Waste policy

One of the themes in the discussion about the Poolbeg incinerator is that it is perfectly in line with the official waste policy of the Department of the Environment while being firmly opposed by the Minister of the Environment. The Minister has now submitted a new Statement of Waste Policy for consultation.

The Statement is rather short, 26 pages (with only 13 pages devoted to policy measures), and not very specific in most places and often ambiguous if not muddled. Presumably, this means that the new waste policy is still some years into the future, and may not be ready during the term of the 30th Dail Eireann.

The Statement is firmly based on the Eunomia report, and does not even acknowledge the existence of the Gorecki report.

The first four policy measures aim to strengthen the role of the state, the counties, and the private sector (at whose expense, one wonders); to decrease costs and increase quality (always a great plan); and to achieve cost-efficacy by imposing additional constraints (a mathematical nonsense).

There is a proposal for the separate collection of six, perhaps seven streams of household waste: clothes and perhaps glass would collected at the kerbside (in lieu of the current bring banks); paper, aluminum, and plastic would be separated at sources (instead of mixed); and brown bins (for food waste) would be rolled out nationwide.

There is to be an arbitrary cap on residual waste (black bins), with financial penalties for counties that do not meet these targets (on average). County councils may respond by tacitly encouraging people to stuff their waste in green, brown, yellow, red, blue and purple bins instead. (There will be a tax credit cq supplemental benefit for the colourblind.)

The Statement reiterates the plan to raise landfill levies by 150% between now and 2012. As there is an EU-imposed cap on landfill, a system of tradeable permits would have been a better choice of instrument.

The Statement invokes the polluter pays principle and calls for an (unspecified) incineration levy that is unrelated to its emissions. There will be another attempt to declare incineration ash to be hazardous waste (it is not). In a separate proposal, there will be an arbitrary cap on incineration.

There will be arbitrary targets for recycling, but no policies to ensure that these are met.

Producers will carry a greater share of the cost of waste management. Newspapers and magazines are mentioned as an example.

There will be an awareness campaign to convince people to waste less.

And plenty of jobs will be created, innovation stimulated, and we will all become terribly rich.

On the one hand, the proposal is an improvement as the Minister now follows the proper procedures of a parliamentary democracy, and some of the hare-brained ideas in the international review have been dropped. On the other hand, the Statement itself is weak. Little thought has gone into costs, incentives and practicalities. The Statement strictly follows the green dogma of the waste hierarchy, a lexicographic ordering of options for waste disposal.

There is also an opportunity missed. The current Irish waste policy is sound (at least on paper). The main exception is household waste collection, with duplication of services and private operators competing with public operators-cum-regulators. The International Review recommended that this be replaced with a system of auctioned concessions, one of the few recommendations that it shared with the Gorecki report. The Statement did not adopt this recommendation, offering only vague language.

Incineration (N+2)

The Competition Authority has rejected complaints that the contract between Dublin City Council and Covanta/Dong is in breach of competition law. See Examiner, Indo, Times and RTE. The last two articles give substantial space to the IWMA’s view that is not really what the Competition Authority said, but it did. The Poolbeg incinerator affects the market for waste disposal directly and the market for waste collection indirectly, but not in an illegal or unfair way. The Competition Authority ruled correctly.

RTE also reports that Minister Gormley wants a word with the Competition Authority, which is peculiar as the CA does not answer to DEHLG.

The IWMA is now pursuing a complaint with the EU that the take-or-pay contract between DCC and C/D constitutes an unfair state subsidy. The evidence is again against the IWMA. Long-term contracts are perfectly legal. The IWMA will have to show that the DCC overpaid, and deliberately so.

The press also report estimates of the cost of abandoning the Poolbeg incinerator at this stage: Hundreds of millions of euro. See Indo and Herald. That number corresponds to my own back of the envelope calculations for the total of landfill fines, money already spent on Poolbeg, contract buy-out, and the extra cost of the alternative disposal methods.

Commentators are increasingly worked up. See, for example, Hogan, Indo, and today’s Sunday Times.

UPDATE: More in the Irish Times of today. Minister Gormley reiterates the misconceptions that the Poolbeg incinerator will only burn waste that is collected by public operators; and that the proposed landfill levy will guarantee that the landfill target will be me (Curtis et al. disagree). Minister Gormley also seems to say that Ireland would not face EU fines if it does not meet its landfill targets — which would be untrue — but perhaps he thinks that there are alternative ways to meet the target — which is unlikely: A double-dip depression and accelerated emigration might do it.

Taxes postponed

It now looks as if neither property taxes nor water charges will feature in the next budget. Shifting the tax burden from income to property and resource use would provide a welcome stimulus to the economy. That said, water charges need water meters and property taxes need a valuation database — and the government does not appear to have put much thought into these matters since the Commission on Taxation released its recommendations.

The upshot, of course, is that spending will need to be cut further and that income taxes will stay high for longer.

Irish economy and climate change

Climate policy in Ireland and Europe is important to the economy of Ireland, and I will continue to blog on that. I have not posted much lately, which is because nothing much has happened (except for a series of non-conclusive international and European meetings).

Most aspects of climate change are not particularly relevant to the Irish economy. Although some frequent visitors to this site share my interest in these matters, the discussion is better placed elsewhere. My adventures in IPCC land are discussed here, but I’ll also use VOX, Klimazwiebel and Pielke Jr for issues on climate change economics, science, and policy, respectively.

Economic crisis fully explained

It wasn’t incompetent economists after all, it was the GAA that did it — see SIndo