FOR A LANDFILL MANAGEMENT COMPANY 171.2. NECESSITY OF ENSURING SUSTAINABLE COMPANY MANAGEMENT 461.3. PARTICULARITIES OF COMPANY SUSTAINABILITY ASSURANCE IN WASTE MANAGEMENT 521.4. INDUSTRIAL SYMBIOSIS AND INDUSTRIAL PARKS AS A STEP TO A SUSTAINABLE BUSINESS MODEL 561.5. RESEARCH MODEL AND RESEARCH DESIGN 62
2. ASSESSMENT OF BUSINESS PERFORMANCE OF LATVIAN WASTE MANAGEMENT COMPANIES AND IDENTIFICATION OF THE NECESSITY FOR IMPROVEMENT 67
2.1. DEVELOPMENT OF LATVIAN WASTE MANAGEMENT SECTOR 672.2. REGIONAL APPROACH TO LATVIAN WASTE MANAGEMENT, AS A DECISION MAKING PROCESS 762.3. SPECIFICS OF LATVIAN LANDFILL MANAGEMENT COMPANIES 812.4. ASSESSMENT OF LATVIAN FULL-CYCLE LANDFILL MANAGEMENT COMPANY 922.5. NECESSITY OF MANAGERIAL IMPROVEMENT OF LATVIAN LANDFILL MANAGEMENT COMPANIES 98
3. DEVELOPMENT OF MANAGERIAL IMPROVEMENT FOR LANDFILL MANAGEMENT COMPANIES 114
3.1. CLOSING THE LOOP IN A WASTE MANAGEMENT SYSTEM 1143.2. INDUSTRIAL SYMBIOSIS MODEL 1253.3. LANDFIL AS A BASIS FOR INDUSTRIAL SYMBIOSIS CLUSTER 1443.4. EXAMPLE OF LMC MATRIX APPLICATION 147
CONCLUSIONS AND RECOMMENDATIONS 163
REFERENCES 167
ANNEXES 185
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LIST OF ABBREVIATIONS USED
CEWEP Confederation of European Waste-to-Energy PlantsCE Circular economyCSD Commission on sustainable developmentC/B Cost/benefit analysisDG ENV Environment Directorate-GeneralDMC Domestic material consumptionDMI Direct material inputDRS Deposit Refund SystemEIA Environmental Impact AssessmentESA toolsEU European UnionGDP Gross Domestic ProductGHG Greenhouse gasGNI Gross Net IncomeIRR Internal Rate of ReturnISPA Instrument for Structural Policies for Pre-AccessionISWA International Solid Waste AssociationLASA Waste Management Association of LatviaLASUA Latvian Waste Management Company AssociationLCA life cycle assessmentLCC Life Cycle CostingLKATA Lithuanian Communal Service and Waste Management Association
LMC Landfill management companyMEPRD Ministry of Environmental Protection and Regional DevelopmentMFA Material Flow AnalysisMOP Multi objective programmingMW Municipal wasteMWI Municipal waste incinerationNIMBY Not in my back yardNIMO Not in my office timeNPV Net Present ValueOECD Organization for Economic Co-operation and DevelopmentPAYT Pay-As-You-ThrowPET polyethylene terephthalateRA Risk AssessmentRATCA Association of Regional Waste Management Centres of LithuaniaRR Recycling RateRWMC Regional waste management centre
SD Sustainable development
STAN subSTance flow ANalysisTOPSIS method The Technique for Order of Preference by Similarity to Ideal SolutionUN HABITAT United Nations Human Settlement programmeZAAO Ziemeļvidzemes atkritumu apsaimniekošanas organizācija (North-
Vidzeme waste management organization)
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3R Reduce, reuse, recycleList of Figures
Fig. 1.1 Landfill emission life cycle 18Fig. 1.2 Schematic life cycle of waste generation 21Fig. 1.3 Municipal waste generation and treatment in the EU1 (kg per capita) 22Fig. 1.4 Municipal waste generated by country in selected years (kg per capita) 23Fig. 1.5 Key elements of sustainable development and interconnections 24Fig. 1.6 Tasks of sustainable development 26Fig. 1.7 Waste hierarchy 27Fig. 1.8 Rational for a systematic approach to strategies for sustainable development 31Fig. 1.9 Continuous improvement approach to managing sustainable development strategies 32Fig.1.10 Sustainable development indicators and quality criteria 35Fig. 1.11 Marginal losses and marginal avoided disposal costs 38Fig.1.12 Marginal avoided disposal costs 39Fig. 1.13 Dependence of price for recycled products from level of recycling 39Fig. 1.14 The cycle of recycling 39Fig. 1.15 Circular economy overview 43Fig.1.16 Concept of industrial symbiosis 44Fig. 1.17 Information flow for decision-making process for locating a waste 50Fig. 1.18 Multi criteria decision making model 50Fig. 1.19 Structure of Project appraisal 53Fig. 1.20 Environmental Kuznets curve 55Fig. 1.21 Classification of business models oriented to the industrial symbiosis approach
61
Fig. 1.22 Theoretical Framework 63Fig. 1.23 Interdependence of the independent variables and industrial symbiosis research design
65
Fig. 2.1 Ranking of landfills by yearly disposed waste amount 69Fig. 2.2 The causal-loop diagram, with the impacts from the stakeholders 71Fig. 2.3 Total costs for landfilling in EU-27 73Fig. 2.4 Waste disposal NRT rates in the Baltic countries, Eur/t 74Fig. 2.5 Household consumption expenditure structure, (% per capita/annum) 75Fig. 2.6 Latvian waste management regions and landfills 77Fig. 2.7 Schematic waste flow within landfill management company 84Fig. 2.8 Volume of disposed waste in the landfills, 2015 85Fig.2.9 Waste disposal tariffs in landfills in 2016, Eur/t 88Fig. 2.10 Measurements of waste composition in four landfills (average sample composition, %)
93
Fig. 2.11 Services offered in North-Vidzeme region and their causal-loop effect 96Fig. 2.12 Material flow analysis in North-Vidzeme region, tons 97Fig. 2.13 Question 1 – response of Landfill group 101Fig. 2.14 Question No.2 – response of Landfill group 102Fig. 2.15 Question No.3 – response of Landfill group 103Fig. 2.16 Question No.4 103Fig. 2.17 Question No.8 107Fig. 2.18 Question No.15 107Fig. 2.19 Question No.12 110Fig. 2.20 Question No.17 111Fig. 2.21 Question No.19 112Fig. 3.1 Development of Natural resources tax, Eur/t 117Fig. 3.2.a Causal loop diagram of full cycle LMC 118Fig. 3.2.b Causal loop diagram of LMC doing only landfilling & education activities 118Fig. 3.2.c Causal loop diagram of LMC doing landfilling, sorted waste collection & education activities
119
Fig. 3.3 Landfill as a basis for industrial symbiosis 1211
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Fig.3.4 Energy flows within a Landfill 125Fig. 3.5 Resource flow, entering a landfill 133Fig.3.6 Flow of the resources within industrial symbiosis 133Fig.3.7 Interconnection with second level industries 134Fig. 3.8 Development of a landfill with industrial symbiosis and impact on waste 139Fig. 3.9 Industrial symbiosis model 145Fig. 3.10 LMC matrix 146Fig. 3.11 Confidence interval 95% for individual and average values 151Fig. 3.12 Volumes of PP, PS, PVC, PET, HDPE, LDPE, tons 152Fig. 3.13 Prices for PET, Eur/t 153Fig. 3.14 PET prices for flakes and bales, Eur/t 154Fig 3.15 Confidence interval of 95% for individual values of PET income 155Fig. 3.16 Prices for PP, PS, PVC, Eur/t 156Fig. 3.17 PP, PS, PVC prices for bales, flakes and bales, Eur/t 157Fig 3.18 Confidence interval of 95% for individual values of PP, PS, PVC revenue 158Fig. 3.19 Prices for HDPE, LDPE, Eur/t 159Fig. 3.20 HDPE, LDPE prices for bales, flakes and bales, Eur/t 160Fig 3.21 Confidence interval of 95% for individual values of PP, PS, PVC revenue 161
List of TablesTable 1.1 Targets of the EU Directives 29Table 1.2 Targets set in the Circular economy package 30Table 1.3 Activities for decoupling waste from economic growth 56Table 1.4 Assessment of external and internal barriers 62Table 1.5 Research design 66Table 2.1.Waste treatment in EU member states since 2004 68Table 2.2 EU leading members in waste treatment 70Table 2.3 Sub-standard landfills in analysed member states 72Table 2.4 Characteristics of waste management regions 78Table 2.5 Proportion of EU and Latvian investments into waste management field until 2012 79Table 2.6 Results of the Cost/Benefit analysis 80Table 2.7 Characteristics of landfill management companies 86Table 2.8 Key performance indicators in waste management 91Table 2.9 Key performance indicators applied to landfill management companies 91Table 2.10 Description of expert groupTable 2.11 Analysis of question No. 6
100104
Table 2.12 Question No. 16 Legislative change necessity to improve waste management system
108
Table 3.1 PESTLE analysis of a Landfill management company 119Table 3.2 SWOT analysis of a Landfill management company 120Table 3.3 Potential savings of resources at LMC 122Table 3.4 Classification of resources 125Table 3.5 Input data for x values and output data for y values 126Table 3.6 Waste classification and breakdown of incoming waste flow into types 126Table 3.7 Classification and breakdown of incoming sorted waste flow 127Table 3.8 Incoming waste flow to a landfill and its changes during 12-month period 128Table 3.9 Industrial symbiosis options 129Table 3.10. Risk analysis of the Scenario 3 and 4 141Table 3.11 Summary of landfill management scenarios 142Table 3.12 Landfill resources for 2015 143Table 3.13 Landfill benefit from engagement into industrial symbiosis 143Table 3.14 Prices for secondary materials, recovered from waste, Eur/t 148Table 3.15 Prices for waste resources Eur/t 150
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DEFINITIONS
Circular economy a type of the economy, where the value of products and materials is maintained for as long as possible, waste generation and the use of primary resources is reduced, and when the product reaches the end of its life cycle, resources remain in the economy where they are re-used to create added value.
Industrial symbiosis
a connection between two or more facilities in which the waste or by-products of one can become as raw materials for another.
Industrial symbiosis complex
physical place, where industrial symbiosis between a range of entities takes place.
Industrial symbiosis model
a model for landfill management companies that takes into account landfill internal resource flow and offers industrial symbiosis modules for effective management of resources.
Landfill management companies
an inter-municipality company, operating in one of 10 Latvian waste management regions and providing a municipal waste disposal service (public utility). The public service provider must ensure that users are able to receive uninterrupted public service in compliance with safety requirements and quality of the relevant public service. The Public Utilities Commission in the municipal waste management sector only regulates the provision of municipal waste disposal service in municipal waste landfills.
Municipal waste waste generated in a household, trade, in the process of provision of services or waste generated in other places which, because of its properties, is similar to domestic waste.
Municipal waste landfill
a physical waste disposal site, selected on the basis of a feasibility study. Long-term engineering and technical facility for 25-30 years usually one per waste management region.
Resources, generated during waste disposal
resources that arise during daily operation of landfill and that can be used for industrial symbiosis purposes.
Waste management
the collection, storage, transport, recovery and disposal of waste (including incineration in municipal waste incineration facilities), the supervision of such activities, the after-care of disposal sites after their closure, as well as trade with waste and mediation in waste management.
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INTRODUCTIONResearch context and topicality
With the end of the 20th century, waste management has become a significant field of
the economy, closely linked to society and the environment. It is said, that in order to have a
sustainable, effective and efficient waste management system in operation, it has to be
socially acceptable, economically feasible and environmentally beneficial. Environment and
entrepreneurship are in a constant conflict situation, which means there is a continual search
for compromise in order to ensure fulfilment of environmental requirements alongside with
provision of company competitiveness and sustainable development.
According to the report of the Committee on the Environment of European Union,
Agriculture and Local and Regional Affairs (2007), proper management of municipal waste is
a central pillar of far-sighted, sustainable environmental policies. Every citizen of the EU
generates approximately 1 kg of municipal waste a day and the figures show an upward trend.
Management of municipal waste is therefore one of the major challenges currently facing
local authorities.
As highlighted by Pires et al., (2011) - in the 21st century, the sustainable
management of municipal waste will become necessary at all phases of impact from planning
to design, to operation, and to decommissioning. As a consequence, the spectrum of new and
existing waste treatment technologies and managerial strategies has also spanned from
maintaining environmental quality at present to meet sustainability goals in the future.
After re-gaining its independence Latvia started the preparatory stage for accession to
the European Union and already in 1995 a country waste management inventory was
performed. The inventory identified 558 operating dumpsites and approximately 160 closed
dumpsites, which did not meet sanitary requirements and possessed air, water and general
environmental pollution as well as had negative impact on the health of the local population.
The first stage was development of a national programme “500- Development of national
municipal waste management system in Latvia”. This was followed by development of the
Environmental protection policy in 1998 and the Sustainable development strategy of Latvia
in 2002. State level programmes, as well as state and regional waste management plans were
based on an increase in the population, stable GDP increase of 6% annually and a 3% annual
increase of waste generation volumes. The trend on the basis of which all calculations were
laid was an increase in waste generation volume. One of the EU requirements was to close
and recultivate all illegal dumpsites and to construct sanitary landfills, which would
correspond to the EU Directives as well as to secure that further waste collection and disposal
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would be performed in an environmentally friendly manner. Waste landfills are long-term
infrastructure elements and are designed to operate for a longer time period – for 20-30 years.
Development of waste management regions and construction of the infrastructure required
considerable time and was undertaken in the time period from 2000 to 2012. In 2012 Latvia
was divided into 10 waste management regions, each of which had its own waste management
infrastructure via a sanitary landfill for municipal waste, sorted waste collection points and
areas, sorting stations, re-loading stations, etc., which were managed by an inter-municipal
landfill management company (LMC). The LMCs vary along the regions due to the activities
they undertake (from only managing waste disposal in a landfill to the ones that operate with
the full waste management cycle from contracts with inhabitants, waste collection and sorting
to disposal). Regardless of the differences, one thing that all the LMCs have in common –
physical landfill site, the place where actual disposal of waste is performed – this is defined as
the object of the research. Previous studies of the author have revealed that due to the
decrease of the number of inhabitants, economic activity and waste generation volumes
(especially during recession period), the preliminary forecasts for establishment of economic
efficiency of Latvia’s 10 waste management regions was not fulfilled. In particular 4 out of 10
waste management regions had negative IRR, NPV and C/B ratios (Cudecka-Purina, 2011a).
Within this dissertation the author develops previous research further and seeks for an optimal
managerial solution that could be adopted by the LMCs, taking into account already
developed infrastructure and acquired investments.
Over the twentieth century, the world increased its fossil fuel use by a factor of 12,
whilst extraction of material resources increased 34 times. Today in the EU, each person
consumes 16 tons of materials annually, of which 6 tons are wasted, with half going to landfill
for disposal (EU COM, 2011). The World Business Council for Sustainable Development
estimates that by 2050 a 4 to 10 fold increase in resource efficiency will be required, with
important improvements achieved already by 2020. This also means that significant measures
in the field of waste management are to be taken immediately. The Europe 2020 Strategy and
its flagship initiative on "A Resource Efficient Europe" set the EU on the path to this
transformation. Across the EU 28, the average domestic material consumption in 2014
reached 13.296 tons per capita, in comparison Latvia’s domestic material consumption was
21.504 tons per capita. The domestic material consumption is defined as the total amount of
material directly used in an economy and equals direct material input minus exports. Taking
into account the fact that currently circular economy, resource efficiency and the concept of
resource sharing (industrial symbiosis) are becoming more important and the fact that Latvia
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is very inefficient in resource exploitation per capita, waste management is viewed as a
potential field that could be assessed first in order to improve the ratio.
During the time period when waste management infrastructure was under its
development stage in Latvia, EU decision-makers were quite active through advancing
legislative improvements in the waste sector. For instance, during 2005-2007 the European
Commission performed a feasibility check of the Directive on waste and certain linked
Directives and issued a new 2008/98/EC on waste (Waste Framework Directive). The
amendments assumed a significant shift in policy, changing emphasis in the waste
management hierarchy accents, focusing on recycling, reuse and recovery and developing a
range of landfilling bans. This stage had a significant impact on functioning of LMCs. Thus,
unconsciously, sustainable development of landfills was endangered on the EU level,
especially for the member states, where a significant volume of waste was still being
landfilled. When applying these legislative changes in LMCs in Latvia, it has to be noted that
waste landfills are complicated elements of infrastructure, the management of which cannot
adapt instantly to such changes. In Latvia’s case it meant that a decision on significant
changes in the current waste landfill sustainable development direction was required in a
fairly immediate timeframe. In the nearest future there are no plans to implement any
revolutionary waste treatment technology in Latvia and the target to decrease disposed waste
from 71% in 2014 to 10% or even 5% in 2030 is a significant challenge both for the existence
and the economic stability of waste landfills in Latvia. Basically the decrease of waste
volumes reaching a landfill is the result of increasing legislative pressure.
Only a limited number of scientific researches have been conducted in the field of
waste management in Latvia, mostly focusing on hazardous waste, some particular waste
management activities or analysing waste management field from an economic point of view.
There has not, however, been any research carried out in the field of management processes at
the waste disposal stage. The analysis of international researches revealed a research gap –
lack of business management studies concerning sustainable management of LMCs in the
situation when a crucial change of waste management hierarchy took place, leaving waste
disposal as least favourable option.
Increase of a tariff for waste disposal (hereinafter – tariff) could improve the economic
situation of LMC’s only partly and to a certain extent, although it will definitely trigger a
social objective. Although, it has to be considered that an increase in tariff can be justified
only in case there are price-competitive treatment options in place (ECOTEC, 2001).
It is of vital importance for LMCs in Latvia to develop a smart and sustainable
decision-making system that will allow LMCs not only to be able to fulfil their financial
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obligations but as legal entities, to generate a positive cash flow and choose further
development options. Analysis of the current situation within LMCs in Latvia has revealed a
negative trend that some of the companies have problems with keeping together managerial,
entrepreneurial and environmental decisions – companies dealing only with landfilling are
interested in the increase of landfilled waste volumes, but this is in direct conflict with current
waste management trends, which indicate that countries are to focus on decrease in landfilled
waste as much as possible. Moreover, since the EU currently provides financial support for
recovery and recycling activities, the respective infrastructure will continue to develop and,
alongside with on-going education programmes for society and waste prevention
programmes, these activities will have an impact on the final waste volume to reach a landfill.
The aforementioned leads to the conclusion, that in order for a LMC to become economically
effective, a new management approach has to be considered in order to secure the economic
efficiency of the LMC in the future. Present research is aimed at performing an in-depth
analysis of waste management concepts, latest trends and developments, decision-making
techniques, applied in waste management on the European level, then focusing on Latvian
landfill management companies and identifying their critical problems. This research is
applicable not only to Latvian waste management companies, but to all EU and non-EU
countries, which still rely significantly on landfilling.
Currently resource efficiency issues are assesed and range of researches are
developed, linked to circular economy issues. In this context the author also examines the EU
Circular economy action plan, which notes development trends and mostly highlights the
necessity to limit waste landfilling. The trends of 2016 show that the limitations of waste
allowed for landfilling could reach 10% or even 5% from generated volumes in 2030. Taking
into consideration the above mentioned, it may be concluded that an important Latvian waste
management issue is closely linked with economic efficiency of landfills, which have to
secure such a direction in their development, which would foresee return of valuable
resources into the economic turnover and would not have an effect on the rapid increase of
waste landfilling tariff and as a consequence on the waste management rate of the population.
As a result of the research, the author has come to the conclusion that the concept of a
circular economy and industrial symbiosis as one of its sub-systems could be a solution for
current problems in the management of landfill management companies in Latvia.
According to EU COM (2015a), it is important to promote innovative industrial
processes, for example, industrial symbiosis, which allow for waste or by-products of one
industry to become inputs for another. The concept of circular economy and industrial
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symbiosis being one of its sub-systems sounds as a good option in order to solve the current
problems of Latvian inter-municipal landfill management companies.
Analysis of the current situation within Latvian LMC’s has revealed a negative trend
that some of the companies have problems with keeping together managerial, entrepreneurial
and environmental decisions – companies dealing only with landfilling are interested in the
increase of landfilled waste volumes, but this goes into direct conflict with EU latest trends on
the landfill of waste, saying that Member States are to focus on decrease of landfilled waste as
much as possible. Currently it is of vital importance to develop a smart and sustainable
decision-making system that will allow LMCs not only to be able to fulfil their financial
obligations but as entities to generate a positive cash flow and choose further development
options. EU provides financial support for recovery and recycling activities, these activities
alongside with inhabitant education programme will have an impact on waste prevention and
final waste volume reaching a landfill. Within the preconditions of existing infrastructure, a
solution for sustainable management of LMCs has to be found within circular economy and in
particular a new management approach has to be considered by modifying and applying one
of its business models – industrial symbiosis.
The outcome of the research is adaptable from institutional and managerial aspects
and applicable not only to Latvian waste management companies, but, under certain
preconditions, may also be applied to other EU and non-EU country LMCs, which still rely
significantly on landfilling.
The object of the research is landfill management company.
The subject of the research is management of landfill with a precondition of
decreasing incoming waste flow.
The hypothesis of the research: the industrial symbiosis built on the basis of a
landfill ensures further development of landfill management companies within decreasing
waste volumes and limited increase of waste disposal tariff tendencies.
Research goal and main tasks
The main goal of the research is to develop a solution for sustainable management of
landfills within decrease of incoming waste volumes.
Main tasks of the research are:
1. Critical analysis of the latest trends in waste management and further evaluation of
the current waste management system in Latvia, identification of preconditions for
sustainable development of landfills.
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2. Development of two surveys to verify theoretical framework based vision on current
waste management sector problems and possible solutions.
3. Development of a methodologically justified industrial symbiosis model and
decision-making matrix for a landfill management company.
4. Development of industrial symbiosis business model application scenarios for
landfill management companies.
5. Practical approbation of the results on the basis of particular material flow and
identification of its potential in industrial symbiosis framework.
6. Development of practical recommendations that would facilitate further development
of landfill management companies.
Theses presented for defence
1. Development and implementation of landfill management company development model
ensures sustainable development of such companies within decreasing waste volumes
and limited increase of waste disposal rate tendencies.
2. Implementation of industrial symbiosis on waste landfills, within decrease of waste
generation volumes, allows landfill management companies to ensure their economic
sustainability.
3. Implementation and development of industrial symbiosis transforms waste landfill into
scientifically technological park and under certain preconditions it may contribute to
economic development of a particular region.
4. Resource flow evaluation along with application of LMC decision-making matrix,
allows LMCs to identify available resources and to choose most suitable development
strategy for company’s further development.
5. Industrial symbiosis model on a landfill basis can be replicated on other landfills abroad
with certain similar output data.
Research methods
The research was developed using qualitative methods (case studies, system dynamics,
logical causal-loop diagrams) and quantitative methods - surveys, analysis of waste
management system data (primary and secondary data), benchmarking, mathematical
modeling, interpretation and data analysis. The theoretical framework has been developed
using the monographic, critical analysis and synthesis methods. Data for the empirical part of
the study were obtained through two surveys. The surveys have been developed based on
Sekaran, Bougie, (2009) methodology. The surveys were developed in order to prove the
author’s theoretical framework-based vision of possible LMC development, with two main
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focus groups – Landfill group (covering 10 LMC) and Expert group (30 waste management
field experts), representing Latvian and foreign experts. The respondents in the Landfill group
were mainly top managers or members of the board of LMCs and in the Expert group –
representatives of foreign LMCs, Ministries of Environment, waste management associations,
universities and consultants. All the experts covered by the survey have an impact on policy
planning and development in particular country.
For the empirical study, Excel (MonteCarlo modelling), SPSS, Vensim and STAN
software were used. In addition to surveys, the data was obtained from statistical databases
available through Eurostat, the World Bank, Confederation of European Waste-to-Energy Plants
and Organization for Economic Co-operation and Development (OECD).
Assumptions and limitations
Waste management in terms of company management is a very complex system,
comprising of various sub-systems and management options. Within the EU, waste
management is highly regulated on the waste treatment side and a variety of goals have been
set to be achieved by Member States for minimisation of each type of waste stream. The
business administration part of the sector is unregulated, offering Member States free choice
to establish public, private or public-private partnership (PPP) companies. The landfill
management companies analysed within the present research are public companies (inter-
municipality limited liability companies) and the research does not evaluate forms of
ownership for such companies that do not exist in Latvia.
The present research is focused only on municipal waste management – which
includes household waste and production waste (similar to household by composition) and
does not include hazardous waste. Municipal waste in Latvia constitutes 30-40% of the total
waste stream and, due to its mixed composition, requires a particularly complex and high-
quality waste collection and treatment system.
The research focuses on analysis of waste management at the stage of landfilling,
not covering the waste collection system, sorted waste collection, transportation and pre-
treatment. Currently in Latvia over 70% of municipal waste is being landfilled. During this
process a range of resources that are either not used, or being used in an inefficient manner
are generated, i.e. electricity, heat, technical water, secondary resources, refuse derived fuel,
etc. Overall, the waste management sector is comprised of a range of market players and
stakeholders – from municipalities to waste collection, treatment, recycling companies, NGOs
and landfill management companies, which total over 70 entities. The research covers all
landfill management companies, who undertake municipal waste disposal activities.
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Landfills in Latvia form an integral part of the municipal waste management
infrastructure, being stationary and long-term (up to 30 years) facility. Despite the fact
their number is way lower than the number of municipalities, a major part of municipalities
(except Pieriga region), are owners of the landfills situated in their waste management regions
thereby bearing also certain financial liabilities.
Research period
As with the end of the 20th century, significant attention was paid to ecological issues,
the research period of the theoretical framework covers the end of the 20th century and the
beginning of the 21st century until present. The framework reviews environmental policy,
development of waste management and its rethinking – a shift from waste to resource
management. Analysis, undertaken by the author within the practical part of the research,
covers the time period from 1995 until January 2017. The practical part of the research took
place from the end of 2011 until 2017. The survey of the landfill management companies and
experts in the waste management field took place from July to October 2016.
The theoretical and methodological basis
In order to develop a convincing theoretical framework, the author has undertaken
research covering published scientific work of scientists from Latvia and other countries and
studies that are available in electronic data bases, special environmental management and
management literature, materials from scientific seminars and conferences, European Union
and Latvian legislation, statistics data, studies and methodological materials of EU
institutions, Eurostat, Central Statistical Bureau of Latvia, the Ministry of Environmental
Protection and Regional Development in Latvia (MEPRD) and other international and Latvian
organizations. The theoretical and methodological basis has been developed based on
developed theories and models of the following researches:
In strategic management and decision-making in waste management field (resource-
based theory; multi-criteria decision-making model; decision making tree) – Ansoff
(2007), Boulding (1966), Ciumasu (2013), Cutaia (2015), DeFeo (2005), Finnveden
(2013), Mintzberg (2013), Porter (1998; 2008), Powell (2000);
In sustainable business model field (circular economy business models) – Eriksson
and Penker (2000), Lüdeke-Freund (2010), Richardson (2008);
In circular economy, industrial symbiosis and management of companies in waste
management field (resource dependency theory) – Baccini and Brunner (2012),
Blumberga (2011), Brunner (2007), Chertow (2008; 2012), Dyson (2005), Gibbs
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(2008), Goorhuis (2012), Heck (2006), Jacobsen (2006), Lombardi (2012), Patala
(2014), Rehan (2017);
In sustainable development field (PESTLE) – Azapagic and Perdan (2000), Dalal-
Clayton (2002), Garmendia (2010), McDougall (2001; 2003), Munasinghe (1993),
Nilsen (2010).
Scientific novelty of the research
The scientific novelty of this research as well as its main achievements can be
formulated as follows:
1. Based on the business administration theoretical framework a model for management of
landfill management companies, has been developed – industrial symbiosis on the basis
of a landfill.
2. The thesis provides a contribution to Latvian scientific research concerning
management processes in waste disposal. 4 resource balance equations have been
developed, which are used as a tool for effective management of resources that enter the
landfill.
3. The thesis offers three new definitions - “industrial symbiosis”, “industrial symbiosis
model” and “resources, generated on a landfill” within Latvia’s waste management
framework.
4. New decision-making matrix combines four LMC development directions: internal
industrial symbiosis; more sophisticated waste sorting; waste recycling facilities and
external industrial symbiosis.
5. For the first time in Latvia an integrated assessment of waste management system at the
stage of waste landfills has been carried out. Developed industrial symbiosis model and
decision-making matrix are replicable and can be applied in similar LMCs within the
EU and beyond.
Research materials can be used as a basis for decision-making at inter-municipal
waste management companies, educational materials (lectures, seminars, etc.).
Theoretical significance of the research
The main theoretical importance of this research is linked with that of the concept of
circular economy – shift from waste to resources and its application to real business
environment with the help of decision-making matrix. It identifies a stage of waste
management with a range of non-efficiently managed resources – internal landfill waste and
material flow. With the help of the resource equations, and the LMC matrix, developed by the
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author, it is possible to identify further sustainable development strategies and develop
industrial symbiosis by applying industrial symbiosis model. Most important significance is
that in the concept of industrial symbiosis, a landfill is being transformed into a special type
of technologic park and is becoming a core element or a starting point for this material
exchange and symbiosis.
Practical significance of the research
The industrial symbiosis model, together with LMC decision-making matrix,
developed within the boundaries of the research, allows assessing the current situation in
landfill management companies and can be used as a decision-making support tool to choose
further directions in development. The research covers a range of resources that are
ineffectively used at present, which can be assessed using the author’s developed
methodology, in order to evaluate a company’s potential for improving resource efficiency.
The obtained results of the research can be used for policy making in waste
management, identifying the economic sectors, which could potentially be involved in
industrial symbiosis and developing an action plan, which would provide special support for
motivating the sectors to engage in this initiative.
The developed model, as well as the decision-making matrix can be applied to the
landfill management companies of any other country, with certain preconditions. This
solution is of special interest to the countries, which are at the primary stages of the waste
management hierarchy and mainly rely on landfilling.
The results of the research may serve as a basis upon which further Latvian or foreign
scientific research can be conducted– further in-depth development of the model and
decision-making matrix or the resolution of particular landfill management company
problems. The results of the research also have practical significance in terms of the education
of society, as they provide explanations on how waste management can be transformed into
resource management and attract other industries, involving them into circular economy.
16
1. ENSURING WASTE LANDFILL SUSTAINABILITYIn order to comprehend the complexity and broad scope of the waste management
sector, this chapter devoted to development of the theoretical framework and literature
review, covers the definition of such terms as “waste management” and “sustainable
development”, which are core concepts necessary for the research. In addition it will tackle
the importance of sustainable development for landfill management companies, going beyond
the topic and expanding the understanding of landfill sustainability, integrated waste
management and recycling. The chapter also covers sustainable development indicators,
decision-making techniques, applied in waste management, economic aspects of waste
management, such as circular economy and decoupling economic growth from waste
generation ratios.
1.1. Sustainability and its characteristics for a landfill management company
The most common definition of sustainable development was developed in 1987 by
the United Nations in the report by World Commission on Environment and Development
(The Bruntland Report) “Our Common Future” and has widespread use since the United
Nations Conference on Environment and Development, which took place in Rio de Janeiro in
1992. According to the UN, sustainable development is that “which meets the needs of the
present without compromising the ability of future generations to meet their own needs” (UN,
1987).
Landfill has been defined (ISWA, 1992) as the engineered deposit of waste onto and
into land in such a way that pollution or harm to the environment is prevented and, through
restoration, land provided which may be used for another purpose.
Sustainable landfilling is a key issue in many modern waste management concepts. No
internationally accepted definition of “sustainable landfilling” has been identified to date.
With respect to landfills very often terms including stability, completion, end-point and threat
to the environment are used in discussions on sustainability (Scharff et al., 2007).
The sustainable landfill should present at the end point of the aftercare time (generally
30 years) an environmental acceptable mass accumulation. This should be the reference
criterion for evaluating any technology, or combination of technologies, which could be
applied for reaching this target (Belevi, Baccini, 1989; Cossu 2005, 2007; Directive
1999/31/EC on the landfill of waste).
17
Fig. 1.1 Landfill emission life cyclesSource: Vigneault, et.al., 2004
A sustainable landfill is understood as a landfill where the disposed of waste mass is
already in a stable state, meaning the remaining turnover processes are low and emission
release is below the local environmentally acceptable level or can be controlled by simple,
robust and natural measures, e.g. control of gas emissions by methane oxidation in landfill
covers. This is exceptionally presented in Figure 1.1. The control and mitigation of
greenhouse active gas emissions from landfills and the enhancement and evaluation of the
carbon and nitrogen storage pool are key issues nowadays and still will be present in the
future (Cossu, 2007; Hubert-Humer et.al., 2006).
Definition of waste and waste management
Seadon (2010) gives a very precise definition of waste. Waste is a result of inadequate
thinking. The traditional approaches to waste management of “flame, flush or fling” are out-
dated customs, which have resulted in an unsustainable society.
Tchobanoglous et al. (1993) and McDougall et al. (2003) provide a very
comprehensive waste classification approach which, over the years, still serves as a
basis for policy makers provide a list of key concepts on waste (i.e. EPA, 2015).
According to them, waste can be classified by a multitude of schemes:
by physical state (solid, liquid, gaseous), and then
o within solid waste by: original use (packaging waste, food waste, etc.);
by material (glass, paper, etc.);
by physical properties (combustible, compostable, recyclable);
by origin (domestic, commercial, agricultural, industrial, etc.);
by safety level (hazardous, non-hazardous).
18
According to McDougall et al. (2003), consumption and use of products leads to
waste generation, although in order to minimise waste that is being sent to a landfill, it is
necessary to restore value from the materials that have been thrown away and to generate
useful goods, which can be brought back to the consumption cycle. The relationship between
value and waste can be expressed via the following formula:
Value=f Idegree of mixing (
1
.
1
)
In accordance with EU Waste Framework Directive (2008/98/EC) and Latvian “Waste
management law”, the waste - is any material, which the holder discards, is obliged to discard
or intends to discard. In accordance with Latvian “Waste management law” waste is being
divided into the following types:
hazardous waste – waste which displays one or more of the properties which
make it hazardous;
municipal waste – waste generated in a household, trade, in the process of
provision of services or waste generated in other places which, because of its
properties, is similar to domestic refuse;
production waste – waste generated as a result of production process or
construction;
biological waste – biodegradable garden and park waste, food and kitchen
waste from households, restaurants, caterers, and retail premises, and
comparable waste from food processing plants.
European Union Waste Framework Directive provides additional definitions:
waste oils - means any mineral or synthetic lubrication or industrial oils which
have become unfit for the use for which they were originally intended, such as
used combustion engine oils and gearbox oils, lubricating oils, oils for turbines
and hydraulic oils;
bio-waste - means biodegradable garden and park waste, food and kitchen
waste from households, restaurants, caterers and retail premises and
comparable waste from food processing plants;
19
The member states of the European Union show significant differences in respect to
municipal waste management standards and practices (Council of Europe, 2007). It is
essential to point out that despite the unified legislation set by the European Union, which
have to be implemented into the local legislation of each Member State, the definition of
municipal waste differs from country to country – from only household waste up to a broader
scope, including end-of-life-vehicles. This difference is also explained by culture and habits
and waste management history of each country. In addition, it has to be mentioned that there
are also different approaches to statistics, which exist among the countries. Commission
Decision (2011) establishes rules and calculation methods for verifying compliance with the
targets set in Article 11(2) of Directive 2008/98/EC, and member states are free to choose 1
out of 4 calculation methods. The level and type of data collection strongly differs among
countries, especially for newer member states. This also means that any simple comparison of
data or benchmarking has to be followed at least by an explanation of waste composition in
term of definition.
As stated in European Environmental Agency reports (2009; 2010), waste
management has been a focus of EU environmental policies since the 1970’s. Such policies,
which increasingly require the reduction, reuse and recycling of waste, are contributing to
closing the loop of material use throughout the economy by providing waste-derived materials
as inputs for production.
Report of the Committee on the Environment, Agriculture and Local and Regional
Affairs (2007) states, that proper management of municipal waste is a central pillar of far-
sighted, sustainable environmental policies. Every European generates approximately 1 kg of
municipal waste a day and the figures show an upward trend. Management of municipal waste
is therefore one of the major challenges currently facing local authorities.
De Feo and Napoli (2005; 2012) stress that the generation intensity is continuously
growing in these countries, with the highest values in the richest countries, testifying an
indivisible link between the levels of affluence and quantity of waste produced. Waste could
be considered the final product of a special production chain: wealth, consumption, waste.
The wealthier the society, the greater the consumption; the greater the consumption, the more
waste produced. By 2020, people could be generating 45% more waste than in 1995.
According to the Renewed European Union Sustainable Development Strategy (2006), waste
prevention and management is identified as one of its top priorities.
Tchobanoglous et al. (1993) suggest municipal waste management may be defined as
the discipline associated with the control of generation, storage, collection, transfer and
transport, processing and disposal of municipal wastes in a manner that is in accordance with
20
the best principles of public health, economics, engineering, conservation, aesthetics and other
environmental considerations and that is also responsive to public attitudes.
The Directive on waste (1991) defined waste management as: “collection, transport,
recovery and disposal of waste, including the supervision of such operations and after-care of
disposal sites”. Based on the aim of the Council Directive quoted earlier, it was argued that
the goal of waste management is protection of the environment and human health, and
resources conservation (Pongrácz, 2002).
Pohjola and Pongrácz, (1999) emphasized, that waste management shall be understood
as a system, providing a medium for making changes in the way people behave with respect
to waste. It is concluded that waste management can be understood as control of waste-related
activities with the aim of protecting the environment and human health, and resources
conservation (Pongrácz, 2002).
Main aims of waste management are: (1) to protect human health and the
environment; and (2) to conserve resources. Under the principles of sustainability, these goals,
which are applied worldwide, should be achieved in a way that does not impair the wellbeing
of current as well as future generations (Brunner et. al., 2007; Cossu R., 2009; Cudeckis V.,
2009; Ministry of Environmental Protection and Regional Development, 2012;).
The scheme (Figure 1.2) proposed and developed by De Feo and Napoli (2005) is
composed of three sections: (1) firstly, the attention is focused on how and which wastes are
generated in the production of goods; (2) secondly, the scheme describes the citizens’
management of goods purchased; (3) finally, the scheme represents units, connections, and
products of a MSW management system.
According to Ayres and Simonis (1994) the first part of the proposed scheme for life
cycle waste generation could be referred to as “industrial metabolism”. Between economy,
goods management and society goods management, there is a buying phase, which is the gate
to “society metabolism”.
21
Fig. 1.2 Schematic life cycle of waste generationSource: De Feo and Napoli (2005); Staniskis (2005)
Schneider D. and Bogdan Z. (2010) note, that efficient waste management is one of
the preconditions for sustainable development of any country. Despite an increasing share of
waste that is separately collected for the purpose of recycling and recovery, the quantity of
waste that ends up at the landfills is growing each year. As stated in Eurostat regular
publication (Eurostat, 2009), around 1,300 million tons of waste is being produced each year
in the European Union, of which 260 million tons is municipal waste (that corresponds to 517
kg per capita in 2006). The generated waste amount is increasing at rates comparable to
economic growth. For example, both GDP and municipal waste grew by 19% between 1995
and 2003.
