Armenia SWM Sector Assessment and Reform Plan SECTOR ASSESSMENT REPORT May 2024 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report © 2024 The World Bank 1818 H Street NW, Washington DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved. This activity was funded by the City Climate Finance Gap Fund, a Multi-Donor Trust Fund with support from the Governments of Germany and Luxembourg. This work is a product of The World Bank. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy, completeness, or currency of the data included in this work and does not assume responsibility for any errors, omissions, or discrepancies in the information, or liability with respect to the use of or failure to use the information, methods, processes, or conclusions set forth. 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Armenia SWM Sector Assessment and Reform Plan. © World Bank.” Any queries on rights and licenses, including subsidiary rights, should be addressed to World Bank Publications, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: pubrights@worldbank.org. Cover photo: Authors. Further permission required for reuse. 2 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Contents EXECUTIVE SUMMARY.......................................................................................................................................................... 6 1. INTRODUCTION ......................................................................................................................................................... 11 2. EXISTING LEGAL AND POLICY FRAMEWORK ............................................................................................................. 11 2.1 NATIONAL WASTE MANAGEMENT LEGISLATION ............................................................................................................ 11 2.2 SOLID WASTE MANAGEMENT STRATEGY ...................................................................................................................... 18 2.3 OTHER POLICY DOCUMENTS ..................................................................................................................................... 22 2.4 COMPREHENSIVE AND ENHANCED PARTNERSHIP AGREEMENT........................................................................................ 22 3. INSTITUTIONAL AND ORGANISATIONAL FRAMEWORK ............................................................................................. 24 3.1 INSTITUTIONAL FRAMEWORK.................................................................................................................................... 24 3.1.1 Institutional responsibilities at national level .............................................................................................. 24 3.1.2 Institutional responsibilities at regional level............................................................................................... 27 3.1.3 Institutional responsibilities at local level .................................................................................................... 27 3.2 OTHER INSTITUTIONAL ARRANGEMENTS ..................................................................................................................... 27 3.2.1 Monitoring and enforcement ....................................................................................................................... 27 3.2.2 Reporting and data management ................................................................................................................ 28 3.2.3 Licensing and permitting .............................................................................................................................. 28 3.2.4 Environmental financing............................................................................................................................... 29 3.2.5 Capacity strengthening mechanisms ........................................................................................................... 29 3.3 INSTITUTIONAL FUNCTIONS FOR MUNICIPAL SOLID WASTE MANAGEMENT ......................................................................... 29 4. RELEVANT INITIATIVES AND STUDIES ........................................................................................................................ 31 4.1 FEASIBILITY STUDIES AND CONCEPTS .......................................................................................................................... 31 4.2 EPR DEVELOPMENT ............................................................................................................................................... 32 4.3 OTHER INITIATIVES AND PROJECTS ............................................................................................................................. 33 5. WASTE MANAGEMENT BASELINE ............................................................................................................................. 34 5.1 CURRENT MUNICIPAL WASTE GENERATION .................................................................................................................. 34 5.2 WASTE COMPOSITION ............................................................................................................................................ 35 5.3 WASTE FORECAST .................................................................................................................................................. 37 5.3.1 Population forecast ...................................................................................................................................... 37 5.3.2 Economic growth .......................................................................................................................................... 38 5.3.3 Waste forecast.............................................................................................................................................. 39 5.4 CURRENT WASTE MANAGEMENT OPERATIONS ............................................................................................................. 41 5.4.1 Waste collection ........................................................................................................................................... 41 5.4.2 Waste recycling and recovery....................................................................................................................... 42 5.4.3 Waste disposal.............................................................................................................................................. 43 5.4.4 Landfill gas utilization................................................................................................................................... 44 5.4.5 Intermunicipal cooperation .......................................................................................................................... 45 5.4.6 Role of informal sector ................................................................................................................................. 45 5.4.7 Public awareness .......................................................................................................................................... 45 6. COSTS AND FINANCING ............................................................................................................................................. 46 6.1 FINANCIAL FRAMEWORK.......................................................................................................................................... 46 6.2 CURRENT FINANCING OF THE WASTE SECTOR ............................................................................................................... 46 6.3 SOLID WASTE TARIFF STRUCTURE FOR HOUSEHOLDS AND COMMERCIAL SECTOR .................................................................. 48 6.4 BILLING AND REVENUE COLLECTION SYSTEMS AND RATES ............................................................................................... 49 6.5 COST RECOVERY AND CROSS-SUBSIDIZATION FROM LEGAL ENTITIES .................................................................................. 50 6.6 AFFORDABILITY OF TARIFFS FOR URBAN AND RURAL POPULATION..................................................................................... 50 6.7 POTENTIAL FOR PRIVATE SECTOR INVOLVEMENT ........................................................................................................... 53 3 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 7. IDENTIFIED AREAS FOR IMPROVEMENT.................................................................................................................... 54 7.1 GAPS IN LEGAL FRAMEWORK AND RECOMMENDATIONS ................................................................................................. 55 7.2 GAPS IN POLICY FRAMEWORK AND RECOMMENDATIONS ................................................................................................ 58 7.3 GAPS IN INSTITUTIONAL ARRANGEMENTS AND RECOMMENDATIONS ................................................................................ 58 7.4 GAPS IN WASTE OPERATIONS AND RECOMMENDATIONS ................................................................................................. 60 7.5 GAPS IN FINANCING OF WASTE OPERATIONS AND RECOMMENDATIONS ............................................................................. 61 8. ANNEX 1. MSWM COSTS AND REVENUE, 2022 ......................................................................................................... 65 List of Tables TABLE 1. WASTE DISPOSAL TAXES ............................................................................................................................................... 14 TABLE 2. CONCEPT FOR SHIRAK WMZ ........................................................................................................................................ 20 TABLE 3. CONCEPT FOR SYUNIK WMZ ........................................................................................................................................ 21 TABLE 4. CONCEPT FOR LORI WMZ ........................................................................................................................................... 21 TABLE 5. WASTE MANAGEMENT PROVISIONS OF CEPA .................................................................................................................. 22 TABLE 6. NUMBER OF WASTE MANAGEMENT VIOLATIONS AND AMOUNT OF IMPOSED FINES .................................................................. 28 TABLE 7. INSTITUTIONAL FUNCTIONS FOR MUNICIPAL SOLID WASTE MANAGEMENT .............................................................................. 29 TABLE 8. MUNICIPAL SOLID WASTE DISPOSED AT MUNICIPAL DISPOSAL SITES IN 2020-2022, TONNE ...................................................... 34 TABLE 9. ESTIMATED MUNICIPAL WASTE GENERATION, 2019 ........................................................................................................... 34 TABLE 10. WASTE COMPOSITION RESULTS, 2019.......................................................................................................................... 35 TABLE 11. WASTE COMPOSITION RESULTS IN YEREVAN, 2016 ......................................................................................................... 36 TABLE 12. WASTE COMPOSITION SURVEY, 2009-2011 ................................................................................................................. 37 TABLE 13. ESTIMATED RANGE OF WASTE COMPOSITION .................................................................................................................. 37 TABLE 14. POPULATION OF ARMENIA, 2012-2023 ...................................................................................................................... 37 TABLE 15. POPULATION FORECAST, 2024-2043 .......................................................................................................................... 38 TABLE 16. WASTE FORECAST, 2024-2043, IN TONS ..................................................................................................................... 39 TABLE 17. NUMBER OF DUMPSITES, 2020 .................................................................................................................................. 44 TABLE 18. WM TARIFF AFFORDABILITY THRESHOLDS ...................................................................................................................... 52 TABLE 19. AVERAGE MSW TARIFFS IN EU AND ARMENIA............................................................................................................... 53 List of Figures FIGURE 1. DELINEATION OF WASTE MANAGEMENT ZONES ............................................................................................................... 19 FIGURE 2. ESTIMATED POTENTIAL FOR WASTE RECYCLING AND RECOVERY, TONS .................................................................................. 40 FIGURE 3. ESTIMATE OF QUANTITIES OF DRY RECYCLABLE WASTE....................................................................................................... 40 FIGURE 4. CURRENT WASTE COLLECTION EQUIPMENT ..................................................................................................................... 41 FIGURE 5. SEPARATE COLLECTION CONTAINERS IN YEREVAN ............................................................................................................. 42 FIGURE 6. PICTURES OF CURRENT WASTE DISPOSAL SITES ................................................................................................................ 43 FIGURE 7. PET BOTTLES SEPARATED AT TASHIR SITE ....................................................................................................................... 45 FIGURE 8. MONTHLY ACTUAL WASTE CLEANING AND COLLECTION COSTS AND REVENUE FROM WASTE FEES , PER CAPITA, BY MARZES, AMD, 2022 ........................................................................................................................................................................... 48 FIGURE 9. WASTE FEE COLLECTION RATES .................................................................................................................................... 49 FIGURE 10. MONETARY MONTHLY INCOME BY DECILE GROUPS AND AVERAGE FOR RURAL AND URBAN AREA , 2022, AMD .......................... 