Using both the carrot of economic incentives and the stick of regulatory control, Bavarian industry and government are working together to effectively manage their hazardous wastes. Some of these approaches may provide a blueprint for U.S. practices.
Hazardous waste management in the United States is one of the most heavily regulated and costly areas of environmental protection. The cradle-to-grave regulatory system features detailed record-keeping requirements, a complex permit process, strict financial liability for generators and transporters of hazardous wastes, and a large clean-up fund drawn from private sources. In addition, the 1984 amendments to the Solid Waste Act place restrictions on disposal of many wastes on land and greatly emphasize source reduction and recycling. Still, many toxic wastes continue to be disposed of on land, and few contaminated sites have actually been cleaned up. The public continues to resist new waste treatment and disposal facilities, government regulators are hampered by cumbersome reviews of their actions, and generators often have little choice but to continue environmentally inferior disposal practices, as well as illegal disposal of their wastes.
The United States is not alone in its hazardous waste crisis. Most industrialized countries face similar dilemmas. In the midst of confusion, however, some countries or regions stand out as having hazardous waste management systems that appear to be more effective than those of the United States. Denmark and the Scandinavian countries are well known for their progressive systems. Perhaps the most notable system is that in Bavaria, the largest state in the Federal Republic of Germany (FRG).
Nearly twenty years ago, Bavarian officials became concerned with the problem of hazardous wastes and joined together with industry to create a comprehensive infrastructure for their management. The present-day results of this joint initiative are impressive. Increasing emphasis is being placed on waste reduction strategies—clearly the preferred longer-term goal. A number of noteworthy waste treatment technologies have been implemented, alleviating many of the environmental problems caused by land disposal of wastes.
Only pretreated wastes are disposed of on land, almost no wastes are exported from the state, and few wastes are handled on site. Nearly all hazardous wastes in Bavaria are sent to two main, integrated facilities where they are tested for composition and then channeled into treatment processes and/or final disposal. These processes, for the most part, even now meet the future intent of current U.S. waste disposal legislation.
Figure 1. State of Bavaria, West Germany, special waste management system
Sources that generate small amounts of hazardous wastes in Bavaria are not exempt from regulations, and a comprehensive collection service exists. Bavarian taxpayers have contributed to the financing of this system, with the remarkable result that there is almost no illegal dumping or black-market disposal. (Illegal disposal is thought to be a problem in the United States.)
These same Bavarian public subsidies, however, have discouraged industries from engaging in as much waste reduction as they might have had they been burdened with the full cost of disposal. Moreover, subsidies distribute some of the cost burden away from industry and to the public. Limited waste reduction and inequity in cost sharing might even be considered the Achilles' heels of an otherwise successful system. But even on these matters the Bavarians may be taking corrective measures. The subsidies are being phased out, and a recent federal law—the Waste Avoidance and Management Act—is aggressively addressing the problem of waste reduction.
The legal framework
Bavaria, along with the neighboring state of Hesse, has been a forerunner of hazardous waste management practices in the FRG and has inspired much of the federal legislation. Under federal law each state enjoys a great deal of autonomy in implementing its own environmental programs. This autonomy is reflected in the Waste Disposal Act (WDA) of 1972, a federal framework law prompting each West German state to create its own more detailed legislation. Much like the U.S. Resource Conservation and Recovery Act (RCRA), this law sets out a minimum mandatory list of wastes to be considered hazardous, delineates lines of authority and responsibility, requires that all hazardous waste facilities have permits, and lays out a cradle-to-grave control system with mandatory trip-ticket procedures and record-keeping. Indeed, the system of manifests in the United States was modeled on Waste Disposal Act procedures. Going further than RCRA, however, the West German law requires that all generators of hazardous wastes and operators of disposal facilities appoint a waste supervisor responsible for the firm's waste management program. In addition, it requires that each state submit a waste management plan similar to that currently requested by the U.S. Environmental Protection Agency.
In 1986, the West German Waste Disposal Act was replaced by the Waste Avoidance and Waste Management Act, known as the Waste Law. As its name suggests, emphasis in the new law has been shifted from waste disposal to waste reduction and recycling for both hazardous and household wastes. Besides increasing the control powers of state authorities and harmonizing the disparate German standards, the 1986 Waste Law aggressively promotes source reduction and recycling. It strengthens the licensing power of state authorities by requiring that all newly planned industrial facilities incorporate state-of-the-art technology for reducing or recycling wastes as a condition for licensing. Moreover, priority is given to consumer products that eventually become hazardous wastes; the idea is to force responsibility for product disposal upstream onto the manufacturers and retailers.
Instruments now available to the federal government under the Waste Law to encourage source reduction and recycling include requiring product labels to specify toxicity and how the product should be disposed of; separate collection of certain wastes, such as paper and glass; outright bans on some products, such as certain types of packaging; and direct intervention in production processes. In addition, manufacturers and retailers can be required to accept returned recyclable products and to introduce deposit systems.