Fig. 1.3 Municipal waste generation and treatment in the EU2 (kg per capita)
Source: Eurostat
2 EU aggregate excluding Croatia for the years 1995 to 2006
22
One consequence of this growth is that despite large increases in recycling, landfill -
the environmentally most problematic way to get rid of waste - is only reducing slowly (EU
COM, 2005). This tendency is changing, but at an extremely slow pace, which is why the EU
aome out with the Circular economy Package (EU COM 2015a) setting ambitious targets for
2030. Figure 1.3 reveals the tendency of waste generation in European Union for 19 years.
Even despite European concerns on recycling and reuse, as in this time period many new
countries joined the EU, and as this time period was characterized with extremely high
economic growth, the overall ratio of waste generation has a positive tendency in comparison
to 1995.
After performing a comparative analysis of the data in Figures 1.3 and 1.4 it may be
concluded, that significant activities in the waste management sector have been undertaken
during time period of 2008 to 2013 and most credibly they possess a continuous trend. First of
all the ratio for EU 27 has been able to go below 500 kg/capita; 20 out of 27 member states
have managed to decrease waste generation per capita.
Fig. 1.4 Municipal waste generated by country in selected years (kg per capita)
Source: Eurostat
It has to be noted though, that these figures are also influenced by a global economic
downturn, but nevertheless the countries keep this tendency after 2014 as well. Nonetheless
the figures have to be critically approached. The author’s own experience through work at the
MEPRD and working groups in EC Brussels has revealed that member states have totally
different approaches to statistics and apply different interpretations and definitions.
As stated in the Environmental Protection Policy of Latvia (1998), movement towards
sustainable development in Europe became more active after the conference of the European
Ministers for Environmental Protection in Dobris in 1991. According to Cudecka (2007),
23
Latvia began its way towards sustainable development from 1995, when an overall country
inventory was performed, which revealed 558 operating dumpsites and about 160 closed
dumpsites, which did not comply with sanitary requirements and were the sources of air and
water contamination. The first action was the development of “500 -” programme – National
municipal waste management system development in Latvia, followed by the Environmental
Protection Policy released in 1998 and the Strategy for Sustainable Development of Latvia
issued in 2002.
Strategy for Sustainable Development of Latvia foresaw the establishment of 10-12
waste management regions, with one sanitary landfill in each of them and the closure and
recultivation of all existing dumpsites.
In order to comply with the latest trends, Latvia had to develop an integrated approach
to municipal waste management. Latvia’s sustainable waste management system had three
main stages:
involvement of 100% of urban and at least 75% of rural inhabitants;
implementation and development of sorted waste collection from 5% in 1995
to 25% in 2025;
development of new infrastructure - waste disposal and dumpsite recultivation.
The first two stages were in the awareness of the regions and municipalities and the
financing for their implementation was at the national or regional level. The third stage
involved recultivation of all existing dumpsites and construction of regional landfills. This
stage required impressive financing provided by the European Union Cohesion Fund (in the
stage of Pre-accession – ISPA fund), the European Regional Development Fund, World bank,
state budget, municipalities, etc.
Definition of Sustainable development – strategies and indicators
It is considered, that Sustainable development is comprised of three main dimensions:
environmental, economic and social. In other words, it has to be economically affordable,
socially acceptable and environmentally effective. Figure 1.5 shows that equal consideration
of each is necessary otherwise the whole system will become unbalanced (McDougall, White
2003).
Incidence of impactsIntra-general equity;Basic needs
24
Figure 1.5 Key elements of sustainable development and interconnections
Source: adopted from Munasinghe (1993)
According to Munasinghe (1993), the economic domain is geared mainly toward
improving human welfare. The environmental domain focuses on protecting the integrity and
resilience of ecological systems. The social domain emphasizes the enrichment of human
relationships and achievement of individual and group aspirations. According to H. Daly
(1990), there are two main principles of sustainable development:
- harvest rates should equal regeneration rates (sustained yield);
- waste emission rates should equal the natural assimilative capacities of the ecosystems
into which the wastes are emitted.
Munasinghe (1993) states that two main types of sustainable development exist:
Weak sustainable development (WSD) – where utility or consumption is non-
declining over time. WSD is characterized by the possibility to substitute economy and nature
to achieve the goal of highest possible utility for humans. For instance, a lake is reduced or
destroyed and is replaced by a pool. If the users of the lake maintain their utility-level by
swapping from lake to a pool, then the development is sustained (Nilsen, 2008).
The weak sustainability position held by many mainstream neoclassical economists,
demands that the overall welfare of society should not decline overtime. It is based on the
work of Solow (1974) and can be labelled as the ‘perfect substitutability paradigm’
(Garmendia et al. 2010).
As weak sustainable development is a good description of the sustainable development
of today, so is utilitarianism a good description of the prevailing ethics of today.
Strong sustainable development - an increasingly used theoretical concept within
economics. The economy and nature are considered to be complementary, and both are to be
sustained Nilsen (2010).
Strong sustainability paradigm, which owes much to the pioneering work of Daly
(1992, 1996), holds that many fundamental services provided by nature cannot be replaced at
any level by man-made capital. Under this approach a minimum amount of different types of
‘capital’ should be independently maintained if a system aims to be sustainable (Garmendia et
al. 2010).
25
In order to ensure realization of sustainable development, five fundamental tasks have
been formulated (Figure 1.6).
To fulfil all these tasks, effective strategies have to be developed and implemented not
only on National but also on Local (Regional and municipal) levels. This also requires
cooperation and a unified development vision of all the involved institutions and inhabitants,
which leads to reasonably complex work with the society (Kudrenickis et al. 2001).
Andriantiatsaholiniaina et al. (2004) also mention, that sustainable decision-making
involves political decisions at the local, regional, or national levels, which aim at a balanced
development of socio-environmental systems. A fundamental question in sustainable
decision-making is that of defining and measuring sustainable development. Many methods
have been proposed to assess sustainability. Recently, a model has been developed, called
Sustainability Assessment by Fuzzy Evaluation (SAFE), which uses fuzzy logic reasoning
and basic indicators of environmental integrity, economic efficiency, and social welfare, and
derives measures of human (HUMS), ecological (ECOS), and overall sustainability (OSUS).
Figure 1.6 Tasks for sustainable development
Source: Developed by the author based on Kudrenickis et al. (2001)
Legislation and its influence on sustainable development
The European Union has set a strict framework of environmental policy, which is
constantly revised, feasibility checks are performed on all the Directives and Regulations and
constant amendments and modifications take place. Historically, according to Wagner (2011)
landfilling was the dominant method in waste management. Significant technological change
has evolved in landfilling (of all waste types) such that the landfill is a more significant
method than at any other time in history. Indeed, reliance on landfilling is pervasive in all
countries, and environmental engineers and waste management specialists do not expect
significant technological change away from landfilling in the foreseeable future. In Europe,
landfilling is currently the predominant municipal waste treatment option, claiming a 40%
share (CEWEP, 2011). Also, the number of municipal waste incineration plants has been
Sustainable development
Resource Conservation
Built Development
Environmental Quality
Social Equity
Political Participation
26
constantly increasing. In the year 2008, 405 municipal waste incineration plants were in
operation in the EU27 member states and 453 all over Europe, with an additional 43 plants
planned until 2020 (CEWEP, 2011).
In contrast to the approach in the USA, Hogland and Marques (2007) point out, that
landfilling in the EU states has been considered to give considerable negative environmental
impact mainly due to emissions to the air, affecting global warming and the risk of water
pollution. According to Saner et al. (2011), this development is a result of several EU
municipal waste directives (European Commission, 2011), which have been adopted over the
last two decades and which are guiding municipal waste management practice from
landfilling towards waste prevention, material recovery, and energy recovery. The purpose of
recent policies in the EU have been to promote more recycling and energy extraction of
products and materials, thereby decreasing landfilling and organic fractions shall not end up at
landfills at all.
Fig. 1.7 Waste hierarchy
Source: adopted from Directive on waste 2008/98/EK
Whole European legislation is based on the waste hierarchy principle, provided in the
Figure 1.7. At the time Latvia was to join the European Union, waste hierarchy was in force
and the Strategy for sustainable development of Latvia (2002) foresaw as first steps – closure
and recultivation of all existing sub-standard landfills and construction of sanitary landfills for
municipal waste. Currently, these plans are fulfilled but this does not bring Latvia forward
with achieving targets, set by the European Union in the field of waste management.
Moreover, it has been proven already, that the hierarchy itself is too simplistic and contains a
range of limitations (Cudecka-Purina, Atstaja, (2012); McDougall, (2001); Brisson, (1997);
UK Waste Strategy, (1995)). According to the researchers, the main limitations of the
hierarchy are:
Reduction
Re-use
Recycling & compost
Energy recoveryDi
sposal
27
the hierarchy cannot be followed rigidly, since in particular situations the cost
of a prescribed activity may exceed the benefits, when all financial, social and
environmental considerations are taken into account
the hierarchy has little scientific or technical basis. There is no scientific
reason, for example, why materials recycling should always be preferred to
energy recovery.
the hierarchy is of little use when a combination of options is used, as in an
IWM system. In an IWM system, the hierarchy cannot predict, for example,
whether composting combined with incineration of the residues would be
preferable to materials recycling plus landfilling of residues. What is needed is
an overall assessment of the whole system, which the hierarchy cannot
provide.
the hierarchy does not address costs. Therefore, it cannot help assess the
economic affordability of waste management systems.
Taseli (2007) emphasises that Directive 1999/31/EC on the landfill of waste sets three
progressive targets for Member States to reduce the amount of biodegradable municipal waste
sent to landfill. Article 5 requires a reduction in biodegradable municipal waste landfilling to
75%, 50% and 35% of the baseline figures within 5, 8 and 15 years, respectively (Directive
1999/31/EK, 1999).
There is a complete prohibition on the landfilling of certain wastes (liquid wastes,
corrosive/oxidising/flammable/highly flammable wastes, hospital/clinical wastes, and used
tyres). In addition, the proportion of biodegradable waste must be progressively reduced. All
wastes must be pre-treated prior to landfilling, and only wastes matching the classification of
a site (hazardous, non-hazardous or inert) may be disposed there, according to Article 6
(Directive 1999/31/EK, 1999). This and other Directives allow national authorities within a
certain scope to stress either recycling or thermal treatment when implementing these policies
into national law. The way that the directives are implemented has direct consequences on
national waste management practices and the MSWI sector, respectively (Saner et al., 2011).
Sustainable development and main targets set in directives within waste
management
This sub-section describes briefly the main waste management targets set in the EU
Directives on waste, on packaging and packaging waste and on landfill of waste, their
comparison with the current situation in Latvia and new targets, currently undergoing
28
negotiation process with the member states, set in the Proposal for the directive on Waste
issued on December 2, 2015 by the European Commission.
Mainly Latvia did fulfil all the targets set so far, but it has to be noted that such
positive results were mainly due to the fact that the baseline figures were set as 1995, which,
due to discrepancies in statistics, consisted of certain overestimations.
As Directives go through a feasibility check from time to time, currently the European
Commission has come out with a proposal package for amendments to the Directive on waste,
Directive on Packaging and packaging waste, Directive on Landfill of waste.
Below is a summarization of the new targets set in the proposal and the opinions of the
Latvian Government, NGOs, waste management field representatives, which were obtained
during a seminar-discussion, on challenges and solutions for Latvia’s shift to a circular
economy and its implementation in real life.
Table 1.1
Targets of the EU Directives
Source: adopted from State waste management plan (2013)
Directive Targets Deadline
Council
Directive
2008/98/E
K of 19
November
2008 on
waste
(Waste
framework
Directive)
Develop and improve a sorted waste collection system for paper, metal, plastics and glass, ensuring system availability within all Latvian territory
December
31, 2014
Prepare for reuse and recycle at least 50% (by weight) of paper, metal, plastics and glass contained within municipal waste
December
31, 2019
Increase preparation for re-use, recycling and other type of regeneration, including daily coverage for at least 70% by weight, using waste as substitute for other materials
December
31, 2019
Council
Directive
1999/31/E
C of 26
April 1999
on the
landfill of
waste
Decrease volume of disposed biodegradable waste up to 50% from the volume of 1995 July 16,
2013
Decrease volume of disposed biodegradable waste up to 35% from the volume of 1995
July 16,
2020
European Recover 60% from used packaging and achieve the following regeneration targets:
December
29
Parliament
and
Council
Directive
94/62/EE
K of 20
December
1994 on
packaging
and
packaging
waste
- 65% by weight for glass;- 83% by weight for paper and cardboard;- 50% by weight for metals;- 41% by weight for plastics, accounting only for materials that have been recycled into plastics;- 29% by weight for wood.
31, 2015
Recycle 55% from used packaging and achieve the following regeneration targets:
- 60% by weight for glass;- 60% by weight for paper and cardboard;- 50% by weight for metals;- 22.5% by weight for plastics, accounting only for materials that have been recycled into plastics;- 15% by weight for wood.
December
31, 2015
The opinion of Latvian State officials, NGO, waste management field representatives
has been obtained during a seminar-discussion “Challenges and solutions for Latvia’s shifting
to circular economy”, which was held by the Ministry of Environmental Protection and
Regional Development of Latvia on March 2, 2016. It gathered many representatives of the
field in order to discuss the latest EU Proposal on the Circular economy package, tendencies,
obstacles and a common path that all stakeholders have to choose in order to be able to
achieve the new targets set.
Table 1.2
Targets set in the Circular economy package
Source: EU COM 2015a, by author
Targets of the Proposal Opinion of Latvian Government officials, NGO,s waste management field representatives
Alignment of definitions Extremely necessary target, as currently serious gaps exist along the definitions across member states, which make simple statistical reports incomparable.
Increase of the preparing for reuse and recycling target for municipal waste to 65% by 2030
The reuse and recycling target for municipal waste has decreased from 70% to 65%, giving a stronger possibility for Latvia to comply with this target on time.
Increase of the preparing for reuse and recycling targets for packaging waste and the simplification of the set of targets
A challenging target, although quite achievable, as EU financial support is focused until 2020 on sorted waste collection system development, it will facilitate achievement of increase of packaging waste and its preparation for reuse and recycling
Gradual limitation of the landfilling
This target can be considered as most vulnerable for Latvian waste management system, which still relies on
30
of municipal waste to 10% by 2030
landfilling and LMC’s that are in charge of waste management on the regional basis, having landfills as their main infrastructural elements currently need reconsideration of their operation model for the upcoming 14 years. Otherwise the target is absolutely unachievable, even with a 5-year extension period.
Greater harmonisation and simplification of the legal framework on by-products and end-of-waste status
A proposal that has a favourable effect – making the legal framework more comprehensive.
New measures to promote prevention, including for food waste, and re-use
A totally new initiative within Latvian waste management context. Prior no definition as “food waste” was in place in Latvian legislation and it was not separated from the commercial or municipal waste streams. Taking into account dramatic volumes of food being wasted (catering leftovers, supermarket expired products), this is a very positive initiative, thus it will require changes in legislation and the development of a food waste management system.Activities for prevention and promotion of re-use are welcomed as well and considered to be implementable.
Introduction of minimum operating conditions for Extended Producer Responsibility
A very disputable issue – mostly due to the fact of significant economic, social and environmental differences across member states
Introduction of an Early Warning System for monitoring compliance with the recycling targets
Could result to be an effective method, in order to allow a member state to go for pivotal options in order to solve the upcoming problems.
Simplification and streamlining of reporting obligations
Decrease of bureaucracy burden that allows focusing more on real problem solutions and not only preparation of reports.
Alignment to Articles 290 and 291 TFEU on delegated and implementing acts
A more bureaucratic and technical issue without any comments from the experts.
Strategies for sustainable development
The DAC guidance (2001) defines a strategy for sustainable development as
comprising:
“A coordinated set of participatory and continuously improving processes of analysis,
debate, capacity-strengthening, planning and investment, which integrates the economic,
social and environmental objectives of society, seeking trade-offs where this is not possible”.
31
According to HJ. de Graaf et al. (1996), two main strategies to satisfy the demands of
sustainable development exist and they differ in their approaches towards dealing with this
situation:
The first is based on the belief that any human society is part of, and depends on, an
ecosystem. The ecosystem constrains the development of that society. It is necessary
to respect the carrying capacity of the ecosystems in order to attain sustainability.
The second strategy is based on the belief that, if environmental decline is regarded as
a cost, western economics can cope very well with environmental problems. It argues
for the power of self-regulation of human society. If the environment is incorporated
in cost-benefit analyses, economic development will become equivalent to sustainable
development.
In order to achieve strategic challenges, set in the strategy, strategic planning is to
become more efficient, effective, credible and lasting. Moreover, sustainable development
requires a systematic approach, as illustrated in the Figure 1.8.
Figure 1.8 Rational for a systematic approach to strategies for sustainable development. Source: adopted from DAC guidance (2001)
Dalal-Clayton and Bass (2002) in compiling a resource book for sustainable
development strategies, describe being strategic as “developing an underlying vision through
consensual, effective and iterative process; and going on to set objectives, identify the means
of achieving them, and then monitor the achievement as a guide to the next round of this
learning process.”
Strategy for sustainable development
Requires balance
System providingcoordination and
coherence
Set of progress:Participation;
CommunicationAnalysis;Debate;
Investment;
Set of objectives:Social
Economic
Requires coordinatio
n
32
Figure 1.9 Continuous improvement approach to managing sustainable development
strategies. Source: Swansen, Pinter (2004)
Dalal-Clayton and Bass (2002) research found that nations appear to be transitioning
from “misconceptions of ideal and static master plans and one-off initiatives,” to “sets of
coordinated mechanisms and continuing processes of monitoring, learning and improvement”.
The successful integration of sustainable development in governmental practice can be
described as a function of the following elements (European Commission, 2004; Steurer &
Martinuzzi, 2005; SRU, 2004):
Leadership: governmental institutions have to develop an underlying vision; and
concretize this vision further by setting overall objectives; this process has to be backed
by a high-level political commitment.
Planning: governmental institutions have to set up a process to identify the means of
achieving objectives (institutional mechanisms, programmatic structures, and specific
policy initiatives).
Implementation: governmental institutions have to employ and finance a mix of policy
initiatives with regard to the requirements of planning.
Monitoring, review, and adaptation: governmental institutions have to develop, monitor,
and report on the indicators to measure:
o progress in implementing policy initiatives and
o the economic, social, and environmental state of the country.
1. Leadership
4. Monitoring,
planning, adaptation
3. Implementation
2. Planning
33
The abovementioned elements correlate with the stages of the continuous
improvement approach to managing sustainable development strategies developed in
the 2002 Sustainable Development Resource Book (Dalal-Clayton & Bass, 2002),
illustrated in Figure 1.9.
In addition to the abovementioned, Latvija 2030 (2010) has determined the main
strategic principles, observation which may significantly improve the sustainable
development possibilities of Latvia:
Creative activity: as a strategic principle should be perceived in as wide a sense as
possible, referring not only to culture and science, but also to any area of social and
economic life. A commercial product or service created as a result of creative activity is
the foundation of the future global economy.
Tolerance: provides for reduction of social exclusion and discrimination of all kinds,
including inequality of income, age and gender discrimination in the labour market,
ethnic prejudices and linguistic institutional obstacles.
Co-operation:
horizontal co-operation allows to combine, in new ways, the resources available to
each person and to solve jointly problems, which reach outside the influence of
individual players.
vertical co-operation gives an opportunity to take more efficient decisions and find
better solutions.
Participation: only with active participation of the largest part of the society in the
policy-making and implementation process, in the field of culture and art and in
activities of local community of inhabitants is it possible to find optimum solutions for
different situations, to promote the unity and awareness of society.
Sustainable development indicators
An indicator is a measurement that shows the status of an environmental, economic, or
social system over time (Redefining Progress, 1997). The goals of indicators are:
to monitor and evaluate effectiveness and performance of goals and targets of
sustainable business (Bennett & James,1999; Parris, Kates, 2003);
to communicate to diverse stakeholders (Thompson, 2002). Indicators can help
stakeholders, including the public, decision makers, and managers, to assist in
decision-making about sustainable business; and
to compare actions and performance of firms that may or may not be
implementing sustainable business (Kuhndt, Geibler, 2002).
34
The European Environment Agency (2013a) defines an indicator as an elementary
data or a simple combination of data of measuring a deserved phenomenon. Thus,
performance indicators could monitor the effect of policy measures. Afterwards it will be
possible to conclude whether or not targets have been met or will be met, and to formulate
additional measures to increase efficiency.
According to Bae, Smardon (2011), indicators for sustainable business practices can
be expressed in many different forms (qualitative or quantitative, general or specific, and
absolute or relative), in accordance with objectives and applications of an indicator.
Quantitative indicators are measured in terms of mass, volume or number of environmental
pollutants or physical materials. Examples of quantitative indicators are total amount of air
emissions like CO2, or total volume of hazardous waste. Not all indicators will be
quantitative, and some will have to be expressed qualitatively because they cannot be defined
in physical terms (Bae, Smardon 2011). Qualitative indicators are expressed interpretively.
Qualitative indicators include social dimensions of a company’s activities, such as changes in
cultural values or equity (Azapagic & Perdan, 2000). Sustainable business could be described
by both qualitative and quantitative metrics because both are required to explain whether or
not an organization’s diverse activities consider or meet human needs and social demands
(Daly, 1990; Azapagic & Perdan, 2000).
The United Nations Conference on Environment and Development in Rio de Janeiro,
in 1992 recognized the important role that indicators could play in helping countries make
informed decisions concerning sustainable development (UN, 2007).
Chapter 40 of Agenda 21 (1992), the action plan adopted in 1992 at the United
Nations Conference on Environment and Development in Rio de Janeiro, calls on countries,
as well as international, governmental and non-governmental organizations, to develop
indicators of sustainable development that can provide a solid basis for decision-making at all
levels.
This mandate was reflected in the decision of the CSD in 1995 to adopt an indicators
work programme that involved several stages: consensus-building on a core list of indicators
of sustainable development; development of the related methodology sheets; policy
discussions within a CSD publication and widespread dissemination of this work; testing; and
evaluation and revision of the indicators. As a result, in 1995 a set of 134 indicators were
developed. Further, after revision in 2001, the number was reduced to 58 embedded in a
policy oriented framework of themes and sub-themes.
35
The third, revised set of CSD indicators was finalized in 2006 by a group of experts
from developing and developed countries and international organizations. The revised edition
contained 96 indicators, including a subset of 50 core indicators. The guidelines on indicators
and their detailed methodology sheets became available as a reference for all countries to
develop national indicators of sustainable development (UN, 2007).
Commission of Sustainable Development Indicator themes
Indicator quality criteria
Poverty
Natural hazards
Economic development
Analytical soundness
Governance
Atmosphere
Global economic partnership
Responsiveness
Health LandConsumption and
production patterns
Comparability
Education
Oceans, seas,
coastsConsistency
Demographi
cs
Freshwater Clarity
Biodiversity
Fig. 1.10 Sustainable development indicators and quality criteriaSource: adopted from UN, 2007; Agamuthu, Hotta (2014)
Within this particular research, the main focus of the author is on Health, Atmosphere,
Economic development and Consumption and production patterns. Above mentioned themes
are measured by the following indicators:
“healthcare delivery” (Percentage of population with access to primary health care
facilities – i.e. clean water, air, environment, safe waste management system),
“climate change” (carbon dioxide emissions – within waste management a highly
important issue is emissions of greenhouse gases, occurring during waste disposal),
“economic development” (includes a range of sub-indicators, such as: gross
domestic product, gross national product, gross national product per capita,
economic growth, inequality and wealth, inflation, unemployment, economic
structure, unemployment);
“material consumption”:
o Material intensity of the economy – domestic material consumption;
o Annual energy consumption, total and by main user category - Share of
renewable energy sources in total energy use
“generation of waste” (waste prevention - waste generation related to demographics
or economic activity, and waste generation as such are the closest approximation
36
for measuring quantitative waste prevention; waste generation by consumption and
production activities)
“waste treatment and disposal” (Percentage of waste which is i) recycled; ii)
composted; iii) incinerated; and iv) landfilled on a controlled site).
The above-mentioned indicators are used to characterize the area of the research –
waste management. Although, as the object of the research are landfill management
companies, specific sustainability indicators have to be applied to them as well.
Most waste management policies emphasize minimization of environmental impacts
with overall priority to reduce waste generated. The second strategy would be to reduce
resource usage with complete or partial recovery or recycling. In that case, indicators need to
be qualified and these quality criteria include those presented in Figure 1.10.
Total waste generation is one of the basic indicators. There is a strong correlation
between economic growth and waste, and measurement of generation rate would give an
indication of the economic status of a nation. Most developing nations produce 45% organic
components, which could be used for biological treatment (Eurostat, 2014). Thus, specific
components within the waste would also form an indicator, and this would be used to predict
the appropriate technology for the component treatment and disposal.
An important remark by Agamuthu, Hotta (2014) is that indicators will not provide a
solution, but will indicate the changes in waste parameters. It can be used as a tool to improve
existing policy and related technology. However, different indicators may be proposed
depending on the type of pressure contents and target groups.
Integrated waste management and recycling
The following section provides insight in the latest development trends within waste
management with a historic perspective: starting with a shift towards integrated waste
management system and recycling, followed by development of deposit refund system and
moving to the latest trends – circular economy and industrial symbiosis.
In 1996, the United Nations Environmental Programme (UNEP, 1996) defined
‘integrated waste management’ as ‘a framework of reference for designing and implementing
new waste management systems and for analysing and optimizing existing systems’.
An integrated system includes a suitable waste collection and sorting system, followed
by one or more of the following options: recovery of secondary materials (recycling);
biological treatment of organic materials; thermal treatment and landfill. Together these form
Integrated Waste Management (McDougall, 2001; Anschütz et al. 2004; Cutaia et al. 2015).
37
Moreover, taking into consideration the high re-cycling and reuse targets, waste management
systems become more like a resource management system.
Recycling is economically efficient if the resources used in the process do not exceed
the resources saved by recycling. In some cases, however, more resources are used on
collecting, separating, transporting, cleaning and reprocessing used packaging than can be
justified by the value and quality of the recycled material and more environmental damage
results from the process than would have resulted from deposition in a landfill or incineration.
What is often overlooked when recycling targets are set is the fact that it is necessary to
balance the costs and the benefits of recycling in order to determine the optimal recycling
level, rather than just setting some arbitrary target (Brisson, 1993; Mazzanti, Montini, 2009).
The benefits from recycling include avoided disposal costs, avoided external costs
associated with disposal (leachate, smells, etc.) and the revenue from the sale of the recycled
material (in some cases there may not be a positive price for the recycled material). These
should be balance against the costs associated with recycling, such as: extra costs incurred due
to the separation of used packaging from mixed waste, the costs associated with any process
involved in recycling (cleaning, de-inking, remelting, etc.) and any external costs resulting
from recycling. (This includes such effects as e.g. pollution from de-inking processes, but also
health risks from the sorting and recycling process. The latter has proved a serious problem in
Denmark for instance, where workers have become ill from inhaling fumes from waste. This
has added substantially to the costs of operating separation and recycling schemes which even
in some cases have had to be discontinued because of continued health risks.) Thus the
condition for optimal recycling is:
PR+MCAD+MECAD=MCSC+MCR+MECR (
1
.
2
)
where:
PR= price of recycled material
MCAD= marginal avoided disposal cost (say, landfill)
MECAD= marginal external avoided disposal cost (e.g. landfill smell, leachate, etc.)
MCSC= marginal cost of separate collection (or mechanical sorter, etc.)
MCR= marginal cost of any process involved in recycling (e.g. pollution, remelting, re-
pulping)
MECR= marginal external costs of recycling (e.g. pollution from cleaning process)
38
The left side of equation (2) is the benefit of recycling (other things may be added if
appropriate, e.g. saved energy costs). The right hand side is the cost of recycling. Therefore
(2) simply says
MBR=MCR (
1
.
3
)
Suppose, for simplicity, MECAD=0 and MECR=0, then (2) can be rearranged as
-[PR-MCSC-MCR]=MCAD (
1
.
4
)
or
-ΠR=MCAD (
1
.
5
)
This tells us that optimal recycling occurs when the loss (-Π) on recycling is just equal
to the avoided disposal costs (MCAD). Thus, one would allow all recycling ventures, both
profitable and non-profitable to occur up to the point where marginal losses are just equal to
marginal avoided disposal costs as illustrated in Fig. 1.10.
Fig. 1.11 Marginal losses and marginal avoided disposal costsSource: Brisson (1993)
Thus in order to estimate the optimal level of recycling, we need to ascertain Π(R) and
MCAD. Using our estimate of disposal costs for the UK of £13 per tons of waste as a
39
benchmark for MCAD, recycling is optimal up to point where loss per ton = £13. The formula
can be modified for landfill user costs (i.e. scarcity of landfill sites) and other externalities.
In the current market in the UK and also in many other countries, what is termed
'Pareto-relevant is recycling’ in Figures 1.11 and 1.12 does not take place. The reason is waste
disposal is financed through taxes, meaning that no individual carries the direct costs of
disposal, so no individual will generate the disposal costs saved by diverting part of the waste
stream to recycling. An attempt to remedy this market failure has been made with the British
'recycling credits'. These pay recyclers a credit equivalent to the average saved disposal cost.
Currently this does not include avoided external disposal costs, however, in the long run, as
landfill standards become stricter, at least part of these external costs will be internalised in
the landfill cost.
In some cases, MCAD may rise as R increases (e.g. incineration costs as paper/plastics
are recycled). A more plausible outcome is that as recycling increases, the price of the
recycled material, PR, will fall as demand is unable to keep up with the increasing supply of
recycled material.
Fig. 1.12 Marginal avoided disposal costs Source: Brisson (1993)
In some cases, this has led to negative prices for recycled materials. Therefore, to
prevent ΠR falling faster (see Fig. 1.13), an active policy on the demand side is required.
Fig. 1.13 Dependence of price for recycled products from level of recycling Source: Brisson (1993)
40
So rather than setting arbitrary recycling levels, because recycling is perceived to be
“good”, policy-makers should introduce measures which transfer the avoided costs of
disposal, which are currently inaccessible to the individual, to recyclers in order to encourage
the optimal level of recycling to take place.
Fig.1.14 The cycle of recyclingSource: adopted from Brisson (1993) and McDougall et.al. (2003)
Some Member States have already set or are contemplating setting their own recovery
and recycling targets, but the Commission fears the effect this can have on the Internal
Market, and believes that targets set at different levels can create unjustified barriers to trade.
If, however, scientific research or any other evaluation technique such as eco-balance,
prove that other recovery processes show greater environmental advantages, the targets for
recycling can be modified.
Essence of circular economy
The rapid growth in world population over the last 50 years has caused an immense
increase in the demand for food. It has been estimated that the world population will reach 9
billion by 2050, requiring a 60%–70% increase in food production (Moraes et. al., 2014).
However, the Food and Agriculture Organization of the United Nations (FAO) estimates that
more than 1.3bt of food are wasted every year (Bräutigam et. al., 2014). This means that
significant quantities of resources spent for food production are used in vain and generate a
significant environmental impact, such as an increase in the quantity of greenhouse gases
generated (FAO, 2011). Therefore, the European Commission has promoted the reutilization
of waste by means of the circular economy (Laso et.al., 2016).
It seems that “Circular Economy” lately has become the most important and discussed
topic especially within the European Union member states. Annually European Commission’s
Directorate-General Environment (DG ENV) holds a Green week conference, joining leading
scientists, researchers, governmental and non-governmental institutions and waste
management companies in order to share best practices, new ideas and developments. Besides
Final disposal(landfill,
incineration without energy
recovery)
Energy recovery(heat recovery, pyrolisis, etc.)
Recycle
Recovery
WasteProduct
New product
Reuse(bottles, etc.)Reprocess
(cullet, pulp, etc.)
41
this event, within the European Semester, DG ENV analyses the fiscal and structural reform
policies of every Member State, provides recommendations, and monitors their
implementation. The legislative proposals on waste, adopted together with the action plan,
include long-term targets to reduce landfilling and to increase preparation for reuse and
recycling of key waste streams such as municipal waste and packaging waste. The targets
should lead Member States gradually to converge on best practice levels and encourage the
requisite investment in waste management (EU COM, 2015).
Back in 1990, Pearce and Turner introduced the concept of a circular economy into
mainstream economic theory. In their well-known textbook on environmental economics, the
authors addressed the interlinkage between the environment and the production/consumption
economic model. In their then newly proposed circular scheme, the environment provides
amenity values, is a resource base and a sink for economic activities, and is also a
fundamental life-support system (Pearce, Turner, 1990).
Circular economy appeared in literature through three main activities - the so- called
3R's Principles: Reduction, Reuse and Recycle (Feng and Yan, 2007; Ren, 2007; Preston
2012). When analysing existing researches in circular economy, the leader is obviously China
– with over 40 case studies. This is logically explained with the fact that the country is
continuously facing huge environmental, human health and social problems. This is the first
country so far, having a Circular economy law in force. In contrast, the European Union is
also paying great attention to this issue but so far circular economy is being seen as a
recommendation, not mandatory. As stated by Ghisellini et. al. (2016), the Chinese CE
promotion laws define CE as “a generic term for the reducing, reusing and recycling activities
conducted in the process of production, circulation and consumption” (CCICED, 2008). This
definition does not seem, however, consistent with China's practice of steady growth of
production and consumption patterns within a national dimension. On the contrary, other
countries such as Europe, seems to identify CE and its founding principles (3R) in more
sectorial initiatives mainly related to waste management policies.
More practically explained by Heck (2006), the Circular Economy means reducing
resource use and reducing the load on our natural sinks. The CE concept is a central part of
the ecological economy and the industrial ecology.
The adoption of a systemic view of industry (Graedel and Allenby, 2003) and the
introduction of activities to close and optimize cycles of matter and energy (Brigenzu, 2003;
Korhonen, 2007) are two pillars of Industrial Ecology that enable a better understanding of
and improvement in the efficiency of the linear chain of production and consumption. The
implementation of these activities may occur at different stages of the supply chain and can
42
lead to Industrial Symbiosis networks when the waste products from certain processes or
companies become income resources for others (Ruiz Puente, et.al., 2015).
It has to be noted that circular economy concepts have already been adopted on
national levels. For example in China, where environmental protection is a very important
issue, a Circular Economy Law was already passed and entered into force in 2009. Austria,
Germany, and the Netherlands have to some extent already developed strategies compatible
with circular economic activities (Heck, 2006; Goorhuis et.al. 2012). As highlighted by
Morone, Navia (2016), the purpose of consumption is to increase consumer’s utility and/or
enhance social welfare. However, at each stage of the supply chain, waste is produced. To
some extent this waste might be recycled and reconverted into resources, reducing the need to
mine virgin resources and, through this, the economy becomes circular. Yet, not all waste can
be recycled or is recyclable, partly owing to missed opportunities and partly owing to basic
physical and thermo-dynamical laws. The amount of waste that can be recycled depends
crucially on the capacity of the environment to assimilate residuals from the economic
system. Once the assimilative capacity is exceeded, environmental damage occurs.
According to Bezama (2016), from a systems perspective, there are three major
observations that can be made with regards to the implementation of the circular economy and
bio-economy strategies. First, that the dialogue between product designers and end-of-life
materials' managers (i.e. the waste industry) is still in an early stage, and there is a great need
to foster it further, as it will be a crucial step for the implementation of circularities within the
production system. Otherwise, energy recovery alternatives will remain as the most adequate
end-of-life management options, without feasible options for an end-of-life management
system focused on material recovery (Hildebrandt et al., 2015). The second reflection deals
with the assessment of the production system itself. Current efforts aim to develop tools that
enable the evaluation of direct and indirect effects of the value added chains under a life cycle
perspective, and its inclusion into the optimization of process design (Budzinski and Nitzsche,
2016).
Circular economy is seen as a economy’s development direction, expected to lead to a
more sustainable development and a harmonious society. It covers at least five different
business models, one of which is resource recovery, tackling in particular benefits of
industrial symbiosis (Geng and Doberstein, 2008; Ness, 2008; Mathews and Tan, 2011;
Europesworld, 2014; Lett, 2014). The UK government has recently released responses to the
EU circular economy package, listing barriers to adoption (Department for Environment,
Food and Rural Affairs, 2015a, 2015b; Environmental Audit Committee, 2014). These
43
include regulatory, financial, information and systemic barriers. Many of these barriers can be
assisted through greater quantification of the waste flows.
As emphasized by George et.al., (2015) recycling is now a significant aspect of most
developed economies and an important objective of policy, so it is time to bring the
aforementioned concept of the circular economy into theoretical consideration. That is,
economic waste and economic resources are interrelated and they can no longer be considered
to be independent. It is now time to weave them tightly together.
Circular economy does sound very reasonable and logical as a concept, but in reality it
is often facing a range of obstacles such as high initial costs, necessity of changing habits and
the system on the whole. One of the main changes promoted by the European Commission
since 1993 – the tax burden must be redistributed so as to lighten the burden on labour and
increase the burden on the use of natural resources (EC, 1993). It is essential to state, that
although this recommendation was developed over 20 years ago, the practice shows that the
EU Member states still have not fully implemented it into their economy, thus not fully
comprehending the idea behind this taxation shift and its inevitable necessity.
Fig. 1.15 Circular economy overviewSource: Ellen MacArthur Foundation (2015)
Salemdeeb et. al. (2016) note that in order to achieve a circular economy, there must
be a greater understanding of the links between economic activity and waste generation. A
44
consensus exists on the vital role of waste and resource management in achieving transition
from a linear model to a circular one where the value of materials and resources are
maintained in the supply chain. Waste systematically emerges throughout the supply chain as
a result of economic activities and trade (Kurz, 2006; Parfitt et al., 2010). An example of this
is a study conducted by the UK Waste and Resource Action Programme (2013), which
examined food and drink waste arising in the supply chain. This study estimated that 13mt of
waste is generated in the food and drink supply chain, 85% more than waste arising in the
post consumption stage.
Industrial symbiosis
Systemic and transformative change is also reflected in a growing number of case
studies analysing innovative solutions based on new systemic thinking like “cradle to cradle”
(McDonough and Braungart, 2002) and “industrial symbiosis” (Gibbs, 2008). As stated by
OECD (2012), the core of industrial symbiosis is a shared utilisation of resources and by-
products among industrial actors on a commercial basis through inter-firm recycling linkages.
In industrial symbiosis traditionally separated industries engage in an exchange of materials
and energy through shared facilities. The waste of one company becomes another’s raw
material. Industrial ecology postulates that the industrial system can learn valuable lessons in
efficiency by examining the cycling of materials and energy in biological ecosystems (Frosch
and Gallopoulos 1989); industrial symbiosis applies the ecological metaphor of industrial
ecology to action between firms (Chertow, 2000). More formally, industrial symbiosis is the
“physical exchange of materials, energy, water, and by-products” among geographically
proximate firms (Chertow, 2000). Further on, Chertow et al. (2008) identified many types of
collaborative arrangements for businesses that lead to the development of it. In addition to the
more “traditional” approach i.e. “byproduct exchanges” there are other typical approaches
included in the definition of industrial symbiosis, such as the sharing of utilities and
infrastructures and joint provision of services. Sharing utilities and infrastructures are defined
as the “pooled use and management of commonly used resources such as steam, electricity,
water, and wastewater”. Industrial symbiosis stems from industrial ecology, which
emphasizes the importance of life-cycle thinking in resource use (Ayres and Ayres, 2002;
Ehrenfeld, 2005; Graedel and Allenby, 2003). Firms engaging in industrial symbiosis can
benefit economically and environmentally (Esty and Porter, 1998) through collaborative
resource exchanges that reduce waste disposal and/or material acquisition costs, while
reducing environmental impacts as companies find new ways to create value from their
wastes (Paquin, et.al., 2015). This is closely linked with resource-based view theory,
developed by Wernerfelt in 1984, which suggested that a firm’s competitive strategy and
45
performance depend significantly on its valuable, rare and inimitable organizational resources
(Barney, 1991).
