Tuesday, May 11, 2010

The Caesar Rodney Institute's Bad Math on Recycling

The Caesar Rodney Institute has circulated another piece of analysis on Senate Bill 234. It's called "Universal Recycling Bill Cost/Benefit Analysis Doesn’t Add Up" and it was authored by David T. Stevenson, senior fellow at the Caesar Rodney Institute, whose previous alarm about the mythical trash police I critiqued several days ago.
His new analysis hasn't been posted online, but his most startling result — that SB 234 would take 65 years to break even — has already been picked up by DelawarePolitics.net.
I have found three fundamental flaws in his work, and conclude that it is his analysis that doesn’t add up.
Mr. Stevenson’s analysis uses participation rates and cost estimates of older and far less efficient programs to project the success and cost of universal curbside recycling. He compounds these errors by offering a lowball estimate of the cost of landfilling. These three errors each amount to about an order of magnitude, and together render his conclusions almost completely unreliable.
The first error is his assertion that SB 234 would increase diversion by only 3 percent, or 13,500 tons a year — an absurdly low projection. Experience shows us that regular single stream curbside recycling quickly pays off in terms of near universal participation.
The City of Wilmington saw its diversion rate jump quickly above 30 percent when it instituted single stream curbside recycling — without the need to call in the "trash police" we have been warned of.

The second error is his use of the current costs of volunteer curbside recycling, $108 per household per year, to project the costs of universal single stream program — a figure that is overblown by an order of magnitude.
Wilmington’s net cost per household, including averted tipping fees, is currently $8 per household per year. When commodity prices recover, that net cost will drop to $3. And of course, higher tipping fees will eventually erase any remaining difference.
This leads us to a third fundamental flaw in his analysis: an absurdly low estimate of the cost of landfilling, which he assumes to be only $5 per ton — about 8 percent of the current tipping fee. Landfills are not renewable resources. But the analysis assumes that landfill space will never run out and that the cost of landfilling will never go up.
If we fail to slow landfill accumulation and Cherry Island Landfill fills up, we would face the expensive prospect of spending several hundred million dollars to build a replacement — if a site can be found in northern Delaware. I have calculated that postponing the need to replace Cherry Island Landfill (at a cost of $250 million) through a vigorous recycling program would create present value savings of about $23 million.
And if Cherry Island closes and a replacement cannot be found in New Castle County, we could see a daily parade of trash trucks — one every minute, nine hours day, seven days a week — running down Route 1 to downstate Delaware.

We've seen this tactic before in the fight to bring wind power to Delaware. Opponents of environmental progress offer the most exaggerated costs and minimized benefits, while hoping that no one will bother to check their math.
SB 234 is again number one on the House agenda for today. I'm hoping the bill gets the full debate it deserves, without too much nonsense being injected into the proceedings.

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