Though West German industry largely continues to operate under the 1972 law, changes are beginning to occur as the 1986 law is gradually implemented. The new Waste Law was motivated by a waste management crisis in West Germany at large. With the exception of Bavaria, the FRG lacks sufficient capacity for land disposal and incineration of hazardous wastes, and the public, as in the United States, vehemently opposes building new facilities. Authorities hope that, when fully implemented, the new law will address this crisis and reestablish public confidence by increasing state controls over the movement of waste, setting out uniform nationwide standards governing all aspects of waste management, and promoting radically new programs to reduce wastes.
Bavarian practices
Small- and medium-sized firms dominate the industrial sector in Bavaria, where there are around 6,000 hazardous waste generators and around 120,000 shipments of such wastes each year. (Bavaria has approximately the same population as Pennsylvania, but is slightly smaller.) As early as 1966, the district of Mittelfranken in Bavaria founded a fully public, municipal cooperative (the Mittelfranken Cooperative for Special Waste Management) responsible for the disposal of special wastes—what we call hazardous wastes. In 1970 a semi-public organization, the Association for the Management of Special Wastes in Bavaria, was created to handle special wastes for the rest of Bavaria.
In both instances, integrated, all-purpose facilities were built for treating, depositing, and incinerating hazardous wastes. In addition, the association operates a system of satellite treatment and collection centers in the state (see figure 1). The association was financed originally by hazardous waste generators (30 percent), by the Bavarian government (40 percent), and by member communities (30 percent). Waste generators pay disposal fees geared to the difficulty of handling their wastes.
Only pretreated wastes may be land-disposed in Bavaria. There is no deep-well injection (a common practice in the United States, especially among industries that dispose of their wastes onsite). Extensive use is made of physical/chemical treatment plants for many waste streams, including waste water. Solvent recycling plants are also part of the regional system.
All organic wastes are incinerated in high-temperature, rotary kilns equipped with state-of-the-art filters (see photo). Air emissions are continuously monitored. The bottom ash from the kilns, as well as the fly ash from the stack and residues from the filter scrubbing water, is placed in hazardous waste landfills.
Under the new federal waste law, Bavarians will still be able to deposit bottom ash in hazardous waste landfills. However, in a radical departure from past procedures, fly ash and filter water sludge must now be stored in salt mines presently used only for disposal of especially toxic wastes.
Bavaria has already been successful in shifting a large portion of its hazardous wastes away from land disposal toward more expensive treatment and incineration technologies that are considered safer. This success has hinged on a combination of economic incentives (including subsidies) and regulatory control. Out-of-state exports of hazardous wastes to take advantage of lower-cost alternatives are prohibited without special permission. Moreover, generators must obtain permission to manage their wastes onsite; only about 10 percent have done so, given that the central facilities have generally been less costly than do-it-yourself alternatives. (By contrast, most industry-generated hazardous wastes in the United States are disposed of onsite.)
In effect, the Bavarian controls have created a statutory monopoly whereby generators are required to make exclusive use of regional facilities. Another key Bavarian feature is that the generator's and transporter's liability ends once the wastes are delivered to the facilities—a major difference from U.S. practice. This circumstance may change, however, with the recent introduction in Bavaria of legislation on environmental liability that would include generators and transporters of hazardous waste.
Compliance is good mainly as a result of the public subsidies. Public absorption of liability and the nature of the government/industry cooperative partnership also have played important roles in encouraging compliance. In a sense, industry has been lured into the waste management systems, with the result that state authorities now have a nearly complete picture of waste generation in Bavaria. Authorities can easily identify noncompliance, so subsidies can be, and will likely be, phased out with little concern that wastes will be diverted to illicit disposal routes.
In sum, the key organizational characteristics of the Bavarian hazardous waste management system are integrated, all-purpose facilities; statutory monopolies through restrictions on exports and onsite disposal; mixed public/private ownership and control; and public subsidies and public liability.
Organizational options
The fully integrated hazardous waste management system in Bavaria is only one of a wide range of possible organizational paths, each with its pros and cons. Integrated facilities, which serve all generations under one management and whose operations are in close proximity, offer authorities clear oversight and control and have inherent cost advantages where wastes require more than one type of treatment. Also, they permit taking advantage of economies of scale and development of competent laboratory facilities. Centralization simplifies the otherwise complex waste-handling system made up of thousands of autonomous generators and transporters who sometimes have limited knowledge of their wastes and no clear directive about what to do with them. With a centralized facility, the only rule is that the waste must be delivered to the facility or an associated regional collection center. These advantages must be weighed against the additional costs and risks of transporting wastes over longer distances to regional facilities.
Monopoly markets for hazardous waste treatment facilities, also a feature of the Bavarian system, may be essential for the financial viability of the facilities, especially if legal but environmentally inferior and lower-cost alternatives are available in other states or countries. As regulations become more uniform in the FRG—and if they are successfully enforced, thus eliminating environmentally inferior alternatives—arguments for policies ensuring a stable waste stream to a facility may not be so persuasive.
