COST CONSIDERATIONS Costs of Collection and Separation

Costs included in this section are curbside collection and processing (MRF) costs. The estimates exclude the cost of efforts to increase or maintain community participation in recycling efforts through advertising and educational programs; those costs have been estimated at $1.00-$1.50 per household per year (Deyle and Schade, 1991).

Collection costs are affected more by the number of stops made than by the tonnage collected. For the Hudson Valley area of New York, the cost of collecting newspaper, glass, and metals and keeping them separate was reported as $50 per ton of collected material (see Appendix E). Other studies have reported $60-$80 (1989 dollars) per ton; at those cost levels, curbside collection of separated materials adds 8-25% to the total collection costs for unseparated MSW (Deyle and Hanks, 1991). The data on these costs are quite limited, however.

Figures 7.6 and 7.7 show the range of capital costs for existing low-tech and high-tech MRFs that sort reusable materials, whether mixed or separately collected(5). The capital cost of those facilities (with an average capacity of 89 tons per day) averages about $26,000 per ton of design capacity per day. Planned facilities are larger, averaging 162 tons per day, and their average capital cost is estimated at $37,000 per ton of design capacity. More detailed data on MRF costs are provided in Exhibit I.

Figure 7.6
(Low Technology)


Figure 7.7
(High Technology)

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Operating costs for the MRFs are shown in Figures 7.8 and 7.9. In general, low-technology MRFs have higher operating costs, averaging $65 per ton, than high-technology MRFs, which average $39 per ton, because of the greater labor intensity of the former. The figures show log-log plots that tend to suggest a narrower range of prices than the actual range. Other studies show a range of $26-$86 per ton, with an average of $45 per ton (Bishop, 1991).

Because the cost ranges are so wide and the number of data points is so small, the data in Figures 7.6 through 7.9, as well as the more detailed cost data provided in Exhibit I, are useful only as order-of-magnitude estimates of the possible costs of new MRFs. The variations reflect inconsistencies in the sources of the estimates rather than predictable variations based on the type of technology or the size of the facility.

Sources of Income for MRFs

The cost of operating a collection program and an MRF is covered by revenues from sale of separated products and by tipping fees charged to generators of materials going to the MRF (either directly or indirectly through waste disposal charges). Costs remain relatively fixed regardless of the amount of material recycled, but revenues depend on the quantity, quality, and prevailing prices of the products. Revenues may be lower, in general, in states with deposit laws because container materials generate higher revenues than many other recycled materials, and smaller quantities of container materials are set out for curbside collection in "bottle bill" states (White, 1990).

Revenues from Sale of Products

Prices of products vary depending on the region and with time; therefore, revenues from products vary between $8 and $32 per ton (Bishop, 1991)(6). Table 7.3 shows revenue ranges for individual products (at the MRF).

Prices paid for recycled products also vary greatly over time, as illustrated by the changes in the national average price for various products in 1991 shown in Figure 7.10. These prices have been volatile in the past, and they are likely to remain so. The prices of all the major recycled products fell during the second half of 1991, and the price of old newspaper fell below zero in some areas (that is, paper mills charged a fee for accepting old newsprint). In general, prices decreased overall for the last 6 months of 1991.

Tipping Fees

About one-half of existing MRFs charge a tipping fee to haulers that bring materials to an MRF; others charge no tipping fee in order to encourage participation. One source estimates that tipping fees range from $2.50 to $70 per ton of material delivered to the MRF, with an average of about $27 per ton [386]. Another source gave a range of $8 to $110 per ton (Glenn and Riggle, 1989). Tipping fees, even when added to revenue from sales of recovered materials, are usually insufficient to cover the O&M costs of the operation (Berenyi and Gould, 1990).

Figure 7.8
(Low Technology)


Figure 7.9
(High Technology)

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                                             Table 7.3
                           REVENUES FROM PRODUCTS OF MRFs
Product           Amount (lb)(a)    Price per ton ($)    ($/t of collected material)

Newsprint              1080             $-3-$57(b)                $-1.62-$31
Cardboard               81              $27-$83(b)                 $1-$3.4
Glass                  540              $0-$20(c)                  $0-$5.4
Aluminum                45             $350-$600(c)               $7.9-$13.5
Ferrous                 45              $0-$22(c)                  $0-$0.50
Plastic (PET)           9              $40-$200(c)               $0.18-$0.90

(a) Source: Reference [386]; amounts are medians calculated from operating MRFs.
    Total output from 1 ton of collected material taken to an MRF is 1,800 pounds of
    products; a 10% loss is common at MRFs [149, 386].

(b) Source: API, 1991; data are the range for #6 newsprint in 1991 and first- and
    second-quarter prices for cardboard in various U.S. regions, excluding shipping
    charges. The lower prices were paid in New York City and the higher prices were
    paid in San Francisco and Los Angeles for both newsprint and cardboard.

(c) Source: RT,1992. The data show 1-week average prices for nonpaper products
    for U.S. regions. The range of prices may reflect the difference between reports
    from municipalities with small volumes and dealers with large ones. The range
    shown above is for glass prices and aluminum prices applied to all U.S. regions.
    The South had the only high price range ($10-$22 per ton) for ferrous cans, but the
    South and South Central regions had the lowest price range ($40-$100 per ton) for
    PET plastics.

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Financial Balance

Separate collection adds 8-25%, or up to $60 per ton, to the total collection costs for MSW. MRF processing costs $39-$65 per ton. Revenues for recycled products range from $8 to $32 per ton. Thus, many materials recovery programs cost money instead of saving it. A study of one region estimated a net cost of $100 per ton of MSW (Deyle and Schade, 1991)(7). Because net costs for curbside recycling can be higher than those of landfilling, some states have included an economic "escape clause" that allows relief from recycling goals if the expense exceeds alternative disposal costs (see Appendix E and NSWMA, 1991; Bullock and Salvador, 1990).

Figure 7.10

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Environmental Releases


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