Clean Tech

Can money make the waste go round?

V Rishi Kumar | Updated on August 11, 2020

Funding could be the key to better urban waste management

Collecting urban waste is, no doubt, a mammoth task but a relatively easier one. Disposing it or recycling it in an eco-friendly manner is the far bigger challenge.

According to 2019 estimates, 377 million Indians live in 7, 935 cities and towns. Together they generate 62 million tonnes (mt) of municipal waste annually of which about 42 mt is collected and only 11.9 mt treated — the rest is simply dumped in landfill sites, which are growing by the day.

Though solid waste management (SWM) is one of the basic essential services provided by municipal authorities across the country to keep urban spaces clean, the funding for it is far from adequate to provide turnkey services that include waste segregation, collection, treatment, recycling and disposal. Sadly, most municipal authorities deposit solid waste haphazardly at a dump yard within or outside the city.

PPP model works

In a document on the financial and economic considerations of SWM, the Central Public Health and Environmental Engineering Organisation, a technical wing of the Ministry of Urban Development, admits that waste management receives a comparatively “inadequate share of the total municipal budget as the municipal agencies assign low priority to this work resulting in poor services.” It says that SWM should be governed by the norms of public finance, and being a public utility and an essential service, investments in it should not be seen in terms of “positive returns on investment” or “minimum profits”. To add to this is the lack of planning and financing strategies and a lack of accountability in the current SWM system throughout the country.

However, over the years, a few Class A cities like Delhi, Hyderabad and Ahmedabad and various Class B cities like Dehradun, Indore, Bilaspur, Katni, Sagar, Raipur, Rewa and Dhanbad have begun to create infrastructure for handling and management of MSW scientifically.

For this, the Public-Private Partnership (PPP) model of establishing collection, transport, processing and disposal of MSW has been quite successful. In some cities, ‘waste to energy’ power units have come up along with integrated waste management systems. Some of these models have shown considerable success and are being replicated. Decentralisation has proven to be one of the best practices.

Working on already stretched budgets and huge establishment costs, several municipal corporations have welcomed the PPP model as it brings in the necessary capital and enables the implementation of the project by a private partner.

But many of the private players feel that to bolster such efforts, fund allocation by State governments and Central government grants to local bodies for development of waste processing facilities could help. In fact, experts point out that a one-time grant from the government along with tipping fee is the best techno-commercial feasible funding model as it reduces the capital investment and ensures the smooth flow of operations.

Tapping bonds

Another option being looked at by fund-starved municipal corporations is raising funds through municipal bonds and by offering debentures. Several municipal corporations, including those in Ahmedabad and Hyderabad, raised funds through this route.

M Goutham Reddy, Managing Director of Ramky Enviro Engineers Limited (REEL), a leading waste management company, points out that there is also a huge potential to tap loans from bilateral and multilateral agencies because they are open to supporting well-designed projects. REEL currently runs three waste to energy projects and has some in the pipeline. “We as a nation are collectively handling about 7,000 tonnes of waste per day through waste to energy projects, we actually generate about 1.85 lakh tonnes to 200,000 tonnes of waste per day,” says Reddy.

“After Covid-19, the amount of medical waste that gets generated has increased significantly. Our strategy is to expand not just in waste to energy projects, but also expand our business in other waste management solutions for healthcare, industries and other segments,” he says.

Finally, he feels, finance for waste management must be raised from waste generators through a ‘waste tax’. Experts calculate that an average charge of ₹1 per person per day would generate close to ₹50,000 crore annually, and this level of funding would probably be sufficient to provide effective waste management throughout the country.

Published on August 11, 2020

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