Ricardo Marsh 500495594

What is the best price for per unit of waste collected given that main
object is to increase recycling and the advantage of this program.
As the city of Toronto embark on a next educational campaign to help communicate to
residents in apartments and condos about the importance of proper sorting, disposal and
diversion. This paper is to show by applying the appropriate price per unit of waste
collect the city can drastically increase the desire to recycle. According to the city of
Toronto website in 2012, residents living in single-family homes had a diversion rate of
66% while those living in multi-residential buildings achieved a rate of only 24%, for a
combined diversion rate of 52%. Based on this information its safe to say that a better
alternative is needed.
To establish whether something is a resource or just garbage, to be disposed of at the
lowest possible cost, including costs to the environment. The answer comes down to
price. If someone will pay you for the item, its a resource. Or, if you can use the item to
make something else people want, and do it at lower price or higher quality than you
could without that item, then the item is also a resource. But if you have to pay someone
to take it, then the item is garbage. This is the major problem with recycling the price and
the cost is vague.

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Fig. 1. The Marginal utility for recycling in Toronto

The citizens of Toronto have a low utility to recycle. Relying on their morals alone will
not change this. This is where the pay as throw will help. Traditionally, residents pay for
waste collection through property taxes or a fixed fee, regardless of how muchor how
littletrash they generate. Pay-As-You-throw (PAYT) breaks with tradition by treating
trash services just like electricity, gas, and other utilities. Households pay a variable rate
depending on the amount of service they use. The PAYT works off the principle that the
polluters internalize the cost of the garbage they produce.

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Fig 2. Supply and Demand curve for garbage

The city faces a demand and supply curve like the one listed above for garbage. Where
the quantity is the amount of garbage collected. Given that that city is face with this
demand curve and the main goal of the government is to reduce garbage collection thus
increase recycling. The question is what is the best price?

If the city chose a price for the per unit waste collect that is very low (P1) then the amount
of garbage collected would be high Q1. The reason for this is that it doesn't cost much to
throw away the garbage so why would Torontonians be motivated to recycle. Base on the
diagram as the price increase the amount of garbage collected decreases. When setting
the price per container there are few costs that need to be considered these are the
administrative, collection, disposal and material handling cost. The administration cost
includes public outreach, enforcement, and billing and customer service. Collection costs
include collecting trash and recyclables, as well as labor and equipment costs and

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contract payments. Disposal and material handling fee include fees for landfill disposal or
waste combustion and costs for materials recovery facilities. To arrive at the optimum
cost per container you need to have an estimate of these costs for the year and the also an
estimate of the total garbage that will be collected for the year. Base on this the optimum
price will be selected. This will lead to an increase in recycling. The price must be fair so
that they are willing to pay to throw away their garbage. Also the law must me fully
enforce and monitor to prevent illegal dumping.
Households that desire to minimize waste disposal costs in a PAYT pricing regime may
reduce the amount of waste generated, dump its trash unlawfully or participate in the
local recycling and yard waste collection programs. Households also may reduce the
amount of waste disposed by reusing certain items or by changing purchasing behavior.
For example, they might buy fewer discretionary items products that have less packaging,
or purchase more products that have recyclable packaging (4). Households also may
recycle more of the materials that are included in local collection programs.
Appling a pay as you throw system will be met with some resistance. Theses include:

Illegal dumping
PAYT is regressive/low-income resident feel greater impact
Overstuffing of containers
Lack of support from private waste hauler

These problems can be solve by educating the residents about the program and develop
an enforcement plan. For low income family you can offer them rebates, coupons or
discounts. To minimize over weight set the weight limit for the containers. As for the
hauler get them involve in the planning process.

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With increase in recycling the city will be able to prolong the life of existing landfills and

postpone the need to locate new disposal facilities. Pollution would be reduced from the
extraction of raw materials.
If the city of Toronto really want to increase it recycling program they best option is to
invest in PAYT program. This will only achieve it objective if the best price is select that
take into consideration all the factors such as the administrative, collection, disposal and
material handling cost

Reference

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1. Bauer, Scott and Marie Lynn Miranda. 1996. The urban performance of unit
pricing: Ananalysis of variable rates for residential garbage collection in urban
areas. Report prepared for the Office of Policy, Planning, and Evaluation; The
U.S. Environmental Protection Agency.
2. Burgiel, Jonathan and Raymond Randall. 1998. National unit-based pricing
survey results. http://www.epa.gov/payt/paytsurv.wpd
3. Canterbury, Janice. 1998. How to succeed with pay as you throw. BioCycle 39.
no.12: 30-35.
4. Ebreo, Angela; James Hershey; Joanne Vining. 1999. Reducing solid waste:
Linkingrecycling to environmentally responsible consumerism. Environment and
Behavior 31, no. 1: 107-135