International Review of Waste Management Policy - Department of ...

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dramatically reduced by marginal tightening of the stability criterion
(increasing the required residence time, and hence the capacity of the plant to
treat waste);
3. It is unclear what rationale could be offered for a stability measure that is
different in one year to that set in another; and
4. To the extent that it is to be used as the basis for establishing when waste can
be considered no longer biodegradable for the purposes of the Landfill
Directive, this has already been considered at some length by the European
Commission, and the 10 mg O2 / g dm was deemed adequate.
The standard would essentially:
� Allow for the application of a lower tax rate than for untreated waste in the
short-term:
� Set the basis for a ban on landfilling of waste which fails to meet this standard
in the medium- to long-term; and
� Importantly, it would make explicit the fact that meeting the standard rendered
the waste no longer biodegradable for the purposes of the Landfill Directive.
It is important to recognise that the above externality assessments do attribute
external benefits to energy generated at different facilities. It is entirely consistent to
apply a levy to address the external costs of pollution whilst also seeking to
incentivise the generation of renewable energy (although the latter is not the first best
solution since the more efficient policy would be to tax the pollution from nonrenewable
sources).
It is worth pointing out, however, that to the extent that other policies internalise
benefits associated with energy generation, then the uninternalised externalities
which a waste levy should consider will, other things being equal, increase for those
facilities upon which policy bestows a benefit. In other words, the level of the levy
should consider the effects of other policies to the extent that they internalise
benefits associated with the treatment. As stated above, however, the way in which
REFIT will support municipal waste treatment facilities is not clear, though an
estimation of benefits received by landfill operators is easier to discern.
The suggested levy structure is below. Note that the rates proposed are in nominal
terms, so we have allowed for some price inflation over this period. Our proposal
involves some changes in structure and design from the initial proposal. The changes
are designed to reward environmental improvement where this is deemed feasible.
Incinerator operators, in particular, will be able to choose the level of abatement they
use to optimise their exposure to the levy. The landfilling of stabilised biowaste is also
affected by the nature of the receiving landfill.
It is important to state that the first announcement of the levy must make clear what
the levy rates will be for the foreseeable future. In other words, the rates for the years
2010 to 2015 must be announced in 2010 so as to give the market confidence. We
would suggest that a commitment is made to increase the proposed rates in Table
56-2 in the years after 2012 at the Retail Price Index to maintain their value in real
terms.
International Review of Waste Policy: Annexes