Fig.1.16 Concept of industrial symbiosis Source: adopted from ZeroWIN (2014)
Industrial symbiosis has been defined as “traditionally separate industries in a
collective approach to competitive advantage involving physical exchange of materials,
energy, water, and by-products”(Chertow, 2000). In addition, exchange of non-material
resources such as knowledge and expertise is central in Industrial symbiosis (Lombardi and
Laybourn, 2012). Industrial symbiosis is of particular interest as it reflects the recent
European strategies of decoupling economic growth, environmental impacts and natural
resource consumption through the promotion of a more sustainable circular economy as
clearly identified in different programming and financing documents of the European
Commission (EU COM, 2011, 2012, 2014a, 2014b).
In addition, according to Chertow and Ehrenfeld (2012) it examines cooperative
management and exchange of resource flows -- particularly materials, water, and energy --
through clusters of companies. According to Patala et.al., (2014), key issues that relate to
industrial symbiosis are the exchange of resources (i.e. material and non-material), geographic
proximity of actors and collaboration between industries. Geographic
proximity has been regarded as
central to industrial symbiosis due to
facilitation
of material
exchanges,
transportation, trust and collaboration
(Lombardi and Laybourn, 2012; Taddeo et al., 2012).
Applications of industrial symbiosis are available in both developing and developed
countries, confirming the effectiveness of industrial symbiosis in pursuing eco-sustainable
development. The eco-industrial park in Kalundborg, Denmark, represents the most famous
46
example of industrial symbiosis in the world with a complex network of symbiotic exchanges
among firms (Jacobsen, 2006). The main environmental benefits consist in 50,000 tons of
fossil fuels saved per year, in 200,000 tons per year of waste not disposed of in the landfill,
and in 150,000 tons per year of avoided GHG emissions (Jacobsen, 2006). According to van
Berkel (2006) "symbiosis/by-products exchanges" generate the highest environmental, social
and economic benefits as well as business opportunities, but comprehend at the same time the
highest business risks followed by "utility sharing" and "planning and management".
According to Lambert, Boons (2002), from a technical point of view, three interesting
opportunities can be discerned with respect to physical flows inside the complex:
Collective use of available utilities;
Collective processing of waste streams;
Mutual exchange of materials and energy.
Apart from these, two more options are present that are related to external exchange:
Applying residual products from remote companies;
Delivering residual products to remote companies.
The industrial symbiosis literature can still be evaluated as fragmented theoretically
and has developed separately from corporate environmental strategy where the focus is
mostly on intra- rather than inter-firm action (Etzion, 2007; Wassmer, Paquin, & Sharma,
2014). The industrial symbiosis is an initiative, which is commonly seen in conjunction with
state support. The literature explored the roles of government policy and governmental
agencies in initiating and supporting the development of the industrial symbiosis. As noted by
Chertow, 2007, policies prescribed to encourage the uncovering of symbioses include (1)
forming reconnaissance teams to identify industrial areas likely to have a baseline of
exchanges and mapping their flows accordingly, (2) offering technical or financial assistance
to increase the number of interactions inspired by managers with a symbiotic mind-set, and
(3) pursuing locations where common symbiotic precursors already exist, such as co-
generation, landfill gas mining, and waste water reuse, often as one-off activities, to determine
whether they may be likely candidates for technical or financial assistance as bridges to more
extensive symbiosis.According to both European Union legislation and as adopted in Latvian
Waste management law, an essential role in the field of waste management is devoted to local
governments as they are responsible for the waste being generated and for establishing a
waste management process on their administrative territories. As stated in the Latvia’s Waste
Management Law, local governments organise the management of municipal waste, including
hazardous waste produced by households, in compliance with the state and regional waste
management plans within their administrative territories.
47
Moreover, there are binding regulations which regulate the following:
management of municipal waste within administrative territories;
division of the administrative territories into municipal waste management
zones;
fulfilling the requirements for collection, transport, re-loading and storage of
waste;
management of waste management payment procedures;
organisation of separate waste collection within the respective administrative
territories (Latvia, 2009).
1.2. Necessity of ensuring sustainable company management Decision-making process
Waste management is a field that relies a lot on sustainable and long-term decision-
making processes and thus it has certain boundaries. It has to be considered that waste
management in the European Union member states has the following main stakeholders:
European Union, country, regional municipalities, IWMS, NGO’s and society. Limitations
exist starting from the type of activity up to limitations of waste sources analysed.
In the 1970s, the goal of the municipal waste management model was simple and
narrow, aimed at optimizing waste collection routes for vehicles (Truitt et al., 1969) or choice
and allocation of transfer stations (Helms and Clark, 1971). In the 1980s, the focus was
extended to cover MSWM on the system level, minimizing the total economic cost (Perlack
and Willis, 1987). Already since the 1990s, municipal waste policies became more
complicated, including sophisticated infrastructure, a variety of waste treatment options,
extensive work with society, etc. (Mesjasz-Lech, 2014).
Hung et al. (2007) note that the factors considered in municipal waste management
models were mainly economic (e.g., system cost and system benefit), environmental (air
emission, water pollution) and technological (the maturity of the technology). Three models
have played a major role in the decision making of municipal waste management: life cycle
assessment, multi objective programming and multi-criteria decision-making. Multi-objective
programming is a popular method for solving municipal waste management problems, such as
locating sites and choosing management strategies (Alidi, 1996). Many researchers used life
cycle assessment to evaluate the environmental impact of the alternatives for municipal waste
management (Powell, 2000).
According to Hung et al. (2007) the characteristic of multi-criteria decision-making is
that it facilitates choosing the best alternative among several alternatives by assessing
48
numerous criteria. Many approaches are available for solving environmental problems with
multiple criteria, including the analytic hierarchy process method (Haastrup et al., 1998; Tran
et al., 2002), outranking methods (Geldermann et al., 2000), and the TOPSIS (Technique for
Order of Preference by Similarity to Ideal Solution) method (Hwang and Yoon, 1981).
Other ESA tools used within the field of waste management include Multiple Criteria
Decision Analysis, Modified Cost-Effectiveness Analysis, ecological footprint of materials
and waste and cost-benefit analysis (Chambers et al. 2004; Cheng et al. 2002; Döberl et al.
2002). Puig et al. (2013) state that Life cycle thinking is a good approach to be used for
environmental decision-support, although the complexity of the Life Cycle Assessment
studies sometimes prevents their wide use. Since the early nineties, researchers have come to
realize the need for decision support tools to support waste managers and decision makers in
the planning, design and selection of appropriate waste management strategies. Several
models have since been developed (Broitman et al., 2012; El Hanandeh et al., 2010).
Most commonly used tools for environmental assessment:
Life Cycle Assessment – is an analytical tool assessing potential impacts from
products or services using a life cycle perspective, including impacts from raw
material acquisition, production, use and waste management as well as transportation.
Life Cycle Costing can be used to assess the costs of products or services using a life
cycle perspective. Social and environmental costs may be included.
Material Input Per unit Service is similar to Life Cycle Assessment but only include
material inputs throughout the life cycle of a product or service.
Bulk-Material Flow Analysis handles the input of bulk material in terms of physical
measures to a system.
Risk Assessment is a broad term and includes both the risk assessment of chemical
substances and of accidents. The latter concerns unplanned incidents, whereas the
former concerns the dispersion of chemicals, which is often part of the use of the
chemicals. RA of chemicals includes exposure assessment and effect assessment,
while RA of accidents includes the analysis of probability and possible consequences.
Strategic Environmental Assessment is a procedural tool for handling
environmental (and sustainability) aspects in strategic decision-making (policies,
programmes and plans). It is required by law for certain programmes and plans (SFS
1998:808).
Environmental Impact Assessment is a procedural tool required by law in some
situations (SFS 1998:808). This tool describes the environmental impact of a
suggested project and its alternatives (e.g. the construction and localisation of a waste
49
incineration plant). How the assessment of environmental impact should be made is
not predefined and analytical ESA tools can be used within Environmental Impact
Assessment (based on Moberg, 2006; Wrisberg et. al. 2002).
It has to be noted that all the above-mentioned tools for environmental assessment are
considerably limited in their application possibilities, i.e. analysing only small stage of waste
management system, not providing an assessment of overall system. Here the author would
like to stress the importance of a different scientific approach, originally developed in the
mid-1950s by Jay W. Forrester (Forrester, 1958). The main idea in Systems thinking,
according to Blumberga et.al., (2011) and Carlsson (2016) is that a phenomenon studied may
be characterised as a whole (the system) as well as by its components (sub-systems) and that
the sub-systems are related to each other and to their (super) system in such a way that the
system can be said to constitute something more than an assembly of subsystems.
Consequently systems can be classified in the form of a hierarchy of systems within systems.
This approach is used extensively in the second and third part of this dissertation as it
facilitates comprehension of many waste management-linked processes and moreover, in
order to assess existing strategies and decision-making aspects and develop or improve new
strategies through comprehensive and effective policy design.
When transposing the theoretical scheme to a real-life waste management system, the
scheme of information flow will look like Figure 1.17. It has to be noted, that the current
figure shows only one small element of decision-making – locating an element of
infrastructure.
Most popular and viable waste management models developed to support decision
making and selection of an optimal waste management strategy can be classified as:
• Models based on the cost benefit analysis of the studied waste management
system;
• Models that consider environmental, energy and material aspects of the waste
management strategy – life cycle assessment;
• Multi-criteria decision making models for selection of the optimal waste
management strategy (Morrissey, Browne, 2004).
Life cycle assessment focuses on environmental aspects, whereas maximization of
economic efficiency is the major goal of cost-benefit analysis. Multi-criteria decision
making, however, allows consideration of the three pillars of sustainability: economic,
social, and environmental criteria (Karmperis et al. (2013), Milutinović et al. (2014)).
In fact, multi-criteria decision making can guide decision makers in evaluating
existing or potential alternatives by simultaneously applying multiple conflicting criteria (Kou
50
et al., 2011; Zhou et al., 2010). Because of their ability to handle several criteria, multi-
criteria decision making methods are considered to be some of the most effective and
thorough decision support frameworks for decision-making in municipal waste management
(Soltani et al., 2015).
The decision making process is implemented in the steps highlighted in Figure 1.18.
The first step of the decision-making model involves defining the scope and primary
objectives that comprise the decision context. These objectives must be specific, realistic and
measureable. The second stage involves identification of all possible alternatives to achieve
the projected goals. In the third step, the decision makers define criteria for assessment of the
performances that reflect the level to which the objectives have been implemented. This stage
involves assigning weighting coefficients and defining criteria priorities, if any. The last stage
of the multi criteria decision-making procedure includes assessment and ranking of the
options in order to reach an optimal choice.
The most frequently used criteria include economic, environmental and energy
parameters. Recently, however, numerous analyses have also included various sociological
and legal criteria (Ehrgott et al., 2010; Mourits, Lansink, 2006).
51
Fig. 1.17 Information flow for decision-making process for locating a waste management infrastructure element
Source: by author, adopted from Velikanova (2014)According to Coelho (2016) multi-criteria decision making approaches are normally
classified in two main streams: multi-attribute decision making and multi-objective decision-
making.
Fig. 1.18 Multi criteria decision making modelSource: by author, adopted from Jovanovic et.al. (2016)
Multi-attribute decision-making comprises of selection or ranking problems, while
multi-objective decision-making encompasses optimisation problems. In other words, multi-
attribute decision making methods aim to compare or rank any set of alternatives based on the
Calculation of alternative
results
Defining criteria
Identification of alternatives
Establishing decision context
FinishStart
52
criteria adopted, whereas multi-objective decision making techniques are focused on
determining the set of optimal alternatives according to the criteria considered.
Benchmarking as one of decision-making tools in waste management
Benchmarking is the process by which companies or stakeholders look at the “best
practices” in the industry and try to imitate their styles and processes. This helps companies to
determine what they could be doing better (Allan, 2015). According to Bolli and Emtairah
(2001), the effectiveness and efficiency of waste services depend on a variety of parameters.
Benchmarking quantifies these parameters in order to determine their necessary combination
for optimum results and also in order to identify the achieved progress of waste services.
Local communities have to be aware of their performance levels in order to determine best
practices for improving them. Benchmarking was also rendered a very important tool for
improving waste services.
Environmental indicators are essential tools for tracking environmental progress,
supporting policy evaluation and informing society. Since the early 1990s, such indicators
have gained in importance in many countries and in international fora (OECD, 2008).
The main function of waste management indicators is to reflect trends in the state of
waste management at local and regional levels and monitor the progress made in reaching
related policy targets, in order to enable decision makers (e.g., municipal councils) to evaluate
their work and the effects of their policy (Karagiannidis, et al. 2004).
From an external comparative perspective, benchmarking helps decision-makers make
well-informed selections among best-practice case studies and to implement them in a
specific (national, regional or local) policy and administrative context (Luque, Munoz, 2005).
In the European environment, with the targets for waste management set for all
countries, a crucial aspect is the choice of the right development path. Taking into account
that the member states are at different positions, benchmarking in the waste management
sector could become a key for the developing member states in this field to choose the right
strategy to catch up to the leaders and to be able to fulfil targets.
Analysis, performed by Simões, Marques (2012) revealed, that until 2010 included,
107 economic performance studies involving parametric or non-parametric methods were
identified addressing somehow these aspects for the different segments of the waste life-cycle.
Out of these 107 studies, less than 5% were identified as cross-country studies. Folz (2004)
defines the benchmarking process as “the systematic identification of the best practices
employed by other jurisdictions which lead to superior performance. The idea is to adapt
particular policies and practices used by top-performing jurisdictions to realize a comparable
level of performance”. Benchmarking was mostly carried out on a local basis in terms of one-
53
country municipalities or within a region. Benchmarking enables researchers to make a
comparative identification of those key elements, peculiarities and deficits that will help to
identify the future strategy to be implemented (Luque, Munoz, 2005).
Various studies on strategic development have been carried out based on UN-
HABITAT reports on municipal waste management, in order to compare low-, middle- and
high-income countries (Rodic et. al. 2009, Wilson et. al. 2012). Otherwise, very few studies
have been performed so far for comparison and analysis of European Union member state
capitals. Taking into account that twenty-eight European countries are unified into one Union
with the same legislative framework, it is of interest to see what the achievements of these
countries are in the field of waste management. It is of special interest for the new member
states, as most of them are still relying heavily at the lowest level of the waste management
hierarchy according to the EU Waste Framework Directive (2008/98/EC) and have to develop
further action plans, applying the most effective and suitable solutions for each particular
member state.
A couple of studies were undertaken on behalf of Vienna MA 48 since 1989, when
after development of the Vienna Waste Management Concept in 1985, “the First Vienna
conference on Waste Management” took place with an aim to compare and share good
practices of waste management among European cities (Vogel, 1997). The author has
undertaken a benchmarking assessment of 9 EU member state capitals in the field of waste
management (Cudecka-Purina, et. al. 2013), which lead to closer analysis of the capitals
showing best practice and possibly developing a type of methodology that could be
considered by the capitals with lower results to be implemented. One of the main conclusions
of the research was that although European Union has a unified legislative and regulation
framework, it still has significant differences in the terminology applied in different member
states. The same applies to statistics – as member states and in this particular case the cities
often have different waste accounting and statistical data. This does not allow to apply direct
comparisons of the capitals, but it does make it possible to determine the ones with best
practices. Then an in-depth analysis can be undertaken and practices that could be applied in
other cities for performance improvement can be applied.
1.3. Particularities of company sustainability assurance in waste management
Feasibility study
Pritchard (2004) states, that the feasibility study is designed to determinate whether or
not, given the project environment, a project will be successful. A feasibility analysis may be
54
conducted for a project with an emphasis on financial viability, environmental integrity,
cultural acceptability or political practicability.
Green (2001) mentions, that feasibility analysis is part of the planning process that is
used to evaluate either current or long-term plans. The feasibility analyst uses financial
techniques to determine economic feasibility and technical evaluation techniques to determine
technical feasibility. Financial evaluation techniques are: payback period, present value, net
present value, internal rate on return, study length, cost of money, inflationary expectations
and tax considerations.
According to Mishra (2009), cost-benefit analysis includes appraisal of the economic
costs and benefits of the project and alternatives, and its impact on the economy and on the
welfare of the people, who are directly or indirectly affected by it.
Cost-benefit analysis can be done either ex ante or ex post (Pearce, 2005). Ex post
analyses are the after-the-fact analyses.
Fig. 1.19 Structure of Project appraisalSource: European Commission Directorate General Regional Policy (2008)
These examine past policies, where, potentially, observed values for the benefits, costs
and inflation rates can be measured. Ex ante analyses, in contrast, are the before-the-fact
analyses. These are future policies, for which future benefits, costs and inflation rates are not
yet observed and must be predicted (Fuguitt, Wilcox, 1999). Before any project is approved
for the Co-financing of the Cohesion Fund, a complex cost-benefit and ENPV analysis is
55
undertaken. According to European Commission Directorate General Regional Policy
(2008), the agenda proposed for project appraisal is structured in six steps (Figure 1.19).
Some of these steps are preliminary but necessary requirements for cost-benefit analysis.
Decoupling economic growth
The OECD (2001) defines decoupling simply as breaking the link between
‘environmental bads’ and ‘economic goods’. Prior to that, the World Business Council for
Sustainable Development coined the term ‘eco-efficiency’, which is achieved through the
delivery of “competitively priced goods and services that satisfy human needs and bring
quality of life while progressively reducing environmental impacts of goods and resource
intensity throughout the entire life cycle” (Schmidheiny, 1992). Similarly, the European
Union in 2005 adopted the Lisbon Strategy for Growth and Jobs, which gave high priority to
more sustainable use of natural resources, and called upon the EU to take the lead towards
more sustainable consumption and production in the global economy.
The quantities of municipal waste have grown steadily along with Gross Domestic
Products (GDPs) over the past decades. According to Mazzanti and Zoboli (2008), indicators
of ‘decoupling’ are becoming increasingly popular for detecting and measuring improvements
in environmental/resource efficiency with respect to economic activity. For example, the total
quantity of municipal waste per capita increased by 29% in North America, 35% in OECD,
and 54% in the EU15 from 1980 to 2005 (Sjöström and Östblom, 2010). The EEA report
‘Waste prevention in Europe’ shows that by the end of 2013, 18 of 31 countries had adopted
waste prevention programmes as required by the EU Waste Framework Directive. Most waste
prevention programmes mention the aim of ‘decoupling’ waste generation from economic
growth, but quantitative targets and corresponding monitoring schemes are often lacking. The
majority (60%) are concerned with information and awareness-raising, while regulatory or
economic policy instruments are mentioned less frequently (17%) (EEA, 2014).
In this respect it is important to mention also such scientists as Kuznets (1955) with
his publication “Economic growth and income inequality”. The environmental Kuznets curve
(Fig. 1.23) is a hypothesized relationship between various indicators of environmental
degradation and income per capita. In the early stages of economic growth degradation and
pollution increase, but beyond some level of income per capita (which will vary for different
indicators) the trend reverses, so that at high-income levels economic growth leads to
environmental improvement (Stern, 2004; Van Alstine, Neumayer, 2010). The environmental
Kuznets curve theme was popularized by the World Bank’s World Development Report 1992
(IBRD, 1992), which argued that: “The view that greater economic activity inevitably hurts
the environment is based on static assumptions about technology, tastes and environmental
56
investments” and that “As incomes rise, the demand for improvements in environmental
quality will increase, as will the resources available for investment”. Of course throughout the
years many opponents of the theory arise (Pearson, 1994; Stern, 1998; Kaika, 2013).
The key criticism of Arrow et al. (1995) and others was that the model as presented in
the 1992 World Development Report and elsewhere assumes that there is no feedback from
environmental damage to economic production as income is assumed to be an exogenous
variable. There is an assumption that the economy is sustainable. But, if higher levels of
economic activity are not sustainable, attempting to grow fast in the early stages of
development when environmental degradation is rising may prove counterproductive (Kaika,
2013; Van Alstine, Neumayer, 2010).
Fig. 1.20 Environmental Kuznets curveSource: Kuznets, 1955
According to Stern (2004) the true form of the emissions-income relationship is likely
to be monotonic but the curve shifts down over time. Some evidence shows that a particular
innovation is likely to be adopted preferentially in high-income countries first with a short lag
before it is adopted in the majority of poorer countries. In addition, as stated by Khajuria et.
al. (2011) the present environmental Kuznets curve should be viewed as the hypothesis on the
interaction between economic growth and environmental quality. The evidence suggests that
there is an aggregate relationship between specific environmental pollutants such as municipal
waste generation and income per capita, however, the shape of the relationship is not uniform
across pollutants and turning points, when they exist, differ across pollutants.
The following table provides a summary of the most commonly applied initiatives or
activities that have a proven effect on the decoupling.
57
Table 1.3Activities for decoupling waste from economic growth
Source: adopted from WRAP (2012)Initia
tive
Quantified evidence S
o
u
rc
es
Landf
ill tax
This initiative has a positive effect in the countries, which
have alternative waste treatment options
E
c
ot
ec
(2
0
0
1)
Pay
as
You
Thro
w
A number of European Union Member States have
implemented PAYT systems, based on volume, frequency,
weight, or sack. The results differ from one country to
another. In Germany, a weight-based PAYT scheme at
regional level achieved a significant reduction in municipal
waste generation.
E
u
n
o
m
ia
(2
0
1
1)
Exten
ded
produ
cer
respo
nsibili
ty
The household packaging EPR chain, established in 1992,
was the first large-scale chain to be set up in France, and it
has fostered progress in reducing the unit weight of
packaging. There is a significant decoupling between
consumption growth products (1%) and for tonnage
household packaging implemented (-20%)
A
D
E
M
E
(2
0
1
2)
58
The table represents the most common economic instruments, in addition to these, a
range of non-economic based instruments exist – such as:
Cooperation: agreement among a group of stakeholders to achieve a specific target
together.
Education and training: support to build capacity and raise awareness.
Information based instruments: using information to encourage waste
prevention, including ecolabels, sustainable procurement criteria, information
centres, etc.: Business Resource Efficiency Programme; Industry Symbiosis
Programme; WasteWise initiative; Eco-Management and Audit Scheme (EMAS,
ISO, etc.) (WRAP, 2012).
1.4. Industrial symbiosis and industrial parks as a step to a sustainable business model
Back in the twentieth century Alfred Marshall (1920) began describing the advantages
of agglomeration of economic activities. His concepts are still widely discussed and
developed further (Okubo, 2004; Pfluger, Tabuchi, 2016). Marshall proved that, due to
concentration in close geographical proximity within “industrial districts”, companies get the
benefit of large-scale industrial production and of technical and organizational innovations.
The economist emphasized the possibility of achieving the advantage of a large-scale
production by a group of small-sized companies located in a given area. It was mainly
possible due to the benefits coming from agglomeration economies, such as: reduction of
transaction costs, accumulation of skills among workers, creation of “an industrial
atmosphere”, promotion of innovation processes.
Later on, based on Marshall’s theory, Michael Porter developed and popularized the
cluster concept. According to Porter’s (2008) definition “clusters are geographic
concentrations of interconnected companies, specialized suppliers, service providers, firms in
related industries and associated institutions (e.g. universities, standards agencies and trade
associations) in a particular field that compete but also cooperate”. When developed further, a
cluster is defined as a set of entities from similar or related sectors that are geographically
close to each other (Pouder, St John, 1996); generating certain externalities that stem from
economic, social and historic factors (Becattini, 1990; Porter, 1990; Rocha, 2004).
Clusters, which form networks of firms and other institutions, are receiving growing
attention in literature on management (Gilbert et al., 2008; Rocha, Sternberg, 2005; Tallman
et al., 2004).
59
A further definition states that the cluster is a knowledge production centre (Tallman
et al., 2004), that is characterized by the transference of knowledge and information between
its members (MacKinnon et.al., 2002).
One of the roots of this discussion is in the concept of industrial ecology, which in
turn was an attempt to face the problems that were related to resource consumption, waste
production, and emission, by an integrated approach (Lambert, Boons, 2002). Patala et.al
(2014) stress that network-based collaboration is critical to solving complex problems such as
the environmental load of production and consumption. Porter (1998) indicates that clusters
affect competition in three ways: first, by increasing the productivity of companies based in
the area, second, by driving the innovation, and third, by stimulating the formation of new
businesses, which expands and strengthens the cluster itself. Clusters can be divided into:
industry, sector and problem solving.
Doeringer and Terkla (1995) examine the literature regarding industry clusters and
identify them as geographical concentrations of industries that gain performance advantages
through co-location. According to Zhao et al. (2009) “Geographical concentration” is the key
that defines the basic but distinctive characteristic of an industry cluster. Industry clusters can
be classified into two types:
vertically integrated clusters. This type of cluster is made up of industries that
are linked through buyer-seller relationships;
horizontally integrated clusters. This type of cluster includes industries, that
might share a common market for the end products, use a common technology
or labour force skills, or require similar natural resources.
Three primary opportunities for resource exchange are considered (Chertow, et.al.
2007):
1. By-product reuse— the exchange of firm-specific materials between two or
more parties for use as substitutes for commercial products or raw materials;
2. Utility/infrastructure sharing—the pooled use and management of commonly
used resources such as energy, water, and wastewater;
3. Joint provision of services—meeting common needs across firms for ancillary
activities such as fire suppression, transportation, and food provision.
The development of industries is led by innovation, assimilation and utilization of
technology that chiefly depends on the economy, society, culture, habits, systems and policies
embedded in a specific geographical context.
According to the Global Competitiveness Report (2012), Latvia is ranked 99th from
144 countries in terms of the state of cluster development.
60
Within waste management two terms as “clusters” and “industrial parks” are often
used in order to describe one type of development. According to Matani (2006) industrial
estates are primarily designed to improve production efficiency through the clustering of
manufacturing industries and services but most of them are posing a danger to the
environment. If environmental concerns are integrated into estate development at all
stages, cumulative damaging effects can be avoided. According to Cote and Hall (1995),
Eco-Industrial Parks entail both economic and environmental benefits that can be achieved
through exchanges of wastes and byproducts, step-by-step utilization of materials, energy and
water, and infrastructure sharing among enterprises.
There is a strong association between industrial symbiosis and improved
competitiveness in the industrial symbiosis literature (Geng and Cote 2002; Lowe and Evans
1995), often attributed to improved natural resource productivity (Esty and Porter 1998). In
the experience of Lombardi, Laybourn (2012), opportunities to improve competitiveness
through industrial symbiosis are much broader than improved resource efficiency. They
include reducing cost through innovative product or process changes, increasing revenue,
diversifying business, and managing risk (Laybourn and Morrisey 2009). The importance of
each synergy being demonstrable as an economically beneficial business deal has been
documented for Kalundborg (Chertow 2007; Jacobsen 2006), Rotterdam Harbor (Baas 1998),
networks in Austria and Germany (Posch 2010), and more generally (van Berkel 2006). In
Kalundborg, a number of independent energy and waste exchanges between collocated
companies and the local municipality evolved over a number of decades, resulting in
economic benefits for all parties involved (Jacobsen 2006). The industrial symbiosis approach
allows achieving environmental, economic, and social advantages (Mirata, 2004; OEDC,
2012). The environmental benefit is the result of the potential reduction of wastes, emissions,
primary inputs, and energy (Chertow, 2000). The economic convenience comes from the
savings due to minor costs for wastes disposal and for primary inputs purchase (Albino et al.,
2015). Finally, about the social benefits, this approach may foster the creation of new firms
and new jobs (Mirata, 2004). For these reasons industrial symbiosis is viewed as business
model that creates competitive advantage through superior customer value and contributes to
a sustainable development of the company and society” (Lüdeke-Freund, 2010).
According to Matani (2006) the tangible environmental benefits include:
reducing greenhouse gas emissions and toxic air emissions
promoting green technology development and diffusion
improving energy, materials and water use efficiency and conservation
promoting pollution prevention on a system or community basis
61
promoting the redevelopment of brown field industrial sites.
Kernels of symbiosis across firms, such as sharing ground water or a specific material,
are observed to be necessary preconditions for what sometimes become more extensive
exchange networks. Certain identifiable precursors of symbiosis, such as co-generation or
wastewater reuse, also emerge from business decisions often rooted in regulatory situations
and can lead to more extensive symbiotic cooperation as well (Chertow, 2007).
Recently, Lombardi and Laybourn (2012) have proposed expanding the definition of
Eco-industrial parks to include “the exchange of knowledge, information, and expertise”
which also “positively influences the physical flows of materials and energy” considered as
sources of innovation.
A key concept among scholars and practitioners for creating economic and
environmental value for firms is eco-efficiency (Ehrenfeld, 2005). Eco-efficiency involves
firms economically “doing more with less” (DeSimone and Popoff, 1997) by creating
economic value through environmentally oriented innovations. Economically, firms may
reduce costs through reduced material use or material substitution, and increase revenues with
innovative products and services (Nidumolu et al., 2009; Parkinson, 1990). Environmentally,
outcomes may include “reduced material intensity, reduced energy intensity, reduced
dispersion of toxic substances, enhanced recyclability, maximized use of renewables,
extended product life, and increased service intensity” (WBCSD, 2000). IS is a potentially
important approach to creating inter-firm eco-efficiency through environmental collaborations
(Wassmer et al., 2012).
Industrial symbiosis does not only deal with technical innovation, but it is part of a
whole hybrid business model that consists of getting value from wastes under different social
tactics at company level and repurpose for society/environment at the multi-organizational
level (Ruiz Puente, 2015).
Industrial symbiosis as a sustainable business model
The business model is a conceptual tool providing an abstraction of how a firm does
business (Eriksson and Penker, 2000; Magretta, 2002). A business model is also understood
as a holistic approach towards explaining how firms conduct business (Zott et al., 2011). It
reflects the firm’s implementation strategy, highlighting the combination of production factors
needed to implement such a strategy and the functions of all the involved actors (Casadesus-
Masanell and Ricart, 2010). The business model serves as a strategic tool for designing
business activities as well as for a comprehensive, cross-company description and analysis.
The focus on business models allows for a better understanding on how environmental value
62
is captured, turned into profitable products and services, and delivers convenience and
satisfaction to users (OECD, 2012).
Through a comprehensive review of these definitions, Richardson (2008) proposed a
consolidated view of which main elements should compose business models: - Value
proposition. What the firm will deliver to its customers, why they will be willing to pay for it,
and the firm’s basic approach to competitive advantage; - Value creation and delivery. How
the firm will create and deliver that value to its customers and the source of its competitive
advantage; - Value capture. How the firm will generate revenues and profits. According to
Lüdeke-Freund (2010) sustainable business models are models that “create competitive
advantage through superior customer value and contributes to a sustainable development of
the company and society”. The business model approach offers a comprehensive way to
understand how value is created and distributed. Eco-innovation aims to create both economic
and environmental value, and business models act as a value driver and enabler of green
technologies and solutions (OECD, 2012).
Business models implementing the industrial symbiosis practice have been recognized
as sustainable business models, classified under the archetype “create value from waste”
(Bocken et al., 2014). According to OECD (2012), by replacing old business practices,
innovative business models also allow firms to restructure their value chain and generate new
types of producer-consumer relationships, and alter the consumption culture and use practices.
The sustainability of business models oriented to the industrial symbiosis approach stems
from the economic value created for firms simultaneously with the environmental benefits
generated for the society as a whole. In particular, the economic benefits are in the form of
lower production costs or higher revenues. As a result, the competitiveness of the firm can be
increased by implementing such an approach (Esty and Porter, 1998).
Fish residues for fish oil and flour production
Bags from used conveyor belts
Construction material production with gypsum
Beer grains for production of cookies / fodder
Co-product
generation
External exchange
Internal exchange
Industrial Symbiosis based
business
Waste exchange
Waste exchange platform
Used tires used in cement production
63
Fig. 1.21 Classification of business models oriented to the industrial symbiosis
approach
Source: adopted from ZeroWIN (2014), Albino, Fracassia (2015)
Barriers for introducing new industrial symbiosis business models
The barriers within the firm, which intends to introduce radical and systemic eco-
innovations are identified as below (FORA, 2010; Tukker and Tischner, 2004). Moreover, the
promotion of many eco-innovations may also be limited due to several factors external to the
firm (Martin, 2009; Meenakshisundaram and Shankar, 2010; OECD, 2012).
Business model innovation is about the creation or reinvention of a business itself.
Whereas innovation is typically seen in the form of offering a new product or service, a
business model innovation is more about introducing different business strategies offering not
only new value propositions, but aligning its profit formula, resources, processes and partners
to enhance that value proposition and capture new market segments (OECD, 2012).
According to Fraccascia et.al. (2016), when talking of industrial symbiosis its value
proposition is based on resource saving and higher efficiency, key activities are linked with
research and development, it requires a reconfigured network of partners and new expertise as
key resources. With respect to customer aspects, both customer relations and channels require
the establishment of new relationships.
Within the present research the author designs to develop an industrial symbiosis
model, not as it is often historically developed – from an industry district, but using a
currently existing waste management infrastructure element i.e. municipal waste landfill,
which already offers the following main resources: electricity, heat, waste water treatment,
technical water, infrastructure, etc.
Table 1.4Assessment of external and internal barriers
Source: compilation by authorBarrier DescriptionEconomic
High investment costs, lack of capital for initial investmentEconomies of scaleUnsecure marketShortage of capitalIncreased development and production costLack of competencies in R&DDifficulty of new business models to fit in existing systems
Policy Lack of market-pull forcesLow levels of eco-taxes or consumer subsidies or lacking implementation of green public procurement, and a general lack
64
of governmental action and commitment for reform towards green growth
Technological
Lack of horizontality among different functions in a firmMismatch between industriesMaterial non-reusabilityMaterial quantity demandsLack of technical knowledgeComplex processing of by-products prior to reuse
Informational
Limited knowledge on collaboration methodsUncertainty regarding potential benefits
Social Lack of time, resourcesLack of trustTraditional mindset among producers and lack of knowledge on sustainability issuesLack of consumer readiness
After development of the industrial park, a life cycle assessment of the park can be
developed in order to calculate, for example, its carbon footprint – precise CO2 emission
decrease, as a result of cooperation of particular companies on the basis of effective resource
management.
1.5. Research model and research designThis sub-chapter focuses on the development of the research methodology, chosen by
the Author, for the thesis “Ensuring municipal waste management sustainability by
administration of landfill management companies”. This methodology, alongside with
theoretical framework is the basis of the whole research project. After assessing theoretical
framework it is essential to develop a research model, identifying the dependent variable,
which would be further analysed in connection with the independent variables.
As Sekaran and Bougie (2009) state, the dependent variable is the variable of primary
interest to the researcher. It is the one, on which other independent variables have direct
impact on. Analysis of dependent variable will help the researcher to verify the hypothesis.
65
Fig. 1.22 Theoretical Framework Source: developed by the Author
The dependent variable within the research has been formulated as “Industrial
symbiosis, developed using internal landfill resources/by-products”. The Author has
identified three independent variables: waste flow, financial feasibility, PESTLE. These are
the variables that have direct influence on the dependent variable. According to Sekaran,
Bougie (2009), independent variables may influence the dependent variable in either positive
or negative way. And the change in independent variable is to cause a change in dependent
variable. In order to achieve this, four conditions should be met:
(i) both variables should covary;
(ii) the independent variable should precede the dependent variable;
(iii) no other factor should be a cause of the same change of dependent variable;
(iv) logical explanation of the interdependence between dependent and independent
variable.
The variables as well as their sub-factors have been identified as most significant
within present research, although other factors of influence cannot be neglected. The
structured theoretical framework can be observed in the Figure 1.22. Figure 1.23 shows the
relationships and interdependence of the independent variables.
Relationship: PESTLE – Waste flow. This relationship shows, that changes in
economy, have direct impact on waste generation and it’s flow, changes in taxation system
influence the volume of waste landfilled, changes in legislation influence the waste treatment
66
options (implementation of EU Directive, development of waste sorting, re-use, etc.).
Moreover, sustainable development (synergy of environmental, social and economic factors)
influences waste management strategies which has direct impact on waste flow. In general,
change in any component of Sustainable development and PESTLE variable results in the
change of Waste flow variable.
Relationship: Waste flow – Financial feasibility. This is a direct and strong
relationship, it stands for – change of waste generated/treated or landfilled leading to a
momentary effect on the financial feasibility of the landfill management company.
Relationship: PESTLE – Financial feasibility. Changes in PESTLE have an impact on
financial feasibility and it`s ratios, stated in the Figure 1.23, for example, increase in taxation,
gate fees and collection rates may lead to illegal dumpsite and this will affect the overall
feasibility, while the ratios calculated, from the landfill data will be a) lower, than expected;
b) not according to the real situation, as part of waste will not reach the landfills.
67
Fig. 1.23 Interdependence of the independent variables and industrial symbiosis research design Source: by author
Industrial symbiosis, developed using internal landfill resources
IS module1
IS modulen
IS module…
IS module3
IS module2
Landfill as a basis for
industrial symbiosis
Financial feasibility
Waste flow
PESTLE
68
In addition, figure 1.23 shows the moderating variable Landfill as a basis for
industrial symbiosis - which is influenced by all the independent variables and has certain
preconditions such as resource flow, resource volume and attraction of other industries and
thus directly influences the dependent variable Industrial symbiosis, developed using landfill
internal resources. The IS module1 … IS modulen are directly dependent on the flow and
volume of the resources of each particular landfill. In addition, each IS module can use
different resources and share different resources with the other IS modules (for more detailed
description, see Table 3.9).
Table 1.5
Research designSource: by author
Elements of the design Type of research undertaken
Purpose of the Study descriptive
Type of Investigation correlational
Extent of Researcher Interference minimum interference
Study Settings noncontrived
The Unit of Analysis Landfill management company (10 in total)
Time Horizon Longitudinal (2011-2017)
Data Collection Method Primary and secondary data
Summary of the chapter
First chapter of the research was devoted to critical analysis of literature and development of
theoretical framework. The framework is based on theories in strategic management and
decision-making, sustainable business model field. The analysis of theories revealed a
research gap – lack of business management studies concerning sustainable management of
LMCs in the situation when a crucial change of waste management hierarchy took place,
leaving waste disposal as least favourable option. The author concludes that a solution for
landfill management companies has to be found within circular economy and in particular, by
modifying and applying one of its business models – industrial symbiosis.
At the end of the chapter a research design is presented, covering main elements of the design,
identifying dependent and independent variables – which set the framework for the research
presented in the following chapters. Next chapter is devoted to analysis of EU and Latvian
LMCs, revealing number of companies, which face similar sustainable development issues. It
will also present results of the surveys, performed among Landfill and Expert groups.