51 FIGURE 11. AVERAGE MONTHLY CONSUMPTION, RURAL AND URBAN AREAS, 2022, AMD.................................................................... 51 FIGURE 12. GDP PER CAPITA BY MARZES, AMD........................................................................................................................... 52 FIGURE 13. SHARE OF EXTREMELY POOR AND POOR POPULATION IN 2022 ......................................................................................... 52 4 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report List of abbreviations ACE/AUA Acopian Center for the Environment at the American University in Armenia CDW Construction and demolition waste CEPA Comprehensive and Enhanced Partnership Agreement EBRD European Bank for Reconstruction and Development EPMIB Environmental Protection and Mining Inspection Body EPR Extended Producer Responsibility EU European Union GDP Gross domestic product LoLG Law of Local Governance LoW Law on Waste (2004) ME Ministry of Environment MH Ministry of Health MoE Ministry of Economy MSWM Municipal Solid Waste Management MTAI Ministry of Territorial Administration and Infrastructure MTPEF Medium-Term Public Expenditure Framework PPP Public private partnership PRO Producer Responsibility Organization RA Republic of Armenia SWM Solid Waste Management UDC Urban Development Committee WEEE Waste from electric and electronic equipment WaRM Waste and resource management WMZ Waste Management Zone 5 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Executive summary Significant progress has been made in Armenia’s solid waste sector in recent years. Waste collection service is nearing universal coverage of the population. A significant number of unauthorized waste disposal sites have been closed over the past few years. Still, in many areas, the waste sector in Armenia is not performing well enough when compared to the best international standards. This Sector Assessment Report provides a critical overview of the municipal waste management sector in the country and identifies specific areas for improvement. Legal framework In November 2017, a Comprehensive and Enhanced Partnership Agreement (CEPA) was signed between the European Union (EU) and the Republic of Armenia (RA). The CEPA entered into force on 1 March 2021. The Agreement provides a framework for the EU and Armenia to work together in a wide range of areas, including environment and waste management. In the field of waste management, the Republic of Armenia committed to undertake gradually approximation of its legislation to the respective legislation of the EU within agreed timeframes. Commitments relate to approximation of national legislation to the requirements of the Waste Framework Directive (2008/98/EC) and the Landfill Directive (1999/31/EC). While official review of the progress regarding the approximation has not been issued, it is noted that little progress has been made so far. There are gaps in the current legislation which prevent the development of the waste and resource management sector. The main gaps are related to: recognition of the waste management hierarchy; application of the polluter pays principle; implementation of extended producer responsibility; and waste disposal. The waste management hierarchy provides instructive guidance on the relative importance of different waste management methods. Currently, all the collected municipal waste goes to landfill, which is at the base of the hierarchy. There are no mechanisms in place to promote, encourage, or incentivize waste recovery, reuse and prevention practices. The polluter-pays principle is not observed yet, and as a result waste management costs are not attributed to waste producers and holders . Waste fees do not yet account for the full cost of the collection service alone. Landfill gate fees are either non-existent or set too low to sustain environmentally safe disposal. Producers of products do not bear financial and organizational responsibility for the management of the waste stage of a product’s life cycle. Legal provisions are needed to underpin application of the polluter pays principle. Lack of full cost recovery is a barrier to private sector participation, which would otherwise be interested in investing in waste management services and infrastructure. Although among the main provisions of CEPA, Extended Producer Responsibility (EPR) principle is not established yet. EPR legislation is currently under preparation, the implementation of which would ensure that producers bear financial and organizational responsibility for management of the disposal of the products they produce once those products have become waste. In the absence of EPR schemes, source separation and recycling activities lag behind and considerable amount of municipal waste (resources) end up in dumpsites. EPR requires producers who put products on the market to assume responsibility for their products beyond their useful life and in particular for their end-of-life treatment and recovery. The application of EPR requires producers to establish or to finance systems for collection and recycling of their waste. EPR schemes would become important investors in assets and infrastructure covering the full costs of separate collection, sorting and recovery of special waste streams, including packaging and packaging waste. This would significantly reduce the financial burden on public budgets. To address all the gaps detailed above, the Law on Waste needs to be amended. The law could streamline the responsibilities among institutions, particularly related to policy making and planning, and designate a ministry which would be primarily responsible for waste management in the country (CEPA provision). This would eliminate unclarities and overlaps in terms of responsibilities and help ensure transparency and 6 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report accountability as good governance demands oversight of decision-making processes. Besides, the law could set up a date for closure of all municipal disposal sites which do not comply with the legal requirements and to introduce a requirement for pre-treatment of waste prior to landfill (CEPA provision), stipulating a date from which onwards landfills should not accept untreated waste. The current state of waste disposal does not prevent environmental and health risks . Apart from the recently built Hrazdan landfill, no other disposal site in the country meets the requirements for a modern engineered facility. This is due to lack of legal provisions imposing high environmental protection standards for selection of sites and construction of sanitary landfills. The gap in establishing provisions for management and closure of disposal sites has recently been addressed by the adoption of RA Government Decision №27- N ”On approval of the minimum standards for the operation, remediation and closure of existing and acting landfills in the territory of the Republic of Armenia". This is particularly important in view of the large number of existing dumpsites in the country - about 300. A new Government Decision is needed on waste landfill construction. The decision could transpose requirements set out in Directive 1999/31/EC on the landfill of waste regarding general requirements for landfills for non-hazardous waste. Policy framework There is a lack of regional planning and existing municipal waste management plans are lacking in scope. The country will be divided into several waste management zones. The role of regional waste management plans would be to identify the regional waste management facilities and services to be shared among municipalities within the certain waste management zone. Municipal plans could then be developed in accordance with the provisions of the national and regional waste management plans and following the structure and scope of the Guidelines for development of local waste management plans. In accordance with the CEPA provisions, a national strategy for reduction the amount of biodegradable municipal waste going to landfill is also needed. This strategy could outline the necessary measures and set a timeline for phased reduction of biodegradable waste going to landfill to 35% of the quantities of the baseline year. Institutional framework Currently there are two ministries which are in fact designated bodies in the field of waste management . The Law on Waste (2004) designates the Ministry of Environment as the authorized body in the field of environment and waste management. At the same time, the Law on Waste Collection and Sanitary Cleaning (2011) designates the Ministry of Territorial Administration and Infrastructure as authorized body in the field of waste collection. Furthermore, apart from waste collection, the latter law assigns responsibilities to MTAI in terms of approval of norms and procedures for the design, construction, operation of landfills and transfer stations. As already mentioned, designating a single institution responsible for waste management would eliminate unclarities and overlaps in terms of responsibilities and help ensure transparency and accountability. Waste management operations Apart from Yerevan, waste collection service in the country is inefficient . Inefficiency is a result of several factors. Containers which are predominantly in use are outdated, without wheels, heavier than modern designs and require more time for servicing. Their capacity (0.7 m3) is lower than the ones used in Yerevan (1.1 m3) and partly in Gyumri and Vanadzor. Waste collection fleet is predominantly outdated with lower compaction than contemporary standards. Although progressively closed, chutes are still in use in many urban areas, which is inappropriate from both technical efficiency and public health point of view. To increase the efficiency of waste collection, waste collection in the country can shift to be based on wheeled 1.1 m 3 containers and rear-loading trucks with high compaction rate. At present, waste disposal does not meet international standards . All currently used disposal sites in the country are basically open dumpsites, which are inappropriate from an environmental point of view. Without control mechanisms, dumpsites cannot ensure that hazardous industrial and healthcare wastes are not 7 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report disposed along with municipal waste. Current operational practices are not consistent with recently adopted higher standards for waste disposal. Sanitary landfills need to be constructed in accordance with the requirements set out in the EU Landfill Directive. Meeting the highest environmental standards makes the sanitary landfills expensive facilities, which cannot be sustained by individual municipalities. New landfills would have to be established on a regional basis and serve several municipalities (as is the case of Hrazdan landfill intended to serve both Kotayk and Gegharkunik Marzes), to allow for economies of scale and reduction of unit costs. Feasibility studies are needed to establish the number and exact locations of these sanitary landfills. Parallel to construction of new sanitary landfills, dumpsites also need to be closed. Based on the quantities and types of waste disposed, a Dumpsite Closure Plan could be developed, detailing the type of closure and rehabilitation measures needed along with costing of the measures. Waste recycling and recovery lags behind . Admittedly not as pressing an issue as waste disposal, Armenia’s integrated waste management system should include treatment and recovery of biowaste, being the largest percentage of municipal waste. Currently neither green waste nor food waste are subject to treatment. The biowaste management system could include recycling of green waste (composting) as well as recovery of kitchen waste. While composting of green waste works as both centralized and decentralized solutions, recovery of kitchen waste is economically feasible only as a centralized solution and can be incorporated in the future regional waste management plans. Once the legal framework, currently under development, is agreed amongst the key stakeholders and established, implementation of EPR schemes can follow. One of the key requirements towards EPR schemes is financial contributions paid by producers to cover the costs of separate collection of waste, transport and recovery/recycling. Municipalities could be legally obliged to cooperate with EPR schemes in setting up systems for separate collection of packaging waste. Although not a municipal waste stream, construction and demolition waste (CDW) if not managed properly often becomes part of the waste collection system and ends up in municipal waste disposal sites. Parallel to the construction of regional landfills and improvement of waste collection systems, municipalities would have to put in place systems for collection and recycling of CDW. International practice shows that CDW should be managed on a regional basis, with recycling facilities located near the largest waste generators and designated storage sites for smaller municipalities. The climate co-benefits of improved solid waste management are a significant opportunity for Armenia. Globally, the solid waste sector is a substantial source of methane emissions, a greenhouse gas with a global warming potential up to 80 times greater than carbon dioxide. Moving from the existing situation of uncontrolled waste disposal to having sanitary landfills with landfill gas management will enable Armenia to improve local environmental conditions while also contributing to global climate change mitigation efforts. Costs and financing of waste operations Current waste fees do not comply with the polluter pays principle and full cost recovery, in line with CEPA provisions. Waste fees have not been revised for years and are still way below the maximum value established in the 2011 Law. In 2022, the average household fees per Marzes were still within the range of 50-200 AMD per person per month and significantly below the affordable levels of waste tariffs defined for upper-middle income economies, such as Armenia. On the other hand, officially reported cumulative inflation for the period 2011-2023 was 44%, resulting in a significant erosion of the real value of waste fees. Services are currently provided to match the amount of funds available within the current waste fee levels. This results in the use of depreciated and inefficient waste collection equipment as available funds are hardly sufficient to cover the operating costs alone. Within the affordability threshold, fees can be set to cover the full cost of the targeted level of service. The waste fee structure should comprise of components corresponding to full recovery of costs by cost centers - collection, waste treatment and disposal. Since full cost recovery cannot be achieved