A recent briefing published by the European Environment Agency (EEA) highlighted that ‘pay-as-you-throw’ (PAYT) schemes are effective instruments that drive recycling up. In line with the findings of the briefing, many countries in Europe apply pay-as-you-throw systems.
In PAYT programs the fees are based on the weight or volume of the waste generated. This is done as an economic incentive for households to recycle their waste, making the producer of the waste financially responsible for the collection and treatment of the waste produced.
Types of PAYT pricing structures
Full unit pricing
- Residents pay for all the waste collected in advance by purchasing a custom bag, bin or selected size container
Partial unit pricing
- The local authority decides on a maximum number of bags or the collection of waste containers which are covered by taxes
- Should the user exceed the permitted amount of waste, additional bags or containers are available for purchase
- A flat fee (‘first-tier’) is applied to create revenue stability, and then the ‘second-tier’ fee is based on the additional amount of waste thrown away
Variable rate pricing
- Residents can choose to rent bins or containers of varying sizes with the price corresponding to the amount of waste generated
- Advantage: householders ration their waste generation to fit the size of container they rent and they are motivated to rent smaller container
Experience from European regions
Interreg IVC has shown that a solution found in one region can be shared, resulting in the inspiration for other regions to improve their policies. The Interreg IVC Pre-waste project identified a scheme as a good practice adopted by the German county Schweinfurt. The scheme takes into account three factors:
- bin volume
- collection frequency, and
The scheme was designed to address the risk that weight-based systems might lead to high set-out rates of bins with small quantities of waste. Under this specific scheme, the inclusion of both weight- and frequency-based charges incentivises low set-out rates of refuse bins, reducing the costs of the collection service.
As part of another good practice identified under the Interreg IVC Regions for Recycling (R4R) project, in Flanders, Belgium, the pay-as-you-throw principle is combined with differentiated tariffs in order to make residual and bulky waste more expensive than selectively collected waste streams.
The level of implementation of these schemes varies greatly by country and within countries, yet it was found that all countries with recycling rates above 45% employ a similar system of sorts, and in contrast most countries with recycling rates below 20% do not use them.