69
2. ASSESSMENT OF BUSINESS PERFORMANCE OF
LATVIAN WASTE MANAGEMENT COMPANIES AND
IDENTIFICATION OF THE NECESSITY FOR
IMPROVEMENTThe harmonisation of legislation in Latvian with European Union legislation has led to
the fact that Latvia, being a EU member state has to achieve a certain percentage in the
decrease of waste landfilling and increase of waste sorting, preparation for re-use and
recovery. A common legislation framework regarding waste management has been developed
within the European Union, although it is becoming more and more obvious that there is not a
“one size fits all” solution but rather many different mixtures of technologies, institutional
frameworks and policies applied across the European Union. This chapter is devoted to the
evaluation of European and Latvian waste management field, case studies, as well as
identification of potential solutions with the help of the surveys.
2.1. Development of Latvian waste management sector The coexistence of different waste management systems that must achieve the same
results in terms of recycling targets, diversion of biodegradable waste from landfills and waste
prevention is a strong driver towards the development of benchmarking techniques that will
allow a deeper comparison of different systems. Member States apply different waste
calculation methods, the interpretation of statistics varies and there even exists strong
distinction in the interpretation of the definitions (Cudecka-Purina et. al., 2013).
European Environmental Agency (2009; 2010) reports emphasise that waste
management has been a focus of EU environmental policies since the 1970s. In the past waste
management was considered a service to be rendered at the end of a chain of processes
(extraction of raw materials - product design - production - distribution - consumption). It
stands to reason that environmental damage is caused and the disposal capacity of nature is
overtaxed if waste management is approached from this angle where all sectors only try to
optimize their own performance (Vogel, 1997). Waste management also forms part of
environmental economics, also called green economics, which has marked an important
turning point in perception. It applies neo-classical economics to non-market phenomena or
phenomena that are inevitably relevant to society and at least partially have an economic
angle, for example, common resources, public goods, human decision making in a wider
sense (Kennet, M., Heinemann, V., 2006).
Each year in the European Union we throw away 2.7 billion tons of waste, 98 million
tons of which are hazardous. On average only 40% of municipal waste is re-used or recycled,
the rest going to landfill or incineration. In some Member States more than 80% of waste is
recycled, indicating the possibilities of using waste as one of the EU’s key resources.
Improving waste management makes better use of resources and can open up new markets
and jobs, as well as encourage less dependence on imports of raw materials and lower impacts
on the environment (EC, 2011). If waste is to become a resource to be fed back into the
economy as a raw material, then much higher priority needs to be given to re-use and
recycling. Lazarevic et al. (2010) agree that municipal waste management has been
predominantly driven by European waste and natural resource policy, directed by a rationale
of protection of human health and the environment and, more recently, sustainability. This is
aimed at reducing the negative environmental impact of waste management within economic,
technological and social constraints.
The disposal of municipal waste is one of the more serious and controversial urban
issues facing local governments globally. Increasing waste generation due to population
growth, societal lifestyle changes, development and consumption of products that are less
biodegradable, have led to the diverse challenges for MSW management in various cities
around the world (Asase et al., 2009).
Table 2.1
Waste treatment in EU member states since 2004
Source: updated, based on Cudecka-Purina et. al. (2012) and Eurostat
Mun
icip
al w
aste
ge
nera
ted,
kg/
ca
pita
Municipal waste treated in 2011, % Municipal waste treated in 2014, %
Land
fillin
g (D
1-D
7,
D12
)
Inci
nera
tion
(incl
. en
ergy
re
cove
ry)
Mat
eria
l re
cove
ry
Com
post
ing
Mun
icip
al
was
te
gene
rate
d,
kg/c
apita
Landfilling (D1-D7, D12)
Incineration (incl. energy recovery)
Incineration/ disposal D10
Material recovery
Composting
Bulgaria 422 70 - - - 442 69 2 21 2Czech Republic 317 68 16 14 2 310 56 18 23 3
Estonia 311 77 - 14 9 357 6 47 27 5
Croatia 387 80 0 14 2
Cyprus 760 80 - 16 4 615 76 1 13 3
Lithuania 381 94 0 4 2 433 59 9 23 9
Latvia 304 91 - 9 1 364 71 0 21 4
Hungary 413 69 10 18 4 385 57 10 24 6
Malta 591 86 - 7 6 599 85 0 8 0
Poland 315 73 1 18 8 272 53 15 4 21 11
Romania 365 99 - 1 0 249 72 3 5 8
Slovenia 422 58 1 39 2 432 23 0 29 7
Slovakia 333 81 10 4 5 320 67 11 0 5 5
71
The table 2.1 was developed, using data, obtained from Eurostat on waste treatment
within European Union countries, comparing member state progress in 2011 and 2014.
It has to be emphasized that within waste management system there will always be
waste landfills in place as final destination for the waste that cannot be processed in any other
way (even incineration, anaerobic digestion or any other type of recovery activities generate a
certain amount of waste at the output stage that has to be landfilled). EU has set control
numbers to be achieved by the member states. Although how the member states adopt or
modify landfills in order to secure their sustainability, is at each country’s responsibility.
The comparison shows the development tendency of waste management and it can be
noted, that already in four years a range of countries experienced significant improvements in
waste treatment methods. There are two member states, which stand out significantly –
Estonia and Slovenia, which have applied cardinal treatment options, thus leading to notable
decrease in waste disposal. In Estonia’s case the solution was to construct a waste incineration
facility. On the one hand it solved the waste landfilling issue, on the other, it does not
stimulate fulfilment of the 2020 target (50% recycling and recovery rate). In general all
member states currently face an important challenge both with 2020 recycling and recovery
targets and even more with 2030 targets for landfilling.
Fig. 2.1 Ranking of landfills by yearly disposed waste amount
Source: Geo Consultants (1997)
Latvian waste management entered into a development stage in the mid 1990s. That
was the period of regaining independence and it was vital to analyse the country’s economic,
environmental and social problems that are broadly described in Chapter 2 of the present
dissertation. Latvia began its course towards sustainable development from 1995, when a
72
country-wide waste management inventory was performed. According to Cudecka (2007),
Latvian accession to the European Union required harmonization of existing legislation
system with the European system and implementation of a sustainable waste management
system. The inventory revealed 558 operating dumpsites (sub-standard landfills) and over 160
closed dumpsites. The first action was the development of a “500 -” programme – National
municipal waste management system development in Latvia. Followed by it, a Environmental
Protection Policy was released in 1998 and in 2002 - the Strategy for Sustainable
Development of Latvia was adopted.
Figure 2.1 shows the preliminary situation of dumpsite (sub-standard landfill) density
and size in Latvia for the year 1996, when the country-wide inventory of waste management
situation was performed.
According to the report of the Committee on the Environment, Agriculture and Local
and Regional Affairs (2007) proper management of municipal waste is a central pillar of far-
sighted, sustainable environmental policies. Every European generates approximately one kg
of municipal waste a day and the figures show an upward trend. Management of municipal
waste is therefore one of the major challenges currently facing local authorities.
Table 2.2
EU leading members in waste treatment
Source: based on Cudecka-Purina et. al. (2012) and updated
Mun
icip
al w
aste
ge
nera
ted,
kg/
cap
ita in
20
11
Municipal waste treatment in 2011, %
Mun
icip
al w
aste
ge
nera
ted,
kg/
pers
on Municipal waste treatment in 2014, %
Land
fillin
g (D
1-D
7,
D12
)
Inci
nera
tion
(incl
. en
ergy
re
cove
ry)
Mat
eria
l re
cove
ry
Com
post
ing
Land
fillin
g (D
1-D
7,
D12
)
Inci
nera
tion
(incl
. en
ergy
re
cove
ry)
Mat
eria
l re
cove
ry
Com
post
ing
EU 27* 499 34 24 26 14 477 25 27 27 17
Germany 626 0 37 46 17 625 0 31 48 18
Belgium 456 1 41 34 20 418 1 43 31 19
Sweden 449 1 52 33 14 447 1 51 32 16
Netherlands 568 2 49 24 25 523 1 47 23 27
Austria 573 5 35 24 33 560 3 38 25 31* - estimated.
From Tables 2.1 and 2.2 it is seen, that the newer member states have a much worse
situation in waste management, as they are falling behind the EU 15 members in terms of
diverse waste management options. The data shows, that all the countries, which joined EU
since 2004 have a considerably smaller amount of waste generated per capita, which is good
and is also explained by the economic welfare of the countries, this is clearly seen, when a
73
GDP comparison is made. Still, a more detailed study shows, that with an increase of GDP,
the municipal waste generation ratio will increase by 1/3 of GDP.
Fig. 2.2 The causal-loop diagram, with impacts from stakeholders
Source: by author
On the other hand the tables show, that waste treatment (incineration, recycling,
composting) is weakly developed, which is a negative ratio, in 2011 up to 99% of collected
waste was landfilled. Although the situation for 2015 has slightly improved, decreasing the
landfilling percentage to 83. Still, the latest tendencies in Europe show, that landfilling is in
the past and the countries have to focus on resource saving and material recovery. Figure 2.2
provides a causal-loop diagram with the relationship between European regulations, stated in
the Directive on Waste (2008), sustainable waste management and involvement of individuals
into waste management systems. The figure 2.2 shows a relationship and impacts of the main
stakeholders in waste management: European Union, Country and Non-governmental
organizations within the country. It also shows the impact that each stakeholder has on the
system. Each step in the diagram has an impact on the others, for example, adaptation of
European legislation into member state legislation leads to increase in taxation, which has a
direct impact on investments as part of the tax is devoted to the state and part to municipality
(which has landfill on its territory) budget; alongside, it has a direct impact on inhabitants in
the increase of the waste collection cost, which may lead to a) decrease of waste generated;
74
and b) stimulation of sorted waste collection. The system has “+” or “-” next to each bullet,
which allows to understand the interrelations better.
Up to 2011 practically all member states have ensured, that strategic objectives for the
waste sector are established based on the general European Union and member state
environment policies, the main goal of which is to avoid waste generation and promote
recovery, including reuse and recycling. Noteworthy changes in the restructuring of the field
of waste handling included a consistent reduction in the number of sub-standard landfills,
which were not in conformity with environmental requirements, implementation of sorted
waste collection systems and in Estonia – a very successful experience of implementation of
the deposit system for beverage packages (EEIC, 2010).
The table 2.3 shows the situation in the new Member states, in terms of closure and
recultivation of sub-standard landfills and construction of new landfills.
During the study, the author struggled with lack of data and with a lot of
misinterpretations of data. This is why the development of Table 2.3 was impossible to base
only on CEWEP or Eurostat data.
Table 2.3
Sub-standard landfills in analysed member states Source: Cudecka-Purina et. al. (2012)
Country Area, km2 Inhabitants, mln. No. of sub-standard landfills3 No. of landfills
Bulgaria 110,910 7,621,337 2500 56
Cyprus 9,250 800,000 120 4
Czech Republic 78,866 10,674,950 1270 237
Estonia 45,226 1,415,680 351 10
Hungary 93,000 10,075,000 2670 53
Latvia 64,589 2,366,500 565 11
Lithuania 65,200 3,601,140 800 11
Malta 316 400,000 3 1
Poland 312,685 38,625,480 998 200
Romania 238,391 22,303,550 7686 65
Slovakia 48,845 5,422,370 8000 71
Slovenia 20,273 2,048,850 60 15
Table 2.3 shows that extensive work has been done in the field of waste management,
mainly with the use of European Cohesion Fund and ISPA co-financing. It also shows the
correlation between inhabitant density and number of sub-standard landfills. For example, in
Latvia in 1995 there were 4480 inhabitants/sub-standard landfill and in 2010, the number
3 A sub-standard landfill is a dumpsite, which does not meet requirements of a landfill.
75
reaches 200,000 inhabitants/landfill. In Poland, there were 38,702 inhabitants/sub-standard
landfill and now the number is 193,129 inhabitants/landfill. This leads to the conclusion, that
the new system is focused on use of developed infrastructure in a more economically effective
and environmentally efficient way. Table 2.3 also shows, that within EU’s newer member
states there are at least 700 LMCs, which are facing sustainable development problems due to
significant limitation of waste flow for disposal, compared to initially forecasted in the
technical-economical justification.
Economical instruments in selected European member states
To comply with the provisions of the Landfill Directive, countries have introduced
various measures to increase the cost of landfilling. The increasing gate fees mainly result
from rising technical standards for landfills and implementation of the principle that gate fees
should cover all costs involved in the setting up, operation and closure of landfills. This study
finds that to be effective landfill tax rates should be relatively high, although in Estonia rapid
increases to a relatively low landfill tax have achieved a similar effect (EEA, 2009).
The Tax is a levy, charged by public authorities for disposal of waste in a landfill site.
The revenue from the tax, for example in Latvia is 60% to local authorities and 40% to the
state budget.
Swed
en
Germ
any
Belguim
(Fl)
Italy
Belguim
(Wall
.)
Poland
United K
ingd
om
France
Spain
Lithuan
ia
Hungary
Greec
e
Portuga
l
Ruman
ia0
20
40
60
80
100
120
140
160
Gate fee (typ-ical)
Landfill tax
Fig. 2.3 Total costs for landfilling in EU-27, Eur/t, 2013
Source: by author, based on CEWEP (2011) and EC (2012) data
Gate fee – is a charge, set by landfill operator, at the entrance, calculated by waste
weight. The charges are developed to cover the costs and profit of landfill operator. This cost
varies not only in European countries, but also within one country, as the costs mainly depend
on the amount of co-financing (whether loan, credit line or local financing) used, for landfill
construction and operation costs.
76
The table below provides information on the taxes and gate fees in the European
Union. From Figure 2.3, it is clear that the member states (excluding Slovenia and Poland)
analysed have the total costs for landfilling ranging from the lowest at 2% to the highest -
40% in Sweden (€155.5).
According to the report of the European Commission (DG ENV, 2012; BIPRO, 2012),
the level of taxation ranges very widely, and some countries levy no tax. Among the countries
with taxes, the taxes vary from €3 per ton in Bulgaria to up to €107.49 per ton in the
Netherlands. The total cost of disposal to landfill in the EU appears to range from €0.33 in
Slovakia to up to €155.50 in Sweden.
Figure 2.3 shows, that all member states, excluding Poland and Slovenia have a
considerably small charge for waste landfilling. Still, compared to the gate fees in force 10
years ago, the rates have increased up to 500% (Estonia case). Figure 2.5 provides a
comparison of current trends in the legislation on waste disposal rates of Latvia, Estonia and
Lithuania. It can be concluded that the three Baltic countries are experiencing a major shift in
waste disposal tax rate volume.
2016 2017 2018 2019 20200
10
20
30
40
50
60
Waste disposal NRT rate for waste disposal tendency
Lithuania plannedLithuania currentLatviaExponential (Latvia)Estonia
Fig. 2.4 Waste disposal NRT rates in the Baltic countries, Eur/t
Source: by author
It has to be pointed out that Figure 2.4 provides data on the countries for the end of
2016, although, in Lithuania, due to changes in the government, the proposed increase of
landfill tax have been not approved and the landfill tax has been decreased to 3 Eur/t.
Although, it is foreseen that this situation will improve within the upcoming years, at least due
to the fact that Lithuania is planning to introduce an MBT tax, which is foreseen to be at least
24 Eur/t and from a waste management hierarchy perspective, waste disposal tax has to be
77
higher than other treatment options. The Figure also depicts the current rates and the increase
up to 2020.
The gate fees and waste disposal tax do not stimulate the waste management
companies to collect sorted waste to the desired extent, as it requires infrastructure (waste
containers), land (where the sorted waste areas would be located), special transport and
storage areas. Still, the fee and tax cannot be increased to the level of other member states
instantaneously, as this will only lead to illegal dumping and to the fact, that no waste will be
transported to landfills. This means, that the member states have to implement the progressive
rates and to use them alongside with popularization and implementation on the individual
involvement level of the three R strategy – Reduce, Reuse and Recycle.
When turning to inhabitants and their economic motivation and involvement into the
waste management system, Figure 2.5 vividly depicts the total expenditures per household,
including for waste management.
electricity consumption6.4% waste
manage-ment0.7%food and beverages
25.3%
alcohol & tobacco3.5%
clothing & shoes5.9%healthcare
5.8%transport
10.0%
communications5.0%
leasure & culture7.0%
education1.9%
restaurants, cafes, hotels3.9%
goods & services6.0%
household (water, gas and other fossil fuels)
14.3%
household equipment4.3%
Fig. 2.5 Household consumption expenditure structure, (% per capita/annum)
Source: adopted from CSB, 2015
Latvian National Development Plan 2014-2020 (2012), being hierarchically the
highest national-level medium-term planning document, is closely related to the Sustainable
Development Strategy of Latvia until 2030 (Latvia 2030) and the National Reform
Programme for the Implementation of the EU2020 Strategy. The Plan sets two main goals
within environmental protection and waste management:
1. Maintenance of the natural capital as the basis for sustainable economic growth and
promote its sustainable uses while minimizing natural and human risks to the
quality of the environment;
2. Sustainable use of cultural capital resources.
78
Highlighting also Individual measures to be carried out within the Strategic Objective:
Waste sorting and processing of waste sorted at collection (Target area: entire Latvia).
Institution, responsible for this objective is – Ministry of Environmental Protection and
Regional Development of Latvia and local governments, with financing foreseen from
Cohesion Policy funds and private funding.
As stated already in the Introduction, for the current planning period 2014-2020,
Latvia is able to receive over 41 million Euros with a 35% support rate. According to the
Ministry of Finance developed Action programme “Growth and employment” (2014) this
financing can be devoted to development of sorted waste collection, including sorted waste
collection points and areas, alongside with vehicles for management sorted waste collection
routes for door-to-door collection (the vehicles can be used only for this purpose), increase of
waste recycling and recovery volumes, including composting of biodegradable waste and
anaerobic digestion. The summary of the activities, financing and outcomes is provided in the
Table in Annex 8. The goals to be achieved with financial support are:
Volume of waste for recycling and recovery in 2022 has to reach 59% of total waste
generated. For comparison, this ratio in 2013 was below 20%. This status quo,
currently negotiable, can lead to an exemption for Latvia, providing a lower target.
Nevertheless, the recycling and recovery rates are considered to be very challenging,
taking into account the current situation of Latvia’s waste management system.
Increase of waste recycling capacity for 172 000 t/annum with recycling facilities.
In comparison with previous planning periods, it has to be concluded, that this period
receives the lowest percentage of financial support from the Cohesion Fund. The industry and
experts see it as a very negative factor, doubting if this support will facilitate reaching the
2020 targets.
2.2. Regional approach to Latvian waste management, as a decision making process
Currently Latvia is divided into 10 waste management regions (see Figure 2.6), each
having its own infrastructure (sanitary landfill for municipal waste, sorted waste collection
points and areas, sorting stations, reloading stations, etc.) and an inter-municipality landfill
management company, which is managing the region’s landfill.
According to the National waste management plan 2006 – 2012 and National waste
management plan 2013-2020, the Republic of Latvia is divided into 10 waste management
regions: Austrumlatgale, Dienvidlatgale, Liepaja, Maliena, Piejura, Pieriga, Ventspils,
Vidusdaugava, Zemgale and Ziemelvidzeme regions.
79
Fig. 2.6 Latvian waste management regions and landfills. Source: VARAM (2016)
The regions have been determined in order to be able to ensure positive development
of waste management system in Latvia, developing infrastructure for waste disposal that is in
accordance with environmental requirements. In addition this allows for efficient use of
available local resources and attraction of EU funding. Table 2.4 shows that the regions vary
by their quantitative characteristics – covering from 3.6% up to 31.8% of Latvia’s population.
This, alongside with inhabitant density per km2, has a direct impact on each region’s financial
efficiency. Currently, taking into account that the number of inhabitants has decreased and
according to the latest data of CSB in 2016 accounted for 1 953 000 inhabitants, these
proportions have even more significant impact on region efficiency.
When analysing municipal waste generation in Latvia for the time period from 2006 to
2015, it can be seen that until 2011 the waste volume had a decreasing tendency, although
after 2012 an increase can be observed. A similar tendency is observed when analysing the
generation of municipal waste per capita (despite constant decrease of number of inhabitants).
Historically Latvia’s waste management was focused on landfilling. Annually 670 000
- 700 000 tons of municipal waste are generated, of which 500 000 tons are disposed on
landfills, which results in 71% from the collected waste amount. Latvia currently has in
operation 11 landfills for municipal waste, 1 for hazardous waste and 1 for asbestos waste.
Table 2.4
Characteristics of waste management regions
80
Source: State waste management plan 2013-2020Region/ Company name Territory,
km2% from territory
Inhabitants % of inhabitants
Austrumlatgale/ ALAAS 5760 9% 93 680 5%Dienvidlatgale/ AADSO 6927 11% 187 000 9%Maliena/ AP Kaudzītes 7417 11% 75 040 4%Ventspils/ VLK 4047 6% 73 300 4%Liepāja/ Liepajas RAS 6801 10% 156 130 8%Rīga, Pierīga/ Getlini EKO 4299 7% 892 960 43%Piejūra/ AAS Piejura 5895 9% 141 420 7%Zemgale/ Zemgales EKO, JKP 5177 8% 174 265 8%Ziemeļvidzeme/ ZAAO 11372 18% 167 040 8%
Vidusdaugava/ Vidusdaugavas SPAAO 7707 12% 109 530 5%
Total 64589 100% 2 070 365 100%The volume of landfilled waste in 2015 was 514 000 t, which is 2% less than in 2014.
The main reason for this decrease is the development of a sorted waste collection system,
which affects the volume of unsorted waste that reaches the landfill. The impact on the waste
generation volume is also provided by the decrease in number of inhabitants.
The entire Latvian waste management infrastructure (except for the largest landfill in
Riga city) was financed from ISPA and Cohesion Fund, with co-financing from 65% to 85%
of the referral costs. It has been summarized that up to 2011 overall public investments into
the waste management field reached almost 100 million Euros (covering two most
financially-intense planning periods 2000-2006 and 2007-2013). Although, it is vital to
mention, that the preliminary calculations were based on assumptions of constant economic
development and number of inhabitants. Due to the global recession both variables due to
their dependency on economic prosperity - have changed, but this did not impact on the on-
going projects in waste management field (Cudecka, 2007; Cudecka-Purina, 2011). This
particular fact continually influences the economy of waste landfills, as it was foreseen that
with growing GDP and population, the volume of disposed waste will grow as well, but
currently it shows an inverted trend.
The planning period 2014 – 2020 is not being analysed, as 1) it is still in progress, 2)
the key waste management infrastructure in terms of landfills and recultivation of sub-
standard landfills is not covered by the current period. The investment amount excludes
investments into the Riga region, as they have been obtained from different sources; all other
projects were co-financed from EU ISPA and later Cohesion fund. It is clearly seen, that
without European Union financing, these projects would not be feasible, as Latvia has faced a
variety of problems for financing all these projects, taking into consideration, that the State
81
co-financing was only 34%. Though, it is vital to mention, that none of the projects would be
financed if their financial NPV (FNPV) resulted > 0 with only local financing, as this is
European Policy, to finance those projects, which are necessary to society, but cannot be
viable with local financing.
Table 2.5
Proportion of EU and Latvian investments into waste management field until 2012.
Source: Cudecka (2011b)
Region/ Company name
Overall investments, EUR
% CF financing
CF financing,
EUR
% Latvian financing
Latvian financing,
EURAustrumlatgale/ ALAAS
5 830 150 75% 4 332 370 25% 1 497 780
Dienvidlatgale/ AADSO
6 905 580 65% 4 488 630 35% 2 416 950
Maliena/ AP Kaudzītes
9 155 890 65% 5 925 430 35% 3 230 460
Ventspils/ VLK 6 065 750 49% 2 972 220 51% 3 093 530Liepāja/ Liepajas RAS
8 084 910 63% 5 093 500 37% 2 991 410
Rīga, Pierīga/ Getliņi EKO
$25 210 000 0% Financing of World Bank, Sweden, WEFF, Riga City, Beneficiary
Piejūra/ AAS Piejura
23 778 140 67% 15 951 630 33% 7 826 510
Zemgale/ Zemgales EKO, JKP
8 852 910 70% 6 147 880 30% 2 705 030
Ziemeļvidzeme/ ZAAO
8 063 910 75% 6 031 740 25% 2 032 170
Vidusdaugava/ Vidusdaugavas SPAAO
19 924 150 65% 12 925 520 35% 6 998 630
Total (excl. Rīga) 96 661 380 66% 63 868 800 34% 32 584 580
Previous research within the Master thesis of the author revealed that some regions show
negative efficiency ratios (see Table 2.6). In order to perform feasibility analysis, the author
referred to EU Guide to Cost-Benefit Analysis of Investment projects (2008) and, using it as a
ground to ex-ante feasibility analysis, has performed ex-post feasibility analysis. For this, the
author had to calculate cash flows for regional projects for 25 years and to calculate three
main ratios: Net Present Value, Internal Rate of Return and Cost/Benefit analysis.
The calculated cash-flow of each region is a forecast, with data, obtained from the
author`s previous survey for LASUA (Latvian Association of Waste Management
Companies), which was used as a basis and the author`s developed projections on waste
amount generated (taking into consideration changes in number of inhabitants, changes in
82
waste generation, economic and GDP aspects, EU directive and regulation requirements on
sorted waste collection, change in disposal rate and operating costs).
Table 2.6
Results of the Cost/Benefit analysis
Source: Cudecka 2011aA
LA
AS
AA
DSO
AP
Kau
dzite
s
VL
K
Lie
paja
s RA
S
Get
lini E
KO
AA
S Pi
ejur
a
Zem
gale
s EK
O
ZA
AO
Vid
usda
ugav
as
SPA
AO
NPV 650675
336196
-5333371
811691
8291935
1812871
-12436954
-4820129
3468664
-8345850
IRR
6,44% 5,5% -3,35% 6,39% 12,65% 5,44% -1,20% -1,31% 9,17% -0,42%
C/B 1,21 1,12 0,83 1,28 1,48 1,17 0,91 0,95 1,29 0,97
The abovementioned analysis already in 2011 leads to an important discussion on
region efficiency and the author raised doubt regarding the appropriate development approach
chosen. In order to avoid this negative result one of the conclusions was in support of the
necessity for region unification in order to shift from ineffective to economically effective and
practically efficient. When uniting the regions, it could also become more attractive for waste
management companies to operate there, as the regions would be larger with a higher
inhabitant density and there would be less necessity for price dumping and situations would
not occur whereby a waste management company, which is operating in another region finds
it more economically effective to dispose waste in the landfill of the neighbouring region.
According to Cudeckis, Cudecka (2009) two parallel and different projects for division of
territory of the country at the same period of time took place. The result of these reforms was
two different approaches to division of country’s territories and significant mismatches (i.e.
one parish or municipality within one reform corresponds to one region, although according
to another reform – to a neighbouring region). In case the administrative-territorial reform
would have finished faster (despite preliminary plans to accomplish the reform in 2004, it
finished in 2009), the amalgamation of the regions could be achieved much earlier (Cudecka,
2011a). At the time, when the administrative-territorial reform took place, the Ministry of
Environment and Ministry of Regional Development and Local-Governments were two
different institutions, this is another possible explanation, beside time frame, why the
administrative-territorial reform did not take into consideration the waste management regions
determined by the Ministry of Environment at the time.
83
It is essential to mention that, despite negative experience with the previous reform,
currently, in 2016 the Ministry of Environmental Protection and Regional Development
submitted a new administrative-territorial reform concept. One of the Ministry’s proposed
options foresees the development of 49 districts and 9 republic-level cities. A second
alternative includes forming 29 cooperation areas, developed around national and regional
development centres. It has to be emphasized, that despite the fact both administrative
territorial reform and waste management issues are in the competency of one Ministry, these
two policies are not considered together, as this new concept will also foresee mismatching of
waste management regions and districts or cooperation areas.
Back in 2011, when the author analysed the existing waste management situation, a
new possible cost-effective scenario was developed within her research, which required
unification of Maliena and Vidusdaugava regions as well as Ventspils and Piejura regions.
This unification would lead to improvement of NPV to 1 546 830 and 3 509 496, as well as
IRR 5,66% and 6,30% and Cost/Benefit proportion of 1,32 and 1,39, respectively. This
assumption leads to the conclusion that the rates for waste disposal will tend to increase, as
the amount of waste disposed has to decrease. The rate increase is an obstacle in regards to
the ability of inhabitants to pay for expensive services. This is why, the author suggests, that it
would be logical to unite regions and use the basis of existing landfills to implement
horizontal and vertical integration, i.e. implement composting, waste sorting, pre-treatment of
reusable materials, energy production (electricity and domestic heating) and even possibly
production.
When going beyond the research of 2011, the author develops the idea of horizontal
and vertical integration into a concept of industrial symbiosis. This is mostly explained by the
fact that eventually less waste will be reaching the landfills and the activities such as sorting
and even pre-treatment might be kept to a minimum. As methane has a very continuous life-
cycle (even after no additional waste is being disposed at the landfill) and especially taking
into account that Latvian landfills still have a significant proportion of biodegradable waste
being disposed there, methane collection followed by production of heat and electricity will
bring long-term opportunities for landfills.
2.3. Specifics of Latvian landfill management companies The main institution in the waste management system is – Ministry of Environmental
Protection and Regional Development. According to the Law on Waste Management, this
Ministry is in charge of policy planning, supervision and coordinating functions. The Ministry
has subordinate institutions:
84
Latvian Environment, Geology and Meteorology Centre (in charge of hazardous waste
management and waste management statistics);
Administration of Latvian Environmental Protection Fund (until 31.12.2016 in charge of
exemptions from Natural Resources tax, starting from 2017 will be in charge mostly for
environmental projects);
State Environmental Service (ensures the compliance of implementation of legislation
framework in the area of the environment and natural resources protection, and control on
radiation and nuclear safety, starting from 2017 it will be in charge of exemptions from
Natural Resources tax).
Section 12 of the Waste management law determines that collection, sorting, storage,
accumulation, handling, disposal or recycling of waste is allowed only in specially designated
areas.
Latvian municipalities are liable for organizing waste management within their
territories. According to the Law, municipalities:
1. organise the management of municipal waste, including municipally generated hazardous
waste, in conformity with the binding regulations of the local government regarding
management of municipal waste, taking into account the State waste management plan
and regional plans;
2. take decisions to place new municipal waste collection, separate collection, sorting,
preparation for recycling and recovery or disposal facilities and infrastructure objects, as
well as landfill sites within the administrative territory thereof according to the State
waste management plan and regional plans;
3. issue binding regulations regarding the management of municipal waste within the
administrative territory.
Municipalities are obliged to follow public procurement procedures in order to choose
a waste management company for collection of municipal waste, sorted waste and in some
cases also construction and demolition waste. Other types of waste management companies
can offer their services within a municipality’s territory without any additional contracts,
working directly with legal entities or private persons.
When analysing waste management companies, which are operating in Latvia, the
following types of companies can be identified: municipal waste collection companies – both
municipal and private companies, operating across Latvia (a contract with municipality is
required, based on the results of public procurement); construction & demolition waste
collection companies, operating across Latvia (a contract with municipality is required, based
on the results of public procurement); hazardous waste collection companies, operating across
85
Latvia (no particular contract with municipality required); waste management intermediaries
(extended producer responsibility companies), operating across Latvia (no particular contract
with municipality required); waste recycling companies, operating across Latvia (no particular
contract with municipality required); landfill-management companies – municipal companies,
operating in particular waste management region. It has to be mentioned that, apart from
landfill management companies, all other types of companies vary by number annually. In
addition, the waste management sector has extended producer responsibility companies, like –
“Latvijas Zaļais punkts”, “Zaļā josta”, “Latvijas Zaļais Elektrons”, “Zaļais Centrs” and
“Nordic Recycling”. These companies are engaged in developing waste collection schemes
for packaging waste, and offering tax exemptions from natural resources tax for the
companies working in Latvia.
Waste management also includes a range of non-governmental organizations –
associations, advisory boards, etc. Two most notable waste management associations in
Latvia are:
LASA (Latvian Waste Management Association), established in 1994, with its
members: municipalities, scientific and research institutions, engineering
organizations, higher educational institutions, enterprises and companies involved
in waste management: in the research field, elaboration of relevant projects,
providing expertise, waste processing, utilization and recycling, and training of
professionals for municipal, industrial and other unused raw material, including
hazardous waste management (LASA, 2016).
LASUA (Latvian Association of Waste Management Companies), established in
1996, gathers both public and private members: professional companies engaged in
management, collection, depositing, processing, handling, disposal of municipal
and hazardous waste and removal of industrial waste, etc.
This short insight into the waste management field shows that the field has a variety of
players on the market, but within the present research, the author choses to analyse the
“landfills” – i.e. landfill management companies, which are municipality owned (inter-
municipality, to be precise – as each waste management region has only 1 landfill site and its
management company is owned by all the municipalities, that are covered by a particular
region). One precondition for EU ISPA/Cohesion Fund support was to have a LLC, which
would include all the municipalities of the region, as these municipalities would also have
their liabilities within the project. It has to be noted, that waste management regions differ
from administrative (statistical) Latvia’s regions – which also brings a degree of complexity
to the system, making it more difficult to benchmark the economic, social and managerial
86
aspects. Waste management in each region is also slightly different –landfill management
companies and a number of their owners are described in able 2.10. Landfill management
companies are regulated by the State Revenue Service and its issued A category pollution
permits. The Public Utilities Commission regulates the operation of landfill management
companies, in accordance with Article 39 of the Waste management Law. The Public Utilities
Commission approves the waste disposal tariff.
The main activities of a landfill management company include but are not limited to:
weighting and registration of incoming waste flow; waste sorting, preparation for recycling,
reuse or recovery; waste temporary storage; landfilling (including all management aspects of
a landfill cell); composting of biodegradable waste; management of leachate; management of
biogas; production of electricity and heat; environmental state monitoring; management of
landfill infrastructure objects and educational activities. The graphic illustration of a
simplified waste flow in a landfill is depicted in Figure 2.7.
Fig.
2.7 Schematic waste flow within landfill management company. Source: by author
Regional efficiency, which has already been slightly tackled in this chapter, is also
depicted in Figure 2.8. It shows that there are landfill management companies, disposing
below 4% of total waste generated in the country. Taking into consideration that the total
volume of waste is to be decreased over the years, this also raises a question of economic
efficiency of the regions. Moreover, this graphical assessment stresses the importance of the
research and the emerging problem – sustainable development of smaller landfill management
companies.
Management CompanyLandfill cellStorage areaComposting
Household hazardous waste
Recyclable
Non-recyclable
For landfilling
For export (secondary materials)
For compost
Waste acceptance area from inhabitants Weighting-registration area
Incoming waste flow
87
56%
7%6%
6%
6%4%
3% 3%6%
2%1%
Getlini EKO
AADSO
AAS Piejura
Liepajas RAS
ZAAO
Vidusdaugavas SPAAO
ALAAS
VLK
Zemgales EKO Grantini
Zemgales EKO Brakski
AP Kaudzites
Fig. 2.8 Volume of disposed waste in landfills, 2015. Source: LVĢMC, 2016
Table 2.7 shows that from total number of 110 municipalities and 9 cities, the landfill
management companies cover 81 municipalities and cities. The remaining 38 municipalities
are using the developed infrastructure, but they practically have not participated financially in
its development. Mostly this situation is explained by the fact, that in the mid 2000s, Latvia
was divided in 12 waste management regions, although due to a range of bureaucratic, social
and other issues, two regions have not been created and their territories have been distributed
among the existing regions. From Table 2.7, it is also clear that the companies differ by their
activities according to NACE classification. Since these differences do not provide a realistic
picture of the activities undertaken by the companies, the author has included this question
into the questionnaire (Annex 3) and on the basis of the responses has developed an allocation
of the companies based on their daily operations. As it was mentioned previously, the volume
of disposed waste decreased from 2014 to 2015, simultaneously, the total turnover of all
landfill management companies increased in 2015 for 9%, reaching 10.1 million Euros
(SPRK, 2016). Increase in turnover is mostly explained by the fact that four companies
starting from the second half of 2014 have started operating with a new disposal tariff,
approved by the Commission, which are based on de facto waste disposal costs and disposed
waste volume.
88
Table 2.7
Characteristics of landfill management companies
Source: by authorType of compan
y
Name of company Year establishe
d
No. of Participants
(cities, municipalities
)
Landfill address NACE codes Volume of
disposed waste in
2015Ltd. ALAAS 2002 7 Landfill „Križevņiki”, „Križevniki 2”, Križevņiki,
Ozolaines parish, Rezeknes district38.21; 38.11 16 265
Ltd. Atkritumu apsaimniekošanas Dienvidlatgales starppašvaldību
organizācija (AADSO)
2002 9 Landfill „Cinīši”, Demenes parish, Daugavpils district 38.11 43 847
Ltd. AP Kaudzītes 2002 5 Landfill „Kaudzītes”, Litenes parish, Gulbenes district 37.0; 38.1; 38.2; 38.21; 38.3
7 034
Ltd. Getliņi EKO 1997 2 Landfill „Getliņi”, Rumbulā, Stopiņu district 38.21; 01.1; 35.11; 33.12; 33.14; 33.13
306 011
Ltd. Liepājas RAS 2000 3 Landfill „Ķīvītes” Grobiņas parish, Grobiņas district 38.21 30 476MLdt. Ventspils Labiekārtošanas
kombināts1994 1 Landfill „Pentuļi”, „Jaunpentuļi",Vārves parish,
Ventspils district38.11; 38.21; 37.00; 38.1; 42.11; 81.30; 96.03; 42.21; 55.30;
02.2
16 010
Ltd. Vidusdaugavas SPAAO 2005 15 Landfill „Dziļā vāda”, Mežāres parish, Krustpils district 38.21 18 934Ltd. Atkritumu apsaimniekošanas
sabiedrība Piejūra2001 9 Landfill „Janvāri” Laidzes parish, Talsu district 38.11; 38.21 37 895
Ltd. Zemgales EKO 2009 2 Landfill „Grantiņi”, Codes parish, Bauskas district 38.11; 38.21; 38.2; 39
8 191
Ltd. ZAAO 1998 28 Landfill „Daibe”, „Stūri”, Stalbes parish, Pārgaujas district
38.11 26 516
Ltd. Jelgavas komunālie pakalpojumi* 2016 2 Landfill „Brakšķi” (II.turn, 3rd and 4th sectors)*, Līvbērzes parish, Jelgavas district
38.11 9 900
*- Ltd. „Jelgavas komunālie pakalpojumi” has started operation in landfill “Brakšķi” II. turn 3rd and 4th sectors, after closure of I. turn of the
landfill on April 1, 2016.
89
EU Directive 1999/31/EK on landfills foresees that, until 2020, the disposable volume
of biodegradable waste has to decline to 35% of the volume of disposed biodegradable waste
in 1995. In order to ensure this target, landfills are equipped with mechanical pre-treatment
facilities, where biodegradable waste is being diverted from the flow, thus decreasing the
disposed volume. Landfill management companies have had significant investments in
technological equipment as well, which ensures further recycling or regeneration of
biodegradable waste, ensuring that waste is being put back into economic turnover. With the
help of pre-treatment facilities, materials that can be re-used are sorted out, thus ensuring the
sustainable use of the resources. The investments of the landfill management companies can
be paid back only through tariffs, which leads to a conclusion that in this waste management
regulated field a constant increase of the tariff is a normal path of development.