immediately, waste fee increases would need to be justified and foreseen in municipal waste management plans too. Costs for sanitary cleaning should be considered as a separate cost center and continue to be covered by other municipal revenue, and not by the waste charge. Waste collection services continue to be subsidized . Again, in light of polluter pays principle, waste fees do not even cover the operating costs of waste collection service. About 50% of the current collection costs are 8 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report covered from other revenues of municipal budgets. The diagram below shows the monthly costs and the collected revenue per capita in 20221. Monthly costs and revenue per capita 450 400 350 300 250 AMD 200 150 100 50 0 Monthly cleaning costs/cap Monthly collection cost/cap Monthly revenue from fee, per capita Source: websites of Marzpetarans Subsidies do not create sustainable waste management systems. Subsidies are needed for households living under the poverty line and may also be needed for the introduction of new technologies and practices as a transitional period. Apart from that, waste generators should be the source of financing of the cost of service. The main disadvantages of using subsidies to cover a significant share of waste management costs come from a long-term perspective. First, it places a significant burden on public budgets. This burden is likely to increase in the future as waste management costs tend to increase with the expansion and improvement of the service. Second, when people do not pay for the full cost of the services, they are less likely to engage in source separation of waste. The cost of landfill disposal is ignored . In 2015, waste disposal costs were 360 AMD/ton or 0.9 USD/ton, while the minimum cost of operating a sanitary landfill is 20 USD/tonne. The recently adopted Government Decision2 on minimum standards of landfill operation sets significantly higher requirements for landfill operation than the current practice, which will come at a cost. As envisaged in the CEPA, a costing mechanism needs to be established. This costing mechanism should ensure that all costs involved in the setting up and operation of a landfill site, including the estimated costs for the closure and after-care of the site for a period of at least 30 years, are included in the price charged by the operator of the waste disposal site. This mechanism should apply for all new and future sanitary landfills. Once sanitary landfills are established, all dumpsites in the Marzes would need to be closed as soon as possible, otherwise municipalities would continue to use the old dumpsites instead of the new landfills, putting at risk the financial, operational and environmental sustainability of the new infrastructure. Beside the environmental concerns of continue using the dumpsites, engineered landfills have substantial fixed costs and accepting less waste than planned may lead to substantial financial deficits and compromise the operation of this expensive infrastructure. Dumping waste has an environmental and financial cost that polluters should pay. Closing and rehabilitating numerous dumpsites represent a significant cost. Responsibilities for cleaning limited contaminations can be put on municipalities, however closing and rehabilitation of large dumpsites can hardly be financed by 1 Under the assumption that 2/3 of the costs relate to waste collection and 1/3 – to sanitary cleaning. 2 RA Government Decision №27-N "On approval of the minimum standards for the operation, remediation and closure of existing and acting existing landfills in the territory of the Republic of Armenia" dated 04.01.2024 9 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report municipal budgets. Many Eastern European countries introduced a dumpsite tax defined as an annually increasing amount per number of population in the municipality, paid by the municipalities, and recovered by inclusion of the tax in the waste fee. The purpose of the tax is to discourage dumping, to generate revenue for closure of dumpsites, and to increase the waste fee to a level sufficient to cover the cost of a sanitary landfill. The current waste disposal tax of 0.15 USD/ton is utterly insufficient to discourage dumping, or to generate revenue for the closure of dumpsites. The potential for private sector involvement in the waste sector can be further explored . While loan conditions are more favorable to governmental bodies than to the commercial sector, the opportunity to take loans and to receive grants is very limited. Cost advantages could be achieved by engaging the private sector in waste management, with the potential to achieve the least cost solution through long contract terms. The ability to recover the costs of the service largely or fully through user fees would be a significant factor in enabling for private sector involvement. Adequate budgeting for investment is needed on an ongoing basis. Timely replacement of depreciated equipment and purchase of equipment needed for the service should be part of local waste management plans, on the basis of options assessment and assessment of available equipment. Replacement of depreciated trucks/containers should be included in capital budgets of the municipalities/in business plans of municipal companies, or in tender requirements for maximum age of equipment used by service operators to be defined in case of tendering of waste collection. Sound planning of investments in waste management infrastructure is critical as waste treatment and disposal facilities have 20-30 years operational life. Political determination and sound national and regional plans are critical for adequate channelling of investment to recycling/recovery/disposal infrastructure. Key binding constraints and sector governance The key binding constraints that hinder the development of the solid waste management sector in Armenia are mainly institutional and financial in nature. If these are properly addressed, then the necessary investments and operational improvements are more likely to be achieved. The institutional constraints relate mainly to gaps in the existing legislation, fragmented institutional roles, and the need for strengthened technical capacities at all levels. Financial constraints fundamentally relate to the lack of cost recovery in the sector, with the polluter-pays principle yet to be put in place. Doing so would require revising existing waste fees and introducing extended producer responsibility (EPR) schemes. A fundamental aspect that would need further consideration is to strengthen accountability and ensure that the right incentives are in place. This would help to close the gap between what is established in the legal and regulatory framework for the solid waste sector, as well as in relevant sectoral strategies and plans, and the realization of actual changes on the ground with improved solid waste infrastructure, operations and service delivery. The success of planned interventions would not be realistic or sustainable without strong enforcement. 10 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 1. Introduction Waste management is a challenging sector to govern. The sector involves the day-to-day delivery of services that are vital to protecting public health and the environment. Regular and reliable waste management services underpin quality of life in municipalities, and contributes to Armenia’s attractiveness as a place to live, work and invest in. Integrated waste management comprises complex and inter-linked services, from cleaning of public spaces, collection and transfer, and recovery and disposal. Waste is highly diverse in nature and composition. Most products purchased and consumed will eventually give rise to waste of some kind, from municipal solid waste (generated from households, commercial, and institutional sources), to construction and demolition waste, end of life vehicles, health care waste, batteries, and electronic waste. Significant progress has been made in Armenia in recent years, with collection service nearing universal coverage of the population. A significant number of unauthorized waste disposal sites have been closed over the past few years. Still, in many areas, the waste sector in Armenia is not performing well enough when compared to the best international standards. This Sector Assessment Report provides a critical overview of the municipal waste management sector in the country and identifies specific areas for improvement. Sections 2 to 6 of this Report provide a factual snapshot of the existing frameworks for waste management – legal, policy, institutional, technical, and financial. Section 5 also includes projected waste generation in the country in the next 20-year period. Section 7 outlines key areas for improvement of the waste sector. This Sector Assessment Report will be followed by analyses of Yerevan, Gyumri and Hrazdan solid waste management systems. Based on the identified areas for improvement and recommendations, a Sector Reform Plan will be produced, which will identify the reforms needed at national and sub-national levels. 2. Existing legal and policy framework 2.1 National waste management legislation The RA Law on Waste № HO-159-N (2004) The Law on Waste (LoW) was adopted in 2004 with the following main objectives and principles (Article 5): (a) establishment of a unified state policy in the area of waste management. (b) establishment of conditions and requirements for an environmentally friendly waste management policy, providing economic incentives for resource-saving activities. (c) to avoid the generation of excessive waste, to promote waste utilization and to mitigate the adverse effects of waste on human health and the environment. (d) the legal basis for the regulation of waste management. Waste management, according to Article 4 means: prevention, collection, transportation, disposal, processing, reprocessing, recycling, removal, disinfection and landfilling. Key articles from the LoW include: • Article 7 sets out an obligation for the Government of Armenia (GOA), to develop a national policy for waste management, ensuring it implementation and to coordinate the activities of state authorized bodies. • Article 8 obliges the Ministry of Environment to participate in the policy development, to develop programs in the field of waste management, to approve sites and locations of waste management 11 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report facilities, to carry out a waste inventory, to develop a list of hazardous wastes, to coordinate waste passports and to keep a registry and to draft legal acts for regulation of the waste management sector. • Article 10 outlines the duties of the territorial administration bodies (i.e. Regional Administrations or Marzpetarans), which are, inter alia, to develop waste management plans on their territories, to issue permits for the disposal of waste within their geographical area (jointly with the respective authorized public authority), to develop sanitary cleaning schemes, to exercise control over waste collection operations, to develop and maintain registers of waste generation, treatment, storage and disposal facilities, and to eliminate unauthorized disposal sites. • Article 11 requires that local self-governance authorities (municipalities) organise waste collection schemes, eliminate unauthorized disposal sites, and support the implementation of source separation and recycling activities. • Article 13 sets requirements for state registration and certification/classification of waste. • Article 14 establishes requirements for the state cadaster of waste (maintained by the Ministry of Environment). • Article 15 establishes requirements for registry of waste generation, treatment and recycling facilities (maintained by the Ministry of Environment pursuant data provided by the legal entities engaged in waste generation, treatment or recycling). • Article 16 establishes requirements for register of waste disposal sites (maintained by the Ministry of Environment). • Article 17 establishes the requirement for a periodic monitoring obligation for waste disposal sites. This means that the monitoring is responsibility of the Ministry of Environment. • Article 21 envisages economic measures to ensure reduction of waste like: b) environmental fee (tax) for placing waste in the environment, differentiated for their hazardousness; and f) purposeful use of the funds received from the environmental fees for the financing of measures aimed at the utilization of waste and the reduction of its volumes. • Article 24 places the supervision over waste management activities under a state authorized body, which is the Ministry of Environment, clarified by the Government Decree No-599-N (2005) on “Designating Authorized Body in the Area of Waste Management”. Comment The Law on Waste was adopted in 2004, prior to the adoption of the Waste Framework Directive in 2008. The key principles missing in the Law on Waste are related to waste hierarchy, polluter pays principle and extended producer responsibility. Following the development of new legislation on Extended Producer Responsibility, the Law on Waste will be amended too. The new amendments are expected to be related to inclusion of the waste hierarchy, polluter-pays principle, and full cost recovery principle. The RA Law on Waste Collection and Sanitary Cleaning № HO -237-N (2011) The law regulates waste collection and sanitary cleaning3 and establishes main principles of waste collection fees and tariffs, rights and obligations of service recipients as well as payment procedures. Article 4.1 sets the powers of the RA Government in relation to waste collection and sanitary cleaning, which are inter alia, the following: • Elaboration and coordination over implementation of the public policy in relation to waste collection and sanitary cleaning. 3The Law defines “sanitary cleaning” as: cleaning of common areas of the settlements (streets, gardens, parks, squares, playgrounds, sidewalks, etc), removal of snow and ice, maintenance of waste bins and waste container platforms installed for general use of the settlements. 