A CDM misadventure in waste management

Developed countries have been pushing the case for market mechanisms to regulate carbon emissions. But as the following account of India's experience with the market-driven Clean Development Mechanism (CDM) under the Kyoto Protocol reveals, there are serious inadequacies in such an approach.

Neil Tangri and Dharmesh Shah

THE Clean Development Mechanism (CDM)'s1 flagship waste management project in India is turning into a multi-faceted disaster, revealing flaws in both the carbon credit mechanism as well as the corporate-driven, technology-focused approach to climate change mitigation.

Delhi's waste management challenges

Municipal solid waste management is a challenge in most urban areas of the developing world: rapidly growing urban populations, increased consumerism and a shift in consumption patterns are resulting in rapidly rising levels of waste generation. The nature of municipal waste is also changing, with increasing quantities of plastics and composite materials such as electronics.

In India's capital state of Delhi, which produces more than 7,000 metric tons of waste per day,2 investment in public infrastructure has not kept pace with the quantity or the increasingly complex nature of municipal waste, and significant quantities go uncollected. The situation would be far worse without the informal sector: Delhi's waste supports a population of approximately 100,000 waste pickers,3 who recover usable materials such as metal, paper, cardboard and plastic from the waste. These materials are cleaned, sorted and sold back to industry as raw material for new products. Altogether, Delhi's recycling economy recovers 1,600 tons of waste per day, or approximately 15-20% of the total generation, and saves $14,000 per day in operational costs for the city municipality.4

However, the informal recycling sector has little use for the largest part of the waste stream - food waste and other organic materials. These are usually collected by the municipality and taken to one of three open dumps (euphemistically called landfills). The presence of organic waste in landfills has long been associated with a variety of problems - odours, pests, landfill fires and toxic leachate. Organic waste in landfills is also one of the primary global sources of methane, a greenhouse gas 25 times as potent as carbon dioxide.5

With the threat of a climate tipping point looming, measures such as the Clean Development Mechanism and the Global Methane Initiative are increasing efforts on eliminating methane emissions - but the experience of Delhi shows that corporate initiatives reliant on high technology can easily backfire.

The Timarpur-Okhla waste-to-energy project6

In November 2007, the CDM Executive Board registered a project by the Timarpur-Okhla Waste Management Company to build two facilities to handle 2,050 tons per day of municipal waste, or about a quarter of Delhi's total. In Okhla, the waste would be dried and shredded into a fluff called 'Refuse-Derived Fuel' (RDF), then burned in a boiler to produce electricity. The Timarpur facility would also produce the same RDF pellets but truck them to Okhla for incineration. The project immediately raised flags among local residents, waste pickers and environmentalists: this is not the first incineration project to be built in Timarpur.

In 1987, the Ministry of New and Renewable Energy (MNRE) commissioned the Timarpur Refuse Incineration-cum-Power Generation Station at a capital cost of INR 250 million7 ($19.3 million8). The plant was built by the Danish firm Volund Miljotecknik and designed to incinerate 300 tons of municipal waste per day to generate 3.77 MW of electricity. The plant initiated trial operations and ran for 21 days, using auxiliary fuel, before shutting down due to the poor quality of incoming waste. Essentially, Indian waste contained too much organic material and insufficient paper, plastic and cardboard to sustain combustion. Unlike residents of wealthier countries, Indians generate smaller quantities of these materials, and an efficient informal sector ensures that most of what is thrown away is recycled rather than left for disposal. However, these lessons appear not to have been learned by government officials.

Sustainable development does not apply to the poor

According to its charter, the CDM is required to only support projects which contribute to sustainable development, but the responsibility for ensuring this - unlike the monitoring of additionality9 - is entrusted to national governments. With a single, pro-forma line, 'This project contributes to sustainable development in India,'10 the Ministry of Environment and Forests discharged its responsibility. However, no evidence or analysis has been made public to back this assertion.

On the contrary, if the project really burns a quarter of Delhi's waste, it will directly threaten the livelihoods of a large part of the city's informal recycling workers. Incinerators cannot burn only food waste, which is high in moisture and low in calorific value. A high proportion of plastics, paper and cardboard must be included for the incinerators to function, but these are precisely the materials which the informal sector recycles. Recognising this threat to their livelihoods, Delhi's waste pickers have begun agitating against the project, holding multiple rallies and demanding that local and national authorities halt the project. For the first time, several waste picker rights groups have joined forces with environmental groups to challenge the project.