Economic gears that are applied in regulation of waste landfilling are waste landfilling
tariff and Natural resources tax on waste landfilling. Increase of waste landfilling tariff
compensates the decrease of landfilled waste volume, landfill management companies have
this tariff as their main revenue source. On the other hand, increase of Natural resources tax
on waste landfilling creates a stimulus for waste management companies to seek alternative
waste treatment options to waste landfilling – i.e. to improve waste sorting and to decrease the
volume of waste for landfilling. Although, it has to be understood that increase of both tariff
and tax cannot be infinitive and tariff increase is not a solution for sustainable development of
a LMC. Figure 2.9 represents the current rate of waste disposal tariffs. The orange columns
are the tariffs that are currently being evaluated by the Public Utilities Commission. Tariffs in
following landfills: Križevnieki, Pentuļi, Brakšķi, Daibe, Getliņi, Dziļā vāda already include
waste pre-treatment costs. Some rates have increased by 55% in 2016. Minimum rates for
waste disposal in 2016 were 19.38 Eur/t, Ventspils labiekartosanas kombinats up to 32.16
Eur/t in Vidusdaugavas SPAAO, or in percentage - the difference reaches 60%.
It is important to point out that the Commission regulates only one component from
the total cost for waste collection service, which is in possession of landfill management
companies. Other cost components are added by waste collection companies.
According to Article 39 of the Waste management law, waste management costs for
inhabitants comprise of the following three components:
a. the payment for the collection, transport, reloading, sorting, and other
activities, set in the legislative regulation, which are undertaken prior to
recovery and which decrease disposable waste value, storage, maintainance of
separate waste collection, sorting and reloading infrastructure objects in
90
compliance with a contract which has been entered into by and between the
local government and the waste manager;
b. the tariff for the municipal waste disposal in landfill sites, which has been
approved by the Public Utilities Commission;
c. natural resources tax for disposal of waste in the amount specified in laws and
regulations (Waste management Law, 2016).
AADSO (C
inisi)
ALAAS (Kriz
evniek
i)
AP Kaudzit
es (Kau
dzites)
Getlini E
KO (Getl
ini)
JKP (Brak
ski)
Liepaja
s RAS (
Kivites)
Piejura
(janvari
)
Vidusdau
gavas
SPAAO (d
zila V
ada)
VLK (Brak
ski)
ZAAO (Daib
e)
Zemgal
es EKO (B
raksk
i)
Zemgal
es EKO (G
rantin
i)
0
10
20
30
Waste disposal tariffs, Eur/t
2015 2016
Fig. 2.9 Waste disposal tariffs in landfills in 2016, Eur/t
Source: by author
The abovementioned means, that waste collection service is extremely complex, for
example current double increase of Natural resources tax for disposal results in a slight
increase (+11,2%) of the overall cost for the service.
One aspect of the current regulatory system has to be especially emphasized - in
accordance with the Public Utility Commission’s decree No. 1/5, from February 16, 2017
“Municipal waste disposal tariff calculation methodology”, articles:
“11. The merchant accounts and together with tariff project submits an overview on
revenues and expenditures, linked to other types of income from landfill use, including from
sale of biogas, electricity and heat, use of land, buildings and technologic equipment, not
including expenditures and revenues for sorted recyclable waste sales. Merchant decreases the
tariff project forming expenditures for the revenues, which are directly or indirectly obtained
from use of landfill infrastructure.
91
12. Merchant decreases expenditures included in the tariff for the revenue part,
obtained from sales of sorted recyclable waste, decreasing the incomes for expenditures of
sorted recyclable waste preparation for sale.”
These provisions are beneficial for the inhabitants, as the income, gained by the
landfill management company decreases waste disposal tariff and as a consequence – waste
collection cost for the inhabitants.
Within the boundaries of the present research, the author has identified problems that
are faced by landfill management companies.
1. Inhabitants receive an economic benefit for the work that is not done directly or
indirectly by them, in other words – inhabitants are not being motivated to engage
in a waste sorting system or waste prevention programme. This is mostly due also
to the fact that current fiscal instruments are considerably low and the inhabitants
do not feel significant change in the payment with or without waste sorting.
2. Landfill management companies are not interested in diversification or developing
industrial symbiosis on their basis as long as these activities will lead to decrease of
waste disposal tariff.
3. Overall waste management system requires significant re-design. For instance,
according to Article 28 of the Law on Natural Resources, tax payments are
distributed between State budget (40%) and special environmental protection
budget of such local government in the territory of which the relevant activity is
performed (60%). Municipalities can use this income only for environmental
activities, thus, it has to be specified, that these activities are not limited to waste
management, and 40% of the revenues that come into State budget are not directly
devoted to environmental issues. In fact, only a small part of the revenue is assessed
by the Latvian Environmental Protection Fund, which offers financing for
environmental issues-related projects and the other part of the revenue is managed
by the Ministry of Finance. A more political obstacle is that it is quite complicated
to explain that Natural Resources tax is not a fiscal instrument but its increase in
rates has to stimulate resource efficiency and a circular economy.
4. Another legislative issue is that Natural Resource Tax for landfilling of all waste, of
a particular region is paid only to the municipality on which territory a landfill is
situated, which puts other municipalities in quite unfair conditions and the revenues
from NRT cannot be currently distributed among a region’s municipalities.
5. Landfill management companies, being municipality-owned are set into
unfavourable market conditions. For example – Getlini landfill uses its electricity
92
and heat to produce tomatoes, which are further sold to local supermarkets. The
main problem with this activity is the product price. According to the regulation set
in the Public person property expropriation law (adopted by the Saeima – Latvian
Parliament - on December 3, 2002), a public entity has to undertake the
expropriation procedure, choosing the party, which offers the highest price for the
products offered by the entity. This is also developing a situation, whereby
inhabitants do not understand why the price of the same products, offered by
Latvian and foreign producers vary up to 3 times.
The abovementioned issues currently are very strong barriers for the landfill
management companies to get involved in industrial symbiosis activities and thus in the
promotion of the circular economy. This is why the author sees that it would be necessary to
conduct a revision and improvement of present legislation, which would expand landfill
management company’s rights to manage secondary resources and infrastructure in an
effective manner, in order to develop a industrial symbiosis model on a landfill basis.
In order to assess landfill management companies, it is essential to apply a range of
key performance indicators. These indicators are going beyond profit and allow seeing,
whether the company is on the right development direction for the long-term.
The indicators that need to be evaluated are:
1. Difference between received volume of Natural Resources Tax for waste disposal
by the waste management company, which brought waste for disposal and paid Tax
for disposal by a landfill management company. This indicator shows whether the
landfill has additional sorting or pre-treatment facilities and is able to generate
income from the waste, entering the landfill prior to landfilling. Although, this
indicator can be misleading in situations, when waste entering the landfill is already
pre-treated.
2. Operating time. As it can be seen from Chapter 2, landfills are normally designed
for 20-30 years of operation. Although, taking into account the changes in the waste
treatment priorities and potential environmental pollution, landfill management
companies must redesign their work in order to ensure prolonged use of landfills.
3. Environmental safety. Taking into consideration the fact that landfills possess
potential harm to the environment and the key pollutant is “waste”, any activities,
different from disposal have to be undertaken considering environmental and
healthcare protection.
In addition, WRAP (2014) has developed a set of KPI’s for waste management, which
are represented in Table 2.8. These indicators are mostly not for landfill management
93
companies, but for the landfills themselves, although they can be applicable within the
boundaries of the current research. The author has adopted the key performance indicators
from Table 2.8 and has applied them to landfill management companies. Table 2.9 provides a
summary of the results.
Table 2.8
Key performance indicators in waste managementSource: adopted from WRAP (2014)
Indicator CharacteristicsWaste recycling % (by weight) diverted from landfill
recycled waste segregated into separate streams on site (e.g. food waste, paper, plastic, glass, etc.) % of waste diverted from landfill
Total waste Tons of waste per occupant / visitor / Gross Internal Floor area Water Drainage per L (or m3) / m2 / operational hours / annum
Grey water recycling / rainwater harvesting per % of total consumption
Materials % (by weight) of materials diverted from landfill for re-useEnergy % of total waste or waste diverted from landfill sent for energy
recoveryCarbon Embodied carbon for waste streams: kg CO2e / tons
Transport emissions from waste disposal: kg CO2e / m2 / operational hours / annum
From the table it may be seen that currently only part of landfill management
companies are engaged in waste sorting and its preparation for recycling or recovery. One
landfill management company has a bio-cell that is dedicated for energy production (biogas
generation, which is further collected and reprocessed into heat and electricity).
Table 2.9
Key performance indicators applied to landfill management companiesSource: by author
Ratio
AAD
SO
ALAA
S
AP K
audz
ites
Gel
tini E
KO
Liep
ajas
Ras
Piej
ura
Vidu
sdau
gava
s SP
AAO
VLK
ZAAO
Zem
gale
s EK
O
Waste disposal
99,6%
94%
96% 95,6%
88% 91%
94,2% 80% 45%
94%
Energy n/a n/a n/a 5,4% n/a n/a n/a n/a n/a n/aRecycling 0,4% 0% 3,9% 0% 12% 8% 0% 15% 12
%12%
Composting 0% 6% 0,1% 0% 10% 1% 3,8% 5% 43%
4%
Electricity (kWh/capita)
n/a n/a n/a 37,76 12,81
n/a n/a 22,51
7,18
n/a
94
Heat (kWh/capita)
n/a n/a n/a 23,89 14,73
n/a n/a 14,18
6,29
n/a
Although, it has to be noted, that for example, Getlini Eko in 2016 already had only
17% of landfilled waste, as 70% of received waste is being pre-treated and sent to the bio-cell
for energy recovery. Based on the research undertaken, the author has come up with a
conclusion that the present situation of landfill management companies is not sustainable and
a change in their development has to be undertaken in order to secure their further efficiency.
The author has analysed one of ten waste management regions, which is considered to
be representative of a regional monopoly within the Latvian waste management system.
During the research the author has revealed that no unified approach to Latvian waste
management exists in terms of management. This provides a basis for the research in order to
analyse differences in managerial approaches applied and to reveal the benefits and
drawbacks of each.
2.4. Assessment of Latvian full-cycle landfill management company
As it will be described in more detail in chapter 3 of the present research, Latvian
landfill management companies differ in terms of their activities. This part of the research is
focused on a critical analysis of one type of company – regional monopoly, where one
company undertakes all stages of municipal waste management. An example of such a
company is found in the North-Vidzeme region. The chapter will provide analysis of benefits
and drawbacks of such an approach. The region has been formed in 1998 as a pilot project. At
the same time, the municipal limited liability company «North-Vidzeme Waste Management
Company» (hereinafter called ZAAO) was established. Initially it was founded by 85
municipalities, later after the administrative-territorial reform, which took place from 1999
until 2009 -- the number of municipalities decreased due to unification to 22. Though
currently it is working in 28 municipalities, but 6 of them are outside the border of the region
and ZAAO is working there on a contractual basis.
The main aim of the pilot project was: to close 104 legal and illegal sub-standard
landfills, perform their recultivation; to create modern sanitary landfill, that would comply all
European Union requirements; to implement waste collection and treatment system, the
primary tasks of which were:
closure and recultivation of old sub-standard landfills;
design and construction of modern sanitary landfill;
development of a waste management system;
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involvement of 100% of urban and 70% of rural inhabitants into the waste
management system;
education of society and awareness raising regarding waste management.
To incorporate a long-term, viable municipal waste management system into a societal
context requires that all of the elements in the waste management hierarchy be addressed in an
integrated approach. The system needs to be one that is market oriented, has the benefit of the
economy of scale and is socially acceptable (McDougall et al., 2003). This approach was
chosen by North-Vidzeme region municipalities, which have transferred all activities,
connected to waste management to ZAAO. According to Gilbert (1993) and, further
developed by Kudrenickis et al. (2001), this integrated approach evolves from waste
management (i.e. collection, sorting, transportation, pre-treatment and treatment) to resource
management, which makes the system more complex, but also more integral.
As stated in the North-Vidzeme Regional waste management plan 2006-2013 (2006),
the region's territory is 10 411 km2, out of which 10 275.2 km2 are occupied by rural areas and
only 135.9 km2 by urban areas, which constitute 98.7% and 1.7$ respectively. The region
covers 14 cities. The number of inhabitants in the region in 2011 was 186 000, which are
distributed among urban and rural as follows: 103 000 and 63 000. Average inhabitant density
in urban areas is 626.6 inhabitants/km2 and in rural areas – only 10.3 inhabitants/km2. The
region's waste accumulation ratio varies from 170 kg/capita in rural settlements to 300
kg/capita in the cities. Figure 2.10 provides results of waste composition studies held in 2011
in four regional landfill sites in Latvia, including North-Vidzeme landfill “Daibe”. This study
covered four landfills, launched in operation in 2004, which means, that the study was
undertaken in regions with developed sorted waste collection. Still, as it can be seen Figure
2.10, a lot of reusable resources are found at the landfill.
Organic waste47%
PET8%
Glass21%
Paper/cardboard
6%
Minerals and rocks
10%Wood
2%
Metal scrap3%
Textiles, leather, rubber4%
Fig. 2.10 Measurements of waste composition in four landfills (average sample composition, %). Source: ZAAO, 2014
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In case of the North-Vidzeme region for example, the high rate of disposed glass is
explained by the fact, that the region recently started working in one coastal resorts, where
sorted waste collection is at a very low level among tourists, coming mainly during the
summer time and with a lack of eco points close to the beach. In addition, from Figure 2.10 it
is clear that there is still a high percentage of organic waste disposed of currently in the
landfills. This is mostly explained by the lack of separate waste containers for biodegradable
waste. Thus, in North-Vidzeme region a pilot project regarding separate collection of
biodegradable waste is already ongoing.
The company was developed with the idea of offering integrated waste management
services to inhabitants, whereby all the municipalities have delegated functions for collection,
transporting, sorting and disposal as a municipal function – work with inhabitants (education,
integration into the system, awareness raising, etc.). North-Vidzeme region has the following
waste management infrastructure elements:
Sanitary Landfill . Landfill is in operation since December 2004, its overall
capacity is 90 ha, from which approximately 12 ha is devoted to waste disposal.
Waste disposal is planned in 4 specially designed cells. Overall landfill life is
planned to be at least 28 years. Landfill is equipped with reverse osmosis leachate
treatment plant, with initial capacity of 5m3/h, which in 2010 increased to 7m3/h. A
biogas collection system was implemented in the first cell and the first
cogeneration facility was mounted in 2009, followed by another in 2010.
Waste sorting station . In 2004 a re-usable material sorting line was constructed and
launched. In 2010 a waste pre-treatment centre was constructed with mechanical
sorting.
Eco-points . To date there are 314 eco points, which consist of waste bins for
packaging (paper & cardboard), glass and PET.
Eco-areas . ZAAO has constructed 13 eco-areas so far. Each area is equipped with
waste containers for: bottle glass, window glass, paper, cardboard, polyethylene,
PET bottles, metal, household electronic appliances, paint cans, luminescent
lamps, batteries, accumulators, tyres (with 140 mm in diameter).
Inter-municipality company ZAAO works on the whole territory of North-Vidzeme,
thus providing services and involving 100% of inhabitants into the system. This aspect is of
high importance, as in cases where a region has two and more management companies, the
following main problems may occur:
1) lack of statistical data on contracts with inhabitants;
2) lack of instantaneous data on generation and collection volumes;
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3) lack of commercial activity transparency, as in case of private operators – this
information may be regarded as confidentiality of commercial transactions;
4) lack of immediate/direct control in terms of involving inhabitant in the system;
5) cherry picking – cases, when management companies chose the biggest, most
profitable and seamless clients (with no payment debts) and less attractive
clients are left uncovered by the service (i.e. inhabitants of distant rural areas);
6) non-optimized waste collection routes, which result in air pollution and fuel
consumption.
In case of the North-Vidzeme region these problems are not vital as there is no need to
engage additional waste management companies. All waste treatment modules are managed
by one company in the region, which will be seen and analysed in the following part of the
chapter. Recently discussions on market liberalization arose. One of the aims is evaluation
and analysis of the North-Vidzeme example and evaluation of ZAAO efficiency in each
particular activity. In the previous studies (Cudecka-Purina 11a, b) the author has performed
an ex-post feasibility analysis, which has proved that North-Vidzeme region has a positive
NPV - 3 468 664 Eur, IRR – 9.17% and Cost/Benefit – 1.29. In addition, the landfill
investments per ton in the third year of operation showed a very positive trend. Figure 2.11
reflects services, offered by ZAAO in the region. Both from the client and municipality’s
perspective, it is easier when all services are provided by one organization.
Figure 2.11 also shows that some causal-loop effects takes place within the system.
For example, the increase in number of clients is closely linked to region coverage by the
waste management system. Inhabitant education programs have direct and most significant
effect on increase of waste sorting, increase of re-use ratios, compost volumes and decrease of
disposal of waste on the landfill. Moreover, even opening of new eco points and eco areas
have an impact on volume of sorted waste, as when the service is offered closer to the client,
the involvement increases interdependently.
The following Figure 2.12 reflects material flow analysis of North-Vidzeme
performed by the author. As stated by Baccini, Brunner (2012), the main advantage of the
MFA system is that it must obey the law of conservation of matter and thus it forms a natural
science base that can be cross-checked for consistency and probability. Here it is obvious that
over 70% of total waste is unsorted waste, which arrives to the landfill and it is being sent to
the waste pre-treatment centre where waste is sorted into: metals 2-3%; coarse fraction 18-
25%; intermediate fraction 38-43% and 30-36% in fine fraction. The coarse fraction is sent to
the waste sorting station, the intermediate fraction is stored for future possible RDF (Refuse
derived fuels) production and the fine fraction is landfilled. This analysis reflects the
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integrated approach, used by ZAAO in the region and it appears that, taking into account the
circumstances (the fact, that all infrastructure elements are owned by the operating company),
it is possible to make it profitable and effective, when managing all or at least most of the
stages of waste treatment.
Fig. 2.11 Services offered in North-Vidzeme region and their causal-loop effectSource: by author
Another very important field, in which ZAAO is working is – inhabitant education
programmes. ZAAO has been working in this field since 2001, offering its clients – North-
Vidzeme region inhabitants a variety of different programmes both for children and adults.
ZAAO specialists have developed study courses for children, for which schools can apply at
no charge. The courses are held at ZAAO facilities, including visits to landfill, sorting station,
etc. Until now ZAAO has issued over 5 different textbooks for pupils and exercise books.
Since 2005 summer camps practice has been developed in the region, involving four schools.
The aim of these camps is to create awareness of environmental issues and processes.
Another type of activity is annual cleaning of the surroundings. Most of the
inhabitants are involved in country-wide, when in spring they gather to clean the territories
around their communities, including forests and roadsides. Overall, it can be considered, that
the North-Vidzeme region is the one, offering the greatest variety and having more experience
in inhabitant education in the waste management field, than any other organization or
municipality in Latvia. Simultaneously, it can be assumed that of all others, the integrated
approach used in the North-Vidzeme region for waste management allows ZAAO to be
economically effective and efficient As future study may reveal, not all of the treatment
options, if considered on a stand alone basis, can be evaluated to be economically feasible,
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taking into account territory, number of inhabitants, their density and volume of waste
generated.
* - for better representation, the figure has the volumes is represented in tenfold Fig. 2.12 Material flow analysis in North-Vidzeme region, in tons
Source: by authorOne more aspect is social responsibility – especially considering inhabitant education
programmes. Compared to other regions, where the municipal organizations are also in charge
of this activity, North-Vidzeme has achieved the most significant results. The author views
this achievement, as a result of the fact that the organization also receives direct profit from
sorted waste collection, and thus is quite motivated to educate society to improve the level
and degree of sorting.
Benefits and drawbacks of integrated approach in the North-Vidzeme region
During the research performed the following benefits of the system were revealed:
The operating company – ZAAO is 100% responsible for waste collection and
overall cleanness of the region’s territory;
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Only 100% region coverage by one waste management operator allows obtaining
an optimal waste collection and transportation scheme. Minimal route length by
maximum inhabitant coverage;
Flexible customer relations and payment system makes it possible to minimize
number of debtors. While working in the region for 15 years (since 1998) ZAAO
has managed to maintain the debtor liabilities to below 1%;
Integrated and sustainable work with inhabitants. There is no other institution in
this region, which deals in waste management activities and this is the reason the
region is being criticized, especially by private companies. Nonetheless, in terms
of inhabitant education this approach is very beneficial as, being interested in
increasing the recycling %, ZAAO has developed a methodical and sustainable
approach to educate different social groups (companies, schools, kindergartens)
and is implementing it since 2004.
The study has also revealed some drawbacks of such a system approach:
Intentional lack of competition in the region. The operational approach, developed
by ZAAO receives most of the criticism regarding deregulation of the market (two
and more operators). Taking into consideration society consciousness level and
current control level, market deregulation may impact service quality;
the waste collection fee from the inhabitants could be lower if there would be
competition in the region. Although, the service quality and “cherry picking” issue
may arise instead.
One important aspect of sustainable waste management in a region or country is long-
term and in-depth work in the inhabitant education field. The North-Vidzeme region has paid
great attention to this and significant results have already been achieved, by involving the
population in using eco points, eco areas, eco bags and much more. The main conclusion here
can be made, that waste management is a complex activity and each treatment module has to
be evaluated on a stand-alone basis in order to evaluate its efficiency and to evaluate, whether
the activity can be carried out by an inter-municipality organization or whether it would be
better to outsource a particular activity.
2.5. Necessity of managerial improvement of Latvian landfill management companies
The research, undertaken up to this part, has identified a range of problems in the
sustainable development of landfill management companies. The author has developed a
survey (Annex 3) with questions developed particularly in order to confirm or dispel the
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author’s theory, that industrial symbiosis is the direction landfill management companies
should follow in order to improve their sustainability and increase efficiency.
The survey’s design is based on three main principles: wording, planning of issues and
general appearance (Sekaran, Bougie, 2009). The survey consists of 19 open-ended and
closed questions and it is divided into three sub-sections. The first sub-section covers landfill
management companies, their functions, output of landfill daily operation activities, potential
resources for industrial symbiosis and disposal rates. The following sub-section covers waste
management tendencies in Latvia and is aimed to disclose a landfill management company’s
vision for further development. The last sub-section tackles decision-making practices in
waste management companies.
The author has analysed the sample set and, in order to make it more representative,
has developed two types of surveys. The target audience or affected party of the research
within Latvia is municipal landfill management companies, 10 of which (91% of respondents)
participated in the survey, providing 100% waste management region coverage4. The
respondents were Members of the Board or top management. Landfill management
companies have a significant impact on waste management policy in Latvia, being members
of LASUA and their interests are also represented in the Working Group organized by the
MEPRD which meets to discuss potential legislative initiatives with policy makers on the
improvement of waste management in Latvia.
In addition, the author has modified the same survey for experts in the waste
management field (experts, not directly engaged with the issues of landfill management
company sustainability), these cover both Latvian and foreign experts. The results from this
group will be hereinafter called “Expert group”. Key factors for choice of experts were:
at least 5 years of scientific or professional experteese;
type and level of education (Phd or Mg. in environmental science, business
administration, economics);
participation in international scientific or practical waste management conferences;
publications in the waste management/environmental/business administration field.
When turning to Expert group, the table below represents the description of the polled
experts. In total the survey provided 30 respondents for the Expert group (75% of assessed
experts). All experts covered by this group have an impact on policy planning and
development in their corresponding countries. The geographical spread of the expert group is
explained by the fact that it is important to compare the views and visions of the neighbouring
countries, as well as to have examples of southern EU member states and countries outside 4 One company has not participated, although it has to be mentioned that it started its operation only since 2017, it was delegated wste disposal in one landfill, which since January 1, 2018 is no longer in operation. .
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the EU – in order to attain a broader picture of the waste management issues, problem-solving
approaches and potential development direction.
Table 2.10
Description of expert group. Source: by author
Country Type of expert, institution Number of experts
EstoniaLandfill management companies (60% of total Estonian LMCs) 3Ministry of Environment 2Consultants and experts in waste management field 2
Latvia
Latvian association of waste management companies (representing unanimous opinion of over 50 Latvian waste management companies)
1
Ministry of Environmental Protection and Regional Development
2
Waste Management Association of Latvia (representing unanimous opinion of over 20 Latvian waste management companies)
1
Latvian Association of Large Cities (representing unanimous opinion of 9 Latvian cities)
1
Consultants and experts in waste management field 2
Lithuania
Ministry of Environment 2Regional waste management centres (landfill management companies) (40% of total Estonian LMCs)
4
Lithuanian Municipal Services and Waste Management Association
1
Consultants and experts in waste management field 2Academics and researhers (Vilnius Gediminas Technical University)
1
Russia Academics and researhers (Samara State Technical University, Perm National Research Polytechnic University)
2
Spain Academics and researhers (University of Cantabria) 2Malaysia Consultants and experts in waste management field 2
When analysing the first question, regarding the development of regional waste
management centres (Figure 2.14), it can be observed, that 80% of the landfill management
companies are in favour of this idea. The concept of a regional waste management centre is
the main infrastructural element of the region – in Latvia’s case it is a waste landfill, its
management company, which is inter-municipality founded, would take over all region’s
municipality functions, including but not limited to inhabitant education, ensuring 100%
coverage of the inhabitants within the waste management system, public procurement for
waste collection and/or treatment services, liability for the targets set for waste recycling and
reuse as well as disposal, etc. This would facilitate administrative burden for the
municipalities, provide a more objective and transparent statistical information of the region
and might result in a better waste collection price for the inhabitants, as the waste
management operator would be chosen for the whole region, not for a single municipality.
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When analysing the responses provided by the Expert group, 70% of respondents were in
favour of developing regional waste management centres, to which municipalities could
delegate all the functions, linked with waste management; 20% state that such an approach is
currently under development and 10% support the current system in place.
Figure 2.13 proves readiness of landfill management companies to adopt a range of
municipal functions. Moreover, it also shows that there are already waste management
regions within the countries surveyed, which have taken over a range of functions linked to
waste management. Some of the regions face strong municipalities, willing to control waste
management functions by themselves, although it has to be noted that economies of scale are
also in place within a waste management system, so the bigger a waste collection territory
with a higher inhabitant density, the lower the price for waste collection service.
80%
10%
10%
Do you consider that waste management regions have to have regional waste management centres, to which municipalities could delegate all the functions, linked with waste management?
Yes, it would definitely solve a range of bureaucratic issues and facilitate regional management
Yes and development of such centres is currently under development
No, it is not necessary, currently existing system is optimal
Fig. 2.13 Question 1 – response of Landfill group. Source: by author
It is quite notable, that the Expert group opinion was divided in the question No.1, as
39% of respondents support delegation of municipal functions to regional waste management
centres and quite a close number – 33% stated that these functions have to stay in competence
of the municipalities. 11% of the Expert group point out that definitely some of the functions
can be taken over by regional waste management centres, but, as waste management in
general is the competency of municipalities, core functions have to be kept for them as main
responsible stakeholders and 17% pointed out that this is the direction in which current
landfill management companies are willing to develop.
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73%
9%
18%
Should a landfill management company take over particular municipality functions and execute public procurement in respect to waste collection in the region and develop binding regulations for waste
management in the region?
Yes, that would significantly facilitate region’s management system
Yes, and it is already in place
No, law, binding to municipalities, states these functions and they are the institu-tions, which have to fulfil these functions
Fig. 2.14 Question No.2 – response of Landfill group; Source: by author
Question No. 3 provided us with a picture of the resources that are produced
during a landfill’s daily operations. Figure 2.16 shows, that landfills rely on sorting, gaining
sorted waste from it (such as paper & cardboard, plastics, metals), as well as other reusable
materials with market value. Purified leachate is obtained by all landfills – thus it has to be
mentioned, that this product has a negligible value, as it is used internally as technical water
or for fire-extinguishing pools. The Expert group sees as the main by-products all of the
options (70%-90%), except for RDF (60%) and compost, that is used for road construction
(40%) and compost for agricultural purposes (25%). This is explained by the fact that
production of RDF in many countries is done prior to the waste reaching landfill. Regarding
compost production – unless separate collection of biodegradable waste is ensured, no high
quality compost production is possible. This is explained with the fact, that compost
composition will be full with residual waste and heavy metals that would be a problem for
meeting the agricultural fertilizer quality.
When analysing, what the resources are that could be offered for other companies that
are either not used in an efficient manner, or not used at all, the Expert group has identified
the following resources (Fig. 2.16), mostly focusing on education of society and awareness
raising. They also pointed out that the landfills should be as open as possible to teach people
to sort waste. The next step is to promote waste reduction and prevention. That means
promotion of repair and reuse, especially for electric, electronic and bulky waste. When
analysing the responses of the landfills, they see themselves as fully involved in sharing
experience, education of society (80%), organization of excursions and trainings (90%),
followed by technical equipment (60%), infrastructure required for establishment of the
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business (fenced territory, supply road, premises, etc.) (50%) and exchange of energy
commodities (30%).
Sort
ed p
acka
ging
mat
e...
Oth
er r
eusa
ble
mat
eri...
Elec
tric
ene
rgy
and
...
Puri
fied
leac
hate
Reso
urce
der
ived
fuel
...
Tech
nica
l com
post
Com
post
for
road
con
...
Com
post
,for
agri
cultu
re
0%10%20%30%40%50%60%70%
By-products, that arise during landfill daily operations
Fig. 2.15 Question No.3 – response of Landfill group. Source: by author
Question No. 4 led to a very important question, analysed within the questionnaire –
question No. 5 “What could be a stimulating factor for a landfill management company to get
involved in industrial symbiosis?”
Infrastr
ucture
Techn
ical eq
uipment
Experi
ence, ed
ucation of so
ciety
Organisatio
n of excursi
ons, trai
nings
Exchang
e of en
ergy co
mmodities
Materia
ls for re
generatio
n
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1619
10
25 6
8 9
30
Which resources could be offered to other entities?
Expert group Landfill group
Num
ber o
f res
pond
ents
Fig. 2.16 Question No.4. Source: by author
Landfill management companies (44% of respondents) point to education of the
society, explaining that modern landfill is environmentally safe and different types of
manufacturing can be allocated within its territory - as the most stimulating factor. This is
followed by necessity of development of state support programs in order to facilitate
cooperation of different sectors – identified by 39% of respondents. 6% see the main obstacle
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as legislation, pointing out that it has to be redeveloped in order to promote inter-disciplinary
cooperation. On the other hand 11% of respondents consider that the existing legislation is
sufficient and the companies themselves already start to develop industrial symbiosis on
landfill basis. When turning to the Expert group, with the same question, 75% of respondents
support the idea of the necessity of state aid, followed by reconsideration and revision of the
legislative base (45%), only 15% of the respondents consider the legislative basis to be
sufficient and 25% of Expert group stress the necessity of the education of society.
Taking into account the current circumstances and potential for 2020 and 2030, it is of
vital importance to ensure sustainable development of landfill management companies as well
as their feasibility. The author has summarized the responses of the Landfills and Expert
Group in the following table.
Table 2.11
Analysis of question No. 6Activities, required for landfill management company feasibility and their sustainable
development. Source: by authorSustainability Feasibility
Availability of EU funding, innovations, participation in international projects
Improvement of procurement system
Stable and predictable long-term legislation development vision
Implementation of latest technologies (state of the art)
Work on waste prevention program has to be initiated, higher quality inhabitant education has to take place
Modernization of existing facilities
Allow landfills to use NRT for sorted volume
Focusing all waste management activities on the landfill
Expanding sorting to other types of waste, ensuring their demand market
Increasing production efficiency, investments in research & development, education
Increase of financing % devoted to education (currently it is limited to 2% from the disposal rate per ton)
The expert group agreed that a stable and predictable legislative base is extremely
important in ensuring sustainable development. Attention has also to be paid to the
development of sorting facilities for inhabitants and to the education of society and their
involvement in the system.
The key points for efficiency, highlighted by the Expert group are:
1. Efficiency could be ensured by smart cooperation on state and regional levels,
attracting private partnerships;
2. Balancing social, economic and environmental interests;
3. Sustainable governance;
4. Timely and wise investments into infrastructure;
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5. Development of end-of-waste status.
As it has already been pointed out throughout the presentation of the results of the
surveys, the ambitious goal set by the European Commission for 2030 is to ensure disposal of
waste decreases to only 10% among all member states. Latvia is among those countries which
will have the greatest challenges with this target and, within current situation, it even looks
unachievable. This is also tackled by the Expert group under question No. 7 “Taking into
consideration the new provisional goal set by the European Commission to dispose only 10%
of waste, what is your vision to ensure landfill efficiency and sustainability?”. The expert
group states the first and key action is the transformation of landfills into waste recycling
and/or recovery centres (86% of respondents). It is interesting, that the experts from
governmental organizations see the solution through development of regional waste centres
(on the basis of waste management regions, where municipalities delegate their rights in
waste management issues to a Regional waste centre, which also would inherit the
obligations, which are set for municipalities) – this initiative was mentioned by 43% of polled
experts. The third most identified activity (39% of respondents) was implementation and
further development of a waste prevention program alongside with a focus on increasing the
population’s awareness. It is quite interesting that the Landfill group had a different set of
required actions:
Technological shift
Development of recycling of biodegradable waste
Improvement of waste sorting at households
Landfill support on the national level
Development of regional waste management centres
Participation in international projects
Development of end-of-waste criteria
Development of material recycling within the country
Increase of disposal rate to the EU level
Question No. 8 allowed one to understand the attitude of Landfill group as well as of
Expert group on the fiscal instrument on that currently exists within waste management at the
national level – Natural resources tax, which is applicable for waste disposal. It is to be noted,
that in Latvia in 2016 it was 12 Eur/t, although with new amendments to the law, which were
developed in 2016, the rate will increase up to 50 Eur/t in 2020. One particularity of the tax is
that, in accordance with Article 28 of the Natural Resources tax law, the tax is being
distributed in a proportion of 40/60, i.e. 40% of revenue i is credited to the National budget
and 60% is credited to the environmental budget of local municipality, on which territory the
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landfill is situated. According to Article 29 of the Natural Resources tax law, the Special
environmental protection budget resources of the local government and the resources of the
environmental protection fund established by a local government shall only be used for
financing such measures and projects which are related to environmental protection, for
example, education and instruction in the field of environmental protection, environmental
monitoring, preservation and protection of biological diversity, air protection and climate
change, protection and restoration of soils and land, strengthening of the performance of
environmental protection institutions and public environment inspectors, waste management,
radioactive waste administration. It has to be mentioned, that this is not the case for the State
revenue part, of which only a limited part of the revenue is devoted to the Latvian
Environmental Protection Fund. Thus the contradiction of this tax as a non-fiscal instrument
is revealed.
According to Figure 2.17, the attitude of practitioners (Landfill group) is less positive
towards the natural resources tax. This is mostly explained by the fact that the revenue is not
diverted to waste management or landfill support issues. 40% of those polled point out that
this revenue should go at least to the education and awareness raising of society and to waste
prevention programs. Within the Expert group, the experts with a neutral (the country could
avoid this tax in the waste management field, for example, many of the EU countries apply
disposal rate and/or gate fee) or even negative (the aim of the NRT is not clearly
comprehended by all parties, the increase of the rate does not provide expected effect, but
only short-term profit to the State’s budget, thus NRT has never been seen as a revenue
instrument) view of the tax, highlight issues such as ensuring effective management of
revenue from NRT. In the case that the revenue simply enters the state budget, the tax is not
useful, however in the case where the revenue comes back to the waste management field
through state funds, it could provide a significant pace increase for decrease of disposable
waste volume.
Experts also point out that the main aim of NRT is often misunderstood, as the
increase of the tax rate does not bring the desired effect, except as a short-term income to the
state budget. In addition, there is significant lack of information available to the inhabitants
regarding the income from this tax. Although it has to be emphasized, that regardless of the
fact that the tax and revenue distribution system might be arguable, experts from both groups
partially see it as a measure to stimulate waste sorting, in question No.9 “Do you consider
NRT as stimulating factor for sorted waste collection?” – 50% of Expert group opted for
“yes”, 25% for “partly”, with only 20% of experts did not identify a direct link between the
tax and an increase in sorting.
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45%
25%
30%
Attitude towards a Natural Resource Tax for waste disposal? (Expert group)
Positive Neutral
Negative
20%
20%60%
Attitude towards a Natural resources tax for waste disposal (Landfill group)
Positive Neutral
Negative
Fig. 2.17 Question No.8. Source: by author
The Landfill group responded 50% for “yes”, 40% for “partly” and 10% not linking
the tax with sorting rates. Presently the 2020 targets are a very important topic – the
possibilities to achieve them, the responsibilities and liabilities for doing so.
Unified targets Differentiated targets other024
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6
1
9
18
3
Is it possible to apply differentiated percentages to be achieved within sorted waste collection and preparation for reuse, regeneration and re-
covery?
Landfill group Expert group
Fig. 2.18. Question No.15. Source: by author
Currently the author is also engaged in changing the Cabinet of Ministers regulations
in Latvia, as the present version does not state the responsibilities for achievement of
recycling, recovery and reuse targets for municipal waste. It is quite notable, that tDirective
2008/98/EC on waste speaks of a target, but does not provide in-depth information on
whether the target has to be unified for all regions of the country, or there is a possibility to
differentiate among regions, with an average per country reaching 50%. During the surveys,
the author revealed, that both in the Expert group and in the Landfill group the respondents
support the second option, i.e. a situation, when within one country, regions have different
110
targets, depending on the region’s specifics, development of waste management system and
other aspects, although on the country level it has to be ensured that the EU defined goals are
fulfilled. The Experts say, that it is very precisely pointed out that regions differ both by
economic situation, by geographical situation and by migration flow intensity, which is why
they consider an “internal rate” system has to be designed. According to the latest forecasts, in
2020 we can have a situation in Latvia whereby 60-70% of all working inhabitants will be
working and living in the country’s capital. The targets have to differ, varied on possibilities
of quality of life, cost calculations and other factors; an appropriate algorithm has to be
developed. It is quite notable, that there were also responses “other”, where the respondents
opted for “We consider that the situation can be settled when one waste management
company would operate within a country, which would be liable for achieving the targets and
their fulfilment. This would allow all regions to set unified requirements, provide unified
circumstances and unified price for waste management.” or “Theoretically, differentiation can
be a solution, but one has to consider economic feasibility. For example Riga region or more
industrially developed region could reach the targets or on the contrary, not be able to reach
certain flow targets. Some flow recycling/recovery can be extremely expensive as the
composition of particular types of waste could be negligible, and recycling or recovery of this
percentage can result to be economically ineffective. Differentiation can complicate the
situation. Possibly, one could consider a quota system, but in this case the system has to be
very understandable and transparent”.
The following question of the survey, No. 16 – “Which new legislative acts or what
kind of amendments to existing ones need to be made in order to improve existing waste
management system?” was very important for the author – in order to find out the possible
future development tendencies as well as to find support of the author’s vision in the opinion
of experts. The author has summarized the proposals in the Table 2.12.
