1. Aid in the management and European comparison of Municipal Solid WASte Treatment methods for a global and sustainable approach Fifth Framework Program

2. AWAST WORKPACKAGE 3 Economic Aspects 3 Leader : Cemagref de Rennes (F) 3 Contributor : University of Stuttgart (ISWA)(G)

3. TASKS 1 - State of the art and data acquisition 2 - Definition of production cost models  Development of a standard structure to calculate the production cost  Aggregation of component costs to obtain production cost  Determining the full cost of MSW service 3 - Calibration and validation of the models

4. COURSE OF THE RESEARCH 1 - Choice of the estimation method for production cost 2 - General form of the production cost model of each process  Choice of the main variables (source: offers from building and exploitation companies) 3 - Sources of data 4 - Application of the method of estimation cost 5 - Expression of main variables 6 - Adjustment of coefficients 7 - Production cost models for each process 8 - Full cost or providing cost service and application 9 - Deliverables 10 - Main economic results 11 - Interests for End-Users 12 - Dissemination and use intentions

5. M ethod of modelling production cost Determination of principal variables of production costs : L, E, R, M  Bibliography  Case Studies  Bibliography  investigation Coefficients of secondary costs : α, β, γ Writing general equation of the production cost model : Cp = Cc + Co = α.L + β.E + γ.R +  I Application to real cases Typology Model adjustment Model of calculation production cost Technical data Determination of : - labour, -energy consumption, -reagent consumption, - maintenance Economic data  Unit costs - electicity : e -employee wage : w -reagent :r

6. ESTIMATION METHOD OF CAPITAL COST - Method developed by R. Turton (1998) and K.D. Kimmerhaus (2002) on the evaluation of the economics (capital costs, operating costs) of chemical process (U.S.A.) and applied once in MSW by D.C. Wilson (1981)  C T = C FC + NPCC (non- plant capital costs: start-up, land, working capital)  C FC = DPC + IPC (direct plant costs, indirect plant costs) f L or k : Lang factor  C FC = f L  IEC with IEC: fixed-capital costs of the plant, installed equipment cost - k : fluctuates according to the process and the process type - IEC : updateable with economic indexes

7. ESTIMATION METHOD OF OPERATING COST - Method developed by R. Turton (1998) and K.D. Kimmerhaus (2002) on the evaluation of the economics (capital costs, operating costs) of chemical process (U.S.A.) and applied once in MSW by D.C. Wilson (1981)  C 0 = Direct Costs + Indirect Costs = DC + IC with DC = f(L, E, R, I) and IC = g(I, L) Fixed Costs - Labour : L - Insurances - Taxes - Overhead Variable Costs - Energy : E - Other utilities - Reagent : R Maintenance - Equipment : IEC - Civil works : I GC C 0 = . L + . E + . R + . I  Each basic variable (L, E, R, I) is estimated by ratio in physical units combined with the standard prices units

8. ACQUISITION DATA Bibliography Sofres - Ademe (1998) World Bank (COSEPRE - 2001) Proctor & Redfern Ltd (1996) ETSU (1999) Eco-Emballages (2002) WDO (2001) CRIQ (2000) Proctor & Redfern Ltd (1997) Biocycle (2002) Eunomia R & C - Ecotec (2002) UK Composting association (2000) Juniper Survey (2001) Draft European Commission (1997) D. A. Tillman & A. Rossi (1989) Heberg and all (1991) BRGM Ademe (2001) ISWA - 1998 - Guidance for landfilling Eunomia R & C (2002) ISWA - US EPA (1998) Ministry of Environment of New Zealand (2002) Partners University of Stuttgart Lisbon Covilha Setubal Berlin (AD) Lisbon Vienna Trondheim - Process - Collection - Sorting - Composting - Incineration - Landfill France 17 following up in France 12 6 13 operating data

9. APPLICATION TO THE COST ESTIMATION METHOD Collection  Application of the cost model to a standard circuit of collection, with performances observed of collection of a given flow of waste Sorting plant  Typology according to design capacity, number of sorting lines, level of mechanization  Composting plant  Typology according to the importance of the fermentation equipment Incineration plant  Distinction according to APCS (Air Pollution Control System) : dry, semi-wet and wet srubber Landfill  Distinction with: - impermeable / semi-impermeable cover - energy biogas valorization

10. GENERAL FORMULATION OF CAPITAL COST  Collection : vehicle, bins : purchased cost  Sorting plant : C FC = k  IEC R  C n with k & IEC R calculated for each type  Composting plant : C FC = k  (k 1. C n + k 2 ) with k, k 1 & k 2 calculated for each type  Incineration plant : C FC = k1. C n + k 2 Landfill : C FC  calculation General formula : C FC = k. IEC

11. GENERAL FORMULATION OF OPERATING COST  Collection : C 0 = . L + . E + M  Sorting plant : C 0 =  ( . L + M)  Composting plant : C 0 = . L + . E + M  Incineration plant : C 0 = . L + . E + . R + M Landfill : C FC  calculation General formula : C 0 = . L + . E + . R + M Parameters of the main explanatory variables L : labour E : energy R : reagent M : maintenance Coefficients representing the secondary expenditure   