12 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • Defines an authorized public authority for management of waste collection and sanitary cleaning sphere. • Approves the regional schemes for waste collection and sanitary cleaning. • Approves the norms for operation, rehabilitation and closure of the existing/operational dumpsites. Article 4.2 sets the powers of authorized public authority in management of waste collection and sanitary cleaning, which is the Ministry of Territorial Administration and Infrastructure (MTAI) 4. Powers of MTAI include, inter alia, approval of norms and procedures for the design, construction, operation of landfills and transfer stations, procedures for collecting, transporting, storing and removing different types of waste, charters of organizations involved in waste collection and transportation, methodological guidelines for waste collection and sanitary cleaning. Article 4.4 establishes the requirement for elaboration of waste collection and sanitary cleaning management plans, which become part of the five-year development plan of the municipality. The plans to be approved annually by the municipal councils (local parliaments). As per Article 5 waste collection fee is a mandatory payment to municipal budget or to extra-budgetary account. Waste collection fee payers are natural persons owners of immovable property or users of such property, legal entities, institutions, state and local self-governments. As per Article 6 waste collection fee privileges can be established for a separate category of persons. According to Article 7 waste collection and sanitary cleaning operations provided within the administrative area of the municipality are financed from the municipal budget from a separate budget line (lines) from an extra-budgetary account. Within the framework of the PPP program provided by the law of the Republic of Armenia "On Public Private Partnership", the financing can be carried out from other sources. According to Article 8, waste collection shall be organized with the use of municipal budget by either municipal body or through a tender selected operator. Waste collection can be also financed through public- private partnership (PPP) arrangements, in accordance with the Law on PPP. Legal entities may carry out the collection and transportation of construction and bulky waste (by themselves, not through waste collection operator) having waste collection and transportation permit issued by the Mayor pursuant to the regulation approved by the municipal council. Article 10 defines general requirements for waste collection and storage. Pursuant to article 10, the procedure for waste collection, including the time schedule, the location of waste bins or containers, their types and quantities, is approved by the municipal council upon recommendation the Mayor in compliance with the national public health and safety regulations. Article 11 establishes procedures for waste transport, while article 12 sets the requirements for waste disposal and operations of landfills. Article 13 provides requirements regarding waste collection and sanitary cleaning schemes. Article 14 defines the way waste collection fees should be calculated. Details are provided in section 6.3. Reduced fees should be applied (as an economic instrument) when waste minimization source separation and recycling of waste is conducted (Article 21.1) 4 Decision of Government No 992-A from 08.08.2019 13 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report The reporting period for calculating the garbage collection fee is the calendar month, article 15(1). The waste collection fee for each month must be paid in cash or non-cash up to and including the 15th of the following month, article 18(1). In case of delay in the payment of the waste collection fee beyond the deadline set by this law, the user shall pay a penalty of 0.075 percent for the entire period past their due date, but not more than 730 days5, article 21. Comment Confusion arises from the fact that two ministries are actually designated bodies in the field of waste management. The Law on Waste (2004) designates the Ministry of Environment as the authorized body in the field of environment and waste management. At the same time, the Law on Waste Collection and Sanitary Cleaning (2011) designates the Ministry of Territorial Administration and Infrastructure as authorized body in the field of waste collection. Furthermore, apart from waste collection, the latter law assigns responsibilities to MTAI in terms of approval of norms and procedures for the design, construction, operation of landfills and transfer stations (Article 4.2). The RA Tax Code № HO-165-N (2018) Article 164 of the Code refers to objects subject of environmental taxes, which include industrial and/or consumption wastes stored/disposed at the specially designated areas. According to Article 164, municipal waste is subject to environmental taxation when it comes to waste disposal. In accordance with the Law, waste collection operators are considered environmental taxpayers. Article 170 defines tax amounts for waste disposal based on the class of hazard, as shown in the table below. Table 1. Waste disposal taxes Waste by hazard class Rate per ton disposed (AMD) Hazardous waste of the first class 48,000 Hazardous waste of the second class 24,000 Hazardous waste of the third class 4,800 Hazardous waste of the fourth class (with the exception of unsorted household waste 1,500 generated by natural persons for waste collection and sanitation operators) Non-hazardous waste (with the exception of mining waste and for waste collection and 600 sanitation operators, sorted consumer waste generated by individuals) Environmental tax applied to waste collection and sanitary cleaning service providers for 60 household waste generated by individuals. The environmental tax applied for disposal of industrial and (or) municipal waste in designated sites shall be multiplied by 1.1 for 2018, by 1.2 for 2019 and by 1.3 starting from January 1, 2020. It should be noted that although municipal waste is considered 4th class of hazard, an exception is made for household waste collected through the municipal waste collection systems. Thus, the tax paid for waste disposal is 60 AMD (USD 0.15) per tonne of waste, instead of 1,500 AMD (USD 3.7). Law on Environmental Impact Assessment and Expert Examination The Law has been adopted in 2014 (re-edited in 2023) and contains standard steps of the EIA for various projects and activities to be implemented in the country. Types of activities, which should undergo EIA are divided into 2 (A and B) categories depending on their impact on environment, where category A means higher and B lower impact levels. As per the Article 12 of the Law, the following waste management activities are considered category A: 5 Or penalty can not exceed 55% of the due amount. 14 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report a) Collection, storage, recovery, treatment, recycling, disinfection, disposal and or burial of hazardous waste b) Landfills servicing population more than 15,000 people or receiving 10 tons and more waste a day c) Transfer stations or landfills for non-hazardous waste with a capacity exceeding 50 tons per day d) Landfills where more than 10 tons of waste is disposed per day, or the total capacity exceeding 25,000 tons, except for a landfill intended for non-hazardous waste e) Construction of waste disposal facilities f) Processing of plastic materials by changing their chemical properties The RA Law on Licensing № HO-193 (2001) The Law on Licensing regulates the licensing regimes for certain activities. Chapter VII provides (exhaustively) the activities that are subject to a license. Municipal waste is categorized as 4th class of hazardousness, which means that waste collection and disposal activities are subject to licensing and permitting. Licenses and permits are issued by the Ministry of Environment. The RA Law on Local Governance № HO-337 (2002) Article 10 of the Law sets out the powers and competencies of the local self-government bodies and distinguishes between generic competencies and competencies delegated by the State. Generic competencies can be mandatory and voluntary. The mandatory competencies and the ones delegated by the State have priority over voluntary competencies. With regard to SWM, the Mayor is responsible for organizing waste collection (mandatory competency given in Article 37), the budget for which is approved by the Municipal Council. The mayor also sets the fees for waste collection services, again approved by the Municipal Council. The Law also provides for establishment of inter-municipal associations, which is on voluntary basis. The inter-municipal associations could be established for the purposes of resolving various municipal problems and reducing expenses of the local self-government bodies. The inter-municipal associations shall have the status of a legal entity. These associations are formed by mayors through concluding contracts, which shall be approved by Municipal Councils. Law on Management of Multi–Apartment Buildings Adopted in 2002, the Law regulates the types of management of a common property. With regard to SWM the relevant common property is the waste chute and the waste chamber with (possibly) bins attached to it. According to the Article 17, the management of the “common property” can be carried out in several ways, including the establishment of a legal body, called “condominium”, by the owners. Law on Condominiums Adopted in 2002, Condominium is a non-commercial cooperative, having legal status, established by its members through unification of property shares. Article 5 states the main objective of a condominium is the conclusion of contracts with utility service providers. Waste classification There are two main types of waste according to the legislation of the Republic of Armenia. The waste can be hazardous waste and industrial and consumption waste, which is actually non-hazardous waste. Five classes of wastes are defined by the legislation: • 1st hazardous class (extremely hazardous) • 2nd hazardous class (high hazardous) • 3rd hazardous class (moderate hazardous) • 4th hazardous class (low hazardous) (municipal solid waste belongs to 4th hazardous class) • 5th class (non-hazardous). Code on Administrative Offenses 15 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report The Code defines the relevant penalties for violating the rules of waste collection and sanitation and dumping waste in non-designated places. RA Government Decision №27-N "On approval of the minimum standards for the operation, remediation and closure of existing and existing landfills in the territory of the Republic of Armenia" dated 04.01.2024 6 The Decision regulate the processes of operation, upgrade and closure of existing and operating solid waste landfills existing and operating in the Republic of Armenia. The Minimum norms are defined to secure environmentally safe conditions as well as to reduce and neutralize the negative impact of landfills on human health and the surrounding environment. As per the noted document, the minimum norms are set for the following landfill operations: • Waste disposal in the landfills. • Remediation of landfills. • Operation of the existing landfills. • Closure of landfills. This Government Decision tries to significantly increase the standards of waste disposal in the country. The minimum standards envisaged for operation of the existing landfills and their subsequent closure are in line with the internationally recognized good practices. The following measures/actions are envisioned for the landfills’ operation phase: • After waste disposal, levelling and compaction of waste should be done by dozers or compactors. • Each layer of disposed waste in landfills should be isolated/covered with a 20 cm layer of soil within 1-3 days. In cold seasons, slag, construction waste, broken brick, lime, chalk, gypsum, slag, concrete, ceramic tiles, asphalt concrete, etc. can be used as covering material. In hot seasons (T>20oC) prior to compaction waste shall be watered. • Trucks shall be cleaned and disinfected at the landfill gate. • The landfill operators shall ensure a disposed waste registration system. • Where possible, weighbridge should be installed at the landfill entrance. • The landfill operators shall develop fire safety plan, landfill operation plan, a list of waste types that can be disposed and rejected at the landfill. • If rejected, a special temporary storage area can be planned in the landfill, from where the rejected waste shall be transported to the appropriate disposal site. • Every decade the landfill operator shall clean the landfill sanitary protection zone and the area adjacent to the access road. The upgrade of the existing landfills shall consist of the following measures: • Confine the landfill area with at least 2 m high fence to exclude the entrance of animals and unauthorized persons. • Equip the landfill with an entrance gate, ensure the accessible entry and exit of the landfill operating machinery and waste trucks. • At the landfill entrance install signs indicating the municipality served by the landfill and the contact details of the landfill operator. Information signs also shall be placed at appropriate points. The landfill closure measures include: • Before closure, a landfill closure plan shall be developed, specifying required actions and restoration works. • Тop layer of waste should be evenly compacted and covered with soil, the type and thickness of which will be selected considering the remediation plan and further use of the area. 6https://www.arlis.am/documentView.aspx?docid=188312 16 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • To prevent erosion from the slopes of the landfill, it is required to cultivate the closed landfill area with tree and shrub species which will be agreed with the Forestry Committee of the ME. • For landfills serving more than 15,000 residents and disposing more than 10 tons of waste per day, landfill gas collection system shall be installed. The RA Government Decree №2105-N dated 30.11.2023 "On determining procedures for landfill monitoring."7 The Decree regulates procedures for the monitoring of authorized (Annex 1) and non-authorized (Annex 2) landfills. The monitoring is performed by the landfill operators. Annex 1 regulates the procedure of the preparation and implementation of the environmental monitoring program within the area of the authorized municipal waste disposal landfills and their sanitary protection zones as well as relationships connected with the submission of the monitoring results to the Authorized State body (which is the Ministry of Environment). Monitoring of landfills is a set of activities planned and regularly carried out according to the monitoring program that is a part of the environmental impact assessment report. The monitoring shall include visual observations, instrumental measurements, sampling, laboratory tests of