Whether a waste disposal facility operates as a regulated private enterprise, a public enterprise, or a combination as in Bavaria, depends ultimately on the political culture of the country. The public enterprise component has worked well in Bavaria where the civil servants responsible are strongly committed to good environmental management. The environmental record of public institutions in the United States is less convincing.
One overriding message from the Bavarian experience is that tradeoffs must be made. Perhaps the most controversial option pursued by Bavaria is the provision of public subsidies. The Bavarians have chosen to place priority on creating a workable hazardous waste management infrastructure and protecting the public against midnight dumping. The costs of meeting these goals have included departure from the polluter-pays principle, with the financial burden being partly shifted to the taxpayers, and disincentives for waste reduction. And while the subsidies will now be phased out, a second force militates against further source reduction. Waste reduction—positive from an environmental perspective—could spell eventual bankruptcy for the capital-intensive waste facilities, to which investments were initially attracted because of the subsidies.
Wastes have been reduced in Bavaria, but the reductions have not met the current goals of the federal government. Implementation of the 1986 Waste Law will present the challenge of combining a workable infrastructure with incentives for waste reduction.
Cultural transplant?
In some respects, the Bavarian waste management system already meets many objectives of the 1984 amendments to the U.S. Solid Waste Act, and it will meet more of them if the West German government is successful in imposing waste reduction measures through the Waste Law. Moreover, Bavaria has over ten years of operating experience. During this time the authorities have successfully combined economic incentives with command-and-control policies, clearly recognizing the tradeoffs involved. But a full transplant of the Bavarian experience to the United States would inevitably clash with U.S. political culture.
First of all, there is a difference in approach between the United States and the FRG. The preferred German approach to environmental policy has been to develop a coalition around a consensus of interests. In the early 1970s, the then West German secretary of state for environmental policy stated that environmental problems had to be solved with industry, not without it or against it. This consultative style still dominates, although some environmental interests—especially the Green party—would welcome more government confrontation with industry.
Beyond that, historical conditions in Bavaria, which allowed for expedient siting of hazardous waste facilities, do not now exist in the United States, or for that matter in West Germany outside of Bavaria. Moreover, any attempt to create a public monopoly in the United States would likely meet strong resistance from the increasingly powerful private waste management sector. Restricting waste exports to other states or regions within the United States might be deemed inconsistent with the Commerce Clause protecting interstate commerce and thus unconstitutional. Further, U.S. industry has traditionally been held responsible for environmental costs associated with its production, which means that subsidization of waste facilities with public funds might meet strong political resistance.
Despite these obstacles, more public involvement in creating and financing hazardous waste facilities (especially integrated facilities) might be desirable in the United States. Limiting this option is strong public opposition to the siting of hazardous waste facilities, even though they are badly needed. This opposition has been positive in the sense that it has forced more consideration of the safety of waste facilities and initiated a serious dialogue on waste minimization.
But before abandoning the pursuit of an environmentally sound waste management infrastructure in favor of total reliance on waste reduction, consideration must be given to the possible costs of such a strategy. Paradoxically, incentives for waste reduction also inspire midnight dumping and the transport of wastes out of the country—options hard to control in the U.S. context. To avoid these shifts in risk, a balanced approach with the goal of reducing risks in an equitable and cost-efficient manner should be pursued.
Integrated hazardous waste management facilities have been considered in the United States. As early as 1974, the Environmental Protection Agency prepared a report to Congress that advocated regionally centralized processing facilities. However, attempts at creating integrated treatment facilities in the United States have largely failed—among them a $100 million facility proposed for Louisiana by the IT Corporation and a publicly owned facility planned by the Gulf Coast Waste Disposal Authority in Texas. On the other hand, in Alberta, Canada, an integrated system modeled after Bavaria's has been successfully sited.
Time is running out. As the amendments to the U.S. Solid Waste Act force more wastes off the land, alternatives must be available. The reduction of wastes at their source and the recycling of wastes should receive high priority. There are limits, however, to the extent to which hazardous wastes can be reduced. To deal with the remaining wastes in an environmentally acceptable way, an infrastructure must be created that goes hand in hand with efforts at waste reduction.
The technologies are available. The challenge is to find an infrastructure that encourages the use of available and proven technologies in the short term, and at the same time encourages source reduction rather than reliance on these technologies in the longer term. Bavaria provides an example: a state that has a working and accepted infrastructure for managing currently generated hazardous wastes, a pricing system that encourages compliance, and a longer-term strategy for reducing wastes. Clearly, it is an example to which the United States should pay close attention.
Joanne Linnerooth, of the International Institute for Applied Systems Analysis, Laxenburg, Austria, has recently been a visiting scholar at RFF's Quality of the Environment Division. Allen V. Kneese is a senior fellow in RFF's Quality of the Environment Division.
A version of this article appeared in print in the June 1989 issue of Resources magazine.