12. EXPRESSION OF THE PARAMETERS OF THE C 0 MODEL L  Incineration:  Sorting:  Composting:  E   R   M  - e, c, w : unit cost - N, B, R : standard consumption ratio for each process and type - B elec : electricity consumption (kWh/t) - B f : fuel consumption (l/t) with R i : lime, bicarbonate of sodium, active char-coal, lignite coke, urea ammoniac (Kg/t)

13. EXPRESSION OF COEFFICIENTS C 0 = . L + . E + . R + M Process - Collection - Sorting - Composting - Incineration  1,7572 1,1 - 1,4 1 1,43  1,264 - 1,05 - 1,30 1  - 1,05 Indirect Cost 0,0805. I v  = 1,1 to 1,5. C FC = 0,01. C FC in 

14. PRODUCTION COST DETERMINATION  Gross production cost C p = C C + C 0 = C FC / d + C 0 with d : life time of the plant Vehicle d = 7 years Sorting plant d = 15 years Composting plant d = 20 years Incineration plant d = 20 - 30 years Landfill d = 20 years  Net production cost C p n = C p - S r with S r : revenues by-products sales

15. Presentation of the Full Cost method èAn American bibliography : methodological proposal by the «Environmental Protection Agency» (EPA) : u A working method flexible and adaptable to personalize according to the needs to retrace as close as possible the service cost. u In first step, description phase of material ’s flow identification, u In second step, identification and affectation of financial flows  Accounting of costs rather than expenditures  Accounting of monitoring costs and indirect costs. Accounting according to two approaches : per path, per activity èDistinction of three levels of cost observation : cost by activity or plant (niveau A), cost by stream (niveau B), cost for the local authority (niveau C)

16. Explicative scheme of the activity and path distinction (a) The vertical approach per stream Cost per type of waste or treatment, all activities melted Collection activity Transport activity Treatment activity Valorization activity Transfert-transit activity Cost/activity all types of wastes Collection activity Cost/activity all types of wastes Cost/activity all types of wastes Cost/activity all types of wastes Cost/activity all types of wastes Transport activity Transfert- transit activity Treatment activity Valorization activity (b) The horizontal approach per activity

17. Distinction between the three levels of costs Waste collection Incineration plant Q1+Q2 Q1 Q2 Other authorities Local authority (C) Stream(B) Activity(A) Bottom ash Fly ashLandfill 1 Landfill 2 Illustration with the thermal stream

18. LIMITS OF RESULTS OBTAINED  Difficulties to obtain detailed costs in European countries (specially when the private sector builds and exploits)  Diversity of composting processes and limit of validity of composting models up to 60.000 tpy  Costs, availables for the sorting plants, come from the U.S, especially types 3 and 4.  Knowledge of the costs is restricted on energy valorization of biogas in landfill  Production cost models give an estimated cost which can be different of each real case (result of tender offer)  The implementation of the methodology for the providing cost requires to have the whole financial data and a flow sheet of organisation of service

19. DELIVERABLES  D6 : Achievement the writing “Methodology of production cost models and the full cost providing by Local Authority”  D7 : Draft of “Economics models for each process and the municipal solid waste management”

20. RESULTS - INTERESTS - DISSEMINATION - FUTURE

21. MAIN ECONOMIC RESULTS ë Production cost models (Level plant) provide costs for each process take into account the main production factor in the form of technical ratios are adapted to the different design capacities updateable to economic conditions applicable to the different European countries

22. MAIN ECONOMIC RESULTS ë Methodology of providing cost knowledge (Local level authority) An analytical step which is based on the various centres of costs Take into account the production costs (collection, treatment) and all the indirect costs linked to the management of waste Improve the knowledge of the total cost formation of services

23. INTERESTS FOR END-USERS  Production cost model Help decision makers in order to point out a cost simulation Evaluate the economic impact of the installation or modification of a treatment unit Help to optimal dimensioning (Technical and economic) of an installation ë Methodology of full cost Follow the evolution in the time of the full cost of service Evaluate the financial consequences of a technical choice on the full cost Target the ways to make economies Foresee the base necessary to implement the unit-pricing system paid by the households

24. DISSEMINATION and USE INTENTIONS (1)  DISSEMINATION Publications on cost model Application of Full Cost model on two activities (Study 2003 for French Minister of the Environment of PAYT) Applications on some local authorities: support, appraisal, consulting

25. DISSEMINATION and USE INTENTIONS (2) ë FORESEE COLLABORATIONS WITH OTHER ENTITIES BRGM: develop the AWAST applications on different situations of organisation and process French Environment Agency (Ademe): improve the knowledge of collection costs and composting of biowaste on various areas (urban, urban surroundings, rural) French Minister of the Environment for the application of the PAYT system : improve the taking into account of the constraint of balance in the budget The future European countries: to evaluate the costs for MSW management (Czech Republic, Poland) Cemagref: - Improve the cost models, espacially for composting (type AD & TW), incineration, biogaz - Constitute a data base on the costs of construction and exploitation for the new plants