soil, atmospheric air, surface and underground water within the landfills and their surroundings. The landfill monitoring shall be carried out: (a) before the landfill construction (to collect baseline environmental data), (b) during the landfill operation, and (c) within at least five years after the landfill closure. The plan for the landfill monitoring shall include: (1) general information relating to the landfill, (2) rationale for selection of environmental components to be monitored, (3) parameters to be monitored, (4) sampling and monitoring points/locations, (5) methodology and frequency of monitoring, (6) landfill monitoring results, (7) sources of information and (8) annexes (layout of the landfill and surroundings, scheme of sampling and monitoring points, etc.). In case of unauthorized landfills (Annex 2), the monitoring should be conducted only during the operation stage and within at least five years after the landfill closure. The following parameters shall be monitored at least twice per year: • Leachate generated from the waste • Contamination of soil by the leachate and waste • Contamination of surface water by the leachate and waste • Air emissions from the landfill For both authorized and non-authorized landfills, landfill monitoring should be carried out annually: • the structure and composition of landfills, area occupied by disposed waste, amount and composition of waste, waste disposal methods, calculation of the landfill's unoccupied capacity, • waste disposal level of the landfill, recorded cases of spontaneous combustion of waste in the landfill, the approximate surface area of the burned area, the approximate amount of burned waste and related pollutions: nitrogen oxides, dioxins and furans. If the results of landfill monitoring show that the negative impact on environment continues, the monitoring period is extended until there is no emission and leakage of harmful substances from the landfill. In case of any negative impact on environment, the operators and managers of the landfill shall immediately inform the Marzpetarans and local self-government bodies, the rescue service of the Ministry 7 Entered into force on January 1, 2024 17 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report of Internal Affairs, the Ministry of Territorial Administration and Infrastructure, the Ministry of Health, the Ministry of Environment, Health and Labor, Environmental Protection and Soil, Urban Planning, Technical and Fire Safety Inspection Bodies. Law on Budgetary System of the Republic of Armenia Article 30 envisages that the mayor, by decision of the municipal council and consent of relevant state authorized body (Ministry of Finance) may sign a loan agreement or issue municipal securities to invest in the social infrastructure of the municipality in accordance with the law. The annual amount of loan repayment - principal and interest payments shall not exceed 20 percent of the capital part of the municipal budget for the corresponding year. Law on Administrative Territorial Division, amendment of 2015 Local government reform led to consolidation of 501 municipalities into 71 municipalities. LG reform is beneficial to waste management, as it allowed for economies of scale in waste collection and management, for consolidation of both financial and human resources for waste management. 2.2 Solid waste management strategy The Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap8, developed by the Ministry of Territorial Administration and Infrastructure, is the main policy document in waste management. The implementation period of the Action Plan (2021-2023) has come to an end and evaluation of the results achieved is still to be conducted. Such an evaluation would inform the next planning period. A new Action Plan is under preparation. The Strategy recognizes the importance of the hierarchy of waste management activities and sets the following priorities: • Establishment of cost-efficient waste collection system in accordance with the best international standards • Establishment of regional waste disposal systems (while the exact number is not identified, it stipulates that the number of regional landfills should be no more than 10) • Establishment of sanitary landfills and closure of all disposal sites that do not meet environmental standards • Use of regional waste management operators, including for waste collection • Modernization or closing of waste chutes in multi-storey buildings • Introduction of separate waste collection schemes for bulky waste • Introduction of source separation system for dry recyclable waste based on polluter-pays principle and introduction of Extended Producer Responsibility (EPR) schemes • Reduction of quantities of biodegradable waste for landfilling • Introduction of source separation of biowaste from residents and commercial sources • Introduction of economic instruments to support the implementation of identified priorities (e.g. introduction of polluter pays principle, increase of environmental tax for landfilling, use of funds accumulated from environmental taxes for stimulating recycling and recovery of waste) • Involvement of private sector in the provision of SWM services • Increase of public awareness and involvement In its scope of ambition, the Strategy actually outlines the establishment of an integrated waste management system in the entire country. The Strategy is also the first policy document to set certain targets for achievement, like the following: • By the end of 2023, waste collection service will be provided to the entire population 8 Approved by RA Government Decision N 464 - L of April 1, 2021 18 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • By 2025, reduction of quantities of waste for landfill by 20% through waste minimization, recycling and recovery • By 2025, 10% of municipal waste will be source separated • By 2025, at least 2 new sanitary landfills (in accordance with EU standards) will be established and 60 dumpsites will be closed and rehabilitated Municipal Solid Waste Management Strategy 2017-2036 The Municipal Solid Waste Management Strategy 2017-2036, approved by the Government in 2016, was the first waste management strategy in the country and primary policy document on waste management until October 2021, when it was repealed along with all other protocol decisions taken by the Government until that date9. This strategy was replaced by the Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap. The Strategy’s main aim was to support the development of modern waste management infrastructure and define the strategic direction for a period of 20 years. It envisaged establishment of five regional landfills, supported by a network of transfer stations for remote areas. The five landfills identified should have been located in: • Yerevan: serving also the Marzes of Figure 1. Delineation of waste management zones Aragatsotn, Armavir, Ararat and Vayots Dzor Source: Municipal Solid Waste Management Strategy • Shirak: serving the Marz of Shirak only • Lori: serving the Marzes of Lori and Tavush • Kotayk: serving Kotayk and Gegharkunik Marzes • Syunik: serving the Marz of Syunik only It envisaged that the regional landfills would be designed and operated in accordance with the EU Directive on the landfill of waste (1999/31/EC)10. Other key provisions of the Strategy included: • Increase of waste collection cover, reaching 100% in urban areas and 70% in rural areas by 2036. • Gradual standardization of the waste collection equipment. • Following the implementation of the new system, all existing disposal sites in Armenia would be closed, if their upgrade was considered infeasible. 9 The RA Government issued Decision 1728-Ն from 21.10.2021 declared all protocol decisions made by the Government of RA before the issuance of Decision 1728 invalid, which included the Municipal Solid Waste Management Strategy 2017-2036 10 Later in the report the term “sanitary” landfill is used, which implies landfill designed and constructed in accordance with the Landfill Directive 1999/31/EC 19 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • Introduction of source separation of dry recyclables in the urban areas, reaching a rate of 11% from the total waste generated in 2036. Establishment of a National Waste Management Authority under the Ministry of Territorial Development, which would oversee and coordinate the implementation of the national waste management system in the country. Solid Waste Management Concepts The SWM Concepts for Shirak, Lori and Syunik waste management zones (WMZ) were approved by protocol decisions of the Government in 2017. However, the RA Government issued Decision 1728-Ն from 21.10.2021, which declared all protocol decisions made by the Government of RA before the issuance of Decision 1728 invalid. Still the section below outlines the main provisions of the concepts as main planning documents for regionalization of waste management system in the country for the period 2017-2021. The SWM Concepts for Shirak, Lori and Syunik WMZ were developed by the Ministry of Territorial Administration and Infrastructure (MTAI). The Concepts were based on the Municipal Solid Waste Management Strategy 2017-2036, approved by the Government in 2016. The purpose of the Concepts, as stipulated, was to establish integrated waste management system, meeting the EU standards, in the respective Marzes, and providing sustainable and cost-effective services to the population. All three regional landfills were expected to meet the requirements of the EU Landfill Directive. Implementation of all three concepts did not envisage a change in the maximum rate of the waste collection fee (400 AMD per person per month, which is 24,590 AMD/ton or 60.6 USD/ton). Although evaluation of the progress made regarding the implementation of the concepts was not done neither before their repeal, nor after that, it can be observed that most of the measures envisaged had not been implemented. A significant number of dumpsites had been closed. Shirak WMZ Shirak WMZ included 3 urban and 76 rural settlements of Shirak Marz. Its population was about 230,000 residents, half of which lived in the City of Gyumri. The Concept for Shirak WMZ envisaged the following waste management measures: Table 2. Concept for Shirak WMZ System component Measures Details Waste collection • At least 95% of the waste generated in • System based on 1.1 m3 containers Shirak Marz will be collected with lids and wheels • City of Gyumri will organize the waste • Optimized waste collection fleet collection of all the settlements of Gyumri city, Amasia, Ashotsk and Akhuryan municipalities • City of Artik will organize the waste collection of entire Artik Municipality • City of Maralik will organize the waste collection of all settlements of Maralik and Ani municipalities Waste disposal • A regional landfill in Benyamin • Identified area of 50 ha (20 ha to be Municipality (located 10 km from used for landfill) Gyumri) • Each cell of 3-year operational life • Constructed in accordance with EU Landfill Directive • Closure of existing disposal sites Transfer stations • No transfer stations envisaged • n/a Source separation • Not in the initial stage • Proposed to be established at later • Separate collection of paper, cardboard, stage with involvement of private plastic bottles and glass in urban areas sector 20 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report System component Measures Details • Rural areas are excluded with the exception of Akhuryan and Azatan villages Syunik WMZ Syunik WMZ included all 8 municipalities of Syunik Marz. Its population was about 140,000 residents. The Concept for Syunik WMZ envisaged the following waste management measures: Table 3. Concept for Syunik WMZ System component Measures Details Waste collection • Waste collection service organised on a • System based on 1.1 m3 containers regional level with lids and wheels • By 2024, 100% cover of urban population • Optimised waste collection fleet • By 2040, 90% cover of villages with population above 1,000 residents • By 2040, 80% cover of villages with population less than 1,000 residents Waste disposal • A regional landfill in Kapan Municipality • Identified area of 20 ha serving all 8 municipalities in the Marz • First cell of 3-year operational life • Constructed in accordance with EU • 20-year operation period Landfill Directive • Closure of existing disposal sites Transfer stations • 2 transfer stations in Goris (serving Sisian • Hook-lift trailers and 30 m3 and Goris municipalities) and Kapan containers envisaged (serving Kapan and Megri municipalities) Source separation • Not in the initial phase • Proposed to be established at later • Separate collection of paper, cardboard, stage with involvement of private plastic bottles and glass in urban areas sector • Rural areas are excluded Lori WMZ Lori WMZ included the entire Lori Marz and Dilijan municipality (included the city of Dilijan and 6 rural settlements) from Tavush Marz. The population of the WMZ was about 230,000 residents. The Concept for Lori WMZ envisaged the following waste management measures: Table 4. Concept for Lori WMZ System component Measures Details Waste collection • Phased expansion of waste collection • Replacement of existing side- service loading fleet with rear-loading • 1st Phase – Vanadzor and surrounding trucks villages, Spitak and surrounding villages, • System based on 1.1 m3 containers Dilijan Municipality with lids and wheels • Waste collection service organised on a • 300 containers in Vanadzor and 50 regional level containers in Spitak • Establishment of inter-municipal company acting as an operator Waste disposal • A regional landfill within the • Identified area of 50 ha (20 ha to be administrative borders of Ghursal and used for landfill) Nor Khachakap municipalities • Total capacity of 1,600,000 m3 • Constructed in accordance with EU • First cell of 7-year operational life Landfill Directive • 20-year operation period • Closure of existing disposal sites Transfer stations • One transfer station near Dilijan • Hook-lift trailers and 35 m3 containers envisaged (without compaction) 21 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report System component Measures Details Source separation • Not envisaged • n/a 2.3 Other policy documents Government Programme and Action Plan 2021-2026 The Government Programme lists improvement of the waste management system in the country as one of the priority directions for environmental management. The Programme also includes several measures for reducing the negative impact of municipal waste on human health and environment, including introduction of source separation of household waste. Other measures in the Action Plan include: • Construction of a sanitary landfill11, closure of 25 disposal sites in 2023 and improvement of the status of the existing disposal sites • Establishment of procedures for supervision and monitoring of landfills Armenia Development Strategy for 2014-2025 12 The only reference to municipal waste management is “application of modern methods for solid waste removal and processing” under environmental priorities. According to the Strategy, the legal framework for waste management has already been established by 2014. Territorial Development Strategy in RA Regions for 2017-2025 Waste management is included in the 3rd Priority for territorial development – “environment protection, energy efficiency and response to climate change”. However, improvement of household solid waste management is included together with improvements in wastewater treatment. Therefore, when the Strategy includes establishment of 10 “Solid Waste and Wastewater Management Systems”, it is not clear how many relate to waste management and what these systems include. The only clear reference is to implementation of the Solid Waste Management Program in Kotayk and Gegharkunik Marzes. 