Waste and the world bank

A look at World Bank projects designed to reduce the climate change impacts of waste management in developing countries. by Charles Peterson, Claudia Barrera and Zarina Azizova The World Bank’s role is to reduce poverty in developing countries through loans and technical assistance in infrastructure including waste management and other areas. Currently, the Bank has more than 150 projects (active or under development) with waste management companies with total investment commitments of US$3.5 billion. The waste management projects cover the spectrum of the solid waste field – collection equipment, transfer stations, and landfill design/construction. Carbon finance or the purchase of reductions in greenhouse gas emissions, including methane, from projects is a service the Bank has offered to developing countries since the year 2000. Carbon finance was developed to meet the opportunities provided by the Clean Development Mechanism (CDM), a provision in the Kyoto Protocol, which enables buyers from developed countries to purchase greenhouse gas emission reductions from projects in developing countries. Such emission reductions are credited towards the emission reduction targets for developed countries under the Kyoto Protocol. The Bank is a trustee for a group of 12 funds and facilities. In the waste management area, existing CDM areas (methodologies) in which the Bank is involved include landfill gas collection with energy recovery/flaring and composting projects. The Bank is developing a methodology for methane avoidance through recycling. In the carbon finance area, the Bank has 38 municipal waste management projects plus additional projects for agricultural wastes. Solid waste and greenhouse gas emissions Methane, a by-product of the decomposition of the organic biomass portion of solid waste disposed of in a landfill, is a greenhouse gas, which has 21 times the global warming potential of carbon dioxide (CO2) . Total anthropogenic (human induced) methane emissions represent about 15 % of greenhouse gases. Worldwide, waste disposal accounts for more than 12 % of anthropogenic methane, which makes waste disposal the fourth largest source of non-carbon dioxide greenhouse gas. Carbon dioxide from biomass organics in municipal waste are considered climate neutral. This includes CO2 from composting (aerobic) as well as burning of methane in a flare or a generator to produce electricity. Clean development mechanism Projects in developing countries that have ratified the Kyoto Protocol must comply with the conditions of the CDM program before their greenhouse gas emission reductions can be sold. These conditions, or methodologies, are managed by the CDM Executive Board under the United Nations Framework Convention on Climate Change (UNFCCC). A common element of all methodologies is the need to set a baseline, which is the level of greenhouse gas that would be emitted in the absence of the project. For waste projects, the baseline is a landfill with no gas recovery. A disposal site with flaring at gas vents would need to subtract the methane being burned from the gas collected if an active landfill gas recovery system was installed. Additionality2, or the level of greenhouse gas emission reduction that would be achieved below those that would have occurred in the absence of the registered project, is a second basic element. Additionality can be demonstrated using the barrier approach, where a project would provide the list of barriers that would prevent the project from happening in the absence of CDM incentives. Or, additionality can be demonstrated using the internal rate of return of the project. The project must show that the financial return on investment would be too low without the additional cash flow from carbon finance. Alternatively if the internal rate of return is deemed too high with carbon finance it is possible that the CDM Executive Board may reject a project as not meeting the additionality test, unless it can be proven that there are significant technological or institutional barriers that would make the implementation of the project without CDM risky. The objective is, to demonstrate that it is because of the existence of the CDM Mechanism, that the project is taking place, otherwise it would have not happened because it is either too risky or technically too difficult to implement. Other barriers include technical innovation, or in the case of waste management common practice. In many countries composting and landfill gas recovery are used rarely, or not at all to manage municipal waste. Approved methodologies Landfill gas capture and use/flaring, aerobic landfill, and methane avoidance (aerobic composting, methane digestion, refuse-derived fuel, and incineration with and without energy recovery) are municipal solid waste activities for which methodologies exist. The Bank is pursuing development of a new methodology for recycling. An advantage with small-scale projects is that they are less complicated to develop and monitor once operations begin. Offsetting these advantages is the relatively high development cost for the emission reductions that can be earned