Table 2.12
Question No. 16 - Legislative change necessity to improve waste management systemSource: by author
Landfill group Expert groupBan on import of RDF has to be in place, as we have internally generated material with no market;Law on NRT has to be reviewed, and the revenue has to be marked for development of sorting;A range of issues arise regarding biodegradable waste, management requirements and
The issue of waste management levy for inhabitants has to be solved. This is a topic that has been under debate for 5-10 years.The system has to be resolved, understanding that smart waste management is a question of vital importance, ensuring the health of the population.More strict requirements for management of infrastructure have to be in place, which cover the whole cycle – i.e. collection, liabilities of all parties involved, participation in the system and maintenance of the sites.
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what is and is not considered to be ‘recovery’.Gate fee regulation required On a state level we should:
d. perform an inventory of the system;e. have a clear vision of the development path.
In this case it will be totally clear, which are temporary problems and which are system-level failures.
Regulatory amendments to motivate landfills not to dispose (i.e. possibility to keep NRT for non-disposed volumes)
There is a strong necessity to implement new laws: law devoted to waste management clusters; law on construction waste and its recycling aim; law on certification of the products from the waste
materials;development of end-of-waste criteria.
Each real estate owner should be obliged to have a contract for waste collection, foreseeing minimal obligatory charged volume.
Quality requirements for recycling materials.
Deposit refund system in Latvia has to be implemented
Enforced State supervision has to be ensured.
More attention should be paid on the municipal level when developing binding regulations and ensuring control over implementation.
Allow and extend the utilization of deposit refund system, in order to improve the Waste Electrical and Electronic Equipment (WEEE) in Europe, because most are transported for export to Africa and Asia.
Higher financial assistance intensity for waste management field would be necessary
Landfill tax is one of the best policy instruments to prompt tdiversion of waste from landfill for recycling, reuse, recovery and treatment. However, it is also depends on the country context. For example, in my country it can be hardly implemented as almost all landfills are owned and managed by local authorities or state-owned-enterprises. Other effective policies are polluter-pays principle (pay as you throw) to forcefully encourage the practice of waste segregation and develop separate collection of DMR (dry mixed recyclables) and organic waste. Development of waste sorting, treatment and recycling facility is highly dependent on a separate collection system; i.e. DMR for MRF, organics for composting/AD, mixed residuals with organics for MBT, residuals only for WTE, etc.
Regulations and legislation have to be improved constantly. Precise definition of liabilities has to be developed.Municipalities have to monitor legislative changes and to be able to implement them into binding regulations promptly. Education of society in waste management issues has to be promoted; NRT revenue has to be invested into the education of society.
The following part of the analysis will be devoted to a Landfill management
company’s internal development, decision-making, etc. From Figure 2.19 it is observed that
Landfill management companies pay special attention to professional development.
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Most of the attention is paid to local seminars and training courses, as well as to those
events organized by LASA and LASUA (80%), followed by international seminars and
training courses (60%), participation in international exhibitions and passive monitoring of
current trends (international scientific journals, publications in the field of waste
management) (both 50%) and less attention is paid to local and international scientific
conferences (only 20% of the respondents take active part in such events).
Local seminars, training courses
Foreign seminars, training courses
International exhibitions
Local and international scientific conferencesResearch activities
Passive monitoring of current trends
Seminars, courses by Latvian waste management associations
0%
50%
100%
In which types of activities is the landfill management company's man-agement level taking part in to ensure professional development
Fig. 2.19. Question No.12. Source: by author
When comparing these results to the Expert group, it can be noted that Experts advise
landfill management companies to focus on participation in international seminars and
training courses, as well as in local and international scientific conferences and international
exhibitions (95% per each activity), with less attention to be paid to passive monitoring of the
trends (55% of the respondents) and about 75% per each activity – for research activities,
local seminars and courses held by LASA and LASUA.
A very important question in landfill management, especially in terms of sustainable
development and ensuring a company’s efficiency, is the decision-making process. The author
has analysed the landfills and their currently applied approach, as well as has gathered
opinions from the Expert group on how they see this decision-making can be managed in the
best possible way. From Figure 2.21 it can be concluded that the Landfill group still relies
significantly on “decisions” – made by Members of the Board, although the Expert group
considers this to be among the least favourable options. The leader in both practical and
theoretical groups is “consultations” – involving industry experts for decision-making. The
Expert group considers this to be the most important tool for efficient development of the
companies. The least favourable options among the Expert group are “voting” (option
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discussion, followed by Board’s decision) and “consensus” (discussion, until all the parties
involved agree upon a particular option). Decision-making is closely linked with innovation
and implementation of new ideas in the company.
Decision Consultation Voting Consensuss0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
914
11
6
1719
6
16
Which decision-making methods should be applied in landfill management companies?
Landfill group Expert group
Fig. 2.20 Question No.17. Source: by author
The results obtained from analysing question No. 18 “New solutions in the company
are implemented using…” show that 90% of the Landfill group applies the Top-down
approach, followed by 40% applying the Bottom-up approach. The Expert group has a similar
vision, with 60% in support of the Top-down approach and 35% supporting a Bottom-up
approach. The experts also opted for “other option” (5%), mentioning that brainstorming or
consultations within the company can be required for some decisions.
Question 19, which is represented in Figure 2.21 logically continues the discussion
within the previous question. As we can see from the results, the practical Landfill group has
focussed more on efficiency prior to decision-making (60% of respondents), followed by
benchmarking (mostly among Latvian or Baltic state landfills) and consultations (by local
experts), both options receiving 50% of the responses and brainstorming having only 30%
support from Landfill management companies. Slightly different accents have been placed by
the Expert group – with the leading option (75%) set as consulting (the Expert group advises
to have cooperation both with local and international experts), followed by benchmarking
(70%), evaluation of economic efficiency in the long-term (65%), and, similar to the Landfill
group, the Expert group considers brainstorming prior to decision-making as less important
(40%).
The analysis of question 20 of the survey will be presented in Chapter 3 of the present
research, as it is a question used to characterize types of landfill management companies by
114
their operations, i.e. ensuring a full waste management service spectrum, ensuring only
landfilling or ensuring landfilling and just some of waste management activities.
Benchm
arking
Brainst
orming
Evaluat
ion of
econ
omic e
fficiec
ny
Consul
ting
0%10%20%30%40%50%60%70%80% 70%
40%
65%75%
50%
30%
60%50%
Which activities usually take place prior to decision-making on important management expansion or change?
Expert groupLandfill group
Fig. 2.21 Question No.19. Source: by author
The survey conducted by the author covered a broader scope than the research in order
to reveal the latest trends and gather opinions from the target groups on the most critical
issues within the field of waste management. Analysis of the surveys shows, that both target
groups consider it logical for the municipalities to delegate major part of waste related
functions to landfill management companies and to turn them into regional waste
management centres.
The landfills are quite similar in the types of by-products arising from their daily
operations, although they currently do not feel confident about sharing these resources with
other industries. Both focus groups consider the following as important preconditions for
further development:
establishment of a end of waste criteria;
establishment of local recycling facilities;
development of circular economy or industrial symbiosis support programs;
improvement of education of society on waste-related issues.
Summary of the chapter
Chapter two of the research provides assessment of general EU trends, going into more details
to Latvian waste management system, describing its development since 1990’s. It also
provides a situation analysis of waste management in one waste management region –
Ziemelvidzeme with a landfill management company, which offers full cycle of services from
waste collection from inhabitants to landfilling. Further, the author has identified necessity of
115
managerial improvement of landfill management companies. Based on the theoretical
framework two surveys have been developed by the author – for interested group – landfill
management companies and independent group – Latvian and foreign waste management
field experts and the chapter ends with analysis of the results. The results of the surveys,
conducted, have confirmed the author’s vision on further development of landfill management
companies.
The next chapter is focused on in-depth analysis of Latvian LMCs, assessment of their
resource flow, development of resource equations, which result in development of industrial
symbiosis model and decision-making matrix.
116
3. DEVELOPMENT OF MANAGERIAL
IMPROVEMENT FOR LANDFILL MANAGEMENT
COMPANIES This section of the dissertation is devoted to development and approbation of the
model that provides a long-term managerial solution for landfill management companies. As
it can be seen from the research, up until now, the main waste treatment option in Latvia
which receives most of the flow remains as landfilling. This means that the LMC operating in
each region, despite their peculiarities, have a landfill as a main infrastructure element.
Unwittingly EU has endangered the sustainable development of new member state landfills. It
has performed a feasibility check of Directive 2008/98/EC on waste, which assumed a
significant shift in policy, changing the focus of the waste management hierarchy and
developing a range of landfilling bans. This stage had a significant impact on landfill
functioning and long-term development strategies. When applying these changes to the
Latvian LMC situation, it has to be noted, that landfills are complex engineer-technical
infrastructural elements, which cannot be very easily adapted to such changes. This means
that the preliminary forecasts of waste volume and revenue will not be fulfilled. In addition,
the Circular Economy action plan, issued in December 2015 has set an even more
revolutionary approach with a very ambitious target of limitation of waste landfilling to 10%
of generated volume in 2030.
3.1. Closing the loop in a waste management system On March 14, 2017 a vote of Members of European Parliament took place. According
to the outcome, the share of waste to be recycled would rise to 70% by 2030 from 44% today,
under the draft legislation adopted. Members of the European Parliament also want the “waste
package” plans to limit the share of landfilling, which has a big environmental impact, to 5%
and to deliver a 50% reduction in food waste by 2030. These targets are extremely ambitious
-- of course negotiations with the Council of Ministers are still to come and the final targets to
be included in the directives are not yet set, although, it is quite clear that EU wishes to set
very ambitious targets in order to ensure faster transition towards a circular economy.
For Latvia it means that revolutionary changes in the current sustainable development
direction of landfills have to be adopted as soon as possible. No revolutionary waste treatment
options are foreseen in the upcoming years and decrease of waste landfilling from 71% in
2014 to 10% or even 5% in 2030 places the existence and economic stability of landfill
management companies under threat.
117
In order to resolve this problem, the author has developed the current research with the
main focus – development of a landfill industrial symbiosis model and a decision-making
matrix. The material flow analysed by the author is distinctive from ordinary MFAs, as the
author stresses the importance of landfill daily operation output, which is mainly – heat,
electricity, leachate, RDF, technical compost. Currently an extensive part of these resources is
either not assigned any value or underutilised. The author offers a new approach in order to
increase effective use of existing resources and enhance the economic stability of LMCs.
Lately Europe has started a very ambitious and at the same time environmentally
conscious path towards the zero waste concept, using circular economy policy. It has been
heatedly discussed since already the 1980s whether a zero waste concept (Willson DC, 2011;
Zaman, 2014; Zotos et. al. 2009) is possible within current social and economic
preconditions, still, the author suggests that a step toward a circular economy or such concepts
as industrial symbiosis is a good alternative – humans cannot prevent all the waste generated,
but can minimize volumes going to landfills and change their attitude towards waste.
Waste management may be divided into three stages: Preliminary stage – from
inhabitant to waste collection, which is the most profitable, as it contains the cleanest reusable
materials; Secondary stage – sorting waste on unsorted waste sorting facilities and Tertiary
stage – waste from waste landfilling process. All three stages require different approaches.
The 3R approach (Hotta, 2014; Sakai, 2011; Wilson, 2010) is more applicable at the
preliminary stage, thus within this research industrial symbiosis is applicable at the tertiary
stage which is the focus of the research. Waste prevention alongside with 3R activities are
widely discussed and promoted within the EU, thus much less attention is being paid to the
waste or resources generated during waste disposal processes. This is explained by the fact
that EU sees landfilling as yesterday’s waste treatment option, but there are 13 member states,
which still heavily rely on it. For these countries, industrial symbiosis to save resources and
move towards a circular economy on the landfills could become a good mid-term solution.
The author has used systems dynamics offered causal-loop diagrams to understand the
processes within different types of municipal waste management companies. According to
Blumberga et. al. (2011), the main idea in systems thinking is that a phenomenon being
studied may be characterised as a whole (the system) as well as by its components (sub-
systems) and that the subsystems are related to each other and to their (super) system in such a
way that a system can be said to constitute something more than an assembly of subsystems.
Moreover within systems dynamics, systems can be composed of both material and non-
material components, which allow examining one problem from various aspects
simultaneously.
118
Latvia’s waste management system was not designed using a “one fits all” approach, but it
allowed municipalities to choose the desired management and operation, that the landfill
management company would undertake. All 11 municipal waste landfills are municipality
owned – each region has a rmunicipal waste management company, operating a landfill, and
all the municipalities of the region are it’s owners. Regarding other waste management
activities, the regions vary. The author has analysed all the operations, undertaken by the
LMC and developed the following schemes (Fig. 3.2.a, 3.2.b, 3.2.c). For comprehension,
“full cycle” includes the following activities: education of the inhabitants; waste container
park (including for sorted waste); contracts with private and legal customers; municipal waste
collection; bulky waste collection; C&D waste collection; green waste collection; hazardous
waste collection; sorted waste collection; waste sorting at sorting stations with further sale of
secondary resources; waste transportation (if necessary, using reloading stations);
management of all infrastructure elements; waste pre-treatment; landfilling (collecting biogas
and production of electricity and heat).
Using the systems dynamics approach, it is possible to examine and evaluate the
operations performed by each type of the companies in terms of beneficial and/ or negative
impacts.
One should mention the independent variable NRT (Nature Resource tax) that has a
fee for waste disposal per ton and is currently undergoing a significant increase until 2020,
when it will reach 50 Eur/ton. Of course, in comparison with other European Union member
states, especially those leading in waste management, the current tax rate is very low (see Fig.
2.4.), but if one considers historical development, it can be seen, that the rate has developed
and increased 30 times by 2014 since 1996 and it is planned that just after 2020 its increase
will reach 100 times since 1996. It is known that no tax increase can be done ad hoc, as this
will result in a totally opposite effect. There have been examples within EU member states,
when a sudden high increase in gate fee was adopted which resulted in momentary
environmental pollution, as the waste did not reach the landfills and the government had to
shift the gate fee back and implement a step-by-step increase.
Total costs for landfilling within EU-27 for 2012 as well as overview of landfill taxes
and fees in member states that joined EU since 2004 as well as the development of NRT of
three Baltic states are provided in Chapter 2 of this dissertation (see Fig. 2.4 and 2.5). The
most notable difference in the operation of different types of inter-municipality companies is
– influence on “landfilled waste”, as the companies which have only waste landfilling as their
main operation, due to decrease of number of inhabitants and different economic growth from
119
the one in the beginning of the project, struggle with payback of the loans and are interested
in landfilling more waste than preventing it from going to landfill.
19962006
20092010
20112012
20142015
20162017
20182019
2020
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
Natural Resources tax ratesHousehold waste
Exponential (Household waste)
Construction & Demolition waste
Asbestos in the form of fibres and dust
Hazardous waste
Production waste
Fig. 3.1. Development of Natural resources tax, Eur/t
Source: adopted from Natural Resources Tax Law and amendments in 2016
On the other hand, the companies doing full cycle benefit from sales of secondary
materials and can invest their profit into development of the infrastructure.
It is necessary to stress that waste management regions in Latvia vary both by
financial possibilities and number of inhabitants. For example there are regions with less than
90 000 inhabitants. As a result of previous research, the author has proven that the regions
where the number of inhabitants is below 120 000 are economically ineffective and one of the
possible solutions could be their transformation into technological parks (Cudecka, 2011).
LMC doing full cycle so far look as having the most logical and not interfering
elements. On the contrary it is quite obvious that type 2 of LMC has a most contradictory
situation.
The LMC presented in Fig. 3.2.b are mostly interested in disposing maximum
volumes of waste as it is their only profit generating activity. This means that implementation
of DRS, pre-treatment, sorted waste collection and other waste prevention from landfills
activities have a negative impact on the economy of these LMC. As their profit has to stay at
least constant, all the prevention activities will necessitate an increase in the Disposal rate.
Decrease of disposed waste is the main target of the EU and all its Member States. On
the contrary, the main goal of LMC’s, as entities, is profit generation.
120
Fig. 3.2.a Causal loop diagram of full cycle LMC
Source: by author(Notes for Fig. 3.2.a, 3.2.b, 3.2.c: interrupted arrows bring effect in the long-term, + bring positive
effect from LMC point of view, - bring negative effect; blue arrows are neutral, green positive, red – negative)
With a decrease in disposed waste volumes and despite increase of the disposal rate
and NRT for disposal, LMC’s that have disposal as their main activity, profit will start
decreasing at a certain point. This leads to contradictions between the society and the LMC.
Fig. 3.2.b. Causal loop diagram of LMC doing only landfilling & education activities.
Source: by author
One of the solutions in order to avoid this contradiction is being offered by the author
– assessing and managing the waste/ resources that are being generated in the landfill during
121
waste disposal process in an economically effective way. In order to find a solution for
improvement of operation and profitability of LMC and to enhance their economic situation,
the author has developed a basis for industrial symbiosis and will offer a model for
cooperation of municipal companies with other industries in order to close the loop and to get
the most of the resources that otherwise currently are resulting as waste.
Fig. 3.2.c. Causal loop diagram of LMC doing landfilling, sorted waste collection &
education activities. Source: by author
Table 3.1
PESTLE analysis of a Landfill management company
Source: by authorPolitical Economical Social
• EU directives on waste, landfills, packaging, etc.;
• EU Circular economy package;
• Carbon low-tech development;
• Local policies;• Funding (i.e. Horizon
2020).
• Natural Resources tax- on waste disposal;
• Decrease of waste generation per capita;
• Development of recycling and recovery facilities;
• State support for industrial symbiosis.
• Awareness;• Change in consumer
behaviour;• Population growth rate;• NGO activities.
Technological Legal Environmental• Research funding;• Innovation potential;• State of the art
technologies.
• Support mechanisms for industrial symbiosis;
• Development of end-of-waste criteria;
• Support mechanisms for waste management clusters;
• Certification of the products from the waste materials.
• Decrease of pollution;• Monitoring of landfills.
122
In addition, for better understanding of the status quo of landfill management
companies, the author has performed PESTLE (political, economic, social, technological,
legal and environmental) analysis. It assesses a market, including competitors, from the
standpoint of a particular proposition or business.
PESTLE provides a summary of the influencing external factors to a company. In
order to understand the whole picture, the author considers it essential to also develop a
matrix of SWOT (strengths, weaknesses, opportunities, threats) analysis, which is provided in
Table 3.2 below. SWOT analysis is useful for assessing a company’s strategic management
and identifying the level of firms in each dimension.
Table 3.2.
SWOT analysis of a Landfill management company
Source: by authorStrengths Weaknesses
1. Regional monopoly in waste disposal;
2. On-site waste treatment;3. Strong market entry barriers;4. Fully public companies;;5. Vertical integration in the in-
house case5.
1. Lack of self-financing;2. Dependence on waste flow;3. Waste disposal tariff is approved by
Public Utilities Commission;4. Research capabilities;5. All income must reduce the waste
disposal tariff.
Opportunities Threats1. Development of waste treatment
facilities;2. Development of industrial
symbiosis on a landfill basis;3. Resource availability for sharing;4. Cooperation with other industries.
1. EU targets on waste landfilling limitations;
2. EU targets on landfill ban of certain materials;
3. Changing policies;4. Global waste trends;5. Energy prices.
Analysis of PESTLE and SWOT provides us with a full picture of internal and
external variables, which influence the daily operation and long-term development of landfill
management companies. In order to ensure their feasibility, LMCs have to elaborate a long-
term development direction, taking into consideration all the factors stated in Tables 3.1 and
3.2. Figure 3.3 provides a current picture of Latvian landfill generated side-products from
their daily operations. This Figure will be developed in the future, as the landfills are
developing and new waste treatment options appear.
5 In the future, all landfill management companies may become vertically integrated. The more functions a municipality assigns to an entity, working on the in-house principle, the lower the possibility for private companies to enter the market
123
Research undertaken by the author revealed that Industrial symbiosis can be
implemented in wood processing (for example – technical water, heat), agriculture (heat for
greenhouses), greening, road construction (technical compost), domestic heating, construction
materials, fish and pig farms (technical water, heat), etc.
Fig. 3.3 Landfill as a basis for industrial symbiosis. Source: by author
Disposed waste opens wide possibilities for industrial symbiosis. Taking into account
a wide range of activities in the field of waste management such as prevention, recycling,
sorted waste collection, re-use, etc., the volume of waste landfilled is going to decrease as the
disposal rate increases. Industrial symbiosis is an economically reasonable solution in such
situation – a so-called contradiction sustaining mechanism.
The author has chosen four landfills, which are in operation since 2004 and already
have stable landfill gas volumes for the basis of modelling. It has to be mentioned that no
particular statistics on all of the outputs stated in Figure 3.3 are available, thus when
launching industrial symbiosis it will be summarized in order to attract other industries.
Currently the LMC use the resources generated during waste disposal internally:
Electricity – internal use, greenhouses (producing tomatoes, strawberries,
flowers), nearby road lighting;
Heat – internal heating, greenhouses;
Recreation areaRemediated area
CO2
Landfill gas
leachat
Cell
sorted waste
RDF
metals
technical compost
waste
Waste pre-treatment
center/ Waste sorting
Landfill,
as
Industrial
symbiosis
124
Remediated area – pasture for lambs (saving costs on lawn mowing via
grazing).
Table 3.3
Potential savings of resources at LMC
Source: data from Latvian Association of Waste Management Companies
Zielemvidzemes atkritumu apsaimniekosanas organizacija
Getlini
EKO
Ventspils
labiekartosanas
kombinats
Liepajas
RAS
Market
price6
Electricity 1 850 MWh/ year 35 000
MWh/
year
1 650 MWh/
year
2 000
MWh/
year
0.01185
kWh
Heat 2 115 MWh/ year 39 500
MWh/
year
1 900 MWh/
year
2 300
MWh/
year
56.28 per
Mwh
Carbon
dioxide
8 634 tons/ year 117 621
tons/year
8 240 tons/ year 8 820
tons/
year
RDF 10 000 tons/ year, equalling to 34 000
MWh/ year
n/a* 7 400 tons/ year, equalling to 25 160 MWh/ year
n/a* 365.66
per 1000
m3
* - landfills have the mechanical-biological treatment facilities in operation since 2016, but no data for the full year of operation is available yet .
Implementing industrial symbiosis will allow sharing the landfill’s resources with
other facilities, which could be located near by. The facilities would definitely have an
economical benefit, below the author has developed a table 3.3, showing market prices on
resources that are currently in use by the LMC themselves.
The resources within industrial symbiosis would be offered to nearby facilities for a
profit, but lower than the market price. Currently landfills that generate electricity are selling
it back to the grid for a fixed mandatory procurement price set by the Latvian Cabinet of
Ministers regulations (2009). In the future, however, the prices will decrease to even out with
the market price. The price for RDF is approximately 14 Eur/t but the main issue is that
6 Market price for resources, generated by the landfill
125
currently only one cement kiln accepts RDF as a fossil fuel in Latvia and it already has a
long-term contract for RDF supplies from abroad. It also has to be mentioned, that in the
neighbouring countries Estonia and Lithuania for instance, waste management companies
have to pay for RDF to be accepted for incineration, except for cement kilns, which pay waste
management companies a certain fee for RDF.
Currently production prices for such resources as heat, RDF, water (after leachate
treatment) are not available, but the author is cooperating with LMCs and the prices at which
they will be willing to offer these resources as well as others, that have not been accounted for
yet, will be developed in order to perform a financial analysis and calculate payback for
interested industries. Despite the aforementioned landfills have to be developing, investments
in the upgrade of infrastructural elements are occasionally required as well as coverage of
daily economic activities. The Landfill waste flow model (presented in Annex 4) depicts a
more sophisticated material flow within a landfill site and introduces a new element to the
system – industrial symbiosis block that is aimed on using the resources that currently stay
unused within the landfill site.
Modelling a new landfill model
Landfill is a more complex unit of infrastructure than just a fly-tipping to dispose of
waste in a sanitary and sustainable manner. Landfills have a range of requirements set in the
Council Directive 1999/31/EC on the landfill of waste: location, water control and leachate
management, protection of soil and water (artificial sealing liner, drainage layer, gas drainage
layer, impermeable mineral layer, top soil cover), gas control, risks and hazards, stability,
barriers.
When constructing a landfill, the following infrastructure elements are to be installed:
access road, fence around the entire landfill territory, weighting bridge at the entrance to the
landfill site, administrative and support buildings, leachate treatment facility, leachate
collection system, fire protection basin, landfill gas collection system power unit (for
production of electricity and heat), temporary waste storage area, composting area, area for
sorted waste (with open access for the inhabitants), waste pre-treatment centre, waste sorting
station (optional), waste disposal cells, technical facilities, etc.
It is essential to understand that a landfill is a long-term investment and an object of
infrastructure that cannot be easily suspended. This is explained by the fact that even stop of
waste disposal does not affect the chemical processes already undergoing in the waste
disposal cell. Figure 1.1 of Chapter 1 of the present research illustrates the long-term effect
that each landfill has on the environment and stresses the need for the developing world to
pay attention to remediate activities of sub-standard landfills, dumpsites or fly-tipped waste –
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as uncontrolled and without necessary infrastructural elements (landfill gas collection system
and power unit) they pose dramatic harm to the environment. Figure 1.1 shows the lifespan of
landfill gas production. It can be concluded that landfill gas generation process is a long-term
activity and can even be active after closure and remediation of the landfill (normal operation
period of a landfill is considered to be approx. 30 years). Each new landfill, reaching certain
volume of waste in the deposit cell, mounts landfill gas collection system (horizontal or
vertical, depending from the technology chosen, although, for new and operating cells,
normally a horizontal gas collection system is chosen), which then is connected to the power
unit. Landfill gas comprises of 40-60% of methane (CH4) and the resting volume of gas is
CO2 with approximately 1% of other volatile organic compounds (VOC). Prior to reaching the
power unit, gas is purified from H2S, Cl, F, siloxanes and VOC, as they negatively affect the
operation of the engine. The gas is then being incinerated by internal combustion engines. The
output process of this combustion results in 40% electricity and 46% heat production.
The ambitious goals set by the European Union in terms of a binding landfill target to
reduce landfill to a maximum of 10% of all waste by 2030, promotion of economic
instruments to discourage landfilling and development of concrete measures to promote re-use
and stimulate industrial symbiosis – turning one industry's by-product into another industry's
raw material, means that the long-term investments into landfill infrastructure, including bank
loans are to be revised as the waste amount going to landfills is to start its decrease. The inter-
municipal waste management companies, the main activity of which is landfilling, will be the
most affected. In order to sustain the economics of the landfills only two main options exist –
either increase of disposed waste or increase of the disposal fee per ton of waste. First option
is totally impossible within the preconditions set and the second option may result in dramatic
increase of fly-tipping. This is the moment when the author advises to consider a third
proposal to be implemented into life. Stimulating industrial symbiosis would not only allow
landfills to enter the circular economy but also to maintain their financial situation.
The current landfill management scheme foresees that the landfill operation company
has an option to sort out all the valuable fractions: 1) from the inhabitant sorted waste, which
comes to the sorting station at the landfill; 2) sorting the mixed municipal waste. In addition, a
landfill can generate for its internal use or for sale to the industry following resources: heat
and electricity from landfill gas, technical water from leachate, technical compost from mixed
municipal waste, etc.
Systemic and transformative change is what is required. This is reflected in the
growing number of case studies analysing innovative solutions based on new systemic
thinking like “cradle to cradle” (McDonough and Braungart, 2002) and “industrial symbiosis”
127
(Gibbs, 2008). Industrial symbiosis - the core of industrial symbiosis is a shared utilisation of
resources and by-products among industrial actors on a commercial basis through inter-firm
recycling linkages. In industrial symbiosis traditionally separate industries engage in an
exchange of materials and energy through shared facilities (OECD, 2012). The author within
this research offers a solution, which would form a cluster on the basis of the landfill, using
all the resources available within it. In other words, all the output resources mapped in Figure
3.5 as “y” are effectively used by other industries, which would have their facilities on the
landfill territory or in immediate proximity to it. The resources available within a landfill are
distinguished by 4 categories: a) materials; b) energy; c) services; d) skills.
Table 3.4
Classification of resources. Source: by authorResource TypeElectricity EnergyHeat EnergyLeachate MaterialsTechnical compost MaterialsSecondary resources MaterialsSludge MaterialsInternal infrastructure ServicesTechnical equipment (vehicles) Services
“Services” and “skills” stand for support resources for example - transportation,
available storage space, etc. which are not used in full by the company and can be shared.
Current output resources can be classified according to the data in Table 3.4.
3.2. Industrial symbiosis modelWithin this research the author has developed a model, presented by Figure 3.4,
where: x1, x2, x…, xn – are the input data, i.e. waste flows that reach the waste landfill site
(which include sorting station and waste pre-treatment centre), y1, y…, ym – are the output resources that are left so far without appropriate
application within a landfill site, z1, z2, zk – industries which may take advantage of y resources and save the
consumption of primary resources.
zk
z2
z1
ym
y…
y2
y1
ym
y…
y1
Waste
landfill sitex…
xn
x2
x1
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Fig.3.4 Energy flows within a Landfill. Source: by authorInput data for x values, as well as output data for y values is provided in Table 3.5, and
a more detailed incoming waste flow break-down can be found in Table 3.6.
Table 3.5
Input data for x values and output data for y values
Source: by author
X input data Amount, tons Y output data AmountMunicipal waste 330 280 Electricity 35 000 mWhSorted waste 42 135 Heat 39 500 mWhOther fractions (i.e. green waste)
58 675 Leachate 84 569 m³
Description of the waste flow
Below the author has broken down the general waste flow, incoming to a landfill into
more specific fractions, so it will be easier to track the resources within the flows and to
comprehend the processes, undertaken with one or another type of waste.
In addition a landfill equipped with a sorted waste sorting station receives resources
stated in Table 3.7.
According to the Directive on waste 2008/98/EC, it is prohibited to landfill untreated
waste, so all the incoming waste flows are divided into two – separately collected waste is
directed to a sorting station, where it is manually re-sorted and prepared for sale to industry.
Separately collected waste is then being distinguished into: paper – of lower and higher
quality and cardboard; plastics – by chemical compounds.
Currently no distribution into foreign trade statistics codes is applicable to the
statistical data in Latvia. Mixed municipal waste is directed to a pre-treatment centre. The
separately collected waste enters a waste pre-treatment plant where it is automatically sorted.
The first stage is an automatic bag opener – which ensures all the waste reaching the conveyor
belt is liberated from the bags, so it can be easily accessed and sorted more effectively. Metal
separators are located along the conveyor belt (most commonly two separators located at
different stages), sorting out all the metal fractions.
The pre-treatment centres are mainly equipped with trommel separators or drum
screens. They separate materials according to their particle size. Waste is fed into a large
129
rotating drum, which is perforated with holes of a certain size. Materials smaller than the
diameter of the holes will be able to drop through, but larger particles will remain in the drum.
Table 3.6Waste classification and breakdown of incoming waste flow into types. Source: by
authorType of waste Waste classification7 Volume,
tons
Waste plastics (except packaging)
02 wastes from agriculture, horticulture, aquaculture,forestry, hunting and fishing, food preparation andprocessing
02 01wastes from agriculture, horticulture, aquaculture, forestry, hunting andfishing
02 01 04 170
Materials unsuitable for consumption or processing
02 02wastes from the preparation and processing of meat, fish and other foods ofanimal origin
02 02 03 1 250
Mixed packaging 15waste packaging; absorbents, wiping cloths, filtermaterials and protective clothing not otherwisespecified
15 01 packaging (including separately collected municipal packaging waste)
15 01 06 7600
Textile packaging 15 01 09 755
Plastic16wastes not otherwise specified in the list
16 01end-of-life vehicles from different means of transport (including off-roadmachinery) and wastes from dismantling of end-of-life vehicles and vehiclemaintenance (except 13, 14, 16 06 and 16 08)
16 01 19 65
Mixtures of concrete, bricks, tiles and ceramics other than those mentioned in 1701 06
17construction and demolition wastes (including excavated soil from contaminated sites) 17 01
concrete, bricks, tiles and ceramics
17 01 07 20
Wood 17 02wood, glass and plastic 17 02 01 40
Mixed construction and demolition wastes other than those mentioned in 17 0901, 17 09 02 and 17 09 03
17 09other construction and demolition wastes
17 09 04 6680
7 Waste classification, based on the European List of Waste (Commission Decision 2000/532/EC) and
Annex III to Directive 2008/98/EC
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Type of waste Waste classification Volume, tons
Mixed municipal waste
20 municipal wastes (household waste and similarcommercial, industrial and institutional wastes)including separately collected fractions
20 03other municipal wastes
20 03 01 300320
Bulky waste 20 03 07 13 380
Total 330 280As a result, waste is sorted into at least 3 fractions by size 30x30mm, 150x150mm and
70x70mm:
Light fraction 15-25%, possible use for recycling or re-use (polyethylene, PET, paper,
cardboard, tetra packs, etc.)
Middle fraction 30-40% - for disposal at landfill cell
Organic fraction 30-45% - possible use for composting, output will be technical
compost, of lower quality then market offered compost products.
Table 3.7
Classification and breakdown of incoming sorted waste flow Source: by author
Type of waste Waste classification8
Volume, tons
20 municipal wastes (household waste and similarcommercial, industrial and institutional wastes)including separately collected fractions
20 01 separately collected fractions (except 15 01)
Paper and cardboard
20 01 91 42 135
glass 20 01 02plastics 20 01 39metals 20 01 40
20 02 garden and park wastes (including cemetery waste)
Biodegradable waste
20 02 01 58 675
Total 100 810
In order to develop a model, it was necessary to monitor the incoming waste flow
within a landfill, compare the results with the previous three years in order to develop a trend
so this data could be used for a repeating pattern. In Table 3.8 the author provides a waste
flow breakdown within one calendar year.
Table 3.8
Incoming waste flow to a landfill and its changes during a 12-month period, tonsSource: by author
Was
te
Janu
ary
Febr
uary
Mar
ch
Apr
il
May
June
July
Aug
ust
Sept
embe
r
Oct
ober
Nov
embe
r
Dec
embe
r
Tota
l
1 2697 2346 2632 3038 2782 2583 2755 2815 3053 3130 2954 2238 33028
8 Waste classification, based on the European List of Waste (Commission Decision 2000/532/EC) and
Annex III to Directive 2008/98/EC
131
2 2 1 6 9 1 8 4 2 1 5 9 0
2
50 150 1460 4860 2340 3400 4500 5600
1023
0
1535
0
1002
5 800 58765
3 3595 2300 3540 3750 3335 3755 4150 3300 3350 3800 3080 3980 42135
Where: 1 – municipal waste, 2 – green waste, 3 – sorted waste
Options for industrial symbiosis
Currently the main source of income for any landfill is the landfill fee – paid by waste
management companies, bringing waste for disposal, based on the de facto weight of each
waste collection truck. According to regional waste management plans, it has been foreseen
that, in order to maintain and upgrade the infrastructure, cover anyloans and other
expenditures and since the disposed waste volumes were predicted to decrease, the waste
disposal fee was forecasted with a systematic increase.
Within the model proposed by the author, industrial symbiosis can be achieved by
attracting other industries or through the diversification of municipal waste management
company’s activities. Overall, successful implementation of industrial symbiosis will allow
the LMCs to become sustainable and economically viable, and the decrease of disposed waste
volume from over 80% today to 10% in 2030 will become more realistic to achieve.
Table 3.9
Industrial symbiosis modules. Source: by author
Mod
ule
NACE Type of activity Required resources Required
construction
time
A A1 - Crop and animal production, hunting and related service activities A3 - Fishing and aquaculture
Farming – pig farms, fish and bird farms, mushroom growrooms
landfill’s offered infrastructure,heat,electricity
1 month to 2 years, depending on farm complexity
B C16 - Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials
Timber factories landfill’s offered infrastructure,heat,electricity,technical water.
1 day to 6 months, depending on facility complexity
C A1 - Crop and animal production, hunting and related service activities
Greenhouses landfill’s offered infrastructure,heat,electricity,CO2.
1 month to 1 year, depending on facility complexity
D A1 - Crop and animal production, hunting and related service activities
Agriculture – greening works
Technical compost, technical water.
E E39 - Remediation activities and other waste management services
Sewage sludge landfill’s offered infrastructure,electricity.
2-3 years
F D35 - Electricity, gas, steam and air conditioning supply
Solar panels, windmill generators
landfill’s offered infrastructure,
approx. 2 years
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connection to the gridG I55 - Accommodation,
R93 - Sports activities and amusement and recreation activities
Recreation area with educational centre
landfill’s offered infrastructure,remediated area, electricity,heat.
From 1 month to 2 years
H R93 - Sports activities and amusement and recreation activities
Swimming pool landfill’s offered infrastructure,remediated area, electricity,heat.
1-2 years
I E38 - Waste collection, treatment and disposal activities; materials recovery
Waste sorting factory
landfill’s offered infrastructure,electricity,heat.
1-3 years
In addition this will have direct impact on the society – as the LMC will be able to
avoid rapid increase of disposal fee, the fee for waste collection from the inhabitants will not
be influenced from this component in the volume it was planned previously.
When analysing a landfill’s resources and by-products from its daily operations and
resources that are currently underestimated, the facilities that can be evaluated for establishing
industrial symbiosis modules are presented in Table 3.9. From the Table it can be concluded,
that a range of modules can be constructed within a landfill’s territory in order to increase
efficiency of the landfill’s generated resources. Below the author provides a small description
of each module’s characteristics. It has to be emphasized that in-depth analysis of module
integration within landfill infrastructure could be a basis for further masters or doctoral thesis.
Farming
The author examines the possibility to use heat generated from landfill gas combustion
in a way, similar to greenhouses – using landfill’s infrastructure to develop a small modular
pig or fish farm. In case of fish farms, new technologies allow farm size to start from 6 m2
being totally transportable modules, which require simple engineering and maintenance.
Timber factories
Within the current research, timber factories dealing with wood drying have been
evaluated. This type of activity requires heat as its main resource and currently heat is the
resource with the least practical application within a landfill, mostly due to its peculiarity of
not being transportable and thus has to be used directly at the location it is being produced.
Greenhouses
Latvia already has successful examples of greenhouses installed within a landfill and
using landfill’s generated heat and electricity to grow vegetables. A similar approach can be
used on other landfills in Latvia as well as abroad, where connection to the domestic heating
grid is estimated to be costly, loss of heat is high and the process - economically ineffective.
Depending on the volume of heat, a landfill may opt for a small greenhouse, covering only the
needs of the landfill personnel, or, in case the produced heat volumes are higher, to opt for a
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more industrial greenhouse. It has to be mentioned here, that such greenhouses offer more
ecological products, as no chemical vegetable or insect protection is in place and the volume
of nitrate can be considerably lower than required, due to fertiliser dosing system.
Agriculture, greening works
Technical compost is another resource that is currently not applied. It cannot be sold to
the mass market due to its low quality and due to the fact that currently no Cabinet of
Ministers regulations regarding any type of compost are in force in Latvia. As Latvia,
alongside with other EU member states, has to eventually decrease the volume of
biodegradable waste being deposited at landfills, composting is an optimal solution. However,
in order to get high quality compost, green waste has to be collected separately, which is not a
common practice in Latvia yet, and if compost is being produced from municipal waste, then
the chemical quality of the product will be low. Thus it still leaves options for this product.
Low quality compost can be used in road construction or in part of greening works.
