Waste Management xxx (2014) xxx–xxx

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Use of the Contingent Valuation Method in the assessment of a landfill mining project Giuliano Marella a, Roberto Raga b,⇑ a b

ICEA, Department of Civil, Architectural and Environmental Engineering, University of Padua, via Venezia 1, I-35131 Padova, Italy DII, Department of Industrial Engineering, University of Padua, via Marzolo 9, I-35131 Padova, Italy

a r t i c l e

i n f o

Article history: Received 29 January 2014 Accepted 25 March 2014 Available online xxxx Keywords: Landfill remediation Landfill mining Economic assessment Social benefits Contingent Valuation Method Consumer’s surplus

a b s t r a c t A comprehensive approach for the evaluation of the economic feasibility of landfill mining (LFM) should take into account not only the direct costs and revenues for the private investor, but also the social benefits or costs (generally called externalities), in such a way that projects generating major social benefits (and no significant private revenues) are not overlooked. With a view to contributing to the development of a common framework for the evaluation of LFM projects, this paper presents the results of a case study where the issue of the assessment of social benefits from a LFM project is addressed. In particular, the Contingent Valuation Method is applied for the monetary assessment of the community-perceived benefits from the remediation of an old uncontrolled waste deposit by means of LFM and the conversion of the area into a park. Based on the results of a survey carried out on a random sample of people living near the old landfill, the economic values of the individual willingness to pay (WTP) for LFM and the subsequent creation of a public park were calculated and the correlations with the relevant variables (distance from the landfill site, age, income, sex, education level) assessed. The results were then suitably extended and the monetary value of the welfare increase of the whole population resident in the area and potentially affected both by LFM and the creation of the park was calculated. Ó 2014 Elsevier Ltd. All rights reserved.

1. Introduction Landfill mining (LFM) consists in the excavation and treatment of waste from landfills, providing for recovery of material and energy as well as land reclamation. According to Krook et al. (2012), the characterization of the deposited material is the most studied topic in LFM research involving the assessment of waste composition (with focus on the effectiveness of separation in homogeneous streams in view of material and energy recovery) and of biochemical and physical characteristics (e.g. biological stability, humidity, calorific value, etc.) relevant to LFM process (Prechthai et al., 2008; Masi et al., 2014). The characterization of the landfill body is an issue too. Technical difficulties can arise during the excavation in case of high leachate levels and/or significant residual emission potential due to biodegradables in the waste mass; such conditions would cause waste mechanical instability and the presence and possible accumulation of methane (possible formation of explosive mixtures) ⇑ Corresponding author. Tel.: +39 049827 8987; fax: +39 049827 8984. E-mail address: [email protected] (R. Raga).

and other trace compounds in the excavation area, hampering the operations and producing safety concerns. For these reasons, the design of LFM should be preceded by geotechnical and hydraulic surveys (Cossu et al., 2009) and, according to the results of specific tests (Raga and Cossu, 2013), in situ aeration should be considered as landfill pretreatment for the enhancement of waste biological stability, providing for reduced emissions during excavation and easier management of the excavated material (Bilitewski et al., 1995; Cossu et al., 2003a; Goeschl and Rudland, 2007; Raga and Cossu, 2014). Although the procedures for waste and landfill characterization and pretreatment before LFM are not standardized and the need for harmonization is clear in the scientific community, the experience gained in the past years and the results of numerous pilot scale applications proved the technical feasibility of waste excavation and further separation and under safe and controlled conditions, fostering the application of LFM worldwide (Cossu et al., 1995; Hogland et al., 2004; Rettenberger, 1995; Jain et al., 2013). However, despite the potential offered by LFM and the increasing interest roused in the last two decades, the number of full-scale projects has been unexpectedly low so far, mainly due to the difficulties in proving the economic feasibility of the many candidate

http://dx.doi.org/10.1016/j.wasman.2014.03.018 0956-053X/Ó 2014 Elsevier Ltd. All rights reserved.