with small-scale projects. Methodology applications Preparation of a Project Design Document (PDD), which defines the nature of a proposed project, the expected emission reductions, the factors used to estimate expected reductions, and describes a monitoring plan to track future performance, is a critical early step in a project’s development. Since landfill disposal is considered to be the baseline for municipal waste projects, the expected emissions to be captured (landfill gas) or avoided (composting) are estimated using the first order decay (FOD) model. Among the factors that influence the landfill gas generation forecast by the model, is the composition of the waste stream, especially the organic discards (food, paper/textiles, other putrescibles, and wood). Developing countries generally have a higher level of organic waste than developed countries, especially food waste. People in the developing world buy more fresh (non-packaged) food, so the residuals of preparation end up being discarded with other wastes. Also low income households in developing countries do not have separate garbage disposals. The average annual precipitation and ambient temperature is another important factor to estimate the decay value (k) in the model. A matrix of values has been developed for the categories of organic waste based on wet or dry precipitation (more than or less than 1000 millimeters per year) and tropical or temperate temperature (more than or less than 20ºC during a year). The effect can be significant. The default k value for food waste for waste in a dry / temperate climate is 0.06; while in a wet/tropical location the k value is 0.4. A CDM registered landfill gas project in Alexandria, Egypt at the Borg El Arab landfill. Adjustment values based on the condition of the existing disposal practice in an area are also important in estimating baseline emissions. These methane Correction Factors (MCF) range from 1.0 for a basic engineered site that is well managed to a low of 0.4 for a dump that is unmanaged and has a waste depth of less than five meters. Emission reduction monitoring methodology Approved CDM methodologies specify monitoring programs that are to be followed by developers in order to qualify for emission reduction credits. The monitoring programs for landfill gas and methane avoidance projects (aerobic composting) differ as landfill gas projects can measure the methane captured and processed; while methane avoidance project can not measure the methane that is not produced. Landfill gas: with landfill gas projects, emission reductions are monitored using data derived from the gas captured and processed after operations have begun (ex-post). A range of parameters to determine the volume of methane captured and destroyed are tracked. In addition, the monitoring data must be stored correctly so that it can be verified when an independent auditor visits the site. Inadequate data storage has caused projects to lose emission reduction credits that they probably should have received. For simplification, methane density is not monitored and at standard temperature and pressure (0 degree Celsius and 1,013 bar) is assumed to be 0.0007168 tCH4/m3CH4. Methane avoidance: most of the parameters to assess emission reductions on avoidance projects are set prior to the start of operations (ex-ante) using default values from IPCC’s guidance report and the FOD model formula. Monitoring requirements, thus, are less rigorous as compared to landfill gas projects. CDM development process Development of a CDM project to the time when it can begin earning emission reduction credits can be a complex and lengthy endeavour. The process at the Bank begins with an approval of a Project Idea Note (PIN), a brief summary that describes the proposed program, the expected emission reductions, the capital investment costs, and a number of other factors. If the PIN is accepted the Bank enters into a Letter of Intent with the project developer/owner of the emission reductions. Preparation of a detailed project assessment, known as a Project Design Document (PDD), is the next important step in a project’s development. The standard sections in this CDM document are provided below: Project description. Baseline methodology. Project duration. The two options under which a project may earn credits (crediting period) are a fixed 10 year period and a seven year period that may be renewed for two additional seven year periods. Projects that elect the seven year crediting period must be reviewed at the end of the period as to whether the baseline conditions have changed - such as has landfill gas recovery in a country become a requirement that is enforced. or a common practice even without a regulatory requirement. Monitoring methodology and plan. Estimated greenhouse gas emissions both reduction and additional emissions that may be generated by sources. Environmental impacts. Stakeholders’ comments. A final draft PDD is made available for public review on the CDM web site. During this process the Bank will enter into an Emission Reduction Purchase Agreement (ERPA) with the project developer/owner of the emission reductions. The PDD