Burn or let them bury? The net social cost of producing district heating from imported waste

Thomas Broberg, Elbert Dijkgraaf and Sef Meens-Eriksson

Energy Economics, 2022, vol. 105, issue C

Abstract: In this study, a net social cost framework is applied to provide insights on policy issues relating to the cross-border trade in waste fuel. We estimate the net social cost of using imported waste fuel in a highly efficient combined heat and power plant (CHP) in a cold climate by considering both private costs and benefits as well as external costs related to energy production, alternative waste management and fuel transport. We conclude that using imported waste fuel is beneficial from a societal perspective compared to using biofuel, given the wide range of assumptions regarding technical, economic and environmental characteristics. The net social cost is mainly determined by fuel cost advantages and the external cost of greenhouse gas emissions. External costs associated with transports only marginally impact the net social cost of waste imports for incineration. The results are robust to variation in the excess heat utilisation rate, which implies that importing waste for incineration would also be beneficial in countries with warmer climates where district heating networks already exist.

Keywords: Net social cost analysis; District heating; Externalities; Incineration; Trade; Waste (search for similar items in EconPapers)
JEL-codes: Q48 Q53 Q56 Q58 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:105:y:2022:i:c:s0140988321005636

DOI: 10.1016/j.eneco.2021.105713

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