Please cite this article in press as: Marella, G., Raga, R. Use of the Contingent Valuation Method in the assessment of a landfill mining project. Waste Management (2014), http://dx.doi.org/10.1016/j.wasman.2014.03.018

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cases. LFM projects can be implemented by enterprises provided that direct benefits to the company (revenues) outweigh the costs. This is likely to occur when the LFM activities generate valuable land for town expansion or new volumes for the extension of landfill service life (Goeschl and Rudland, 2007; van der Zee et al., 2004; Raga and Cossu 2014). In all other cases LFM profitability for private companies can be discussed and depends on very site-specific conditions. Except for cases of mono-landfills for industrial waste (Zanetti and Godio, 2006), LFM activities have not been carried out with focus on resource recovery so far and the very limited research effort for the enhancement of the recycling potential for the excavated waste has led to discouraging results; for these reasons, it is not realistic to consider LFM if the main motivation is material recovery and further research for innovative separation and transformation technologies is needed (Krook et al., 2012; Jones et al., 2013). The trigger for LFM can be the removal of the landfill as a (potential) source of groundwater and surface water contamination. This would grant a dramatic reduction of the aftercare costs for the landfill and the avoidance of the unpredictable cost for the possible long-term groundwater remediation. However, it is likely that public funding cannot be avoided in this case (van der Zee et al., 2004; Hull et al., 2005) unless a profitable enough use of the recovered land is foreseen. Currently, a new vision is opening encouraging scenarios for the full exploitation of LFM potential market opportunities. According to Jones et al. (2013), LFM should be ‘‘embedded in a broad resource management perspective’’ where a significant role is played by resource recovery (including energy from biogas before excavation) from the landfilled waste. This is one of the key issues of the Enhanced Landfill Mining (ELFM) concept, where (old and new) landfills are considered as ‘‘temporary storage place, awaiting future valorisation’’ (Geysen et al., 2009): after waste excavation and treatment, the non-recyclable fractions are deposited in purpose built landfill sectors, to be stored until proper technologies for treatment and recycling are available and further LFM becomes profitable. Temporary storage of waste before future valorisation is currently an issue in numerous European countries and the related challenges have been recently addressed (Wagner and Bilitewski, 2009; Ibrahim and Hogland, 2013). 1.1. Social value of LFM According to EPA (1997) most economic benefits associated with LFM are indirect and fall on a broad community; particularly, on those living close to the landfill in question. In order to take them into account, social issues should be properly assessed (by assigning them a monetary value) and integrated in a methodological framework to support private and public actors in the evaluation process of LFM feasibility (van Passel et al., 2013), in order to avoid the risk of overlooking those cases in which LFM would guarantee large social benefits without any significant private revenues. In such cases however, a fundamental role should be played by appropriate government policies, support schemes and incentives (Jones et al., 2013). Examples of full-scale applications of LFM where public funding was available and LFM was part of a wider project of public interest are reported. van der Zee et al. (2004) present case studies where the local government was involved in promoting and funding landfill mining activities for the development of industrial areas (two cases) and for the avoidance of possible contamination of the surroundings of a landfill. Cossu et al. (2003a) report a case study where landfill mining was completely funded by the Italian government, in the framework of a huge project for the construction of the high speed railway line connecting Milan and Bologna. Van Passel et al. (2010) describe the application a purposely-devel-

oped simulation tool for the evaluation of the influence of the major economic drivers on the feasibility of ELFM projects in the Flanders region in Belgium (approx. 20 km2 of potential candidate area for ELFM). The output showed that the major part of calculated benefits would come from the waste to energy conversion; the overall cost-benefit analysis (CBA) proved that ELFM in the region has a positive economic potential mainly thanks to government incentives, granted as a compensation for the social value of ELFM for ‘‘the attainment of, among others, the renewable energy targets imposed by EU legislation’’. It is a common position among the scientific community that a comprehensive assessment of landfill mining projects should take into account not only private costs and revenues, but also social and environmental issues. This should be achieved through the application of a CBA which includes the monetary evaluation of those costs and benefits (generally called externalities) affecting somebody (i.e. citizens living in the area, the society) other than the people engaged in the LFM project and which are not reflected in prices. Some externalities commonly associated to LFM are:  reduction of environmental footprint (air, soil, surface water and groundwater pollution);  lower import dependency for energy and materials;  nature restoration and creation of recreational areas;  benefits for the citizens from the urban development in the recovered area;  noise, smells, dust and increased traffic during excavation. All of them should be properly encompassed in the assessment procedures of a LFM project. To this regard, the implementation of a methodological framework is in progress and the first results of the assessment of private profitability as well as costs and benefits to society of an ELFM project are available (van Passel et al., 2013). Concerning the benefits to society, the authors compared the carbon footprint for the current scenario with a hypothetical one where ELFM is applied. The simulation proved that the ELFM scenario is more beneficial in terms of greenhouse gas mitigation; the CO2 emissions of the energy recovery from selected fractions of the excavated waste are compensated by the carbon emission savings offered by the material recovery. The same authors conclude that the methodological framework must be refined and extended, particularly regarding the assessment of social costs and benefits. With a view to contributing to the development of a common framework for the evaluation of LFM projects, this paper presents the results of a case study where the issue of the assessment of social benefits from a LFM project is addressed. In particular, the Contingent Valuation Method is applied for the monetary assessment of the perceived benefit that a community may gain from the remediation of an old uncontrolled waste deposit by means of LFM and the conversion of the area into a park.

