Waste-to-Energy in the EU: The Effects of Plant Ownership, Waste Mobility, and Decentralization on Environmental Outcomes and Welfare

Waste-to-energy (WtE) could prevent the production of up to 50 million tons of CO2 emissions that would otherwise be generated by burning fossil fuels. Yet, support for a large deployment of WtE plants is not universal because there is a widespread concern that energy from waste discourages recycling practices. Moreover, incineration plants generate air pollution and chemical waste residuals and are expensive to build compared to modern landfills that have appropriate procedures for the prevention of leakage of harmful gasses. In the context of the EU, this paper aims to provide a picture of the actual role of WtE as a disposal option for municipal solid waste (MSW), enabling it to be utilized as a source of clean energy, and to address two important aspects of the debate surrounding the use of WtE; namely, (i) the relationship between WtE and recycling, and (ii) the effects of decentralization, waste mobility, and plant ownership. Finally, it reviews the role of the EU as a supranational regulator, which may allow the lower government levels (where consumer preferences are better represented) to take decisions, while taking spillovers into account.