Waste Collection and/or Sorting Facilities
Waste Collection and/or Sorting Facilities
Business Model Description
Investments in Building and Operating Waste Collection and/or Sorting Facilities
Expected Impact
This IOA can increase resource efficiency by increasing the share of recovery and recycling in the waste disposal processes.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- Turkey: Mediterranean Region
- Turkey: Black Sea Region
Sector Classification
Infrastructure
Development need
Turkey's performance on SDG 9 (Industry, Innovation and Infrastructure) exhibits major challenges, and significant challenges still remain for SDG 12 (Responsible Consumption and Production) according to the Sustainable Development Report 2020. (1)
Policy priority
The New Economy Program covering 2020-2022 emphasizes that projects on the "Zero Waste Initiative" will be extended. (2)
Gender inequalities and marginalization issues
Within the infrastructure sector, there is a high rate of informality among solid waste collectors. Workers in this area suffer from poor working conditions and a lack of social security. In terms of the provision of utilities, households with lower income levels face the risk of energy poverty. Fair employment practices and pricing mechanisms need to be implemented to address the issues of marginality within this sector. Investments in this area need to generate job opportunities within the green economy and promote energy-efficiency measures to decrease the household consumption costs.
Investment opportunities
The government has planned the following public investment amounts for urban infrastructure areas for 2020: 198 million TRY (29 million USD) for urbanization, 152 million TRY (22 million USD) for communication infrastructure, 71 million TRY (10 million USD) for environment and 67 million TRY (10 million USD) for municipal services. (3)
Key bottlenecks
Given high investment and operations costs, human capital and technology resources and governance needs, some urban infrastructure services such as wastewater treatment facilities cannot reach the desired efficiency levels. New models are needed to improve efficiency in urban infrastructure. (4)
Waste Management
Development need
SDG 9 is identified as one of the priority SDGs in the context of Turkey and as one of the most relevant SDGs for Turkey to achieve the Global Goals acording to the VNR 2019 report. (5)
Policy priority
The government has a main objective to improve urban infrastructure with a focus on provision of clean drinking water, treated wastewater and an active solid waste management system. (6)
Gender inequalities and marginalization issues
There is a high rate of informality in the waste management sector of Turkey. Waste-pickers suffer from poor working conditions and a lack of social security. It is estimated that the informal recycling sector could be responsible for up to 30% of solid waste management. This is a key area of income for the urban poor and ethnic minorities. (14) (15)
Investment opportunities
Turkey's Private Participation in Infrastructure (PPI) figures show that infrasture in ICT, integrated MSW (municipal solid waste) and treatment and disposal still needs a higher private sector engagement. (7)
Key bottlenecks
Given high investment and operations costs, human capital and technology resources and governance needs, some urban infrastructure services such as wastewater treatment facilities cannot reach the desired efficiency levels. New models are needed to improve efficiency in urban infrastructure. (4)
Pipeline Opportunity
Waste Collection and/or Sorting Facilities
Investments in Building and Operating Waste Collection and/or Sorting Facilities
Business Case
Market Size and Environment
> USD 1 billion
The total municipal waste is estimated to reach 33 million tonnes by 2023. (8)
The investments necessary to build recycling and recovery facilities and sanitary landfills in alignment with national standards varies between 1.7-2.9 billion EUR with sanitary landfills accounting for 370-618 million EUR. (8)
Indicative Return
10% - 15%
Investors already operating in the waste recovery sector in Turkey estimate an IRR between 10%-15%.
Investment Timeframe
Short Term (0–5 years)
The usual timeframe for investments in constructing and operating recovery facilities for solid waste is limited with the duty periods of municipalities, which is 5 years. Waste collection centers require a less technologically intense investment.