2. Methods for the assessment of social benefits The evaluation of social benefits is generally omitted in the economic assessment made by private operators for three main reasons: (a) they refer to economic agents (i.e. individuals or firms) who are different from those involved in the LFM operations (b) although they affect other agents0 welfare, the direct effects of these benefits are not transmitted through market prices and therefore remain outside market mechanisms and (c) their monetary value needs to be analysed using complex and ad hoc evaluating procedures (D’Alpaos, 2012). Since the preferences of individuals are to be taken as the source of perceived benefits, it is necessary to know to what extent

Please cite this article in press as: Marella, G., Raga, R. Use of the Contingent Valuation Method in the assessment of a landfill mining project. Waste Management (2014), http://dx.doi.org/10.1016/j.wasman.2014.03.018

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the well-being of economic agents is affected by the provision of a public good and/or of an externality and, since utility cannot be directly measured, an indirect measure should be considered. Preferences are de facto measured by willingness to pay (WTP) for a benefit and willingness to accept compensation (WTA) for a cost (Pearce et al., 2006).1 Therefore, the monetary value of public goods and externalities is strongly related to the concept of ‘‘consumer surplus’’, namely the difference between the maximum amount of income the individual would be willing to pay (WTP) for a given good or service, and the actual expenditure (i.e. the amount of money actually spent)2. Considering the remediation of a landfill, the surplus (i.e. the measure of the welfare change) can be representative of the difference between the theoretical price that residents in the area would be willing to pay - as long as the landfill was rehabilitated or mined and the actual price paid, which generally could be equivalent to zero, insofar as the costs of reclamation would be borne by a different subject, public or private. Methods of economic evaluation of non-market goods or effects (e.g. externalities), based on consumer’s surplus, are mainly three: the Travel Cost Method (TCM), the Hedonic Price Method (HPM) and the Contingent Valuation Method (CVM). The TCM is based on an estimation of the quantity of money that a given community is willing to pay for a good in terms of transport costs, entrance ticket, staying overnight, etc. An example of the application of the TCM is reported by Ayalon et al., 2006: assuming that the residents living near a landfill travel to reach distant recreational areas, the TCM was used for the evaluation of the benefits in terms of travel cost reduction for the same residents due to the construction of a (closer) recreational area on the landfill, in the framework of a wider rehabilitation project. The HPM estimates the value of a non-tradable good by observing the market of a related tradable good. The reclamation of a landfill is likely to significantly affect the market values of houses in the area; the effect can be evaluated through the analysis of market values for the houses before and after the site was used for waste disposal. The two abovementioned methods are also known as indirect methods because they provide the value of a non-market good indirectly, i.e. on the basis of the effect the good itself has on the consumption of other private goods such as transport services or property values. Conversely, the CVM represents a direct method because it offers a direct approach to estimating willingness to pay for changes in provision of (non-market) goods. The CVM is surveybased and elicit people’s intended future behaviour in constructed markets. By means of a questionnaire, a hypothetical market is described where the good in question can be traded (Carson et al., 1995; Carson et al., 2003; Mitchell and Carson, 1989). A random sample of people is then directly asked to express by means of interviews the maximum WTP (or WTA) for a hypothetical change in the level of provision of a good (e.g. the maximum WTP of individuals to enjoy a positive externality, or otherwise the minimum WTA to receive a compensation for suffering for a negative externality). Questionnaires were used by Sasao (2004) for the assessment of public preferences on landfill siting by means of a choice

1 The notions of WTP and WTA can be extended to include WTP to avoid a cost and WTA compensating to forego a benefit. 2 A gain in an individual’s well-being, utility or welfare can be measured by the maximum amount of good or services – or money income – that he or she would be willing to give up or forego in order to obtain the change. Alternatively, if the change reduces well-being, it would be measured by the amount of money that the individual would require in compensation in order to accept the change.