On the other side, many of India's corporate heavyweights have invested in the project, which stands to earn $37 million from the sale of carbon credits alone. The project proponent has a complex corporate structure enmeshing major Indian conglomerates such as IL&FS and Jindal with public bodies such as the Andhra Pradesh Technology Development Center. Clearly, these entities will profit from the waste pickers' loss.

Carbon credits to increase emissions

By its own calculations, the Timarpur-Okhla project will reduce emissions by an average of 262,791 tons of carbon dioxide equivalent (tCO2e) per year. In comparison, Delhi's waste pickers are responsible for annual emission reductions of approximately 962,133 tCO2e through recycling.11 If the project burns even one-quarter of Delhi's recyclables, it will effectively wipe out its own emission savings, resulting in no net emission reductions. But because the CDM has not calculated the project's impact on recycling, it will continue to award the company hundreds of thousands of spurious carbon credits - credits which do not represent real emission reductions. The primary market for these emission credits is Europe, where companies meet their own greenhouse gas emission targets by using such reductions. The Timarpur-Okhla project will therefore contribute to an increase in European emissions. If the project captures a larger percentage of recyclables, or uses auxiliary fuel,12 the situation will be even worse.

Climate accounting tricks

The emissions picture worsens when biogenic emissions are taken into account. Under the CDM, it has become standard practice for companies to claim that burning biomass13 has no net effect on the climate. Scientists have pointed out that this rule does not reflect reality - all CO2 has the same effect on the atmosphere, regardless of source - and its widespread application would have disastrous consequences, including the complete deforestation of the planet.14 Nevertheless, the CDM continues to allow companies to undercount their emissions, issuing carbon credits for emissions that were not in fact reduced. In the case of the Timarpur incinerator, only 16% of its CO2 emissions from burning waste are reported, since the other 84% are assumed to be biogenic in origin.15

Toxic emissions not appreciated by neighbours

In its submission to the CDM, the company claimed, 'the role of the local population will be as beneficiary of the project, (...) providing both direct and indirect employment opportunities to the local people. The project does not propose to displace any community, it does not have any direct conflict with the people of the region.'16 In fact, the project will not only displace waste pickers, but is also facing stiff resistance from local communities which object to the siting of a waste incinerator in residential neighbourhoods, within 100 metres of residences and close to three major hospitals.

Residents are right to be concerned; incinerators are a major source of toxic air emissions, including dioxins, mercury, heavy metals (such as lead, arsenic, etc.), particulates (including ultrafine particulates that escape filters), acid gases (hydrochloric acid and sulphur oxides) and others.17 Even the best of modern incinerators struggle to keep emissions under control, as recent incidents in the UK, the US and Iceland indicate. In December 2010, a waste incinerator in Crymlyn Burrows in Wales, UK, was shut down for repeatedly breaching dioxin emission limits.18 Incinerator operators in the US are currently paying millions of dollars in fines and court settlements for breaches of emissions law.19 In Iceland, incinerators have been identified as the source of widespread contamination of meat and dairy products.20

In Delhi's case, there is suspicion that the Okhla facility will not even have any modern emissions-control technology installed: its total price tag of INR 2 billion ($45 million) is a fraction that of an RDF incinerator one-third as large in Rostock, Germany ($140 million).21

In 2009, local residents filed a lawsuit to stop the construction of the plants, based on numerous violations of national environmental laws. The public hearing was so poorly announced that not a single person attended; the Environmental Impact Assessment has been lost, or perhaps was never filed; and the project has grown from a 15 MW plant to 21 MW after approval. Perhaps most ominously, the company claimed in its Detailed Project Report (DPR) to generate RDF with a calorific value of 2,000 kcal but later revised the figure to 800-1,300 kcal in its bid documents. This is slightly above the value of the waste that was supplied to the old plant, which failed to burn. Based on this crucial revelation, the MNRE noted on 29 May 2008 that 'this will necessitate that a fresh DPR is prepared as not only will the actual quantity of MSW [municipal solid waste]  required to be processed be different but also the basic parameters of all the equipment will change.' However, no new DPR has been released.