findings and the concept is reviewed by an independent assessment firm, called a Designated Operational Entity (DOE) that has been approved by the CDM Executive Board (EB). After the project has been validated, it can be submitted to the CDM for registration, which involves an additional review of the project documents. The process from submission of a PIN through registration can take two years or longer depending on quality of the information prepared and the volume of projects submitted during the validation and registration phases. After registration, a project can begin earning emission reduction credits. Credits, the most reliable, must be verified by a DOE and then issued by the CDM EB. Projects must follow the approved monitoring plan from the registered PDD or otherwise face rejection of all or a portion of the credits claimed. Project owners and operators should be thoroughly familiar with the approved monitoring procedures, use reliable equipment, and be sure the collected data is properly stored to avoid losing emission reduction credits during verification and issuance. Because of the administrative cost of verification and issuance, this process is often done on an annual basis. CDM and municipal waste management Landfill gas: One of the earliest sectors of interest with CDM was landfill gas projects in urban areas. Large quantities of municipal waste are discarded in cities and to the extent it is collected, the waste is taken to a disposal site. Urban areas also recently became home to 50 % of the world’s population. In developing countries, as an example, there are about 400 cities with a population of one million or more. Many disposal sites in developing countries are unsuitable for effective gas recovery because the facilities have been operated as dumps due to poor or no site design and operation. A common operations hindrance to gas recovery is fire that may be started as a means to reduce the volume of waste or to ease the processing of certain grades of recyclables. Fires consume organic waste, thus eliminating the potential for the organics to generate methane as they decompose. Nonetheless, there are many disposal sites in developing countries that are designed and operated in a similar fashion to landfills in North America and Europe. As of Autumn 2009, 120 landfill gas projects had been registered with the CDM. This accounts for 6.5 % of all registered CDM projects. Once a project is registered with the CDM, it can begin earning emission reduction credits, which is the basis for payment under the carbon finance program. At the same time, an additional 11 projects had registrations pending and another 95 had validations pending. The Bank has ERPAs with 22 landfill gas projects more than half of which are registered. Composting: Even though the composition of municipal waste in developing countries, which typically has a high organic content, especially with food waste, may lend itself well to composting few projects have been registered with the CDM. Again, as of Autmn 2009, 11 municipal waste composting projects had been registered and another 20 had validations pending. The Bank had seven municipal waste composting projects most of them in various stages of development. The Tianjin project Among the registered landfill gas capture projects that are operating, and the Bank is a trustee for a Fund, are projects in Alexandria, Egypt; Durban, South Africa; Monterrey, Mexico; Montevideo, Uruguay; Nova Iguacu, Brazil; and Tianjin, China. Tianjin, with a population of about 9.6 million, is the third largest city in China, about 150 kilometers from Beijing. A photo of the landfill operation in Tianjin, China, which has a CDM registered landfill gas (LFG) capture and power generation project. The city is served by a network of disposal sites that includes four landfills and an incinerator. The first engineered landfill (Shuangkou) built to Chinese national standards including bottom liner and leachate collection and treatment system began operations in early 2001. The landfill was financed by the World Bank as part of a broader loan program for Tianjin. The gas capture and use program developed by the Tianjin Clean Energy and Environmental Engineering Ltd Co. (TCEEE), is a joint undertaking of the Tianjin Construction Commission and the Environmental Sanitation Commission. TCEEE selected a Chinese firm Nanjing Long-Term Environment Technology Development Co., Ltd. as a build, operate, transfer company (BOT) to develop and operate a gas collection and power generation system. About 2 million tons (1.8 million tonnes) of waste have been received at the landfill and 34 horizontal collection wells have been installed on about four hectares of the site. The 60 hectare landfill has a design capacity of 8.5 million cubic meters, or 7.4 million tons (6.7 million tonnes) of waste. The facility will have about 15 years of life at the expected rate of fill. At closure, the landfill will have an average waste depth of 34 meters. The landfill gas captured is being drawn to an energy recovery center where one Caterpillar combustion generator with a total generating capacity of 1.03 MW is being