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experiment. Considering three different hypothetical siting plans, the results showed that the option with the lowest private cost it is not always the option with the lowest social cost. Based on a literature review of the application of TCM, HPM and CVM for the evaluation of external benefits of the reclamation of contaminated areas, Van Passel et al., 2013 concluded that the benefits to society of the nature restoration after (enhanced) LFM projects can be high in densely populated regions and are most likely higher than the market value of the area. The three abovementioned methods were used in the framework of a cost-benefit analysis for the engineering and landscape rehabilitation project of Israel’s largest landfill (Ayalon et al., 2006). The engineering rehabilitation involved biogas extraction and combustion, leachate extraction and slope stabilization; the landscape rehabilitation was considered for the conversion of the area into a nature park. The results of the study proved that the benefits of the reclamation exceed the costs only in the case the landscape rehabilitation is included in the project and the landfill site is redeveloped into a public park. To the authors0 knowledge, the case study presented below is the first comprehensive report of the use of CVM for the assessment of social benefits from the remediation of an old uncontrolled waste deposit by means of LFM, available in the literature up to now.

3. Application of the CVM to a LFM project An application of the CVM for the assessment of social benefits associated to the reclamation of an old landfill by means of landfill mining and subsequent construction of a park is presented and discussed. The primary aim of the paper is not to evaluate all the social costs and benefits of the intervention according to the Pareto efficiency principle, but rather to evaluate the perceived benefit that potential users may gain from LFM and the fruition of the park. The benefit estimated through CVM in this paper represents therefore just one of the benefits generated by the project. In order to implement a comprehensive cost-benefit analysis all of the future benefits and costs should be included. The landfill is actually a typical example of uncontrolled waste disposal site, increasingly common from the 1950s to early 1980s in Europe due to the dramatic acceleration of waste generation, before the proper environmental awareness and the first national legislations on waste management, as well as proper recycling and reuse schemes, were available. The presence of a huge number of these old uncontrolled waste disposal sites is an issue, international projects for the characterization have been carried out in the last decade and evaluation procedures for the related risk have been set up and applied (Allgaier and Stegmann, 2005; Cossu et al., 2003b). The area under investigation is located in Northern Italy and was exploited in the mid 1970s for the extraction of clay to be used in the nearby furnaces. In the early 1980s, following an agreement between the owner and the local administration, the site was used as a landfill for municipal solid waste and combustion residues for some years. As recorded in the many similar cases throughout Europe, the waste disposal activity was uncontrolled and undocumented, neither bottom barriers nor leachate drainage or extraction systems were installed. Due to the residual waste emission potential, the leachate present in the landfill and the unknown thickness of the residual natural clay below the waste, an impact on the groundwater system is possible in the near future. The area is close to a small town (typical for this kind of former waste disposal sites), and it is considered to be strategic according to the town0 s new municipal land use plan. Recently, besides being assigned to the creation of public green space, this area has been

Please cite this article in press as: Marella, G., Raga, R. Use of the Contingent Valuation Method in the assessment of a landfill mining project. Waste Management (2014), http://dx.doi.org/10.1016/j.wasman.2014.03.018

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envisaged as part of an urban redevelopment project which, among other things, includes the relocation of numerous handicraft businesses. Obviously, the presence of a landfill in the area is highly incompatible with the ongoing plan for revaluation. For the abovementioned reasons the reclamation of the area and the possible application of LFM were considered. 3.1. Methodology In the framework of the economic assessment of the remediation activities, the monetary evaluation of the related social benefits perceived by the population was carried out by means of the application of the CVM. The other two available methods (HPM and TCM) were not considered for the following reasons:  the TCM cannot be properly applied to the case in question because the potential recreational area, due to its small extension, is exclusively of local interest and has very limited capacity to attract visitors from other districts. For this reason, the use of TCM would underestimate the social benefits;  the HPM cannot be applied either because it is not possible to compare market prices in the presence and absence of the landfill, which is one of the main hypothesis which the HPM is based on. Data on local recent real estate market prices in the absence of the effects of the landfill are not available, having the landfill been built decades ago. The application of the CVM involves the submission of a questionnaire to the population living in close proximity to the old landfill site. Two possible distinct future scenarios were envisaged and presented. In the first scenario, LFM is carried out for the complete removal of the deposited waste and the underlying soil affected by leachate percolation. In the second, the interviewee is asked to assume that LFM is completed. At this point, the area undergoes a landscape rehabilitation and is converted into a public park. Contrary to more traditional approaches, the CVM involves the evaluation of the environmental damage caused by the uncontrolled landfill as perceived by the community. As a result of the procedure, the monetary value related to the increase in the collective well-being following the landfill mining was estimated. Subsequently, survey results were processed to derive the monetary measure of the social benefits generated by the realization of a recreational area, based on individuals’ WTP for the creation of a public park. The WTP for the abovementioned interventions was elicited using the iterative bidding game technique.3 The analysis was carried out according to the following phases:    

design of a contingent valuation questionnaire; definition of the random sample; interviews; descriptive data analysis and interpretation;