Ticket Size
> USD 10 million
Market Risks & Scale Obstacles
Business - Supply Chain Constraints
Market - Highly Regulated
Impact Case
Sustainable Development Need
According to OECD, Turkey still faces insufficient recovery and recycling of municipal solid waste. Despite some progress in waste treatment infrastructure, 90% of municipal waste is sent to landfills. Only 6% of municipal waste was collected seperately in 2016. (9)
According to the Ministry of Environment and Urbanization, 6% (1.5 million tonnes) of municipal waste goes to recovery plants, while 64% (17.5 million tonnes) is kept at sanitary landfills and 30% (8.1 million tonnes) goes to irregular landfills. (8)
Waste is largely collected through door-to-door with 58%, containers with 33% and waste collection centers with 9%. 11.9% of municipal waste are collected seperately by municipalities and sent to recovery facilities and other wastes sent to biogas and composting facilities. (10)
Gender & Marginalisation
The waste collection and management sector heavily involves informal workers with no access to social protection. Business and policy interventions in this sector should not eliminate the livelihood of the workers in this sector, but find ways to transform informal occupations into new jobs in the green economy.
Expected Development Outcome
The IOA can reduce environmental pollution stemming from dumping of non-biodegradable and toxic waste into landfills.
The IOA can rehabillitate wild dumping sites by increasing the share of recovery and sanitary landfills in waste disposal to 35% and 65%, respectively by 2023. (8)
This IOA can increase resource efficiency by increasing share of recovery and recycling in the waste disposal processes and reduce waste generation through prevention, reduction, recycling and reuse.
Gender & Marginalisation
This IOA can reduce waste release to air, water and soil in order to minimize their adverse impacts on human health and the environment, which is heavily concentrated around peripheral settlements.
Primary SDGs addressed
9.4.1 CO2 emission per unit of value added
0.41 kg of CO2 per constant 2010 US$ (11)
11.6.1 Proportion of municipal solid waste collected and managed in controlled facilities out of total municipal waste generated, by cities
11.6.2 Annual mean levels of fine particulate matter (e.g. PM2.5 and PM10) in cities (population weighted)
41.97 mgr/m^3 (11)
41.97 mgr/m^3 (11)
12.5.1 National recycling rate, tons of material recycled
12.4.2 (a) Hazardous waste generated per capita; and (b) proportion of hazardous waste treated, by type of treatment
151,505.1 tonnes (11)
(b) 6,623,186 tonnes (11)
Secondary SDGs addressed
Directly impacted stakeholders
People
Gender inequality and/or marginalization
Planet
Corporates
Public sector
Indirectly impacted stakeholders
People
Outcome Risks
Over 500,000 people collect waste informally from the streets, who live below the poverty line. Investments in this IOA will significantly reduce the demand for street collectors' services.
Impact Risks
Stakeholder Participation Risk given the informal job market for waste collectors will be distorted by investments in this IOA.
Efficiency Risk given the heavy involvement of local authorities in waste management.
Endurance Risk given that the investment timeframes are heavily dependent on the duty terms of municipalities.
Impact Classification
What
Reduced waste levels and increased recovery.
Risk
Informal waste collectors and non-competitive markets in waste collection limit investments' capability to deliver maximum impact.
Impact Thesis
This IOA can increase resource efficiency by increasing the share of recovery and recycling in the waste disposal processes.
Enabling Environment
Policy Environment
11th Development Plan: 11th Development Plan, 2.4.5. Urban Infrastructure, 696. An active solid waste management system that help reducing harmful effects on human health and negative environmental impacts and ensuring eliminating, recycling and recovery present the sector’s another main objectives.
11th Development Plan: 11th Development Plan, 2.4.5. Urban Infrastructure, 699. Implementation tools, particularly PPP, will be developed to ensure resource efficiency and environmental responsibility in solid waste management.
11th Development Plan, 2.4.5. Urban Infrastructure, 699. By enabling solid waste management, waste reduction, resource separation, separate collection, transportation, recovery, disposal phases and rehabilitation of irregular/wild dump areas will be developed technically and financially as a whole.
11th Development Plan, 2.4.5. Urban Infrastructure, 700. Domestic solid waste recovery and disposal facility projects and transfer station projects that local administrations with inadequate financial power have difficulty in financing will be supported within the scope of a program.
Financial Environment
Financial incentives: The Development and Investment Bank of Turkey signed a 3-year-nonrecourse 20-year loan agreement with KfW to finance infrastructure projects targeting sustainability. (12)
Investments in waste recovery and disposal facilities over 5 million TRY in these areas are eligible for Region 5 incentives regardless of location, which include VAT exception, customs duty exemption, tax deduction, land allocation, interest/profit share support and so on (13)
Other incentives: Investments over 1 million TRY in regions 1 and 2, and over 500,000 TRY in regions 3, 4, 5 and 6 are eligible for "Regional Investment Incentives": VAT exemption, tax deduction, social security premium support, income tax withholding support, land allocation etc. (13)
Regulatory Environment
(Regulation): The ultimate regulator of waste management in Turkey is the Ministry of Environment and Urbanization, while other public bodies such as the Ministry of Interior and Ministry of Health are also involved as per their respective mandates.
