Energy Recovery and Waste: Is There a Trade-Off?

33 Pages Posted: 27 Jun 2019

See all articles by Laura Levaggi

Laura Levaggi

Free University of Bozen - Faculty of Science and Technology

Rosella Levaggi

University of Brescia - Department of Economics and Management

Carmen Marchiori

University of Brescia - Department of Economics and Management

Carmine Trecroci

University of Brescia

Date Written: June 26, 2019

Abstract

This paper investigates incentives, trade-offs and equilibria in a simplified two-Region model of the final treatment of municipal solid waste. The two regions are identical but for the waste disposal facilities operating in each region, which are: a Waste to Energy (WtE) plant in Region 1, and a landfill in Region 2. In this setting, and in the absence of spillovers, we investigate how waste mobility and the institutional setting (public/private ownership of the WtE plant) affect waste management choices and welfare in the two Regions. When waste mobility across Regions is not allowed, the institutional setting is uninfluential, but it does not necessarily minimise its environmental damage. Allowing for mobility when the incinerator is publicly owned, leads to an equilibrium outcome which is both globally efficient and Pareto improving for the two Regions. Compared to the no-mobility case, the optimal level of recycling is higher in Region 1 and lower in Region 2; moreover, the total amount of waste incinerated is larger. Finally, the mobility scenario with private ownership may not be welfare improving for all parties involved.

Keywords: Energy recovery, waste mobility, WtE technology, Recycling, welfare analysis

JEL Classification: H70, D62, Q20

Suggested Citation

Levaggi, Laura and Levaggi, Rosella and Marchiori, Carmen and Trecroci, Carmine, Energy Recovery and Waste: Is There a Trade-Off? (June 26, 2019). Available at SSRN: https://ssrn.com/abstract=3409970

Laura Levaggi

Free University of Bozen - Faculty of Science and Technology ( email )

Universit├Ątsplatzt, 1
Bozen, 39100
Italy

Rosella Levaggi (Contact Author)

University of Brescia - Department of Economics and Management ( email )

Via San Faustino 74B
Brescia, 25122
Italy
+39 03 0298 8825 (Phone)
+39 03 0298 8837 (Fax)

HOME PAGE: http://www.eco.unibs.it/segdse/rlev/index.htm

Carmen Marchiori

University of Brescia - Department of Economics and Management ( email )

Contrada Santa Chiara, 50
BRESCIA, BS 25122
Italy

Carmine Trecroci

University of Brescia ( email )

Via San Faustino 74B
Brescia, 25122
Italy

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