3 Respondents are asked questions to determine how much they would value the good if confronted with the opportunity to obtain it, under the specified terms and conditions. The elicitation question can indeed be asked in a number of different ways: open ended format, iterative bidding game format, payment card and dichotomous choice (single or double bounded). In the bidding game approach, as in an auction, respondents are faced with several rounds of discrete choice questions, with the final question being an open-ended WTP question. This format facilitate respondents’ thought process and encourage them to consider their preferences carefully.

 estimate of the demand for LFM and measurement in monetary terms of the decrease in welfare due to environmental damages incurred;  estimate of the demand and measurement in monetary terms of the welfare increase due to the creation of a public park. The key element in any contingent valuation study is a properly designed questionnaire, i.e. a data-collection instrument that sets out in a formal way the question designed to elicit the desired information (Dillon et al., 1994). The questionnaire is intended to uncover individuals0 estimates of how much having or avoiding the change is worth to them and it can be subdivided into four parts. The first part of the questionnaire, of a more general nature, was designed to provide the interviewee with a series of information on the objectives of the valuation procedure, on the characteristics of the area, and on the contents of the project and the contingent scenario. The second and third parts, based on the iterative bidding game technique contain a series of questions to identify the maximum WTP for LFM and for the creation of a public park, respectively. Finally, in the fourth part, questions about the socio-economic and demographic characteristics of the respondents are asked in order to ascertain the representativeness of the survey sample relative to the population of interest, to study how WTP varies according to respondents’ characteristics. The analysis was carried out on the population of interest represented by the residents living in close proximity to the landfill, using a stratified random sampling. The first layer was obtained by identifying three concentric bands corresponding to the area under investigation, and revealing the population of the residents whose houses were situated in the band between: (a) 0–50 m; (b) 50–100 m and (c) 100–200 m. In each band, two further layers were created based on sex and age. During the analysis, a total of 150 questionnaires were filled in, out of 174 submitted to the residents. The study was carried out by giving the sample direct personal interviews. The choice of the door-to-door method was motivated both by the need to provide subjects interviewed with a number of clarifications (on the objectives of the analysis and on the questions present in the questionnaire), and to motivate the subjects directly to take part in the investigation. No specific problems were encountered during the interviews, two months were necessary to complete the study. 3.2. Results An initial data processing made it possible to identify the socioeconomic characteristics of the respondents. The subjects interviewed were between 18 and 75 years old, with a rather high level of education; the incidence of high school and university (almost 60%) was significantly higher than the average in the municipality (37%). Almost all of the respondents (91.3%) declared to be willing to pay for the LFM. Those who did not agree to this (the remaining percentage) can be traced mainly to a lack of perception of the damage done, especially in those recently settled into the area. The mean WTP was equal to approximately 196 euro. Similar figures are available in Sasao (2004), who reports a one-time WTP of approx. 200 dollars (external costs associated with the siting of a landfill for industrial waste originated from outside a community). Caplan et al. (2007) estimate compensatory values (WTA) associated with an in-county landfill for the host community equal to approx. 32 dollars per month, for an indefinite period of time. According to the same authors, the discrepancy with what calculated by Sasao (2004) is related to the non-negative attitude of

Please cite this article in press as: Marella, G., Raga, R. Use of the Contingent Valuation Method in the assessment of a landfill mining project. Waste Management (2014), http://dx.doi.org/10.1016/j.wasman.2014.03.018