Sewage sludge
Sewage sludge is colloidal sediment resulting from the treatment of municipal,
domestic and industrial waste water in treatment plants, as well as sludge from septic tanks
and other similar installations for waste water treatment. Sewage sludge is a municipal waste
(particularly biodegradable waste), the management of which should be organized in the
municipality, according to the Waste Management Act (Article 9) of Latvia.
One of analysed treatment options for sewage sludge could be – anaerobic
fermentation. Benefits from such management are:
- pathogen microorganisms are eliminated during thermophile processes;
- it is possible to use the energy generated during the process;
- possibility to combine with other forms of bio-waste recycling, thus decreasing the
relative cost of sludge recycling;
- final product of recycling can be used as a daily cover material at landfills.
As landfills are situated geographically in the centres of waste management regions, it
can be economically effective to deliver the sewage sludge to these areas and moreover it
would avoid generation of environmental pollution at new areas.
Solar panels and windmill generators
Taking into account that the areas of remediated landfills or dumpsites normally form
at least 20m high hills, not covered by trees and in most cases remain unused, it can be
economically effective to take advantage of these areas and mount solar panels or windmill
generators. Moreover, as the volume of landfill gas will start decreasing, the electricity from
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these sources will be available not only for sale to the grid, but for the use of developed
industrial symbiosis within the landfill’s territory.
Recreation area with educational centre
Landfill or dumpsite after reclamation activities (covering all the waste with HDPE
membrane and at least 0.5m clay and soil) has a 30 year post-closure monitoring period
before it can be brought back to nature. But this does not mean that this area has to remain
unused. Reclaimed (or recultivated) areas can be used for 3 categories: Category 1 - open
space, agricultural and passive recreation; Category 2 - Active recreation, parking or
industrial/commercial activities; Category 3 - Intensive uses such as residences, industry and
commercial development. The most common uses are categories 1 and 2, mainly transforming
a landfill or dumpsite into a hiking park, nature preserves, golf course, ski slope.
As municipalities are responsible for education of society and creation of awareness in
the field of waste management (Law on Waste management), and as these functions are often
delegated to LMCs, this solution would attract inhabitants – in case the recreation area is a
hiking park, a ski slope or any other outdoor activity centre and it would facilitate the work
with inhabitants, as they will be able to see the daily operation of the landfill, understand the
complexity of waste management process and get involved in waste sorting and waste
minimization activities.
Swimming pool
A landfill’s infrastructure (roads, lighting, etc.) also allow for the construction of
facilities such as swimming pools or recreation centres, as these require heat and electricity at
most, and these are the resources that can be provided by the landfill for at least 30 years.
Waste recycling facilities
It is obvious that in the nearest future, landfill sites will have constant decrease of
volumes of the disposed waste. Nonetheless, the author considers that landfills in Latvia will
stay as significant elements of infrastructure for the upcoming years, and taking into account
current trends, it is important to transform these facilities, in order to ensure their
sustainability and feasibility into technological parks (Cudecka, 2011a; 2011b). These
technological parks could also include waste recycling facilities for a particular waste stream
(i.e. rubber, metal, textiles, etc.), especially focusing on rare waste streams, so the particular
recycling facility could accumulate a particular waste stream from the whole country, or even,
from closer neighbouring countries as well, in order to increase its efficiency. In this context,
recycling of such materials, which are currently either not being recycled or being sent abroad
need to be considered. These types of parks can also be expanded, taking into account also the
social and education function that the LMCs have to execute, to scientific parks – bringing
135
researchers, universities and education specialists, providing scientific research for further
possible landfill development options as well as educating society in environmental issues.
The developed model will allow landfill management companies to increase effective
management of resources that are being developed during its daily operations as well as to
move towards a circular economy and have an impact on waste minimization. Figure 3.5
illustrates the primary waste and resource flow. Waste is being generated and collected, and
afterwards separately collected waste is being sorted and all the secondary resources are being
sent back to the industry, gaining Sale profit (S i(o), where i = 1,2,…,N), the rest of the waste
flow enters landfill, where it is processed in the pre-treatment facility and the waste
designated for disposal is landfilled. Landfill daily operations generate a range of Resources
(R11, …, RL
K), which, within the model developed by the author, are being offered to different
modules (in case, Landfill decides to construct modules offered in Table 3.9) or industries, in
case the landfill decides to attract a third party to use the resources available (I1, …, IK).
Fig. 3.5 Resource flow, entering a landfill Source: by author
SK,1 … SK, P
O1,1 … O1,M Ok,1 … Ok,M
S1,1 … S1, P
SaleSale
RK,1 … RK, LR1,1 … R1, L
IkI1
Landfill
Waste
R1,1 … R1, L
136
Fig.3.6 Flow of the resources within industrial symbiosis. Source: by author
Figure 3.5 shows the interconnections and flows of the resources when applying
industrial symbiosis. Landfill offers resources (R1i, … RL
i) to the industries (I1, …, IK),
industries can also share the resources among themselves.
Fig.3.7
Interconnection with second level industries. Source: by author
During production processes industries create waste (O,,1 …, O1,M; …; OK,1, …, OK,M),
which is sent to landfill. Output of industry activities, i.e. product is being sold to the market
and the figure illustrates the sales volume (S1,1, …, S1,P; …; SK,1, …, SK,P) and profit is
generated from sales (B1,1, …, B1,P; …; BK,1, …, BK,P). Result of these flows is represented by
the formulas in the Figure 3.6. Next figure, 3.7 shows the interconnections of a particular
module with new facility and other industries, showing interconnection and resource flow,
alongside with potential sales.
SK,1 … SK, PS1,1 … S1, P
ITI2I1
ER1,1,2,…, ER1,1,K
New facility
O1,1
O1,2
O1,M
R1,1, R1,2, … R1,L
I (greenhouse)
{BT,1, BT,2, …, BT,G}{B2,1, B2,2, …, B2,G}{B1,1, B1,2, …, B1,G}
137
In order to evaluate all the outputs of landfill activity, it is necessary to calculate the
volume of the resources, available from waste. Total resources from Waste are being
calculated using the formulas 3.1:
R = {R1(i), … RL
(i)} (i= 1, 2, …, K) = ∑i=1
K
∑j=1
L
R ij
(3.1)
138
Where i stands for type of industry and j, for type of resource. This equation provides
the landfill management company with the information on the valuable resources that can be
used for further sales, or internal use for module application.
The next stage it assessment of waste, generated by different industries or modules
(Q1,1, …, Q1,M; QK,1, …, QK,M). This waste is being calculated for each type of industry and
afterwards a total waste from all operating modules/industries is being generated. Q i,j, where i
stands for type of industry and j, for type of resource:
Total Waste generated during the production process is calculated as follows:
Q = {Q1(i), … QM
(i)} (i= 1, 2, …, K)= ∑i=1
K
Qi
(3.2)
This equation provides the landfill management company with the forecasted volume
of waste, which will be entering the landfill for sorting and disposal. The next equations are
aimed to assess the volume of available exchangeable resources (ER), that can be offered by
landfill and by industries/modules for exchange and thus will provide savings for the purchase
of raw materials.
Where k stands for number of industry/module; j – type of resource, l –
industry/module to which the exchangeable resource is sent.
The next stage of the model – is evaluation of the sales from all types of industries/modules,
where SK,P stands for: K – industry/module number, P – type of product sold.
S1 = S1,1 + S1,2 + ... + S1,P = ∑i=1
P
S1, i
S2 = S2,1 + S2,2 + ... + S2,P = ∑i=1
P
S2, i
SK = SK,1 + SK,2 + ... + SK,P = ∑i=1
P
SK , i
(3.4)
Total first level industries:
(3.3)
139
(3.5)
Sales are divided into Sales from first level and second level industries. Within the
present research, first level industries are such industries, which interact with the landfill and
its offered resources and second level industries are such industries, that do interact with other
industries, but do not have direct connection in terms of exchangeable resources with the
landfill. Sale from second level industries is depicted as BT(N), where T – stands for number of
industries in the second level connection and K – type of product sold.
Sale from second level industries:
(3.6)
Total sale from second level industries is calculated as follows:
B(N)=B1(N)+B2
(N )+…+BT( N )=∑
i=1
T
Bi( N) (3.7)
Within the research the Target function has been developed in order to ensure
maximum use of all resources:
Blandfill = B + B(N) = B1 + B2 + … + BK + B1( N )+B2
( N )+BG( N ) = ∑
i=1
K
Bifirst + ∑
i=1
K
Bisecond (3.8)
Where B and Bfirst stands for first level industries/modules and B(N) and Bsecond – second
level industries/modules. Further four balance functions are presented, that will allow landfill
management companies to evaluate resources that can be used for industrial symbiosis and,
depending on their volume, will be able to develop a decision making tree for optimal
development direction.
1. Waste balance
Q=∑i=1
K
Qi=Qrw+Q fi+Q sl
Q ≤ R
(3.9)
where:
rw – return waste
fi – for industries
sl – second level
Qrw+Qfi+Q sl≤ R (3.10)
2. Electric balance
140
∑j=1
K
E1 , jfirst+∑
i=1
T
E2, isecond ≤ E
(3.11)
3. Thermal balance
∑j=1
K
TE1, jfirst+∑
i=1
T
TE2 , isecond≤ B
(3.12)
4. Technical water balance
∑j=1
K
W 1 , jfirst+∑
i=1
T
W 2, isecond ≤W
(3.13)
It has to be evaluated that different types of resources have different life-cycles. For
example, electricity and heat generation from methane has an approximate active lifespan of
30 years (as illustrated in Fig. 1.1) and further 10-15 years will be generating minimum level
of resources. This means that a landfill management company has to take into account the
status quo of the landfill and evaluate strategies for long-term, mid-term and short-term
development. On the other hand this decrease in resources may be compensated by generation
of wind power on the recultivated part of the landfill, which will be high enough and without
high trees, to ensure efficient operation of the generator. All these current resources, their life-
cycle and substitution possibilities have to be taken into account when choosing optimal
industries/modules. Landfill management companies also have to consider the possibility of
variable structure, depending on seasonal market requirements.
(3.14)
where S stands for “Sales” and C – for “Costs”
(3.15)
ΔB is the source of financing that will be devoted to development and provision of financial
stability.
As a conclusion to the abovementioned modelling, the author has come up with the following
equation, offering resource, electrical, thermal and technical water balance:
141
(3.16)
After developing the set of equations, the author would like to provide some small-
scale examples of decision-making that will illustrate application of the model.
With significant financial support from the European Union, new member states have
harmonised their legislation, waste management regions have been developed, all sub-
standard landfills have been closed and remediated, sanitary landfills for municipal waste
disposal have been constructed alongside basic infrastructure elements (depending on each
country’s and in particular waste management region’s financial possibilities), extensive work
on sorted waste collection has been launched. Currently a new stage of development of waste
management in these countries has been initiated and this is the time when the countries can
introduce circular economy elements into their waste management system. Latvia’s state
waste management plan 2013 – 2020 foresees financial support only for sorted waste
collection and recycling, thus the author considers that the next logical stage should be to
develop industrial symbiosis, following latest trends from the EU in resource efficiency and
closed-loop approach.
One of the solutions offered by the author to avoid contradictions between decreasing
disposed waste volumes and increasing disposal rate and Natural Resources Tax (NRT) rate
that both from a certain point will have a negative impact on LMCs that are engaged only in
waste disposal activities,– is assessment and management of the waste/resources that are
being generated in the landfill during landfill daily operation in an economically effective
way. Current and further in-depth research will allow developing specific tailor-made
recommendations for each particular region and this know-how can be applied in the future to
other member states struggling with economic efficiency of LMC. The author sees the
importance of government in promotion and implementation of industrial symbiosis into the
economy. In order to do so, policy makers together with industry representatives have to carry
out a resource flow assessment, in order to identify the maximum number of
industries/facilities which could be covered by industrial symbiosis. As a result of this
assessment, an action plan with special financial support in order to motivate industries to
142
take part in the establishment and development of industrial symbiosis would be necessary.
The best practices already persist, i.e. Circular economy strategy in the Netherlands or in
Slovenia, which is even better applicable, due to country’s smilitarities with Latvia.
As the landfills in each waste management region are situated more or less in the
middle of the region, then the industries that would be interested in participating in industrial
symbiosis will not face logistic problems.
In order to verify the hypothesis defined within present research, the author provides
the following calculations. The author has developed an example of the forecast for:
waste disposal for one landfill (major decrease of revenue from waste disposal is due
to change of technology applied on site),
revenue from implementation of industrial symbiosis;
change of disposal rate per ton of waste;
alternative development of disposal rate per ton of waste, with the implementation of
industrial symbiosis.
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
0200000400000600000800000
100000012000001400000160000018000002000000
0
10
20
30
40
50
60
Waste disposed, eur Resource use Disposal rate, EURDisposal rate with IS,EUR
Years
Rev
enue
from
was
te d
ispo
sal,
Eur
Was
te d
ispo
sal r
ate,
Eur
Fig. 3.8 Development of a landfill with industrial symbiosis and impact on waste
disposal rate. Source: by author
Figure 3.8 clearly depicts the difference of landfill development with and without
industrial symbiosis. The Δ↓ of disposal rate shows the possibility to maintain a company’s
positive performance without an increase in waste disposal rate, thus avoiding social
resistance. This is compensated by direct implementation of resource use, which, even with
the significant decrease of waste disposal volumes, brings positive Δ.
Δ↑
Δ↓
143
In order to provide more credible data, the author has assessed 10 landfill management
companies for a 25-year operation period and developed 4 different scenarios:
Scenario Description
Scenario 1 Basic development scenario, which foresees significant decrease in waste
disposal for the 25th landfill operation year (on average it is equal to 35%
of waste disposed in 2014). It also foresees significant increase of the
disposal rate per ton, from current average of 26.09 Eur/t, to average 42.6
Eur/t (reaching in some cases up to 49 Eur/t).
Scenario 2 Development scenario with same decrease in waste disposal as in
Scenario 1. Disposal rate development from current average of 26.09
Eur/t to 31.4 Eur/t.
Engagement in industrial symbiosis with 10% of available resources.
Scenario 3 Development scenario with same decrease in waste disposal as in
Scenario 1. Disposal rate development from current average of 26.09
Eur/t to 31.4 Eur/t.
Engagement in industrial symbiosis with 60% of available resources.
Scenario 4 Development scenario with same decrease in waste disposal as in
Scenario 1. Disposal rate development from current average of 26.09
Eur/t to 31.4 Eur/t.
Engagement in industrial symbiosis with 85% of available resources.
The analysis took into consideration following assumptions – the LMCs were initially
financed by municipalities and Cohesion fund (see table 2.5), and this was taken into
consideration during the calculations. Normally European Investment Bank recommendation
is for IRR to be at 5% level. Although, for private investors (for industrial symbiosis
scenarios), it is advised to have IRR at 12% level. IRR rate is directly linked with risk level
that a private investor may have to take up (EC, 2015c). The real discount rate is assumed to
be 5% and the reference period is calculated to be 25 years.
A summary of different business model application scenarios for landfill management
companies is provided in Table 3.10. Scenario 1 is updated from Cudecka (2011a). The main
reason for decrease in ratios is the fact that in 2035 a significant decrease of allowed waste
landfilling volume is expected and an increase in disposal rate will not be able to compensate
this.
It has to be noted, however, that Scenario 1, due to extremely high waste disposal rate,
is not a realistic scenario, and as such an increase in costs for inhabitants is beyond breakeven
point and would not be acceptable and bearable for the population. This scenario would
144
definitely lead to littering and environmental pollution. Scenario 2 is considered to be a
pessimistic view on the development of industrial symbiosis, using only 10% of resources
available for a landfill management company. Scenario 3 is considered to be the most
realistic, with a significant percentage of resources used for industrial symbiosis – 60%. And
Scenario 4 is considered to be optimistic, in case industrial symbiosis gets major support
through Government support and entrepreneurship opportunities. It can be summarised that
Scenarios 3 and 4 can be evaluated as realistic and applicable and the assessment of risk
factors is presented in the table 3.10.
The risk analysis for the Scenarios 3 and 4 convincingly shows that the residual risks
for the IS project are mostly kept at Low level, as a result of the measures already
implemented to prevent their occurrence. All in all, the overall level of the residual risk is
deemed to be fully acceptable, it can be concluded that the probability of project failing to
attain its targeted objective at a reasonable cost is with low probability.
Table 3.10
Risk analysis of the Scenario 3 and 4. Source: by author
Risk description
Probability Severity Risk level
Risk prevention Residual risk after prevention measures
Demand side/ Resource risksWaste flow is lower then forecasted
B III Moderate Demand analysis has been performed based on pessimistic assumptions on waste generation.
Low
Financial risksInvestment cost overrun
C III Moderate Investment cost estimates have been compared with similar projects (on a modular basis) within Latvia and abroad.
Low
Operating cost overrun
B III Moderate Operational cost estimates have been compared with costs in similar projects (on a modular basis) and are proved to be lower.
Low
Problems of financing/ attracting industries
C IV High Support from state and local municipalities in attraction of industries; Support from local municipalities for loans in case of internal IS.
Moderate
Shortfall in revenues from gate fees and sales of materials
B IV Moderate Gate fee as well as NRT for waste landfilling are known for 2-3 years in advance. The forecast included a pessimistic scenario of increase of number of inhabitants and thus waste volumes.
Low
145
Implementation risksProblems with public opposition
D IV Very high
Public consultation and inhabitant awareness creation are crucial activities to be performed. Support from local municipalities, NGOs and state is beneficial in order to secure successful implementation of IS.
Moderate
Operational risksLimits for emissions of pollutants to air/water are exceeded
A II Low Selection of proven, best available technologies for emission treatment will be secured.
Low
Evaluation scale: Probability: A very unlikely; B Unlikely; C about as likely as not; D likely; E very likely.Severity: I no effect; II minor; III moderate; IV critical; V catastrophic.Risk level: Low; Moderate; High; Very high
146
Table 3.11
Summary of landfill management scenarios
Source: by authorR
atio
s
Aus
trum
latg
ale
Die
nvid
latg
ale
Mal
iena
Ven
tspi
ls
Ziem
elvi
dzem
e
Vid
usdu
sdau
gava
Rig
a
Zem
gale
Piej
ura
Liep
aja
Scenario 1
NPV -2 116 380 -10 214 138 -8 655 869 -5 119 762 -1 994 882 -16 990 079 -7 598 282 -8 780 395 -19 083 403 -2 843 428IRR -1% -6% -12% -13% 2% -11% 3% -6% -6% 2%C/B 0,841 0,787 0,348 0,613 1,076 0,445 1,082 0,778 0,607 1,060
Scenario 2
NPV 909 526 -2 889 932 -7 425 400 -4 705 460 1 068 959 -13 764 336 32 330 788 -1 590 764 -14 007 391 511 780IRR 7% 3% -7% -7% 6% -7% 10% 4% -1% 5%
C/B 0,835 0,715 0,311 0,603 1,042 0,416 1,052 0,756 0,566 0,988
Scenario 3
NPV 7 383 493 14 405 535 -4 562 836 -3 779 216 8 041 946 -6 510 571 117 806 054 13 323 738 -2 498 956 9 142 617IRR 13% 11% 0% -2% 11% 1% 16% 11% 4% 10%C/B 0,835 0,715 0,311 0,603 1,042 0,416 1,052 0,756 0,566 0,988
Scenario 4
NPV 11 429 723 25 215 201 -2 773 733 -3 200 313 12 400 063 -1 976 969 171 228 095 22 645 302 4 693 815 14 536 891IRR 15% 14% 3% 0% 13% 4% 18% 14% 6% 12%C/B 0,835 0,715 0,311 0,603 1,042 0,416 1,052 0,756 0,566 0,988
147
Landfill management scenarios from Table 3.11 reveal that industrial symbiosis is a
solution for 7 landfill management companies, however for 3 companies it can be used as a
partial solution, in combination with other development options. From this it may be
concluded that the municipalities or even the Ministry of Environmental protection and
regional development might need to revise current regional division within the waste
management system in Latvia and, in case it is found feasible, to undertake region and landfill
merger, thus assigning landfill specialisation on certain types of resources or waste
management activities.
To make precise calculations for a yearly benefit of a landfill management company’s
engagement into industrial symbiosis, the author provides real figures of landfill’s available
resources in the table 3.12.
Table 3.12
Landfill resources for 2015. Source: by author
Resources Volume Market priceHeat 1200 MWh 53,56 Eur/MWhLeachate 24215 m3 1,10 m3 /2,37m3Electricity 1047,46 MWh 0,01185 KwhPremises 200 m2 2 Eur/m2
Territory with infrastructure (access roads, asphalted areas, etc.)
1 ha 1 Eur/m2
In 2015 one of Latvia’s landfills has ensured constant collection of landfill gas for
production of electricity and heat. In total 851 276 Nm3 of biogas was collected and 1047.46
MWh of electricity and 1200 MWh of heat was been produced from it. Collected and utilized
landfill biogas volume provided a decrease of greenhouse gas emissions equivalent to 6256.9
t/CO2. With the electricity produced it would be possible to provide approximately 500
households with average electricity consumption. Table 3.12 provides a summary of resources
generated by the landfill in 2016 and their market price for the reference year. Further the
author has elaborated potential revenue from the resources available, by landfill engagement
into industrial symbiosis.
Table 3.13
Landfill benefit from engagement into industrial symbiosis. Source: by author
Resources Revenue from efficient resource use, Eur/yearHeat 64300Leachate 57400Electricity 12400Premises 4800Territory 120000Total: 258900
148
As Table 3.13 shows, total revenue for a particular landfill from engagement in
industrial symbiosis may reach 260 000 Eur per annum. For the same year, the revenue from
waste disposal of the landfill are equal to 660 000 Eur, meaning that industrial symbiosis may
add up or compensate up to 40% of revenue. This leads to the conclusion that a landfill
management company can benefit from such a development direction and moreover, it can
significantly limit increase of waste disposal rate (see Figure 3.8.), which would have a
positive social impact.
3.3. Landfil as a basis for industrial symbiosis cluster
As already mentioned in Chapter 2 of the present research, the author has identified a
range of problems that are currently facing landfill management companies and do not allow
them to engage directly into industrial symbiosis. This means that the first obligatory stage in
order to promote involvement into industrial symbiosis is to revise and change or amend
legislative acts in order to stimulate promotion of such activities.
The main obstacle currently is the Commission’s decree No. 1/5, from February 16,
2017 “Municipal waste disposal tariff calculation methodology”, as currently it does not
directly support any additional activities that could be undertaken by the landfill management
companies. In addition, it has to be mentioned, that within present regulations, in case a
landfill starts successful implementation of industrial symbiosis, which would generate
additional profit, it would have to deduct the profit from the expenses calculated in the landfill
tariff, which, in turn, will decrease the cost for inhabitants. At this point, it has to be stressed
that this action will not be environmentally fair, as the inhabitants will receive discount in
payment without any increase of participation in waste management activities (sorting, reuse,
etc.). Currently the author is initiating the abovementioned revisions and is actively involved
in development of the Circular Economy strategy that will be developed by the Ministry of
Environmental Protection and Regional Development of Latvia. This strategy will take into
consideration Latvia’s status quo situation with resource efficiency and will highlight the
possible development paths in order to promote a circular economy. These development
paths, according to the author’s concerns, have to include primary resource consumption,
assessment of critical resources for the country and highlight possible solutions, ensuring
resource efficiency, development possibilities as industrial symbiosis.
Figure 3.9 depicts the possible industrial symbiosis model, offering cooperation among the
modules. Basing on this model, the landfill management company is able to choose best
149
suitable modules, which then can be constructed by it or a cooperation model with the desired
industry can be offered. Further on, developing the industrial symbiosis, other industries can
join the symbiosis, not necessarily interacting directly with the landfill, but sharing resources
with other modules. In order to be able to apply the developed resource balances to a
particular landfill and thus to chose the best possible solution taking into consideration all the
nuances and specifics of the landfill’s operation, the author has developed a decision-making
matrix.
Fig. 3.9 Industrial symbiosis model. Source: by author
The developed industrial symbiosis model is also applicable to LMCs abroad, within
certain limitations. The industrial symbiosis model can be applied in Eastern European
countries, non-EU countries, which follow same waste management development path as EU
member states. It is applicable in the countries, which still use landfilling as one of waste
management options and in particular in the landfills. In terms of ownership, the model is
suitable both for private and public entities.
The model is not suitable for waste dumpsites (sub-standart landfills) and for
hazardous or construction and demolition waste landfills, due to different types of resources,
generated on these types of landfills.
fe
rti
liz hot water
sl
ud
ge
sludge Module 5Module 4
gas
fertilizer
Technical water
electrici
C
O
h
ea
heatelectricity
electricityheat
Module 3Module 2Module 1
Landfill
150
Fig. 3.10 LMC matrix. Source: by author
Figure 3.10 offers a decision making matrix for the landfill management company. This
matrix will allow the landfill management company to take into account main variables as
well as the company’s desired development path. It consists of four quadrants:
First quadrant with preconditions of low volume of resources and low profit
foresees development in the form of modular internal industrial symbiosis.
This means that the landfill management company has to perform a balance of
the available resources and can chose one or a combination of modules, similar
to the ones the author mentions in Table 3.9.
Second quadrant has the precondition of high volume of resources and low
profit. This situation is considered to be a good starting point in order to
develop more sophisticated waste sorting – focusing on smaller fractions with
higher value (i.e. development of sorting of Low-density Polyethylene (LDPE)
and High-density Polyethylene (HDPE) and preparing this material in flakes/
regrinds or pellets).
Third quadrant foresees that a landfill management company has both high
volume of resources as well as high profit. In this case it may consider
focusing on fractions, which can be imported for recycling from abroad and/or
other waste management regions in Latvia. These could be sophisticated tyre
recycling facilities or specific material recycling facilities, which currently are
not available in Latvia or nearby countries.
II
IV
III
I
151
Fourth quadrant with low volume of resources and high profit is suitable for a
landfill management company that wishes to focus on sale of resources and
development of infrastructure. In this case the company will be able to attract
other industries and develop an industrial symbiosis centre.
Application of the LCM matrix will allow a landfill management company to identify
its current position and its prospects for future development. Together with the industrial
symbiosis model developed within present research (Figure 3.21), landfill management
companies can apply the matrix and use these tools for decision-making and shifting towards
a circular economy.
3.4. Example of LMC matrix applicationIn this part of the research, sorted materials with particular market value will be
considered – as approbation of the developed LMC matrix and leading to the choice of
material flow that can be considered as most economically feasible within the assessed
example. One of the particularities of the analysed materials is their storage possibility or in
some cases particular storage necessity. Storage time of the sorted material, ready to be sold
to the industry is mainly influenced by the following factors:
- exchange prices. The prices for different types of sorted materials vary monthly. For
example, the price for PET bales in August 2015 was 0.16 Eur/kg, in December 2015
it reached 0.24 Eur/kg and in January 2017 it dropped down to 0.14 Eur/kg. A more
detailed price breakdown is provided in Table 3.9.
- availability of sheltered storage facilities. This is an especially essential requirement
for materials vulnerable to atmospheric forces (precipitations.), i.e. paper and
cardboard. One of the requirements, for example – is the percentage of humidity. In
case of paper - humidity cannot exceed 10% in order to achieve best price for the
material.
- shipping quota. A minimum shipping volume per type of material, i.e. camion,
container, van, etc.
Taking into account the above-mentioned, each particular facility develops an optimal
storage time and accumulation recurrence for each material. Below the author provides some
data on different types of materials. It has to be pointed out, that paper, for example, in the
recycling industry is divided into 5 main groups, which are then divided into 62 different
grades. This leads to the conclusion, that preliminarily considered simple waste streams
consist of a wide range of materials and each material is recycled or processed, applying
152
certain technologies, which may result as cost efficient for one type of material and totally
inefficient for another.
The following table 3.14 provides data for other types of waste resources. The author
only tackles the most common materials, in order to identify economically efficient resources
and development path.
Table 3.14
Prices for secondary materials, recovered from waste, Eur/t
Source: author’s compilation from Eurostat (2016-2017)
Resources Price range, Eur/tonPaper and cardboard
110 - 190
Glass 20 – 55Ferrous Metal 350 – 3900Non-ferrous metals 90 - 135
According to Eurostat data, price for paper through years varied from 60 Eur per ton
for low quality material up to 210 Eur per ton for highest quality material; at the end of 2016
the prices were between 110 and 190 Eur, respectively. The difference in price between the
lowest and highest quality remains fairly constant. In other words, both prices appear to
develop in parallel.
When analysing the market of secondary resources, it is necessary to mention, that,
according to BSI (2014) EN 643 the European List of Standard Grades of Paper and Board for
Recycling, waste paper is being divided into 5 groups:
Group 1: Ordinary grades (contains 11 grades i.e. mixed paper and board,
corrugated paper, magazines, newspapers, graphic paper for deinking, etc.)
Group 2: Medium grades (contains 12 grades i.e. unsold newspapers, sorted
office paper, sorted colored letters, white woodfree bookquire, etc.)
Group 3: High grades (contains 20 grades i.e. woodfree binders, heavily
printed multyboard, unprinted tissues, etc.)
Group 4: Kraft grades (contains 5 grades, i.e. corrugated kraft, used and new
kraft, etc.)
Group 5: Special grades (contains 14 grades, i.e. mixed papers, used liquid
packaging board, wet/dry labels, cores, kraft sacks, etc.
This grading is very important for further paper and cardboard recycling as it:
defines what grades of paper for recycling contain and don’t contain;
assists industry professionals in buying and selling paper for recycling;
specifies types of recycling for each type of paper
develops different price ranges for different types of materials (BSI, 2014).
153
The author has also developed a flow of paper resources, which can be found in
Annex 7. Such grading also allows savings on recycling expenditures, because different types
of paper and board are treated differently, due to their chemical characteristics, and thus a
facility may chose the best suitable materials. When turning to Latvian waste paper industry,
it is minimally developed and when producing materials for recycling, the materials are sorted
only based on humidity principles (drier materials provide higher revenue). In comparison
neighbouring countries already implement more sophisticated paper and cardboard stream
sorting in order to generate materials with a higher added value.
Regarding glass recycling, the European Union has already developed end-of-waste
criteria for this type of material. This criterion significantly facilitates use of glass cullet and
allows diverting it from the waste stream, thereby saving primary resources and increasing a
country’s resource efficiency ratios. Normally, when sorting glass, the following main criteria
are faced: colour and transparency. Thus, in order to shift to a circular economy and limit the
use of virgin resources in glass production – the use of so-called “cullet” contributes to
reducing energy input, moreover, it helps achieve reduced CO2 emissions. On December 10,
2012, Council Regulation (EU) No 1179/2012 established criteria determining when glass
cullet ceases to be waste under Directive 2008/98/EC of the European Parliament and of the
Council. This regulation states that glass cullet has to comply with the following criteria: the
content of non-glass components shall be limited to the following thresholds:
Ferrous metals: ≤50 ppm;
Non-ferrous metals: ≤60 ppm;
Non-metal non-glass inorganics :
o ≤o100 ppm for cullet size > 1mm
o ≤1500 ppm for cullet size 51 mm
Organics: 2000 ppm
Examples of non-metal non-glass inorganics are: ceramics, stones, porcelain, pyro-
ceramics. Examples of organics are: paper, rubber, plastic, fabrics, wood.
For certain metals, end of life criteria have also been developed. Council Regulation
333/2011 establishes criteria determining when iron and steel scrap and aluminium scrap
cease to be waste under Directive 2008/98/EC of the European Parliament and of the Council.
In order to fall under this regulation, iron and steel scrap has to fulfil the following criteria:
total amount of foreign materials (steriles) shall be ≤ 2 % by weight;
scrap shall not contain excessive ferrous oxide in any form, except for typical amounts
arising from outside storage of prepared scrap under normal atmospheric conditions;
154
scrap shall be free of visible oil, oily emulsions, lubricants or grease except negligible
amounts that will not lead to any dripping.
In order to fall under this regulation, aluminium scrap has to fulfil the following criteria:
total amount of foreign materials shall be ≤ 5 % by weight or the metal yield shall be ≥
90 %;
scrap shall not contain polyvinyl chloride (PVC) in the form of coatings, paints,
plastics;
scrap shall be free of visible oil, oily emulsions, lubricants or grease except negligible
amounts that will not lead to any dripping.
In order to produce high quality secondary materials, a landfill management company,
managing landfill and waste pre-treatment and sorting stations has to monitor that the
secondary materials comply with the following quality requirements: for RDF – calorific
value of 14 mega joules per kilogram and moisture of 20-30%; SRF – calorific value of 17 –
22 mega joules per kilogram and moisture of >15%; for paper – moisture of 10% and 6
subgroups; glass – by colour and chemical compounds; plastics – by type.
Table 3.15
Prices for plastic materials, recovered from waste, Eur/tSource: by author, compilation from plastiker.de (2017)
Resources Price range, Eur/t
Bales Pellets Regrind/ FlakesPlastics* 370
PET 110-250 - 290-450HDPE - 820-970 570-650LDPE 180-330 730-870 560-730
PP 150-280 740-890 500-620PS - 880-1010 600-730
PVC - - 360-470*- data for the time period from August 2015 till January 2017
As it can be seen from Table 3.14, the price range is very wide which also leads to the
conclusion that waste sorting and processing has to become even more sophisticated. Annex 5
of the research provides detailed data on stock prices for each particular type of plastic in
three types of preparation for the time period from August 2015 to January 2017. Annex 6
depicts a flow of plastics materials within the waste management system.
In order to test the LMC matrix developed by the author, an example of a landfill
management company, which is also involved into sorted waste collection, is being assessed.
In particular, the author choses one sorted material flow for assessment – plastics. The author
has used for the analysis the data available regarding volumes of separately collected plastics,
divided into 3 sub-categories: 1) PET (Polyethylene terephthalate); 2) PP (Polypropylene), PS
155
(Polystyrene), PVC (Polyvinyl chloride) and 3) LDPE (Low-density polyethylene), HDPE
(High-density polyethylene).
0 2 4 6 8 10 12 14 16 180
20406080
100120140160180200
Confidence 95% interval for individual and average PP, PS, PVC values,t
Low border PP, PS, PVC Upper border
months (2015-2017 years)
tons
Fig. 3.11 Confidence interval 95% for individual and average valuesSource: by author
This division is based on the data available on the volumes of each type of material. It
is necessary to mention, that the prices for the plastics resources within the European Union
are divided into 6 groups by type of plastics and 3 groups by type of prepared materials: 1) in
156
flakes; 2) in pellets and 3) in bales. Figure 3.11 provides us with a summary of calculation
results for a confidence interval of 95% for individual values, including the low and upper
borders for average values (lines in black). Most commonly a confidence interval of 95% is
being calculated. It is used to express the degree of uncertainty associated with a sample
statistic. A confidence interval is an interval estimate combined with a probability statement.
P ( X∈Ci95% )=95 % (3.17)
P ¿ Ci95% ¿=5% (3.18)
Where:
From the figure 3.11 it can be concluded that with 95% confidence volume of PET is
in the interval (391.15; 655.48), volume of HDPE, LDPE is in the interval (138.23; 267.55)
and volume of PP, PS, PVC is in the interval (109.01; 188.86).
The black lines in each chart represent low and upper borders for individual values,
whereas green and red lines represent low and upper borders respectfully for average values.
For further analysis the author has used modelling of 1000 values for each type of
material and price for each type of prepared material. Figure 3.11 summarises the volume
frequencies of plastics volumes within the analysed time frame – August 2015 – January
2017.
0 100 200 300 400 500 600 700 8000
10
20
30
40
50
60
70
80
90
100
Frequency of volumes for PP, PS, PVC; PET; HDPE, LDPE
PP, PS, PVCPETPE-LD, PE-HD
Volume, t
Freq
uenc
y
Fig. 3.12 Volumes of PP, PS, PVC, PET, HDPE, LDPE, tons. Source: by author
From this figure it can be seen, that all three groups have empirical probability
distribution. The highest volumes of material are provided by PET (PETmin = 330 t; PETmax =
770 t), followed by LDPE, HDPE (HDPE, LDPEmin = 103 t; HDPE, LDPEmax = 300 t) and the
157
least volume provided by PP, PS, PVC (PP, PS, PVCmin = 84 t; PP, PS, PVCmax = 208 t).
August
2015
Septem
ber 2015
October
2015
November
2015
Decem
ber 2015
January
2016
Febru
ary 2016
March 2016
April 2016
May 2016
June 2016
July 2016
August
2016
Septem
ber 2016
October
2016
November
2016
Decem
ber 2016
January
2017
050
100150200250300350400450500
Prices for PET, Eur/t
FlakesBales
Fig. 3.13 Prices for PET, Eur/t. Source: by author
Following this stage, the author has performed analysis of prices for PET material in
accordance with its preparation type. PET is being more commonly traded in flakes or bales.
It has been revealed that prices for this type of material for the analysed time period cannot be
characterised with normal distribution. This is why the author has calculated equations for
each chart.
For PET prices in flakes:
y = -6.03x + 446.8
R2 = 0.369
For PET in bales:
y = -3.41 x + 226.5
R2 = 0.112
Where, xi, model = a*ti + b + e
i = 1, …, n (n=18)
{e = xi, real – xi, model}
{ei,real} is average {e}, equal to
standard deviation.
and e = N(;)
N(;) is normal distribution. The normal distribution is a probability
distribution that associates the normal random variable X with a cumulative probability. The
graph of the normal distribution depends on two factors - the mean and the standard deviation.
The mean of the distribution determines the location of the centre of the graph, and the
158
standard deviation determines the height of the graph. When the standard deviation is large,
the curve is short and wide; when the standard deviation is small, the curve is tall and narrow.
All normal distributions look like a symmetric, bell-shaped curve (Jansons, Jurenoks, 2005).
R2 is a statistical measure that shows how close the data is to the fitted regression line.
It is also known as the coefficient of determination, or the coefficient of multiple
determination for multiple regression. The definition of R-squared is the percentage of the
response variable variation that is explained by a linear model (Jansons, Jurenoks, 2005).
When analysing R2 for PET, it can be concluded that prices for PET in bales have a weak
pattern (11%), i.e. random fluctuations around a constant. PET in flakes has a better R2 ratio –
37%, although it has to be pointed out, that strong pattern is considered to be when R2 lies in
the interval 75% - 100%.
Figure 3.13 reveals the frequency of prices for PET materials. Where empirical
probability distribution to the left represents frequency of prices for bales (where Cmin = 40
EUR/t, Cmax = 357 Eur/t) and empirical probability distribution to the right representing
frequency of prices for flakes (where Cmin = 227 EUR/t, Cmax = 550 Eur/t).
0.00 100.00 200.00 300.00 400.00 500.00 600.000
10
20
30
40
50
60
70
80
90
Frequency of prices for PET
Flakes Bales
Eur/t
Freq
uenc
y
Fig. 3.14 PET prices for flakes and bales, Eur/t. Source: by author
Further the author has calculated a confidence interval of 95% for individual values of
PET revenues from sales in flakes and bales (where X – volume of material, C – price of
material). Figure 3.15 shows the results of analysis performed by the author, modelling 1000
times individual values for revenue from different types of prepared PET. This modelling is
calculated using the following information:
Modelling of X*C values for 1000 times;
159
Calculation of average; ; t; t* and calculation of low and upper borders
for the modelling.
The Confidence interval of 95% shows that 95% of 1000 modelling results appear to
be within the borders of the calculated intervals.