2.4 Comprehensive and Enhanced Partnership Agreement In November 2017, a Comprehensive and Enhanced Partnership Agreement (CEPA) was signed between the European Union (EU) and the Republic of Armenia (RA). The CEPA entered into force on 1 March 2021. The Agreement provides a framework for the EU and Armenia to work together in a wide range of areas, including environment and waste management. Regarding the latter one, the table below presents the commitments that the Republic of Armenia undertakes to gradually approximate its legislation to the respective legislation of the EU within agreed timeframes. Table 5. Waste management provisions of CEPA EU legislation Approximation area Timeframe* Directive 2008/98/EC Adoption of national legislation and designation of competent 4 years on waste authority/ies Preparation of waste management plans in line with the five-step waste hierarchy and of waste prevention programmes 11 Not named, but assumed to be Hrazdan landfill 12 Approved by RA Government Decree # 442 - N on 27 March, 2014 22 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report EU legislation Approximation area Timeframe* Establishment of a permitting system for establishments/undertakings carrying out disposal or recovery operations, with specific obligations for the management of hazardous wastes Establishment of a register of waste collection and transport establishments and undertakings Establishment of full cost recovery mechanism in accordance with the 6 years polluter pays principle and extended producer responsibility principle Directive 1999/31/ЕС Adoption of national legislation and designation of competent 3 years on the landfill of waste authority/ies Classification of landfill sites Preparation of a national strategy reducing the amount of biodegradable municipal waste going to landfill Establishment of an application and permit system and of waste acceptance procedures Establishment of control and monitoring procedures in the operation phase of landfills and of closure and after-care procedures for landfills to be disaffected Establishment of a costing mechanism Establishment of conditioning plans for existing landfill sites 6 years Ensuring the relevant waste is subject to treatment before landfilling *Note: following the entry into force of CEPA In addition, CEPA envisages certain approximation measures related to environmental governance, like: establishment of rules and procedures aimed at preventing and remedying damage to the environment based on the polluter-pays principle. The Road Map and Action Plan for CEPA implementation, adopted in 2019 13 under Chapter 5 “Environment” contains requirements to approximate the national legislation and regulations with the following EU Acquis: • Directive 2008/98/EC of the European Parliament and of the Council of 19 November 2008 on waste and repealing certain Directives, • Council Directive 1999/31/EC of 26 April 1999 on the landfill of waste Regarding the establishment of full cost recovery mechanism in accordance with the polluter pays principle and extended producer responsibility principle, Article 14 of Directive 2008/98/EC envisages that until 2027: “1. In accordance with the polluter-pays principle, the costs of waste management, including for the necessary infrastructure and its operation, shall be borne by the original waste producer or by the current or previous waste holders. 2. Without prejudice to Articles 8 (Extended producer responsibility) and 8a (General minimum requirements for extended producer responsibility schemes), states may decide that the costs of waste management are to be borne partly or wholly by the producer of the product from which the waste came and that the distributors of such product may share these costs”. 13 Decision N 666-L 23 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Regarding the establishment of full cost recovery of landfill costs , Article 10 of Council Directive 1999/31/EC, envisages that until 2024: “States take measures to ensure that all of the costs involved in the setting up and operation of a landfill site, including as far as possible the cost of the financial security or its equivalent referred to in Article 8(a)(iv) 14 the estimated costs of the closure and after-care of the site for a period of at least 30 years to be covered by the price to be charged by the operator for the disposal of any type of waste”. 3. Institutional and organisational framework 3.1 Institutional framework 3.1.1 Institutional responsibilities at national level In Armenia, the roles and responsibilities with regard to waste management are divided among the following institutions: Government of RA According to the Law on Waste, the Government of RA is responsible for: • Development of state policy Iin the field of waste management and ensuring its implementation • Coordination of the activities of all other state institutions in respect to waste In Bulgaria, the policy making and planning functions are vested in the Ministry of Environment and Waters. management The Ministry sets the overall strategic direction of the • Setting up economic instruments for sector, develops legislative framework, and prepares a introduction of low-waste technologies and national waste management plan. Municipalities then waste utilization have to transpose the requirements of the national plan • Ensuring establishment of waste disposal into their municipal waste management plans. facilities for treated and non-recyclable Municipalities have access to national financing only for waste those measure which correspond to the measures • Setting rules for landfill monitoring 15 outlined in the national plan. According to the Law on Waste Collection and Sanitary Cleaning, the Government of RA is also responsible for: • Elaboration and coordination over implementation of the public policy in relation to waste collection and sanitary cleaning. • Introduction of modern waste collection technologies, as well as technologies for sorting, transportation, storage, safe disposal, aimed at waste minimization. • Defines an authorized public authority for management of waste collection and sanitary cleaning sphere16. • Approves the regional schemes for waste collection and sanitary cleaning. • Approves the norms for operation, rehabilitation and closure of the existing/operational dumpsites 17. 14 Art. 8(a)(iv) adequate provisions, by way of a financial security or any other equivalent, on the basis of modalities to be decided by the state, has been or will be made by the applicant prior to the commencement of disposal operations to ensure that the obligations (including after-care provisions) arising under the permit issued under the provisions of this Directive are discharged and that the closure procedures required by Article 13 are followed. This security or its equivalent shall be kept as long as required by maintenance and after-care operation of the site in accordance with Article 13(d). 15 Adopted with RA Government Decision No 2105-N dated 30.11.2023 16 The Ministry of Territorial Development and Infrastructures through the Department of Support to Regional (Capital) Programs and Solid Waste Management. 17 Adopted through RA Government Decision No 27-N dated 04.01.2024 24 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Ministry of Environment (ME) The Law on Waste makes the ME responsible for: • Participation in the development of public policy in the field of waste management. • Development of targeted programs in the field of waste management. • State registration of waste 18. • Granting consent on the locations of waste disposal facilities. • Development of legal acts regulating the field of waste management. • Approval of waste disposal limits for legal entities and sole traders. • Development of lists of hazardous and prohibited wastes. • Development of list of waste classified according to their hazardous characteristics. • Drafting recommendations on granting permits for transboundary movement of hazardous waste. • Approval on waste passports developed by waste generators. • Establishment of database of waste generation. • Implementation of environmental impact assessments of plans for construction, reconstruction and operation of landfills and waste management facilities. • Management of state cadaster of waste. • Exchange of information on low-waste and zero-waste technologies with other departments. • Management of database on waste generation, processing and disposal facilities and disposal sites, and monitoring. • Conclusion of international agreements on international cooperation in the field of waste management and transboundary transportation of waste. • Exchange of information in the field of waste management with international organizations and foreign states. Thus, the Ministry of Environment is in charge for registering, classification and certification/passporting of waste pursuant to waste statistics submitted by legal entities engaged in waste management. The Ministry of Environment is also in charge of maintaining waste cadaster, which includes the following data: • Register of waste generation, treatment, recovery and disposal sites/facilities19 • Database of waste reuse and treatment technologies The waste disposal sites are subject of regular monitoring to identify potential negative impacts and to elaborate respective preventive measures. The monitoring is carried out by the Centre of Hydrometeorology and Monitoring under the Ministry of Environment20. Ministry of Territorial Administration and Infrastructure (MTAI) Municipal solid waste management is clearly in the domain of the MTAI. The MTAI is also the main coordinator of the work of the Marzpetarans 21 regarding the implementation of national sectoral policies (including waste management policy) in the Marzes. 18 The regulations in respect to registration of waste are set through RA Government Decision 07.12.2006 dated No 1739-N 19 The registers are available at the web site of the Ministry of Environment through http://www.mnp.am/shrjaka- mijavayr/kadastr-reestrner 20 The summary of landfill monitoring is available at http://www.armmonitoring.am/page/860 21 Regional/provincial administrations 25 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report According to the Law on Waste Collection and Sanitary Cleaning, the Ministry is responsible for: • Participation in the development of state policy in the field of waste collection and sanitation. • Development of targeted regional programs in the field of waste collection and sanitary cleaning. • Development and coordination of programs aimed at improving waste collection services. • Development of legal acts regulating the field of waste collection and sanitary cleaning. • Approval of norms and procedures for the design, construction, operation of landfills and transfer stations, procedures for collecting, transporting, storing, and removing different types of waste, charters of organizations involved in waste collection and transportation, methodological guidelines for waste collection and sanitary cleaning. • Coordination of the elimination of disposal sites that do not comply with environmental and urban planning standards. • Participation in international cooperation in the field of municipal waste management. The unit within the MTAI in charge for waste management policies/programs/regulations is Department of Support to Regional Programs and Solid Waste Management. Comment The Government of RA assigns to itself the primary role of policy maker, while the ME and the MTAI participate in the development of the national policy. The Law on Waste assigns the ME with the responsibility to develop “targeted programs in the field of waste management”, but it is not clear to what kind of programs the Law refers to, which makes the role of the ME in policy making a bit unclear. At the same time, the national waste management strategy was developed by the MTAI. Environmental Protection and Mining Inspection Body (EPMIB) The enforcement of waste management in terms of regulations set by the Law on Waste are assigned to the EPMIB, which is structured under the Government of RA. Namely, the Inspectorate exercises the following functions: • ensuring compliance with the requirements set for the export of hazardous substances and waste from the Republic of Armenia, import into the Republic of Armenia and transit through the territory of the Republic of Armenia • implementation of normative requirements for waste generation and disposal regulations • implementation of requirements for waste registration and registry management procedure Ministry of Economy (MoE) MoE is responsible for the overall economic policy and investments in the waste management sector. Within its powers is also the establishment of public private partnerships. The MoE is also the regulator on import and export of waste. Ministry of Health (MH) The MH develops the governmental policy on public health and safety, including sanitary and hygiene norms and regulations. As per the Law on Waste the MH has the following empowerments within waste management domain: • Development of public health and safety requirements and regulations in relation to waste management (including sanitary and hygiene), • Giving non-objection to locations of waste disposal sites, • Defining sanitary and hygienic requirements for waste derived products and providing a health certificate. The enforcement of public health and safety regulations at waste management facilities is done by the Health and Labour Inspectorate under the RoA Government. 