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Cost benchmarking

Waste management is greatly affected by economic factors and therefore it is very helpful to carry out cost benchmarking analysis in order to reflect the cost structure of a certain municipality (city, village or county) and to eventually identify optimisation options.

Cost benchmarking can be carried out by an independent third-party organisation, or internally by a local public administration of a considerable size, or in cooperation with other municipalities. Cost figures analysed can include costs for waste management services and for the disposal of certain waste fractions as well as revenues gained from the sale of waste that is sent to preparation for reuse or recycling and other by-products. All relevant waste fractions generated within the territory considered and belonging to MSW (paper/cardboard, glass, plastics, biowaste, green cuttings, scrap metal, non-ferrous metals, residual waste from households etc.) must be taken into account in the cost benchmarking study. Comprehensive analyses include costs for waste collection, waste treatment (sorting, recovery, disposal, etc.) including the management of closed landfills, staff costs and all other waste-management-related costs.

Once the cost benchmarking study is completed, analyses on the data could support the identification of improvement options in waste management processes (e.g. collection of the different fractions) or in the waste strategy (e.g. type of fractions collected) implemented at local level. It can also be used to compare the costs of waste prevention measures with the cost savings due to the decreased amount of waste to be managed.

The improvement on the environmental performance is not directly associated with the cost benchmarking analysis. However, it contributes to an optimisation of services, such as the collection of the different waste fractions. In this respect, it can encourage municipalities to increase the number of waste fractions that are collected separately as the figures demonstrate that advanced collection systems do not necessarily lead to significantly higher costs.

Cost benchmarking can be applied within an area (at local or national level) where waste management conditions are comparable and where there is a uniform legal framework. However, in some cases, strong deviations occur due to specific conditions. Cost benchmarking is particularly relevant for areas with poorly performing waste management systems, in order to support the shift to better performing waste management options.

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Indicators

Benchmarks