A recent credible study suggests the amount of waste Americans dispose in landfills each year is over twice what the EPA had been estimating.
Although this news may not surprise the country’s disposal facilities (who already knew the quantity of waste they take in), the study may strike an old nerve for many Americans – that our society generates too much garbage. The answer, we have been repeatedly told, is to recycle our waste. In fact, plans for zero waste or 100% recycling have been hatched in places including Berkeley, California and Indianapolis, Indiana.
But is more recycling always better than less recycling? Is it conceivable that society can recycle too much? What does the research say about the costs and benefits of recycling?
Unfortunately, not much is available. We may sense that more recycling is better than less recycling, but we really do not know. Our recycling habits developed not in the wake of a scientific understanding of these matters but perhaps, as John Tierney describes in his recent New York Times piece, on a leap of faith.
Last year, I coauthored a research study to estimate society’s optimal recycling rate. Results surprised us – society’s best recycling rate is only 10%. And only specific recyclable materials should be included in that 10%. What drives these results?
The literature on recycling
First, dozens of published economic studies from across the globe estimate that landfills depress neighboring property values, although this negative impact appears to diminish for small landfills. Second, a growing number of published life cycle analyses suggest that mining raw materials is damaging to the natural environment, and manufacturing goods with recycled materials rather than their virgin counterparts can be beneficial to the environment. But the magnitude of these benefits varies across materials.
Finally, the economics literature suggests recycling requires more economic resources than simple waste disposal. The value of the extra energy, labor and machinery necessary to prepare materials for recycling can double the value of those resources needed to dispose the material in the landfill.
Our study made the first known attempt to combine these various costs and benefits into one analysis to estimate what recycling rate is best. Our conclusion was that recycling up to 10% appears to reduce social costs, but any recycling over 10% costs the environment and the economy more than it helps. The environment and economy suffer as we transport some recycled materials to destinations as far afield as China.
These provocative results certainly require confirmation from future independent and objective research before broad policy goals can be adjusted. Also, many of the benefit and costs associated with waste disposal and recycling vary across regions of the country and world, and thus optimal recycling rates may also vary. For example, we used municipal cost data from Japan for this study because the United States and most European countries do not keep such data.
But if these results hold for other developed countries, then society should collectively rethink how to approach recycling.
Detailing the costs of waste and recycling
This paper identified several factors that help justify possible reductions in the recycling rate.
First, the environmental damages associated with both modern landfills and incineration plants turn out to be less than traditionally imagined. These facilities certainly depress neighboring property values – on average each ton of waste deposited in a landfill or incinerated is found to reduce property values by about US$4.
But modern disposal facilities in most developed countries are required to abide by strict environmental standards, and air and water pollutants such as methane and carbon generated by these facilities (and the carbon monoxide and consumption from the trucks transporting waste to these facilities) appear less than previously expected. These environmental standards have increased disposal costs (tipping fees) paid by waste generators by as much as $50 per ton, but the remaining external costs have fallen to roughly $5 per ton disposed. Thus, collectively waste disposal facilities generate just $9 per ton in external costs borne by society ($4 from depressed property values plus $5 from remaining air and water pollutants). Economists had once imagined external costs of $67 per ton to as much as $280 per ton.
But because these costs do not appear on the balance sheet of the disposal facility, the assessment of a corrective tax of $9 per ton disposed is necessary for disposal facilities to consider these costs when making decisions. Once this tax is in place, then laws requiring municipalities to recycling can be lifted.
Second, recycling is rather costly to municipal governments. The cost for New York City to process one ton of materials for recycling markets is about $300 more than the cost of simply taking that same material to the landfill, according to the recent New York Times article. In many cases, the travel itinerary for recycled materials, which increasingly includes final destinations in developing countries, exceeds by large margins the distance that garbage is transported.
Third, we found the primary benefits of recycling accrue not from saving landfill space but from generating materials that, when used in production, are less costly to the environmental than mining those materials from the earth. Our study concludes that using an average ton of certain recycled materials in the place of a ton of virgin materials generates environmental spillover benefits of as much as $400 per ton.
By the way, this monetary estimate (and all dollar estimates associated with environmental considerations) is calculated using two processes. First, the life cycle analysis identifies the physical quantity of carbon, sulfur, nitrates and other pollutants associated with the entire life cycle of waste and recycling systems. Second, the economics literature has developed per-dollar estimates of the impact each unit of pollutant costs society. Each ton of carbon, for example, has been estimated to generate $25 of damage to the natural environment.
But the substantial environmental benefits outlined above of using recycled materials in production vary substantially across materials. Aluminum and other metals are environmentally costly to mine and prepare for production. Paper, too, is costly to manufacture from raw sources. But glass and plastic appear relatively easy on the environment when manufactured from raw materials.
These differences are vital. Although the optimal overall recycling rate may be only 10%, the composition of that 10% should contain primarily aluminum, other metals and some forms of paper, notably cardboard and other source of fiber. Optimal recycling rates for these materials may be near 100% while optimal rates of recycling plastic and glass might be zero. To encourage this outcome, a substantial subsidy offered only on those materials whose life cycles generate positive environmental benefits should be applied.
In the end, the economy and the environment, speaking in one unified voice, may wish for society to reduce the overall quantity of waste recycled. Perhaps recycling efforts need to surgically focus on only those specific materials that really matter to the economy and the environment. Other materials can be simply disposed of in modern facilities.