26 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 3.1.2 Institutional responsibilities at regional level Administratively, Armenia is divided into 10 provinces, or Marzes22. Each Marz is headed by a governor, appointed by the Government. The regional administrations, or Marzpetarans, are thus the secondary tier of central government authority. From one side, Marzpetaran is acting as an implementer of state policies in the region. From other side it coordinates the activities of municipalities regarding waste management. Two very important roles of Marzpetaran stipulated by the Law on Waste are related to: (i) selection of disposal sites and processing all necessary documentation and subsequently issuing permits (upon agreement from the competent state body) on the selected site within its administrative competency; and (ii) organization of waste treatment and recycling within the Marz territory. Other important roles and responsibilities regarding waste management include: • Participation in the development of state policy and state programmes in the field of waste management. • Promotion and development of regional development strategies, including in the field of waste management. • Development of sanitary cleaning schemes within their administrative territory and exercising control over waste collection. • Establishment and management of registers of waste generation, treatment, recovery and disposal facilities. • Elimination of uncontrolled and unlicensed landfills within their administrative territory. • Organization of public participation in source separation of recyclable waste. The Marzpetarans are responsible for administrative enforcement of competencies/powers of the Mayor23 (including those stipulated by the Law on Waste collection and sanitary cleaning). 3.1.3 Institutional responsibilities at local level In accordance with the Law on Waste, the Mayor is responsible for: • Control over waste collection • Development of sanitary cleaning schemes on territory of his municipality • Elimination of uncontrolled and unlicensed disposal sites • Organization of public participation in source separation of recyclable waste • Support to the introduction of sorting of municipal waste Besides municipalities are responsible for setting up fees for waste collection. In addition, municipalities are in charge for development of annual waste collection and sanitary cleaning management plans (annex to municipal development plans). 3.2 Other institutional arrangements 3.2.1 Monitoring and enforcement Although the Ministry of Environment is the authorized body to exercise control over waste management activities, in reality the Ministry (through the Centre of Hydrometeorology and Monitoring) only conducts 22 Yerevan, as the capital city, has a special administrative status. 23 Pursuant Article 96 of the Law on Self-Government 27 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report monitoring over the environmental components (soil, air, etc.). Monitoring of waste disposal sites is conducted only in relation to the impact of waste on the environmental components (soil degradation, water contamination, air emissions). Actual monitoring of waste disposal activities is conducted by the EPMIB. Provision of waste collection service by municipalities is monitored by the Environmental Protection and Mining Inspection Body (EPMIB), the Ministry of Territorial Administration and Infrastructure, or through the Provincial Governors. The use of municipal budget for waste collection is monitored by the Audit Chamber24. EPMIB is the institution which can apply sanctions in the field of waste management (only in terms of environmental violations). Enforcement of preventing waste dumping, however, is impossible to apply considering the lack of sanitary landfills in the country. The table below shows the number of waste management related violations for the period 2015-2019. The violations are not entirely related to municipal waste but include also industrial waste management. Table 6. Number of waste management violations and amount of imposed fines 2015 2016 2017 2018 2019 Waste violations, number 5 31 19 3 9 Imposed fines, AMD 76,000 50,000 62,700 50,000 75,700 Imposed fines, USD 188 124 155 124 187 Source: Statistical Committee of the RA 3.2.2 Reporting and data management The Ministry of Environment is the national authority responsible for maintaining waste management registers. The Ministry is obliged to maintain two main registers: on (i) waste disposal sites, and (ii) waste generation, treatment, and recovery facilities. Regular reporting is not required. The Government Decrees No 500-N and 1180-N oblige legal entities and private entrepreneurs to submit reports to the ME by 1 March only if there were corrections to the initially submitted report. The only requirement for annual reporting is stipulated by Ministerial Order No 112-N (2002) of the ME. However, the Order is binding only for legal entities and private entrepreneurs that are generators of hazardous waste and/or carrying out waste disposal. Reporting on waste generation is conducted yearly by municipalities, which report to the Statistical Committee of the RA. However, estimates on waste quantities are usually based on number of runs of collection trucks, irrespective of the load they carry. Costs incurred and revenues collected by municipalities are reported to the Marzpetarans, but not to the National Statistical Committee. 3.2.3 Licensing and permitting As mentioned in section 2.1, municipal waste collection operators are subject to licensing and waste disposal sites are subject to permitting. In reality, however, only 2 companies in the country are licensed for waste disposal and 4 companies are licensed for waste collection and transport. Out of 297 disposal sites, only 3 sites are permitted as waste disposal sites. Licenses and permits are issued by the Ministry of Environment. 24 Pursuant Article 95 of the Law on Self-Government 28 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Although control over waste operations is exercised by the EPMIB, the lack of licenses of waste collection operators is a matter which is brought to the attention of the State Revenue Committee. As mentioned in section 3.2.1, EPMIB could impose sanctions only in terms of environmental violations. When it comes to licensing, another peculiarity stemming from the legal framework is that operators dealing with source separated recyclable fractions are not obliged to be licensed due to the fact that fractions like plastics, glass, paper are not hazardous and not subject to licensing respectively. 3.2.4 Environmental financing Environmental Protection Fund is established within the ME. However, the Fund is established only for the purposes of mineral extraction industry. The levied environmental taxes for waste disposal go to the national budget. Municipal waste management is a subsidized activity, where direct subsidies are provided by the municipalities (the waste management costs allocated in municipal budgets are much higher than the revenues from waste fees). Municipal waste management services are also indirectly financed by the government, through subsidies provided from the state budget to the municipal budgets. Section 6.2 provides an overview of the current financing of the waste sector. 3.2.5 Capacity strengthening mechanisms There is no SWM Association established in Armenia or any other professional body, which could provide capacity building trainings to municipalities. In light of the new developments of the legal framework and technical guidelines (particularly guidelines for development of local waste management plans), there is a clear need for providing training to municipalities, which is acknowledged by the MTAI. However, the MTAI lacks human resources for providing such trainings and would rely on technical assistance for this. 3.3 Institutional functions for municipal solid waste management The table below presents the distribution of institutional functions for municipal solid waste management in Armenia. Table 7. Institutional functions for municipal solid waste management Function Institution/organization Supplementary comments Policy maker The Government of RA Ministry of Territorial Administration and Infrastructure, Ministry of Environment, and Marzpetarans participate in the policy making. The Government coordinates the activities of all institutions in respect to waste management policy in general and municipal solid waste management in particular. Planner MTAI (general) MTAI prepares national plans/strategies for municipal solid waste management. ME is ME (data management) consulted in the waste sector planning. Municipalities (waste collection) ME collects data and maintains waste related Marzpetarans registers. Regular reporting is, however, not required. 29 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Function Institution/organization Supplementary comments Marzpetarans are supposed to prepare regional municipal solid waste management plans; in reality it is done by MTAI. Municipalities prepare municipal waste management plans and annual plans for waste collection and sanitary cleaning. Regulator Technical MTAI (municipal solid waste MTAI approves norms and procedures for the management regulations and design, construction, operation of landfills and standards) transfer stations, procedures for collecting, transporting, storing and removing different types of waste, operating conditions for organizations involved in waste collection and transportation, methodical guidelines in the field of waste collection and sanitation. Environmental Environmental Protection and EPMIB exercise overall supervision and control Mining Inspection Body over waste management activities. However, it cannot enforce licensing regime for all waste Ministry of Health (public health operators. Lack of licensing is brought to the regulation in terms of WM) attention of the State Revenue Committee. MTAI MTAI and Marzpetarans exercise control over Marzpetarans waste collection. Centre of Hydrometeorology and Monitoring (within the ME) monitors the impact of waste disposal on environmental components. Financial Government, Municipalities The Government regulates the maximum tariff thresholds for households and commercial entities. The municipalities set fees for municipal waste management services within the defined thresholds. Client/Employer Collection Municipalities Municipalities clearly mandated as the client authority for municipal waste collection. Recovery Not assigned Responsibilities for recovery of waste are not explicitly assigned. Disposal Municipalities, private sector Sometimes disposal sites are owned by private entities/persons. Revenue Collector Municipalities, private operators Different systems functioning, those that rely on the municipality to collect revenue, and those that rely on private operators. Operator Collection Municipalities, Private sector Different operators, with the dominant proportion of services carried out by municipal departments, municipality-owned enterprises, and in some cases private operators. Recovery Informal sector, private sector Limited number of operating entities, significant reliance on the informal sector. 30 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Function Institution/organization Supplementary comments Private sector engaged in treatment. Disposal Municipal Enterprises, Private Functionally split between municipalities and sector, Inter-municipal companies private operators. Inter-municipal company will be in charge of waste disposal in Kotayk-Gegharkunik regional waste management system. Change Agent International development Multiple international partners have partners contributed significantly to development of the waste management systems in Armenia. Several conclusions can be drawn from the table above. Waste management policy making is a function assigned to several authorities – the Government, ME, MTAI and Marzpetarans. Although the LoW assigns the Ministry of Environment as the state authorized body in the field of waste management, the primary planning authority in reality is the Ministry of Territorial Administration and Infrastructure. Designating a single institution responsible for waste management would eliminate unclarities and overlaps in terms of responsibilities and would help ensure transparency and accountability. Although the environmental regulator role is clearly assigned to the Environmental Protection and Mining Inspection Body, the latter one is limited to imposing sanction only for environmental violations. EPMIB cannot enforce licensing regime for all waste operators. Certain waste management functions are currently not fulfilled by any institution. Technical regulator function for waste recovery services and facilities is currently missing. Also, responsibilities (client function) for recovery of waste are not explicitly assigned. In tandem with the existing situation with regard to institutional roles and responsibilities as summarized above, a fundamental aspect of sector governance that would need further consideration is to strengthen accountability and ensure that the right incentives are put in place. This would help to close the gap between what is established in the legal and regulatory framework for the solid waste sector, as well as in relevant sectoral strategies and plans, and the realization of actual changes on the ground with improved solid waste infrastructure, operations and service delivery. The success of planned interventions would not be realistic or sustainable without strong enforcement. 