A paradox of profitable waste, carbon footprint

Ova Candra Dewi ,  Jakarta   |  Mon, 10/13/2008 11:34 AM  |  Opinion

Twenty percent of registered clean development mechanism (CDM) projects in the United Nations Framework Convention on Climate Change UNFCCC (2008) are based on waste management and disposal. That is the second biggest percentage after energy projects.

Until now India (356 projects) and China (260 projects) are dominating the internatonal CDM project market. Indonesia has only 16 CDM projects so far, but we can be sure that the number will increase in the coming years since many stakeholders are now trying to develop them, mostly with local government.

Gikoko Kogyo Indonesia is investing billions of rupiah to build the new Bekasi waste management facility which makes use of the CDM mechanism in the Kyoto Protocol. The waste management process, by burning landfill gas, will result in the accumulation of credits for carbon dioxide (CO2) and methane (CH4) (the carbon credits being the basic measuring unit to work out volume and value). The results will be reported to the World Bank. The Netherlands Clean Development Mechanism Facility will buy the resulting credits, representing the equivalent of 250.000 tons of CO2 for five years up to 2012.

The coordinator of the World Bank living environment program recently said that the value of a carbon credit nowadays is a minimum of 10 euro per ton. The Sumur Batu landfill in Bantar Gebang, Bekasi has the potential to produce credits for 50.000 tons of CO2 per year.

In the project MoU it is stated that the Bekasi City administration will receive 17 percent of the payment resulting from the trading of carbon credits from Land Fill Gas (LFG). The Bekasi adminstration will therefore receive 85.000 euro per year. Half of this will be used for funding social programs in the area around the landfill project and the rest will be used to improve the waste collection facilities in the city.

The Bekasi city administration nowadays is making an effort to learn more about the potential of waste-to-energy schemes and how to prepare for UNFCCC registration. The mayor said that in the coming year Bekasi will be ready to receive and process waste from other places.

The centralization of waste from other places will become increasingly common for this type of project. Investors need a guarantee that the total amount of waste should fulfill the minimum production requirements. In some big cities in Java island for example, investors canceled the construction of such projects since feasibility studies showed negative results due to inadequate supply of waste. Collection of waste from other areas also proved to be more complex than first thought.

In the longer term, the competition will not only be about project implementation but also about accessing waste as raw material for waste-to-energy projects. The city government has to work hard to build investor trust in guarantees that the waste supply will always meet the minimum requirement. Otherwise, the dream of benefitting from profit-sharing in the project will not come true since cost recovery to cover operation and maintenance would absorb limited funds.

If the project ceases to be profitable there are only two choices, either to stop the project or to increase the contribution of municipal waste as fuel from other places.

Normally we tend to think of cities as political or administrative entities or as geographic areas dominated by a built environment. From the economic viewpoint, a city is the locus for intense socio-economic interaction among individuals and firms and the engines of production and national economic growth.

But if we look from the other aspect, ecological considerations focus on the broader relationship between human population, consumption and the sustainability of essential energy and material flows.

Willieam E. Rees, the originator of the ecological footprint concept said that this reveals dimensions of the urban system that are invisible to conventional policy models. This includes the total dependency of cites on the productivity of distant areas and negative impacts on the hinterland that feeds them, such as erosion, desertification and deforestation. This is in addition to debilitating social and environmental problems arising from burgeoning squatter settlements around many developing cities.

Regarding the volumes of waste that are needed to implement CDM projects, it seems there are two contradictory aspects. On the one hand we want to reduce consumerism in order to provide a healthy environment and safe foods for next generation, on the other hand we need a constant supply of waste as a form of 'payment' to keep the CDM waste disposal plant in operation, so combatting climate change.

Nevertheless the ecological footprint is changing. Hungry people in an increasing population cannot wait for perfect ecological solutions. At least the value of waste has changed from something we do not want, to something we need (to pursue climate change). We need to stay aware of these changes and look out for slow but incremental progress.

The writer is on the junior teaching staff, department of architecture University of Indonesia, and an Urban Management Program Intern with Deutsche Gesselschaft fuer Technische Zusammenarbeit (GTZ) GmBH. She can be reached at ovacan99@yahoo.com

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