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the respondents to Sasao’s questionnaire toward a landfill in their neighbourhood, due to a ‘‘sense of inevitability’’, probably caused by proper consensus building processes. Concerning this study, the perception of the environmental damage caused by the landfill depends more on experiences of the past than on the current situation, where the landfill is covered and not visible anymore; for this reason, the external costs can be much different from those related to the siting of a new landfill. Contrary to expectations, the distance of one’s residence from the landfill does not seem to influence the WTP significantly. A similar finding was reported by Ayalon et al. (2006), where the distance calculated with the travel time to the site was not significant in any regression model; in another case (Sasao, 2004) the distance from the respondent’s house to the landfill site clearly influences the WTP. The reason of this result can be explained by: (a) the difficulty to perceive the real proximity of the landfill and (b) the fact that the residents closest to the area (who ought to show more concern than the others) who live in recently built areas, have not had any direct experience of the landfill, and therefore have a limited perception of its potential damage. In fact a correlation of the WTP with the proximity to the landfill is found if the evaluation is limited to the residents that were already living in the area when the landfill was in operation. The one element that seems, above all others, to condition the WTP is age. It can be said that an increase in age corresponds to an increase in WTP, even if contradictory behaviour patterns exist. Within the age range 54–75 years, for example, there was a bimodal distribution; even in the presence of a clear majority of respondents willing to pay sums exceeding 150 euro, 31.8% of the respondents are not willing to pay sums greater than 50 euro. This phenomenon shows a certain similarity to the corresponding distribution for the work categories and, with a high probability, for income level. There are numerous pensioners belonging to this age range whose income does not allow them to pay above a limited amount. Here, it is worth mentioning the widespread resentment towards public administration among the most elderly subjects, who had expressed the most concern on the decision of using the site for waste disposal. This resentment is witnessed by an attitude that tends to reduce the declared WTP compared to the real value. Given its importance, the effect of the working category on the WTP has been the subject of a more detailed analysis. It has been possible to verify that subjects belonging to low income brackets (such as housewives, pensioners, factory workers and students) are prepared to pay sums lower than those in the higher income bracket such as the self-employed, managers or artisans. Subjects who have achieved a certain economic stability are, on the whole, more likely to finance environmental recovery activities and have often shown a lively interest in the retractable benefits, on a property level, of the proposed intervention. Therefore, a close link between the WTP and working category has emerged. Another variable able to influence WTP considerably is sex, being as the males are willing to pay higher sums compared to females. Those interviewed who were willing to pay sums lower than 50 euro were mainly women (77.3%), whereas those willing to pay sums over 300 euro were mainly men (70.8%). The influence made by different income levels cannot be overlooked; it is widely known that in the region men’s incomes are generally higher than women’s, and a certain quota of women interviewed (13.3%) belongs to the category of housewives who do not have their own personal income. Moreover, the education level influences the WTP significantly; a relationship between education level and qualifications has been revealed. This influence is clear looking at the values of the modal classes of WTP referring to the different categories which are:

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 less than 50 euro for those who have completed primary education;  50–150 euro for those who have completed junior high school;  150–300 euro for those with a high school diploma or university degree. In this case, however, even supposing that the more educated subjects are more environmentally aware, the indirect influence of income cannot be overlooked, as it tends to increase with a higher level of education. Extending the analysis to other variables, the results can be confirmed and explained further. The questionnaire includes questions aimed at identifying the main cultural interests of the interviewees like favourite books and television programmes, free time activities. The data have shown clearly that those declaring a higher WTP, but with less free time available, prefer to read about scientific or environmental issues, or watch TV programmes on cultural matters. Summing up, the effect of the WTP evaluation method has been measured based on the monetary values declared. The iterative bidding game technique foresees that each individual is offered a randomly selected sum of money from a range of predefined sums. In this case study, four starting values have been identified in advance (via preliminary interviews with open-ended elicitation formats) to be randomly proposed on a case-by-case basis. Similarly to other experiences, a slight dependence of the WTP on the starting point offer was highlighted. This appears logical as the interviewees have no prior experience of this type of valuation and, therefore, expresses themselves as a result of being conditioned by the initial monetary value proposed; this effect can be controlled if the interview process is carried out by experienced professionals. Subsequently, the variables able to influence the WTP for the creation of a park after the LFM were analysed. In this case, the percentage of those interviewed who had declared their WTP fell slightly (87%). The non WTP by the remaining percentage can be attributed to two factors: (a) the lack of perception of possible advantages and (b) the conviction that the area is not suitable for housing a public park; considering the irreversible damage done to the area by the landfill, some of those interviewed (6.7%), were rather perplexed by the possibilities of restoring the area, at least within a reasonable timescale of 20–30 years. The WTP to create a park is, on average, equivalent to approximately 200 euro; a sum slightly above that declared for LFM. A study of the relationships existing between the characteristics of the interviewee and his or her WTP for the creation of a park has highlighted links similar to those identified previously for LFM. Nonetheless, the probability of independence between the WTP and socio-economic variables is on average lower than in the previous case; therefore, the possibility of explaining the WTP using socio-economic variables is in this case even higher, with the responses tending to be more reliable. This is confirmed by the multiple regression analysis where the effect of income and education level (both well represented by the working category of the interviewee) have emerged clearly. 3.3. Calculation of welfare increase The final phase of the valuation process concerns the estimation of WTP distribution and welfare increase associated to LFM and the creation of a park after the landfill is mined. The estimation of WTP distribution was made by regressing the cumulative frequencies of the interviewees on their corresponding WTP. Linear, semi-logarithmic and logarithmic functions have been tested. The logarithmic function appears to be the one that