Gaming two systems

Despite these flagrant violations of national law, the project is moving forward with the full support of the state government. In a recent public meeting, the Chief Minister of Delhi dismissed the environmental concerns raised by the residents of Okhla, citing assurances given by her bureaucrats and the project proponents. Finally, the national Ministry of Environment and Forests stepped in, flagging the project for review and appointing a special committee to investigate. But as the Minister himself observed, the company has already sunk too much money into the project to risk cancellation. In this manner, national laws are voided by the fait accompli of simply constructing a plant.

Similarly, the CDM is on track to award carbon credits to a project that meets none of the requirements - because failing to do so would endanger 'investor confidence' in the carbon market mechanism.22 The Timarpur-Okhla RDF incinerator is an example of how major corporate firms are pushing technology-driven approaches to climate mitigation that harm the poor, increase emissions and undermine the rule of law - but result in handsome profits for the private sector.

Alternatives

Fortunately, alternatives to waste sector privatisation do exist. Waste picker groups in other parts of India, notably Mumbai and Pune, have had success in establishing source-separation schemes for municipal waste with the cooperation and support of local government. The organics, which comprise 70% or more of the waste,23 are composted or processed into biogas, avoiding the methane emission problem while creating a second income stream, and the recyclables are returned to industry for re-manufacture. Such models are win-win situations for local residents, municipal authorities and the urban poor, but leave little room for participation by major multinational firms.

Neil Tangri works on GAIA (Global Alliance for Incinerator Alternatives/Global Anti-Incinerator Alliance)'s global Waste and Climate Change Campaign. Dharmesh Shah is GAIA's Climate and Waste Picker Coordinator in India.

Endnotes

1     The Clean Development Mechanism  was established under the international Kyoto Protocol on cutting carbon emissions responsible for climate change. The CDM allows a country with an emission reduction commitment under the Kyoto Protocol to implement an emission reduction project in developing countries. Such projects can earn carbon credits which can then be traded and sold, and used by industrialised countries to meet part of their reduction targets under the Protocol.

2     Delhi Pollution Control Committee, http://dpcc.delhigovt.nic.in/waste-msw.html

3     Kaul, 'A Study of Ragpicker Children in Delhi', ILO, 2003.

4     Chintan Environmental Research and Action Group, 'Factsheet: Wastepickers,' Delhi. http://www.chintan-india.org/images/WastepickersFactSheet.pdf

5     The Global Warming Potential of methane (CH4) is 25 on a 100-year timeline but 72 on a 20-year timeline, according to the Intergovernmental Panel on Climate Change's 4th Assessment Review (2007).

6     CDM documents available at http://cdm.unfccc.int/Projects/DB/SGS-UKL1185291186.52/view

7     Case Study by Ministry of Urban Development, India, http://urbanindia.nic.in/publicinfo/swm/annex15.pdf

8     Using the 1987 exchange rate of $1 = INR 12.959;  http://fx.sauder.ubc.ca/etc/USDpages.pdf

9     A CDM project must provide emission reductions that are additional to what would otherwise have occurred.

10   Host Party authorisation and approval letters, available from the CDM website.

11   Chintan, 'Cooling Agents: An Examination of the Role of the Informal Recycling Sector in Mitigating Climate Change,' 2009.

12   Under the CDM, waste incineration proejcts are allowed to burn up to 50% of fossil fuel (diesel, coal, etc) and still claim carbon credits for emission reductions. Effectively, they are using fossil fuel to boil off the water in food waste. The practice is common in India and China, where the waste has insufficient calorific value to burn on its own.

13   Including wood, paper, food waste and plant material.

14   For example, Searchinger et al, 'Fixing a Critical Climate Accounting Error,' Science Vol. 326, pp 527-8, October 2009.

15   Calculations based on the Project Design Document, Annex 3.

16   From the Project Design Document.

17   Allsopp et al, 'Incineration and Human Health,' Greenpeace Research Laboratories, March 2001.

18   http://www.thisissouthwales.co.uk/news/Incinerator-stay-closed-breach-emissions-levels/article-3134378-detail/article.html

19   http://www.baltimoresun.com/news/opinion/oped/bs-ed-waste-incineration-20110510,0,4310562.story

20   http://www.grapevine.is/Home/ReadArticle/Dioxin-Poisoning-In-Meat

21   http://www.industcards.com/wte-germany.htm

22   Remarks made in the context of awarding credits to non-additional HFC projects.

23   From the Project Design Document.

*Third World Resurgence No. 250, June 2011, pp 32-34