Using Green Credits For Effective Waste Management

Green Credits is an incentive framework to reward environmentally-friendly behaviour. With waste-management and incentivizing people to reduce their waste-generation, segregating their waste or recycling their waste, we need to understand that an intervention with an incentive framework like Green Credits is very different from its intervention in the context of the energy sector or water consumption. This is mainly due to difficulty in measuring what exactly constitutes as the ‘environmental friendly’ activity, and quantifying and valuing the reward based on the activity. While with energy and water one can easily quantify and measure the impact of a unit reduction in water/energy usage on an individual level, in the waste-management system, the story is different. The varying levels of market forces, complicated structure of the system, diverse stakeholders and difficulty in verifying individual behaviour and rewarding it appropriately, make it a difficult task, even from a multidisciplinary searcher’s approach to build a fair, sustainable, impactful incentive framework like Green Credits around it.

With a rapid increase in plastic usage and hence waste-production as a result of the government’s promotion of the petrochemical industry, the plastic consumption was 3.4 million tons per annum and 3.8 kg per in 2010, and must have certainly increased a lot more in the past 6 years, with rising per capita income, consumption and growth. The waste management system in India is defined by poverty, excess, inefficiencies, exploitation, caste-barriers and environmental degradation. From the existence of manual scavengers from lower caste-communities to rag-pickers in India who benefit from the black, underbelly market of Solid Waste Management, to the increasing number of landfills on the outskirts of cities fuelled by consumerism, there need to be incentives on a grass-root level for Waste Management like Green Credits for many reasons. Firstly, it involves individual choices and behaviour, from the point of purchase of a product; to the way it is discarded and segregated, to how and where it is transferred, to where it eventually ends up, and how efforts are made to recycle it. There are many stakeholders involved and hence there are numerous points of intervention to incentivize participation in waste-management. Secondly, through the proposed approaches for building the Green Credits incentive, reward system, in the arena of waste management, there are implications on all the planetary thresholds and the social foundation. With respect to the planetary thresholds, the waste-system has consequences on land-use, freshwater, chemical pollution, ocean acidification, nitrogen and phosphorous cycle, aerosol loading, ozone depletion, which ultimately impact climate change and biodiversity loss, hence all the nine thresholds are affected by the waste system in various ways. With respect to the social foundation, in India especially, there are deep implications on most areas, due to the poverty associated with the lower-levels of waste-chain. With lower education levels, low-occupational mobility and exploitation shaping the lives of many who are involved in the waste-chain in India, an incentive framework to lessen the environmental impact of waste, and help those involved in managing it will definitely have positive spill-overs on every threshold and social factor, which will help us reach a ‘safe and just space’ for humanity. 

Using indigenous knowledge through multidisciplinary academic dispersion to study various stakeholders, their valuation choices, their interaction with waste, the Green Credits system can intervene at the point of purchase, at the point of waste disposal and at the recycling point. Through various incentives and outreach programs which a Green Credits system will try to incorporate, many cities such as San Francisco and Flanders in Belgium have achieved astounding success with a “reduction in its waste to landfill by 77 percent—the highest diversion rate in the United States—and is on track to reach 90 percent by 2020 in San Francisco” and  “73 percent diversion of residential waste, the highest regional rate in Europe, through aggressive standards and incentives” in Belgium. Community mobilization, grass-root recycling and collective action through incentives have seen successes in Pune, Buenos Aires, Philippines, Gipuzkoa, Taiwan and Kamikatsu in Japan. Through value creation by composting, Mumbai and La China in Chile have achieved success in managing a large part of municipal waste, and using all these case-studies and adapting it to the Indian context after localized research, we can properly design the Green Credits Incentive Framework.

At the point of purchase, there can be some particular number of Green Credits offered to a consumer upon returning the packaging of the product, depending on the post-recyclable value of the packaging of the product. This will put the burden of segregating and recycling upon the seller, however, the buyer is incentivized to not throw the packaging of the bought product elsewhere, where it may or may not get recycled. The seller on the other hand, can redeem Green Credits upon giving the packaging back to the manufacturer or distributor, earning Green Credits on every part of the supply chain, till ultimately the manufacturer gets the packaging of the product back, which he can recycle at the base level itself, while earning these Green Credits. Thus ultimately, the entire supply chain of a product till the consumer is incentivized via Green Credits (which can be negligible also, based on empirical research) to return it back to the manufacturer, who in turn earns the Green Credits by recycling it. This prevents waste from being generated at the household level when it is thrown in the dustbin. The second level of intervention can be at the waste disposal. The metrics to determine how many Green Credits one can earn while disposing waste on an individual household level, one can do it in two ways. At the point of collection, through surveys and through actual evidence, a waste-worker who is involved in the Green Credit system can see how many categories each house-hold segregates their waste in, the pattern of segregation, the amount of waste generated per category (in kg), potential in being recycled again, and other such metrics/criteria and allot weekly Green Credits to households, based on benchmarks set the previous week in the same metric/criteria.

The determination of the metrics and criteria to judge how many Green Credits should be allotted to a household upon their waste-disposal can take incorporate the learning and lessons of the various success stories above, where households take an active part in waste-management on an individual level. Thus Green Credits can be allotted based on pre-determined standards and metrics, which are adapted to the various contexts and localities where it is implemented, through the searcher’s approach. The third level of intervention is at the point of recycling the waste. By awarding Green Credits to those who take the effort in recycling and segregating the waste, based on the value created out of the recycled material, amount recycled, and then awarding it to those who ultimately purchase the recycled material (a lower amount than the amount awarded to the recycler upon resale), the Green Credit system can ultimately reignite the virtuous cycle of recycling, and re-use and help create a sustainable world. By allowing the purchase of various items which aid the process of waste management and recycling through Green Credits (like a machine which helps convert plastic to bricks, or a compost machine etc), the Green Credit system can catalyze the mass-change required in the way we look at our waste-system. With deep inequalities, poverty, deprivation and caste-based ostracization/discrimination which underlines various aspects of India’s Solid Waste system, the Green Credits system by incorporating those at the bottom rungs, and directly helping the most, can receive lump-sum Green Credits and higher valued Green Credits to help bridge some of the income inequality gaps between those at higher rungs of the waste hierarchy. While it will certainly take a large amount of time to raise all those in the Waste system to the just, social foundation, the Green Credits system if it flourishes can help in the achievement of the just, social foundation and reduction of impact on the planetary thresholds. 

Anurit Kanti

BW Reporters The author is correspondent at BW Businessworld, he has a keen interest in sustainability and environmental economics