Please cite this article in press as: Marella, G., Raga, R. Use of the Contingent Valuation Method in the assessment of a landfill mining project. Waste Management (2014), http://dx.doi.org/10.1016/j.wasman.2014.03.018

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functional relation which links the dependent variable to the frequencies results:

ln WTPP ¼ 6:32  0:02Fc and therefore:

WTPP ¼ e6:320:02Fc

Fig. 1. WTP distribution for LFM.

can be best applied to the data since it presents, compared to the other two functions, a higher R2 (equal to 0.92) (see Fig. 1). The estimated function is the following:

ln WTPLFM ¼ 7:9  0:77 ln Fc and, so:

WTPLFM ¼ e7:90:77 ln Fc where WTPLFM, willingness to pay for LFM; Fc, cumulative frequency. Subsequently, the total surplus of the representative sample was calculated from the area in the graph beneath the curve by integrating the function between zero and the maximum valid frequency equal to 137 subjects, obtaining a result of approximately 25,900 euro. In order to report the results relating to environmental damage obtained on the population in question: (a) the per capita surplus was calculated (189 euro) and (b) the catchment area was calculated. The latter is represented by those who, presumably, have a good or fair knowledge of the problem, and whose lives, it is reasonable to suppose, have been in some way influenced by it. The quantification took place by identifying, after consulting the electoral lists, the population resident in the area (2639 individuals). Subsequently, an adjustment was made in order to take into account the quota of non-respondents (24 out of 174 people). The affected population was then calculated (2639⁄150/174) equal to 2275 individuals. The economic value of the environmental damage perceived by the community was, therefore, estimated equal to approximately 430,000 euro. In parallel, the utility flow obtained from the creation of a park was quantified, estimating the function that links the willingness to pay for the construction of the park (WTPP) to the cumulative frequencies of the interviewees (see Fig. 2). The regression analysis proved that the semi-logarithmic function, with an R2 equivalent to 0.93, was the most suitable to describe the phenomenon. The

The value of the surplus related to the sample was calculated by integrating the function in Fig. 2 between zero and the maximum valid frequency, equal to 135 subjects. This value amounts to 26,545 euro. The per capita surplus was calculated (196.63 euro) and on the basis of this, the total utility flow retractable from the proposed use of the area as a public park was estimated. To achieve this it was necessary to identify a different catchment area (larger than the one identified previously) as it is reasonable to suppose that the recreation facilities, considering the dimensions and the lack of public green, can be used by consumers living further away from those who perceive the damage. The potential number of persons interested in the creation of a public park was estimated at 3182 individuals and the utility flow retractable from the potential park was equal to approximately 625,700 euro. The above results deserve some comments regarding the form of the functions (and the distribution of the interviewees on the basis of their WTP) and the size of sums identified. Concerning the first issue, the considerations are as follows:  the distribution of the WTPLFM tends to be bimodal. This is due to the fact that, within the sample, there is a group of more wealthy and educated people who show a greater willingness to pay. Alongside this there is the rest of the population, which is in favour of sums that are decidedly lower. This difference in behaviour can be traced to the non-homogeneous perception of the damage, the size of which depends on an individual’s experience of the landfill site also;  the WTP distribution for the creation of a park has a more regular tendency compared to the reclamation of the area. This is most probably due to the fact that the perception of benefits deriving from the creation of the park is more immediate and clearly perceived by individuals. Concerning the economic value of the individual WTP, the size of the sums identified for LFM and for the creation of the park is comparable. It is important to stress that the high level of environmental damage depends more on experiences of the past than on the current situation. Therefore, it seems reasonable to suppose that the perception of the damage (and the corresponding WTP) will tend to dissipate over time, both due to a natural process and due to the progressive decrease in the population quota that had previously experienced the inconveniences of the landfill. Therefore, unless new issues are raised which may revive concerns about the presence of the landfill (i.e. groundwater pollution, etc.) it is possible that the need to reclaim the area prior to creating a park will progressively lose interest over time.

