Blaine County Recycling Program Review & Planning Meeting #3 December 16, 2004
Trash Math Returns!
Part 1: Avoided Costs
Concept of Avoided Costs ď Ž
ď Ž
Avoided costs are savings that can be realized from choosing a less costly waste management option. Avoided costs are often applied to recycling or waste diversion programs to account for some of the deficit of program costs minus program revenues.
Factors Affecting Avoided Costs
Degree of ownership of the service/utility
Short-term vs. long-term savings
Greater degree of ownership = less potential for savings Most savings are realized from short-term activities
Savings realized from avoided variable costs when compared to fixed costs
Calculating Avoided Costs Cost Center 1: Landfill Cost per Ton
Cost Type
Potential Savings
Debt Service
$4.05
Fixed
$0
Reserve Funds
$2.27
26% Variable
$.56
Landfill O & M
$8.27
Fixed
$0
Calculating Avoided Costs Cost Center 2: Transfer System Cost per Ton
Cost Type
Potential Savings
Operation
$12.03
Fixed
$0
Debt Service
$5.08
Fixed
$0
Equity Reserve
$1.15
Fixed
$0
Trailer O & M
$2.17
Fixed
$0
Hauling Fees
$11.38
Variable
$11.38
Calculating Avoided Costs Cost Center 3: Other Costs Cost per Ton
Cost Type
Potential Savings
Landfill Closure
$1.50
Fixed
$0
Resource Recovery
$1.45
Fixed
$0
($2.11)
Variable
($2.11)
System Revenue
Calculating Avoided Costs Putting It All Together Possible Savings – Cost Center 1: Landfill Possible Savings – Cost Center 2: Transfer Possible Savings – Cost Center 3: Other Total Blaine County Avoided Cost Per Ton
$.56 per ton $11.38 per ton $0 per ton $11.94
Part 2: Calculating Costs Per Ton by Commodity
BCRRC Recycling Operations Average Cost Per Hour Per Ton Total BCRRC Expenses - Buyback Expense
$120,875.72 20,662.50 $100,213.22
52 Weeks x 6 Days Operation/Week - Closed Holidays/Year
312 days/year 6 days/year 306 days/year
306 Days x 9.5 Hours Operation/Day $100,213.22 รท 2,907 hours
2,907 hours/year $34.47 avg. cost/hour/ton
Please Keep In Mind In the following commodity price per ton calculations, revenues per ton are based on current (Dec.) market prices. These prices are subject to change at any time.
Cost Per Ton: Cardboard 1 Bale = 1 hour ($34.47)
$34.47 รท 1200 lb. = $.03/lb.
1 Bale = 1200 lb.
$.03 x 2000 lb = $60/ton
Buyback Expense ($14,122.04) รท Total Tons (948.4) = $14.89/ton Processing Cost per Ton
$60.00
+ Buyback Cost per Ton
14.89 $74.89
- Revenues Per Ton
80.00
Revenues Per Ton
$5.11
Cost Per Ton: Newspaper 1 Bale = .5 hour ($17.24)
$17.24 รท 1600 lb. = $.01/lb.
1 Bale = 1600 lb.
$.01 x 2000 lb = $20/ton
Buyback Expense ($0) รท Total Tons (261) = $0/ton Processing Cost per Ton
$20.00
+ Buyback Cost per Ton
0 $20.00
- Revenues Per Ton Revenues Per Ton
65.00 $45.00
Cost Per Ton: Aluminum Cans 1 Bale = 2 hours ($68.94)
$68.94 รท 500 lb. = $.14/lb.
1 Bale = 500 lb.
$.14 x 2000 lb = $280/ton
Buyback Expense ($6310.80) รท Total Tons (18.6) = $339.29/ton Processing Cost per Ton
$280.00
+ Buyback Cost per Ton
339.29 $ 619.29
- Revenues Per Ton
1000.00
Revenues Per Ton
$380.71
Cost Per Ton: Tin Cans 1 Bale = 2 hour ($68.94)
$68.94 รท 800 lb. = $.09/lb.
1 Bale = 800 lb.
$.09 x 2000 lb = $180/ton
Buyback Expense ($0) รท Total Tons (24.2) = $0/ton Processing Cost per Ton
$180.00
+ Buyback Cost per Ton
0 $180.00
- Revenues Per Ton Cost Per Ton
20.00 $160.00
Cost Per Ton: Paper Grades 1 Bale = .75 hour ($25.85)
$25.85 รท 1300 lb. = $.02/lb.
1 Bale = 1300 lb.
$.02 x 2000 lb = $40/ton
Buyback Expense ($103.84) รท Total Tons (163.4) = $.64/ton Processing Cost per Ton
$40.00
+ Buyback Cost per Ton
.64 $40.64
- Avg. Revenues Per Ton Revenues Per Ton
55.00 $14.36
Cost Per Ton: Magazines 1 Bale = 1 hour ($34.47)
$34.47 รท 2200 lb. = $.02/lb.
1 Bale = 2200 lb.
$.02 x 2000 lb = $40/ton
Buyback Expense ($0) รท Total Tons (233.2) = $0/ton Processing Cost per Ton
$40.00
+ Buyback Cost per Ton
0 $40.00
- Revenues Per Ton Revenues Per Ton
60.00 $20.00
Cost Per Ton: Plastic 1 Bin Sorting = 20 hour ($430.00)
$430.00 รท 1200 lb. = $.36/lb.
1 Bin = 1200 lb.
$.36 x 2000 lb = $720/ton
(labor costs = $21.50/hr) Transportation Expense ($7020.00) รท Total Tons (10.4) = $675/ton Sorting Cost per Ton + Transportation Cost per Ton
$720.00 675.00 $1395.00
- Revenues Per Ton Cost Per Ton
0 $1395.00
Summary of Costs Per Ton Commodity Cardboard Newspaper Aluminum Cans
Processing Cost (Revenue) per Ton $
(5.11) (45.00) (380.71)
Tin Cans
160.00
Paper Grades
(14.36)
Magazines
(20.00)
Plastic
1395.00