Economic analysis of the Portuguese recycling system

Recycling packaging waste is a major objective for the European Union. The European law sets clear targets for the recycling rates to be attained by all member states. Hence, to analyze the operations and added costs resulting from this environmental policy is an important research topic. Since every member state has its own recycling system, there is a clear lack of information regarding the true costs of the life cycle of packaging waste and how these costs have been allocated to the various participants. This study illustrates the Portuguese case and discusses the financial transfers made by the company that manages the Green Dot scheme. These transfers are compared with the true costs of the local authorities (waste management operators), which allow us to discuss the efficiency and justice of the national framework. Each ton of sorted packaging waste costs about 289(sic) to waste management operators (investment, operation and maintenance costs with selective collection and sorting). If the avoided costs with undifferentiated collection and final disposal of this waste are accounted for as benefits of the system, then the total benefits correspond to 127% of the total costs. However, if these "opportunity" costs are not considered, the benefits of the waste management operators only cover 77% of the costs.