used to generate electricity for sale to the power grid. As the amount of waste deposited in the landfill grows, the number of combustion generators will eventually increase to four units with a total capacity of 4.12 MW. A flare manufactured by Nanjing Kun Yuan Technology Ltd., Co. (Nanjing, China) is used when there is excess methane or at time when the generator is out of service, such as during maintenance. The emission reduction methodologies applied to this project were ACM0001 (Consolidated baseline and monitoring for landfill gas project activities) and AMS-I.D (Grid connected renewable electricity generation). The Cairo project The Bank has entered into ERPA agreements for municipal waste composting projects including ones in Kota Kinabalu, Malaysia; Lahore, Pakistan; and Cairo, Egypt. The metropolitan area of Cairo, the capital of Egypt, has a population of 17.8 million people making it the largest city in Africa and the sixteenth largest metropolitan area in the world. Four generators using methane from a landfill site to produce electricity. ECARU (the Egyptian Company for Solid Waste Recycling) has a contract with the governorate of Cairo for the landfill of municipal solid waste from the Cairo ‘southern zone’. About 2000 tons (1814 tonnes) of municipal waste is discarded in the southern zone, including 1500 tons (1360 tonnes) per day of domestic and commercial discards and 500 tons (453 tonnes) per day of construction and demolition debris. The company’s contract with the governorate allows it to process the waste received through recycling or composting. Currently, ECARU receives about 375 tons (340 tonnes) per day of waste which it processes (sorts for recyclables), composts the separated organics, and landfills the residue. The balance of the waste will be directed to ECARU when an existing landfill that is near capacity closes. Incoming domestic and commercial waste is unloaded on a concrete pad, where large bulky items are removed. The waste is feed onto a conveyor which moves it to an elevated sorting platform where a combination of manual and mechanical sorting is used to recover recyclables and produce an organic fraction for composting. The organic stream is taken to an adjacent windrow composting facility. The windrows are turned periodically to provide oxygen needed for the aerobic composting process. Water also is added on a regular basis to maintain the composting operation. The first stage (fermentation) composting operation lasts about 30 days followed by a second stage (maturation) with less frequent turning. The final product is ready for marketing after the compost has been screened to remove oversize residue. ECARU has a laboratory to check compost quality. ECARU’s current sorting and composting demonstration activity is a financial breakeven operation that is only being undertaken due to a contractual obligation to divert 20 % of the waste received at the ECARU waste management complex from the landfill. More importantly, the demonstration activity has provided ECARU with the opportunity to develop markets for its compost which will be important after the project is registered and production is scaled up. The emission reduction methodology applied to this project was AM0025 (avoided emissions from organic waste through alternative waste treatment processes). This methodology covers a range of avoidance technologies in addition to aerobic composting including incineration with energy recovery, refuse derived fuel and related processes. Conclusion Municipal waste will continue to play an important role in the reduction of methane emissions under the CDM with a growing number of landfill gas programs and the increasing importance of municipal waste composting. The Kyoto Protocol led to the establishment of a global carbon market. The commitment period for the Protocol will expire by the end of year 2012; a new international program that will deliver continued carbon reductions is needed to control greenhouse gas emissions and the increase in global warming. In anticipation of a continued market for emission reduction from greenhouse gases, the Bank has committed to purchases of such reductions beyond the year 2012. Charles Peterson is a Deal Manager in the Operations Group in the World Bank’s Carbon Finance Unit (Washington, DC),e-mail: cwpiv@aol.com Claudia Barrera in the Unit’s Methodology Group,e-mail: barrera@worldbank.org Zarina Azizova was formerly with the Unit and now works for ENDESA Corbono (Madrid, Spain).e-mail: zarina.azizova@gmail.com, This article is online. Please visit www.waste-management-world.com (For further info visit: worldbank.org, carbonfinance.org, tinyurl.com/pb8aqjl, tinyurl.com/24qawfp) References Methane has an atmospheric life in the range of 9 to 15 years with a GWP over 20 years of 56, declining to 21 over 100 years, including indirect effects of tropospheric ozone production and stratospheric water vapor production. (Source: tinyurl.com/24ppomc). Methodological Tool ‘Tool for the demonstration and assessment of additionality’ (Version 05.2) (tinyurl.com/yj59pdk) More Waste Management World Articles Waste Management World Issue Archives