When analysis of PET type of plastics was completed, the author turned to analysis of
prices for PP, PS and PVC material in accordance with their preparation type. PP, PS, PVC is
traded in flakes, pellets and bales. It has been observed that prices for this type of material for
the analysed time frame cannot be characterised with normal distribution. This is why the
author has calculated equations for each chart.
0 100 200 300 400 500 600 700 800 900 10000
50000
100000
150000
200000
250000
300000
350000
400000
Confidence interval 95% for individual values, revenue from PET flakes
X*C Low Upper
0 100 200 300 400 500 600 700 800 900 1000-30000
20000
70000
120000
170000
220000
Confidence interval 95% for individual values, revenue from PET bales
X*C Low Upper
Fig 3.15 Confidence interval of 95% for individual values of PET income, EurSource: by author
160
Figure 3.16 shows changes in prices for all three types of material preparation for the
time period analysed – from August 2015 to January 2017.
For PP, PS, PVC prices in flakes:
y = -3.75x + 548.64
R2 = 0.771
For PP, PS, PVC in pellets:
y = -3.38 x + 905.16
R2 = 0.1945
For PP, PS, PVC in bales:
y = -0.31 x + 244.05
R2 = 0.0013
The explanation for the equations is the same as for prices for PET on page 153.
August
2015
Septem
ber 2015
October
2015
November
2015
Decem
ber 2015
January
2016
Febru
ary 2016
March 2016
April 2016
May 2016
June 2016
July 2016
August
2016
Septem
ber 2016
October
2016
November
2016
Decem
ber 2016
January
2017
0100200300400500600700800900
1000
Prices for PP, PS, PVC, Eur/t
flakespelletsbales
Fig. 3.16 Prices for PP, PS, PVC, Eur/tSource: by author
When analysing R2 for PP, PS and PVC, it can be concluded that prices for PP, PS,
PVC in flakes has a very strong pattern with 77%, meaning that the model explains all the
variability of the response data around its mean. R2 for PP, PS, PVC in pellets is only 19%
with random fluctuations around the constant. And PP, PS, PVC in bales has R2 equalling 0%,
which means that the stock prices for this material in bales is the least predictable.
161
0 200 400 600 800 1000 12000
10
20
30
40
50
60
70
80
90
Frequency of prices for PP, PS, PVC
Flakes Pellets Bales
Eur/t
Freq
uenc
y
Fig. 3.17 PP, PS, PVC prices for bales, flakes and bales, Eur/tSource: by author
Figure 3.17 represents the frequency of prices for PP, PS and PVC materials. Where
empirical probability distribution to the left represents frequency of prices for bales (where
Cmin = 85 EUR/t, Cmax = 407 Eur/t) empirical probability distribution in the middle
representing frequency of prices for flakes (where Cmin = 432 EUR/t, Cmax = 586 Eur/t) and
empirical probability distribution on the right represents frequency of prices for pellets (where
Cmin = 714 EUR/t, Cmax = 1010 Eur/t).
In Figure 3.18, the author has calculated a confidence interval of 95% for individual
values of PP, PS and PVC revenue from sales in flakes and bales (where X – volume of
material, C – price of material).
When analysing the prices for HDPE and LDPE material in accordance with their
preparation type, the author identified that these materials are most commonly traded in all
three types, i.e. flakes, pellets and bales. It was discovered that prices for this type of material
for the analysed time frame couldn’t be characterised with normal distribution. This is why
the author has calculated equations for each chart.
162
0 100 200 300 400 500 600 700 800 900 10000.00
2.00
4.00
6.00
8.00
10.00
12.00
Confidence interval 95% for individual values, revenue from PP, PS, PVC flakes
X*C Low Upper
0 100 200 300 400 500 600 700 800 900 10000
20000
40000
60000
80000
100000
120000
140000
160000
180000
200000
Confidence interval 95% for individual values, x*c PP, PS, PVC pellets
X*C Low Upper
0 100 200 300 400 500 600 700 800 900 10000.00
10000.00
20000.00
30000.00
40000.00
50000.00
60000.00
70000.00
Confidence interval 95% for individual values, x*c PP, PS, PVC bales
X*C Low Upper
Fig 3.18 Confidence interval of 95% for individual values of PP, PS, PVC revenue, EurSource: by author
163
August
2015
Septem
ber 2015
October
2015
November
2015
December
2015
January
2016
February 2016
March 2016
April 2016
May 2016
June 2016
July 2016
August
2016
Septem
ber 2016
October
2016
November
2016
December
2016
January
2017
0
100
200
300
400
500
600
700
800
900
Prices for HDPE, LDPE, Eur/t
FlakesPelletsBales
Fig. 3.19. Prices for HDPE, LDPE, Eur/tSource: by author
For HDPE, LDPE prices in flakes:
y = -0.59x + 626.25
R2 = 0.003
For HDPE, LDPE in pellets:
y = -0.74 x + 859.13
R2 = 0.032
For HDPE, LDPE in bales:
y = -6.49 x + 303.25
R2 = 0,.33
The explanation for the equations is the same as for prices for PET on page 153.
When analysing R2 for HDPE and LDPE, it can be concluded that prices for HDPE
and LDPE have considerably weak patterns. Both prices in flakes and pellets have R2
equalling 0% with random fluctuations around a constant with very weak predictability
possibility. R2 for HDPE, LDPE in bales, however, is quite close to 50% (43%), showing
already less fluctuation and higher predictability possibility.
Figure 3.20 represents the frequency of prices for HDPE and LDPE materials. Where
empirical probability distribution to the left represents frequency of prices for bales (where
Cmin = 60 EUR/t, Cmax = 389 Eur/t) empirical probability distribution in the middle
representing frequency of prices for flakes (where Cmin = 420 EUR/t, Cmax = 770 Eur/t) and
empirical probability distribution on the right representing frequency of prices for pellets
(where Cmin = 773 EUR/t, Cmax = 916 Eur/t).
164
0 100 200 300 400 500 600 700 800 900 10000
10
20
30
40
50
60
70
80
90
Frequency of prices for PE-HD, PE-LD
Flakes Pellets Bales
Prices, Eur
Freq
uenc
ies
Fig. 3.20. HDPE, LDPE prices for bales, flakes and bales, Eur/tSource: by author
Further the author has calculated a confidence interval of 95% for individual values of
HDPE, LDPE revenue from sales in flakes and bales (where X – volume of material, C –
price of material).The undertaken modelling on the example of only one waste stream out of
the extensive municipal waste stream shows how complicated municipal waste composition is
and what a variety of different materials exists in one particular waste stream.
As a result of the modelling provided in this part of the research, it can be seen that, in
order to generate more profit from separate waste collection and return more valuable
materials into the economic cycle, a more sophisticated waste sorting has to be undertaken,
trying to separate from the waste stream different types of plastics. In addition, it can be seen
that the economic assessment of the most valuable type of material preparation has to be
made, either to prepare material in flakes, bales or pellets.
Pellets or bales have considerably smaller preparation costs compared to flakes.
Moreover, the company has to assess the incoming potential volumes of each of the waste
streams and identify the most valuable ones. For example, the modelling has identified that
PET occupies the biggest volume (average volume 523 t) of material in the total flow
whereby HDPE, LDPE constitute volumes of approximately 201.53 t and PP, PS, PVC
accounts for 148.45 t. The most valuable material however is PP, PS and PVC prepared in
pellets (average price 873.06 Eur/t), followed by:
HDPE, LDPE in pellets (average price 847.78 Eur/t);
HDPE, LDPE in flakes (average price 616.67 Eur/t);
PP, PS, PVC in flakes (average price 513,06 Eur/t);
PET in flakes (average price 389.44 Eur/t);
HDPE, LDPE in bales (average price 243.89 Eur/t);
165
PP, PS, PVC in bales (average price 241.11 Eur/t);
PET in bales (average price 193.33 Eur/t);
0 100 200 300 400 500 600 700 800 900 10000.00
50000.00
100000.00
150000.00
200000.00
Confidence interval 95% for individual values, revenue from PE-HD, PE-LD flakes
X*C Low Upper
0 100 200 300 400 500 600 700 800 900 10000.00
50000.00
100000.00
150000.00
200000.00
250000.00
300000.00
Confidence interval 95% for individual values, revenue from PE-HD, PE-LD pellets
X*C Low Upper
0 100 200 300 400 500 600 700 800 900 10000.00
10000.00
20000.00
30000.00
40000.00
50000.00
60000.00
70000.00
80000.00
90000.00
100000.00
Confidence interval 95% for individual values, revenue from PE-HD, PE-LD pellets
X*C Low Upper
Fig 3.21 Confidence interval of 95% for individual values of PP, PS, PVC revenue, EurSource: by author
166
Current practise shows, that the most commonly sorted and traded material from
landfill management companies is PET in bales, which according to modelling results to be
the most numerous but at the same time the cheapest material.
Based on the modelling carried out in this chapter, the author advises landfill
management companies to evaluate the possibility of focusing on sorting HDPE, LDPE and
PP, PS, PVC and their preparation in pellets. Preparation of all of the materials in flakes has
to be economically evaluated, as this method requires significant capital investments. It has
to be taken into account, that the analysed types of plastic materials are stock materials and
have certain supply and demand. With the change of market environment, a change of price
proportions may also be affected. The expenditures for material preparation should always be
considered prior to the decision on focusing on certain materials and their preparation type.
When applying results of the modelling to the LMC matrix developed in Chapter 3.3.
of the present research, the company, possessing significant volumes of sorted materials, can
be advised to choose the II quadrant development direction. In a similar approach, the
company has to assess all other material flows in its possession and afterwards a decision of
both further company’s development and engagement into industrial symbiosis has to be
made by the management.
Summary of the chapter
Third chapter of the research was devoted to analysis of particularities of Latvian
LMCs, assessment of resource flow within landfills, as a result resource, electrical, thermal
and technical water balance equations have been developed. They served as a basis for
development of industrial symbiosis model and decision-making matrix - tools for company
management, which by assessment of the present situation, facilitate decision-making on
further development of the company. As a result of this chapter, a managerial solution for
sustainable development of LMCs has been developed. The author has also developed four
different business model application scenarios, based on cost/benefit analysis in order to
verify the impact of implementation of industrial symbiosis on a landfill basis. For
approbation of the developed model and matrix, the author undertakes modeling and analysis
of one waste flow – plastics.
167
CONCLUSIONS AND RECOMMENDATIONSAfter undertaking extensive and broad research on the topic of the thesis, the author
has come up with the following summary of the results.
CONCLUSIONS
Regarding methodology and theory of the research:1. Waste management is a complex field, involving such aspects as society, economy and
environment. Environment and entrepreneurship are in a constant conflict situation,
which means a constant need for compromise in order to ensure fulfilment of
environmental requirements alongside with provision of company competitiveness and
sustainable development.
2. Each Member State of the European Union has the right to determine the set of economic
instruments that are applied in the country with a view to ensuring a sustainable waste
management system, taking into account national social, economic and historical
differences, in spite of the common goals set by the current legislation. In part, this also
serves as the reason why it is not possible to apply a one-size-fits-all solution in the field
of waste management.
3. One of the main factors, which encouraged the current research, is a concern about the
inevitable scarcity of resources. As current economic development trends continue and a
constant increase in the global population persists, it is vital to identify critical resources,
which are required for securing sustainable development. Despite Latvia’s population
decrease tendencies, the issue of critical resources cannot be neglected. Shifting to a
circular economy would allow keeping current resources for the longest possible period
within the economic cycle.
Regarding studies of industry trends:4. When assessing Latvia’s waste management system, the main contradiction has been
identified – from one side current trends are focusing on sustainable use of resources and
necessity of decrease of landfilled waste volumes, thus from the other side landfill
management companies are interested in large as possible volume of waste incoming to a
landfill, thereby securing them with income.
5. Within the present research it was determined that by applying industrial symbiosis, a
decrease in incoming waste volumes would not be the main factor for significant increase
of waste disposal tariff and as the consequence of the fee for waste management borne by
the inhabitants.
6. System management in the waste management sector in Latvia differs across regions
without a unified approach, leaving waste management regions the freedom of choose
168
one or another management model. Latvia’s landfill management companies can be
divided into three groups, based on the activities they undertake (landfilling; landfilling &
management of sorted waste; full cycle).
7. The present legislation in Latvia does not foster engagement of landfill management
companies in industrial symbiosis. In order to promote transition to a circular economy
and the possibility of implementing industrial symbiosis, a range of legislative acts have
to be revised, thus developing a beneficial environment for this type of development.
8. It is essential to develop a special type of scientific technological park, which would be
based on a landfill and its by-product (resource) in order to solve the problems identified
within landfill management companies.
Regarding the developed industrial symbiosis model:9. With implementation of industrial symbiosis on a landfill basis a landfill management
company will have a possibility to undertake risk diversification, consequently decreasing
their current direct dependence on incoming waste volume.
10. Implementation of the proposed model, will allow landfill management companies, as
expensive infrastructure elements, to ensure sustainable development and retain an
increase in waste disposal rates.
11. Management of by-products arising from landfill daily operations allows saving primary
resources and enhances inter-sectoral development. Thus landfill management companies
are able to save primary resources, influence waste prevention and sustain resources for a
longer time within the economic cycle.
12. Within this research, an industrial symbiosis model is developed, which is aimed at
effective use of a landfill’s available resources. With the development of scientific
technological parks, regional development would encourage improvement of
infrastructure and development of new jobs, which altogether will have a positive effect
on improvement of a country’s economic ratios.
13. The hypothesis, formulated within the research, has been accepted - the industrial
symbiosis built on the basis of a landfill, ensures further development of landfill
management companies within decreasing waste volumes and limited increase of waste
disposal rate tendencies.
14. The research provides landfill management companies with a LMC matrix, which
facilitates decision-making in terms of choosing a company development direction and
initiates inter-sectoral cooperation. Landfill management scenarios confirm that industrial
symbiosis is a solution for 7 landfill management companies and for 3 companies it can
be used as a partial solution, in combination with other development options.
169
RECOMMENDATIONSThe author of the research has developed a range of recommendations, in order to implement
the results of the research into practice.
Recommendations for landfill management companies:
1. To develop a special type of scientific technological park on the basis of the landfills, in
order to ensure effective management of the resources arising from the daily operations
of landfills.
2. To assess initial resource flow balance, in order to identify which of the resources possess
the most potential and which would be the best possible application for their effective
management in the future.
3. To undertake resource flow mapping and to identify primary resources required by
potential IS facility, and its waste/by-products, so LMC or another industry company
would have an opportunity to engage effectively in industrial symbiosis.
4. To start active work with the social component, explaining that industrial symbiosis
would bring positive economic impact to the inhabitants, as waste producers. With the
help of industrial symbiosis, landfill management companies will achieve that decrease of
landfilled waste volumes will not be the primary and inevitable reason for waste disposal
rate increase, as it would no longer be the only income source of a landfill management
company.
5. To ensure that landfills as costly infrastructural elements are self-sufficient. The
developed model, which includes elements of circular economy is a potential solution to
the problem, in order to be able to turn to other waste treatment options at a national
level, moving through the waste management hierarchy.
Recommendations for national - level institutions:
6. To conduct a revision and improvement of present legislation (especially in the municipal
waste disposal rate evaluation methodology, waste management law, law on public
person divestment, etc.), which would expand landfill management company’s rights to
manage secondary resources and infrastructure in an effective manner, in order to
develop a industrial symbiosis model on a landfill (Ministry of Environmental Protection
and Regional Development, Ministry of Economics, Ministry of Finance).
7. To take active part in implementation and promotion of industrial symbiosis within the
economy, policy makers together with industry representatives have to carry out a
resource flow assessment, in order to identify the maximum number of
industries/facilities which could be covered by industrial symbiosis (Ministry of
170
Environmental Protection and Regional Development, Ministry of Economics, Ministry
of Agriculture).
8. To develop an action plan with special financial support in order to motivate industries to
take part in the establishment and development of industrial symbiosis (Ministry of
Environmental Protection and Regional Development, Ministry of Economics, Ministry
of Finance, Ministry of Welfare, Ministry of Agriculture).
9. To revise current regional division within the waste management system in Latvia and, in
case it is found necessary, to undertake region and landfill merger, thus assigning landfill
specialisation on certain types of resources or waste management activities (Ministry of
Environmental Protection and Regional Development).
10. To amend Waste Management Law with three new definitions: 1) “industrial symbiosis –
a connection between two or more facilities in which the waste or by-products of one can
become as raw materials for another”; 2) “industrial symbiosis model - a model for
landfill management companies that takes into account landfill internal resource flow and
offers industrial symbiosis modules for effective management of resources” and 3)
“resources, generated on a landfill – resources that arise during daily operation of landfill
and that can be used for industrial symbiosis purposes” (Ministry of Environmental
Protection and Regional Development).
Recommendations for future research:
1. To determine optimal industrial symbiosis modules for a particular landfill, evaluating
its geographic location, distance to public utilities, market conditions, economic
feasibility, consumer behaviour and other independent variables.
2. To determine the linkage between industrial symbiosis and commitment of the public
to waste sorting.
3. To assess economic, managerial and environmental benefits in case municipalities
form a regional waste management company within a waste management region.
171
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ANNEXES
190
Annex 1
The Latvian “Waste management law”, based on EU Waste Framework Directive
(2008/98/EC) has elaborated the following definitions:
waste holder – any natural or legal person who complies with at least one of the
following conditions:
o is a waste producer,
o is a Physical person or legal entity in the actual possession of which is the waste;
waste producer – any Physical person or legal entity the activity of which produces
waste (original waste producer) or anyone who carries out pre-processing, mixing or
other operations resulting in a change in the composition or nature of the waste;
waste management – the collection, storage, transport, recovery and disposal of waste
(including incineration in municipal waste incineration facilities), the supervision of
such activities, the after-care of disposal sites after their closure, as well as trade with
waste and mediation in waste management;
waste collection – the gathering of waste, including the preliminary sorting and
preliminary storage of waste for the purposes of transport to a waste recovery or
disposal facility where preparation of waste for recovery or disposal is performed;
separate waste collection – the collection where a waste stream is kept separately by
type and nature so as to facilitate preparation of waste for recovery or disposal, as well
as the recovery or disposal itself;
landfill site – a specially constructed and equipped site for the disposal of waste on the
ground or in the ground, in which all the measures for environmental protection
prescribed in Regulations are ensured;
waste dump – a site for the disposal of waste, which does not conform to the
requirements regarding landfill sites;
storage of waste – the storage of waste in specially applicable and equipped sites for
further recovery or disposal thereof [except short-term storage (of less than three
months) at the sites of the creation, sorting and collection thereof in quantities, which
do not cause harm to the environment or threats to human health];
recovery of waste – any operation the principal result of which is waste serving a
useful purpose in the production processes or in the national economy by replacing
other materials which would otherwise have been used to fulfil a particular function,
or waste being prepared to fulfil that function;
recycling of waste – any recovery operation by which waste materials are reprocessed
into products, materials or substances whether for the original or other purposes,
191
including the reprocessing of organic materials but excluding recovery of energy
present in waste and the reprocessing into materials that are to be used as fuels or for
backfilling operations;
preparing of waste for re-use – checking, cleaning or repairing operations, by which
products or components of products that have become waste are prepared so that they
can be re-used without any other pre-processing;
re-use – any operation by which products or components that are not waste are used
again for the same purpose for which they were conceived;
disposal of waste – any other operation performed with waste which is not considered
as waste recovery even where the operation has as a secondary consequence the
reclamation of substances or energy;
preparation of waste for disposal – separation of waste to be recovered or composted,
as well as hazardous waste produced in a household prior to disposal thereof in a
landfill site;
waste dealer – any person acting on the behalf thereof to purchase and subsequently
sell waste, including such a person which does not take physical possession of the
waste;
waste management broker – any person arranging the recovery or disposal of waste on
behalf of other persons, also such a person which do not take physical possession of
the waste;
waste manager – a merchant, also waste dealer and waste management broker who has
received the relevant permit for waste management in accordance with the procedures
specified in this law or the Regulations regarding pollution;
electrical and electronic equipment – equipment which is dependent on electric
currents or electromagnetic fields and equipment for the generation, transfer and
measurement of electric currents and electromagnetic fields designed for use with a
voltage rate not exceeding 1000 volts for alternating current and 1500 volts for direct
current and falling under the categories determined by the Cabinet of Ministers;
waste electrical and electronic equipment – electrical or electronic equipment which is
considered as waste, including all components, subassemblies and consumables which
are part of the product at the time of discarding;
waste electrical and electronic equipment from private households – waste electrical
and electronic equipment which comes from private households or trade, the process
of provision of services, industrial, institutional and from other sources which, because
of its nature and quantity, is similar to waste electrical and electronic equipment
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produced from a private household. Waste from waste electrical and electronic
equipment likely to be used by both private households and users other than private
households shall in any event be considered to be waste electrical and electronic
equipment from private households.
prevention of waste electrical and electronic equipment – aggregate of measures aimed
at reducing the quantity, as well as the harmfulness to the environment of electrical
and electronic equipment and materials and substances contained therein;
producer of electrical and electronic equipment – any person who, irrespective of the
selling technique used, also irrespective of a distance contract:
within the framework of its economic activity manufactures electrical and electronic
equipment under his/her own name (firm) or trademark, or has electric and electronic
equipment designed or manufactured and markets it under his/her name (firm) or
trademark within the territory of Latvia;
within the framework of its economic activity resells within the territory of Latvia,
under his/her own name (firm) or trademark, equipment produced by other suppliers,
except the cases if the name (firm) or trademark of the producer appears on the
equipment;
within the framework of its economic activity places on the market of Latvia electrical
and electronic equipment from a third country or from other Member State of the
European Union supplying them for a charge or free of charge for distribution,
consumption or use;
carries out its economic activity in another Member State of the European Union or
third country and, using a distance contract, sells electrical and electronic equipment in
Latvia by means of a distance contract directly to private households or to users other
than private households;
a distributor of electrical and electronic equipment - any person who, within the framework of
its economic activity, makes an electrical and electronic equipment available on the market. A
distributor of electrical and electronic equipment may be at the same time a producer of
electronic and electrical equipment within the meaning of this Law.
193
Annex 2
Waste treatment options – existing and possible
Figure 1.21 of this dissertation’s Chapter 1.3.3 represents a theoretical framework of
waste treatment options. Thus if converting that to practice, waste management activities,
described in the Table below are in place. Each European Union Member State is free to
choose a mix of waste treatment options, depending on its historical background, cultural
peculiarities, geographic location, space availability, climate, etc. Regardless, the targets set in
the waste management Directives are binding for all Member States.
Table
Waste management activities
Source: by author
Waste hierarchy
Waste treatment option
Description
Landfilling Pre-treatment, landfilling
According to Directive on waste 2008/98/EK, no untreated waste is permitted to be landfilled, so waste sorting takes place prior to disposal. Waste is disposed at landfill sites in special waste disposal cells.
Energy recovery
Waste to energy plants
Energy recovery can be performed using the following facilities:Landfill – via landfill gas collection system, where it is brought to power unit and electrical and thermal power are being produced;Waste incinerators – using mixed municipal waste, produce electrical and thermal power;Waste fermentation – wet and dry fermentation, producing electrical and thermal power.
Recycling and compost
Recycling facilities, compost production facilities
Recycling is ensured by highly developed sorted waste collection system, which generates cleanest possible recycling materials that are re-sorted at sorting stations (manual or mechanical). Or another approach is a breakdown of a used item into raw materials, which are then sold separately to the industry.
Reuse Sorted waste collection system, deposit refund system, etc.
This approach is based on reuse of a product, including conventional reuse (using the product for the same function) and creative reuse (using the product for a different function). Most common examples of conventional reuse – delivery of milk/juice in a refillable bottle; refilling a cartridge.
Prevention Economic gears: increase of payment for collection of unsorted waste; implementation of deposit refund system
Work with society, education, raising awareness of waste management issues.
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In terms of the situation in Latvia, over 70% of waste generated is disposed at
landfills, thus today already 4 landfills have installed gas collection systems and generate
electrical and thermal power. In case of the former, it is used for the internal energy needs of
the landfill’s infrastructure, with the surplus being sold back to the grid (where possible),
using the tariff stated in Cabinet of Ministers Regulations No. 221 “Regarding Electricity
Production and Price Determination upon Production of Electricity in Cogeneration”. In case
of the latter – thermal power - is not used efficiently in 3 landfills, and in case of Riga landfill
– the heat is being used for two greenhouses located at the territory of a landfill site. During
summer period, however, the heat is not used in an efficient manner in any of the landfills.
In addition, a pilot project on collection of green waste is in place in one of the regions
in order to produce high quality compost. Here another problem arises – lack of Cabinet of
Ministers regulations up to March 2017 on the chemical characteristics of compost produced
from waste and this limits the potential distribution area.
A sorted waste collection system is being developed in Latvia from the year 2004 –
placement of waste containers for paper and cardboard, plastics, glass by apartment buildings
or in places for easy access to inhabitants and sorting areas – with a wider range of containers,
where inhabitants can dispose of the following waste types free of charge: glass; paper and
cardboard; polyethylene; pet bottles; metal scrap; WEEE; paint cans; luminescent lamps;
batteries and accumulators; tyres; greaser filters; engine oil; wooden pallets.
For an additional fee, inhabitants may dispose of: glass panes; bulky waste; construction
waste; green waste.
Although, it has to be mentioned, that these sorting areas are quite developed in the
regions and much less in the capital city of Riga, as the latter has a very different managerial
structure from the other nine waste management regions.
While implementing sub-activities as development of regional waste management
system and development of sorted waste collection system, 67 sorted waste collection points,
5 municipal and 2 hazardous sorted waste collection areas, 9 composting areas for
biodegradable waste as well as 20 mechanical lines and re-sorting facilities for sorted waste
have been created. It is foreseen that these facilities will not only improve waste management
quality in the long-term, but will also improve waste recycling and the return of recycled
materials into economic circulation, i.e. promoting thoughtful and efficient use of natural
resources.
According to the data available from the Ministry of Environmental Protection and
Regional Development of Latvia (2016), the data for fulfilment of the ratio “Number of sorted
waste collection points” and “Ensuring sorted waste collection infrastructure (number of
195
inhabitants per one sorted waste collection point)” is considered to be quite low. In line with
the overall evaluation of the Latvian waste management system, in total Latvia has 3071
sorted waste collection points for municipal waste. Moreover, 50 municipalities state that
sorted collection of municipal waste is ensured via waste collection routes. 1138 sorted waste
collection points have been designed in the cities and 1933 points in counties. In 5 cities and
63 district municipalities with 760 000 inhabitants, representing 37,9% of total Latvia’s
population sorted collection of municipal waste is ensured. 31 municipality (with 996 000
inhabitants, representing 49,8% of population) evaluate the system to be satisfactory, but 20
municipalities with 12,1% of the country’s population, state that sorted waste collection is not
yet available in their territories. According to Geo Consultants (2015) research, on average,
sorted waste collection points for municipal waste are designed to serve 650 inhabitants (both
for EU funding and waste management company funding), the fulfilment of the ratio
“Ensuring sorted waste collection infrastructure (number of inhabitants per one sorted waste
collection point)” reaches 70%.
Since the middle of 2015 Latvia has two sorting plants for unsorted waste (one located
in Riga region and another one in Liepaja region). These plants are aimed for sorting waste
into biodegradable, which then will be disposed of at a landfill into a special biodegradable
cell – for faster production of landfill gas (comparing to ordinary cells) and sorted waste
(mainly paper and cardboard, plastics, metals) – depending on quality, these materials will be
sold to the industry as secondary resources or used for RDF production.
Taking into account EU Directive targets and the fact that today Latvia still heavily relies
on landfilling, a core infrastructural element of each municipal waste management company is
a landfill, the author summarises the latest trends and achievements in the field of waste
management and offers considering “industrial symbiosis” as a solution in order to gain
maximum benefit from landfills even when waste management systems will be developing
further, to generate a positive cash flow and to be able to invest in development of other more
advanced elements of infrastructure. This is of particular importance, due to the fact that
currently the period of EU co-financed projects in the field of waste management is mostly
limited to development of sorted waste collection infrastructure (with financial support of
35%) and limited financial support for waste to energy plants is foreseen, meaning that these
types of investments are to be ensured by the member states individually.
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Annex 3
Survey
During my PhD research “Ensuring sustainability by managing Latvian landfill management companies”, I Natālija Cudečka-Puriņa, would like to kindly ask you to spend some time in order to respond to the questions below.
I will be very grateful for more explicit responses; your opinion and comments will be highly appreciated.
As a result of the research, a possibility to implement an industrial symbiosis (inter-sectoral cooperation on the resource level) for waste landfill sites. After analysis of the obtained responses, you will be able to get acquainted with the results of the research.
When responding to the questions, it is possible to use the multiple-choice option.
1. Do you consider that waste management regions have to have regional waste management centres, to which municipalities could delegate all the functions, linked with waste management?
Yes, it would definitely solve a range of bureaucratic issues and facilitate regional management
Yes and development of such centres is currently under development No, it is not necessary, currently existing system is optimal Other solution possible:
Comments: ________________________________________________________2. As to your opinion, should landfill management companies take over (and if they are
capable to) particular functions and execute public procurement in respect to waste collection in the region and develop binding regulations for waste management in the region?
Yes, that would significantly facilitate region’s management system Yes, and it is already in place No, law, binding to municipalities, states these functions and they are the
institutions, which have to fulfil these functions Comments: ________________________________________________________
3. Which by-products arise during landfill daily operations? Sorted packaging materials Other reusable materials with commercial value Electric energy and heat Purified leachate Resource derived fuel (RDF) Technical compost (for internal greening works, waste coverage material) Compost, which is being utilised for road construction works Compost, which could be used in agriculture _______________________________________________
Comments: ________________________________________________________
4. Which resources landfill management companies could offer to other entities? Infrastructure, required for establishment of business (fenced territory, supply road, premises, etc.) Technical equipment Experience, education of society Organisation of excursions, trainings Exchange of energy commodities _______________________________________________
Comments:________________________________________________________
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5. What could be a stimulating factor for a landfill management company to become involved in industrial symbiosis?
In my opinion the existing legislation is sufficient and the companies themselves already start to develop industrial symbiosis on the basis of the landfill
Legislative basis has to be redeveloped (please provide comments, what in particular has to be changed)
State support programmes have to be developed in order to facilitate cooperation among different sectors
Education of society, explaining that modern landfill is environmentally safe and different types of manufacturing can be allocated within its territory.
Comments:________________________________________________________
6. Which additional activities must be undertaken in order to promote sustainable economic feasibility at the situation when disposed waste volumes will start decreasing and it will not be possible to increase infinitively the tariff for waste disposal?
Sustainability:______________________________________________________Feasibility:_________________________________________________________
7. Taking into consideration the new provisional goal set by the European Commission to dispose only 10% of waste, what is your vision to ensure landfill efficiency and sustainability?____________________________________________________________________
8. What is your attitude towards Tax on Natural resources (NRT) for waste disposal? (In case your country has another fiscal instrument in place, please state its name and comment on that)
Positive – NRT is a good fiscal instrument, influencing decrease of disposed waste
Neutral – the country could avoid this tax in the waste management field. For example, many EU countries apply disposal tariff and/or gate fee
Negative – the aim of NRT is not clearly comprehended by all parties, the increase of the rate does not provide the anticipated effect, but only short-term profit to State’s budget
Comments: ________________________________________________________
9. Do you consider NRT as a stimulating factor for sorted waste collection? Yes No Partly (please explain),
Comments: ________________________________________________________
10. Until what level would it be reasonable to increase NRT rate in the future? (please also specify your current rate and retrospective, if possible)
increase till _________ Eur/t decrease till 10 Eur/t
Comments: ________________________________________________________
11. How would you forecast waste disposal rate until 2030? (please also specify your country’s current rate and retrospective, if possible)
__________________________________________________________________
12. In which types of activities should landfill management company managerial level take part in order to ensure professional development?
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Participation in local seminars, training courses Participation in foreign seminars, training courses Participation in international exhibitions Participation in local and international scientific conferences Research activitiesPassive monitoring of current trends (foreign scientific journals, publications in the
field of waste management) Participation in seminars, training courses held by Latvian waste management
associationsComments: ________________________________________________________
Discussion questions about waste management trends
13. What is your attitude towards deposit refund system? (In case your country has it in place, please state, from what year)
Positive – deposit refund system has proven itself, with its help the packaging returns to the turnover, avoids disposal, environmental pollution (forests, landmarks which are currently polluted with PET, metal cans and glass bottles)
Negative – it is costly and the efficiency has not been proven. In addition for Latvia, which has already had investments into sorted waste collection system it would threaten the investment efficiency.
Neutral (please specify) Comments: _______________________________________________________
14. What is your attitude towards waste incineration facility development in Latvia? Unambiguously positive. Latvia is the last country within theEU, which does not
have an incineration facility. In addition, it would be possible to burn RDF in such a facility.
The usefulness of such plant is doubtful, as Latvia has comparatively small waste volumes (and with the tendency to decrease) and the profitability of such facility is doubtful.
Other Comments: ________________________________________________________
15. Is it possible to apply differentiated percentages to be achieved within sorted waste collection and preparation for reuse, regeneration and recovery?
All the regions have to have unified, even targets A situation, when within one country, regions have different targets, depending on
the region’s specific characteristics, development of waste management system and other aspects, although on the country level it has to be ensured that the EU directive requirements are fulfilled.
Other option Comments: ________________________________________________________
16. Which new legislative acts or what kind of amendments to existing ones need to be made in order to improve existing waste management system? (Please also feel free to specify the most significant legislative changes that your country experienced)
__________________________________________________________________
Decision-making practice in waste management companies
17. Which decision-making methods should be applied in landfill management companies?
199
Decision – decision made by Members of the Board. Consultations – involving industry experts for decision-making Voting – option discussion, followed by Board’s decision Consensus – discussion, until all the parties involved agree upon a particular
option. Comments: ________________________________________________________
18. New solutions in the company should be implemented using: Bottom up approach Top down approach Other option
Comments: ________________________________________________________
19. Which activities should take place prior to decision-making on important management expansion or change?
Careful benchmarking – comparison of similar landfills and their management specifics across the Baltic States or European Union
Brainstorming – In order to reach a best possible solution Evaluation of economic efficiency in the long-term Consulting with local and foreign experts
Comments: ________________________________________________________
According to your opinion, please define functions, necessary for landfill management companies:
Function Should the company apply it? 1. Waste pre-treatment2. Waste disposal3. Waste sorting4. Electricity production (and its
internal consumption)5. Sale of electricity6. Usage of heat7. Compost production8. RDF production9. Society education programmes,
training10. Excursions11. Waste collection (municipal, sorted,
hazardous, construction & demolition, green)
Please specify which type of waste collection
12. Management of waste container (bin) park (for municipal waste, sorted waste, green waste, etc.)
Please specify which type of containers
13. Signing contracts with legal entities and private persons
Thank you for your time and input into the research!
In case of any questions or additional information required, please do not hesitate in contacting me: [email protected] 26789563
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Annex 4
Landfill waste flow model
201
Annex 5
Prices for plastics, Eur
Regrind/Flakes PET HDPE LDPE PP PS PVC-h PVC-wJanuary 2017 290 600 560 520 640 440 410December 2016 310 590 570 500 650 410 360November 2016 310 570 620 520 650 430 380October 2016 350 590 580 540 600 410 360September 2016 370 600 580 520 640 420 360August 2016 440 610 660 540 670 460 390July 2016 400 610 670 570 640 430 420June 2016 340 610 730 570 630 410 410May 2016 440 620 720 550 620 420 380April 2016 420 610 560 540 610 450 410March 2016 420 590 570 550 630 440 420February 2016 440 600 900 600 620 410 440January 2016 430 620 480 610 660 430 440December 2015 450 610 570 600 650 430 440November 2015 5460 630 650 610 640 450 440October 2015 360 650 640 610 660 440 450September 2015 380 630 600 550 730 420 470August 2015 400 640 560 620 700 430 470
Pellets HDPE LDPE PP PSJanuary 2017 900 730 740 890December 2016 820 780 760 880November 2016 840 800 750 880October 2016 860 870 750 900September 2016 840 850 800 980August 2016 850 820 800 990July 2016 910 840 840 880June 2016 920 820 830 880May 2016 920 800 830 950April 2016 890 830 840 990March 2016 870 800 880 980February 2016 970 770 890 1010January 2016 850 820 850 990December 2015 870 790 850 950November 2015 840 840 810 880October 2015 970 820 860 880September 2015 910 800 800 910August 2015 890 820 830 900
Bales PET LDPE PP
202
January 2017 140 200 300December 2016 180 220 290November 2016 190 240 260October 2016 110 210 250September 2016 230 200 230August 2016 240 190 240July 2016 180 180 230June 2016 140 240 160May 2016 130 220 150April 2016 180 330 220March 2016 260 230 210February 2016 150 270 200January 2016 240 290 200December 2015 240 230 260November 2015 240 240 320October 2015 220 260 270September 2015 250 310 280August 2015 160 330 270
Annex 6
203
Flow of plastics materials
C1<Ci <
C3
no
y
es
Demand
for RDF
no
yes
no
B1Sale to the industryCi > C3
C1, C2, C3, … Cn
Pa1, Pa2, Pa3, … Pan
Paper & cardboard
C1<Ci <
C3
B3
Industrial symbiosis
B2Storage
Sale to the industry
Production of RDF
y
es
Where:
Pa1, Pa2, Pa3, … Pan – types of paper:
47071000, 47072000, 47073010, 47073090,
47079010, 47079090
C1, C2, C3, … Cn – price per each type of
paper
B2
yes, opt. 1 Production of RDFCi ≤C1
Where:P1, P2, P3, … Pn – types of plastic: PE, PS, PVC, PP, PETC1, C2, C3, … Cn – price per each type of plasticB1, B2, B3, B4 – revenueB∑=Pi× Ci
no
yesDemand for RDF
yes, opt. 2
yes
no
yes
B4
Industrial symbiosis
Recovery activities
B1Sale to the industry
Ci > C4
C1, C2, C3, … Cn
P1, P2, P3, … Pn
Plastics
B3Storage
Sale to the industry
no
204
Annex 7
Flow of paper and cardboard materials
Annex 8
Planned investments, their distribution among the activitiesSource: Ministry of Finance (2014)
Specific support target 5.2.1. Promotion of reuse, recycling and recovery of different types of waste
Cohesion Policy (35%) - 41.34 million euroPrivate co-financing (65%) - 76.78 million euro
5.2.1.1. activitySorted waste collection
5.2.1.2. activityWaste recycling
5.2.1.3. activityWaste recovery
Cohesion Fund (35%)EUR 5 478 088
Total EUR 15 651 680
Cohesion Fund (35%)EUR 26 679 915
Total EUR 76 228 329
Cohesion Fund (35%)EUR 9 184 249
Total EUR
10 804 999
Supported activities:• sorted waste collection points
and areas• specialized vehicles for
routes
Supported activities:• waste recycling plants, composting
facilities
Supported activities:• energy recovery
plants
Increase in the volume of sorted waste from supported projects in 2023 - 52 000 tons per year.
Increased amount of waste recycling capacity by 2023 by 172 000 tons per year: biodegradable waste – 109 000 t; other types of waste – 54 000 t.
Additional waste
recycling with energy
recovery capacity in
2023 – 11 000 tons per
year.
205