(Regulation): Turkish Law on Environment no. 2872 creates the basis of the legal framework for waste management practices in Turkey.
(Regulation): The "Waste Management Regulation" published in the Official Gazette issue no. 29314 of 02.04.2015 aims to ensure an environmentally harmless waste disposal process.
According to the Law on Environment, municipalities are responsible for the municipal waste management processes. According to the Law on Metropolitan Municipalities no. 5216 and the Law on Municipalities no. 5393, local governments are in charge of waste management.
Collection/sorting and recycling facilities are required to obtain environment licenses.
Marketplace Participants
Private Sector
İSTAÇ, Evreka.
Government
Municipalities are legally responsible for the municipal waste management processes. Ministry of Environment and Urbanization also supports investments in solid waste management. İlbank.
Multilaterals
EBRD, World Bank, EU through IPA funding
Non-Profit
ÇEVKO, TAYÇED.
Target Locations
Turkey: Mediterranean Region
Turkey: Black Sea Region
References
- (1) Bertelsmann Stiftung & SDSN, 2020. Sustainable Development Report Dashboards 2020. https://dashboards.sdgindex.org/#/TUR
- (2) Presidency of Strategy and Budget, The New Economy Program 2020-2022. http://www.sbb.gov.tr/wp-content/uploads/2019/10/YeniEkonomiProgrami_OVP_2020-2022.pdf
- (3) Presidency of Strategy and Budget, 2020 Investment Program, http://www.sbb.gov.tr/wp-content/uploads/2020/03/2020_Yatirim_Programi.pdf
- (4) Presidency of Strategy and Budget, 2020 Annual Presidency Program. http://www.sbb.gov.tr/wp-content/uploads/2019/11/2020_Yili_Cumhurbaskanligi_Yillik_Programi.pdf
- (5) Presidency of Strategy and Budget, Turkey's SDGs 2nd VNR 2019. https://sustainabledevelopment.un.org/content/documents/23862Turkey_VNR_110719.pdf
- (6) 11th Development Plan, Presidency of Strategy and Budget, http://www.sbb.gov.tr/wp-content/uploads/2020/03/On_BirinciPLan_ingilizce_SonBaski.pdf
- (7) World Bank. Turkey PPI Snapshot. https://ppi.worldbank.org/en/snapshots/country/turkey
- (8) Ministry of Environment and Urbanization National Waste Management and Action Plan 2023. https://webdosya.csb.gov.tr/db/cygm/haberler/ulusal_at-k_yonet-m--eylem_plan--20180328154824.pdf
- (9) OECD Environmental Performance Reviews Turkey 2019. http://www.oecd.org/env/country-reviews/Highlights-Turkey-2019-ENGLISH-WEB.pdf
- (10) TUIK, 2019. Disposal/recovery methods and amount of municipal waste. http://www.tuik.gov.tr/UstMenu.do?metod=temelist
- (11) UNStats. SDG Indicators Database. https://unstats.un.org/sdgs/indicators/database/
- (12) Statement by DBIT CEO, 2019. https://www.hurriyet.com.tr/ekonomi/bolgesel-kalkinma-fonu-ile-teknoloji-ve-inovasyon-fonu-kuruldu-41404794
- (13) Ministry of Industry and Technology, 2020. The Framework of Investment Incentives Program in Turkey. https://www.sanayi.gov.tr/destek-ve-tesvikler/yatirim-tesvik-sistemleri/md0403011615
- (14) ILO, https://www.ilo.org/wcmsp5/groups/public/---ed_emp/---emp_ent/---coop/documents/publication/wcms_715845.pdf
- (15) European Environment Agency, 2013. https://www.eea.europa.eu/publications/managing-municipal-solid-waste/turkey-municipal-waste-management/view
- (16) Ministry of Environment and Urbanization, National Waste Management Action Plan of 2023.