4. Conclusions

Fig. 2. WTP distribution for the creation of a public park.

Despite the potentials of LFM, the number of full-scale projects has been unexpectedly low so far, mainly due to the difficulties in proving the economic feasibility of the many candidate cases. The need for the development of innovative technologies for valorisation of the excavated waste and for a standardized framework for the assessment of the economic potential of LFM is clear among the scientific community.

Please cite this article in press as: Marella, G., Raga, R. Use of the Contingent Valuation Method in the assessment of a landfill mining project. Waste Management (2014), http://dx.doi.org/10.1016/j.wasman.2014.03.018

G. Marella, R. Raga / Waste Management xxx (2014) xxx–xxx

A comprehensive approach for the economic evaluation of LFM should take into account the role of externalities and encompass them into a structured procedure to support private and public actors in the evaluation process of LFM feasibility, in such a way that projects generating higher social benefits (and no significant private revenues) are not overlooked and can be favoured through tailored policies and support schemes. The Contingent Valuation Method (CVM) was used in this case study for the monetary assessment of community-perceived benefits of the application of LFM for the reclamation of an old landfill in Northern Italy. The economic values of the individual willingness to pay (WTP) for LFM and for the subsequent creation of a park were calculated and the correlations with the relevant variables assessed. The total benefit of the representative sample was calculated for both cases and the results were suitably extended to the population resident in the area and potentially affected both by LFM and the creation of the park. The economic value of the total benefit was estimated equal to approximately 1 million euros. Much higher values are expected in more densely populated areas; however, the results of the application of CVM are very site specific and therefore the possible use of benefit transfer methods to extend them to other situations should be handled with proper care. In the many cases of old uncontrolled waste deposits where a LFM project is considered, the monetary assessment of the related social benefits should comprise a step where the evaluation of the benefits perceived by the community is carried out. To this regard, the case study described offers valuable information and may contribute towards the implementation of the much awaited common methodological framework for the assessment of LFM projects. References Allgaier, G., Stegmann, R., 2005. Old landfills in the focus of urban land management. In: Proceedings Sardinia 2005 – Tenth International Waste Management and Landfill Symposium. CISA Publisher, Cagliari Italy. Ayalon, O., Becker, N., Shani, E., 2006. Economic aspects of the rehabilitation of Hiriya landfill. Waste Manage. 26, 1313–1323. Bilitewski, B., Conrad, H., Grischek, H., 1995. Transportation and reconstruction of old landfill sites in east Germany. In: Proceedings Sardinia 95, Fifth International Landfill Symposium. CISA Publisher, Cagliari, Italy, pp. 807–818. Caplan, A., Grijalva, T., Jackson-Smith, D., 2007. Using choice question formats to determine compensable values: the case of a landfill-siting process. Ecol. Econ. 60, 834–846. Carson, R.T., Carson, N., Alberini, A., Flores, N., Wright, J., 1995. A Bibliography on Contingent Valuation Studies and Papers. California, Natural Damage Assessment Inc, La Jolla. Carson, R.T., Mitchell, R.C., Hanemann, M., Kropp, R.J., Presser, S., Ruud, P.A., 2003. Contingent valuation and loss passive use: damages from the exxon valdez oil spill. Environ. Resour. Econ. 25 (3), 257–286. Cossu, R., Motzo, G.M., Laudadio, M., 1995. Preliminary study for a landfill mining project in Sardinia. In: Proceedings Sardinia 95, Fifth International Landfill Symposium. CISA Publisher, Cagliari, Italy, pp. 841–850. Cossu, R., Raga, R., Rossetti, D, 2003a. Full scale application of in situ aerobic stabilization of old landfills. In: Proceedings Sardinia 2003 – Ninth International Waste Management and Landfill Symposium. CISA Publisher, Cagliari, Italy. Cossu, R., Pivato, A., Raga, R., 2003b. Preliminary risk assessment of old landfills in Italy. Sustain. World 8 (2003), 195–203.

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Please cite this article in press as: Marella, G., Raga, R. Use of the Contingent Valuation Method in the assessment of a landfill mining project. Waste Management (2014), http://dx.doi.org/10.1016/j.wasman.2014.03.018