4. Relevant initiatives and studies 4.1 Feasibility studies and concepts Yerevan Solid Waste Management Project 25 The project is funded by the European Bank for Reconstruction and Development (EBRD). The project was approved in 2016. The feasibility study envisages construction of a new sanitary landfill on an area of area of 29 hectares adjacent to the existing landfill of Nubarashen. Part of the measures include also closing of the existing disposal sites of Nubarashen and Ajapnyak, and acquisition of landfill equipment. The capacity of the new landfill is designed for 8.8 million m3 of waste, with estimated lifetime of about 28 years of operation. The overall investment project is estimated to cost EUR 26 million. It will comprise of a loan of EUR 8 million from the European Investment Bank, EUR 8 million loan from EBRD, grant from the EU Neighbourhood 25 https://sudipyerevan.am/en/waste-management/ 31 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Investment Facility in the amount of EUR 8 million to support priority investments in solid waste management, and EUR 2 million grant from Eastern European Energy Efficiency and Environment Partnership. Tender procedures for construction were announced over the last few years, but these turned out to be unsuccessful. It is not entirely clear when the next tender will be announced. Kotayk Solid Waste Management Project The project was financed by the EBRD. The project covers 12 municipalities (and adjacent rural settlements) from two Marzes – Kotayk and Gegharkunik. The project envisaged construction of a sanitary landfill in accordance with the EU Landfill Directive near the town of Hrazdan, construction of 2 transfer stations, and upgrade of the waste collection system. A municipality-owned company will be established (‘Kotayk and Gegharkunik Municipal Solid Waste Management’ LTD), which will become a landfill operator, and potentially will tender waste collection services to private operators. The total budget of the project is EUR 11 million, of which EUR 5.5 million is a loan from EBRD and EUR 5.5 million is a grant from the EU Neighbourhood Investment Facility. The investment component of the project was finalized in 2023. Corporate development of the publicly owned company is forthcoming. Vanadzor solid waste management project Feasibility Study for Integrated Solid Waste Management Vanadzor, Armenia was financed by KfW and implemented within the framework of the Armenian - German Financial Co-operation. The project was implemented between 2012 and 2015. The project area was extended to cover municipalities from the southern zone of Lori Marz with overall population of about 130,000 residents and estimated waste generation of 34,000 tonnes per year. The project identified a site for future regional landfill (envisaged to be constructed in accordance with the Landfill Directive). It also included measures for upgrade of the waste collection system. The feasibility study was not followed up by an investment project. Solid Waste Management Solutions for Remote and Small Communities 26 The project was financed by the Asian Development Bank. The aim was to develop solutions for low-cost, environmentally sound solid waste management in small and remote municipalities, which can serve as a basis for future investment. Syunik Marz was selected as the project area. The main outcome was a comprehensive SWM concept for the Marz. The concept included selection of a site for a regional landfill and a transfer station in Goris. A system for source separation was also proposed for urban areas. The technical assistance was not followed up by an investment project. Feasibility Study for Solid Waste Management Improvement in Shirak27 The study was financed by the Asian Development Bank. It was prepared in 2016. The aim was to develop an integrated waste management system for Shirak Marz. A site for sanitary regional landfill was identified. The feasibility study also included: assessment of needed number of collection vehicles, containers and transfer stations during a 20-years planning period; detailed route planning and design of improved waste collection and transportation systems; detailed design for a new regional landfill. The feasibility study was not followed up by an investment project. 4.2 EPR development Currently, there are no policy documents or legal provisions that address EPR in the country. As mentioned in section 2.4, CEPA includes a commitment to establish full cost recovery mechanism based on Polluter Pays and EPR principles. The Ministry of Environment is the responsible body to develop EPR legislation and ensure timely implementation of a working EPR system. 26 https://www.adb.org/sites/default/files/project-documents/48201/482015-001-tcr-en.pdf 27 https://www.adb.org/sites/default/files/project-documents/45398/45398-003-tcr-en.pdf 32 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Regarding EPR, ME is supported by the ‘Waste Policy Armenia’ Program of the Swedish International Development Cooperation Agency (SIDA), implemented by Acopian Center for the Environment at the American University in Armenia (ACE/AUA). At present, legislation on EPR is being drafted. Since EPR would be regulated by a separate law, amendments to the framework Law on Waste and other primary legislative acts are being prepared too. Provisionally, it is expected that the Law on EPR and the respective other legal provisions will be finalized by the end of 2024. EPR schemes are expected to cover the following six waste categories: • Packaging waste • Waste tires • Waste oils (including used air and oil filters) • Waste batteries and accumulators • Waste from electric and electronic equipment (WEEE) • End-of-life vehicles In terms of obligations, producers of specific waste streams would be able to choose between individual fulfilment of obligations and establishment of producer responsibility organizations (PRO). In terms of number of PROs, the preferred approach envisages establishing one PRO for each special waste category. The draft law on EPR does not envisage targets. Instead, it is expected that targets for the specific waste streams could be defined in the ensuing secondary legislation. 4.3 Other initiatives and projects Other relevant waste projects of the ACE/AUA include: • Waste Handling Mapping in Armenia28. The project is implemented in partnership with the MTAI and aims at developing a registry of existing dumpsites with their characteristics. • Guidelines for Transitional Landfills in Armenia29. The project aimed at improving the management of waste dumps and introducing minimum standards for new controlled disposal sites that may need to be established if existing dumpsites are closed but new sanitary landfills are not available yet. The project played considerable role for the adoption of RA Government Decision №27-N "On approval of the minimum standards for the operation, remediation and closure of existing and acting landfills on the territory of the Republic of Armenia". • Guidelines for Local Municipal Waste Management Planning30. The project aimed at establishing sustainable planning of solid waste management in municipalities in accordance with national policy and strategy goals. The project played a significant role in supporting the Government to adopt guidelines for developing local waste management plans. An EU-funded ‘Alliance for Better City Governance’ Project supports the municipalities of Gyumri and Vanadzor in establishing plastic recycling systems. Both cities are equipped with containers for source separation of plastics and will be supplied with recycling equipment for production of construction materials for improvement of public spaces. The EU-funded project ‘Capital Cities Collaborating on Common Challenges in Hazardous Waste Management - Yerevan, Warsaw, Tirana’ supports Yerevan Municipality in expanding its source separation initiative. With support from the project, the source separation points in Yerevan were increased to 300 in early 2024. 28 https://ace.aua.am/projects/waste-handling-mapping-in-armenia/ 29 https://ace.aua.am/projects/guidelines-for-transitional-landfills-in-armenia/ 30 https://ace.aua.am/projects/guidelines-for-local-municipal-waste-management-planning/ 33 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 5. Waste management baseline 5.1 Current municipal waste generation Municipalities report annually to the Statistical Committee of RA about the waste disposed at municipal disposal sites. Reports are based on number of runs of waste collection trucks. Municipal waste in Armenia is not weighed. The table below shows the data of disposed waste by Marzes for the period 2020-2022. Table 8. Municipal solid waste disposed at municipal disposal sites in 2020-2022, tonne Marz 2020 2021 2022 Yerevan 413,750 318,175 347,300 Aragatsotn 3,497 3,372 13,213 Ararat 8,364 7,719 15,755 Armavir 17,354 17,486 49,082 Gegharkuniq 17,139 18,631 6,698 Lori 18,035 24,237 40,424 Kotayk 41,991 39,216 5,530 Shirak 14,487 19,600 20,953 Syuniq 16,225 14,025 30,201 Vayots Dzor 8,629 9 405 2,198 Tavush 13,756 15 516 1,342 Total 573,228 487,384 532,698 Source: Statistical Committee of RA According to the Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap, in 2019, 472,800 tons of municipal solid waste were disposed to municipal dumpsites. However, the Strategy recognizes that not all municipal waste was collected and not all municipal waste was disposed on designated disposal sites. Based on the existing population in 2019 and the assumed waste generation rates (0.9 kg/cap/y in Yerevan, 0.6 kg/cap/y in urban areas and 0.4 kg/cap/y in rural areas), the Strategy concluded that the total municipal waste generated was close to 690,000 tonnes per annum. The table below presents the assumed quantities of waste generated in the Marzes and the city of Yerevan. Table 9. Estimated municipal waste generation, 2019 Marz and Yerevan City Daily amount of Annual amount of generated waste, kg waste, tonne Aragatsotn* 117,060 20,163 Ararat* 122,000 42,727 Armavir* 104,400 44,530 Gegharkunik 104,400 38,106 Lori 110,540 40,347 Kotayk 127,720 46,618 Shirak 119,680 43,683 Syunik 73,560 26,849 Vayots Dzor 22,820 8,329 Tavush 58,880 21,491 Yerevan 975,600 356,094 Total 1,936,660 688,938 Note: *annual amounts are calculated on different basis (not on 365 days) Source: Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap 34 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report In 2019, the Waste Quantity and Composition Study 31 did a review of previous studies and comparison with countries with similar economic development. As a result, the study used the following assumptions on waste generation rates to establish the quantities of generated municipal waste: • Yerevan city: 300 kg/cap/year • Average for all Marzes: 220 kg/cap/year Applying these rates to the population in 2019, the study concluded that the total municipal waste amounted to slightly less than 740,000 tonnes. In 2012, a week-long quantity measurement survey was conducted within the framework “Feasibility Study for Integrated Solid Waste Management Vanadzor, Armenia” Project. All waste collection trucks in Vanadzor were weighed for a week to establish the waste generation rate. It was established that the municipal waste generation rate for the city of Vanadzor was 0.73 kg/cap/year, corresponding to 267 kg/cap/year. The same project established that the commercial sector in Vanadzor contributes 18% to the total municipal waste generation. Within the framework of Advisory Study on the Municipal Solid Waste Management in Yerevan32 the consultants estimated that 24% of the municipal waste was attributed to the commercial and institutional sectors. No other studies have analyzed the percentage of commercial waste from the total waste generated in the country. 5.2 Waste composition Several municipal waste composition surveys were conducted in Armenia over the years. All surveys used different methodologies, which makes the comparison of their results difficult. Below are presented the results from these surveys. Waste Quantity and Composition Study in the Republic of Armenia 33 The survey took place between May and September 2019. In total, 15 samples were taken – 3 in Yerevan, 2 in Ararat, 3 in Hrazdan, 3 in Gyumri, 2 in Kapan, and 2 in Vanadzor. The methodology included sorting of municipal solid waste into 22 waste fractions. The average results per settlement are presented in the table below. Table 10. Waste composition results, 2019 Waste type Yerevan Ararat Hrazdan Gyumri Kapan Vanadzor Kitchen waste 34.3% 30.8% 51.4% 53.3% 61.0% 46.3% Garden waste 13.1% 12.9% 8.9% 5.4% 3.5% 14.9% Other biodegradable 2.8% 0.6% 0.7% 0.3% 0.8% 0.2% Newspaper and print 1.0% 0.8% 0.4% 0.6% 0.5% 1.4% Corrugated cardboard 4.3% 3.7% 1.8% 2.1% 1.7% 1.1% Paper packages 2.4% 2.3% 1.4% 1.4% 1.5% 0.7% Other paper 1.2% 0.4% 0.8% 0.8% 0.3% 0.5% Soft plastic packaging 12.3% 11.3% 7.7% 8.3% 7.9% 5.6% Styrofoam 0.2% 0.1% 0.2% 0.1% 0.0% 0.1% Dense plastics 3.6% 4.2% 2.0% 1.5% 2.9% 1.1% 31 LL Bolagen. (2020). The Republic of Armenia Waste Quantity and Composition Study. Yerevan: AUA Acopian Center for the Environment and AUA Manoogian-Simone Research Fund, American University of Armenia. 32 Advisory Study on the Development of the Solid Waste Management System in the City of Yerevan through Private Sector Participation, the World Bank, 2008 33 LL Bolagen. (2020). 35 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Waste type Yerevan Ararat Hrazdan Gyumri Kapan Vanadzor Other plastics 1.2% 1.5% 1.3% 0.9% 1.1% 0.8% Glass packaging 4.9% 2.5% 3.0% 2.6% 5.0% 1.8% Other glass 0.6% 0.4% 0.9% 0.2% 0.7% 0.3% Metal packaging 0.6% 0.8% 0.5% 0.7% 0.6% 0.2% Other metals 1.9% 1.9% 0.8% 0.8% 0.5% 1.0% All other inorganics 4.3% 4.7% 4.9% 7.1% 2.9% 9.5% Hazardous waste 0.4% 1.5% 1.2% 0.3% 0.7% 0.4% WEEE items 0.2% 0.6% 0.3% 0.3% 0.2% 0.2% Wood 0.5% 0.8% 0.4% 0.4% 0.2% 0.3% Textiles 5.6% 11.5% 5.6% 8.6% 3.7% 10.0% Sanitary 2.6% 4.1% 4.3% 3.0% 2.7% 2.1% Other 2.2% 2.9% 1.4% 1.3% 1.4% 1.6% Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Qualitative Analysis of Municipal Solid Waste in Armenia, Croatia, Cyprus, F.Y.R.O.M. and Ukraine – Methodology and Results (2016) The survey consisted of taking 9 samples from different residential areas in the capital city of Yerevan. The samples were taken between 24-28 November 2015. The average results for Yerevan are presented in the table below. Table 11. Waste composition results in Yerevan, 2016 Waste category Mass share Biodegradables (garden and kitchen) 57.0% Paper 2.7% Carton 4.0% Tetrapak 0.3% Glass 3.2% PET 2.1% PE film 5.1% Other Plastics (PS, PP, PVC, HDPE) 4.2% Ferrous Material 3.2% Aluminum 0.3% Textile 2.7% Leather - Elastic 0.3% Wood 0.6% Diapers/ Sanitary 4.4% Fine materials <10mm 5.8% Inert 4.0% Total: 100% Baseline-study for Recycling of Household Solid Waste in Armenia (2009-2011)34 The survey was conducted between October 2009 and March 2011. This study included 4-season surveys, covering five different types of settlements: • Large settlement: Vanadzor (above 100 thousand) 34 Project, funded by the Federal Environmental Agency of Germany 36 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • Middle-size settlement: Echmiadzin (above 50 thousand) • Smaller middle-size town: Sevan (around 20 thousand) • Small-size town: Talin (less than 10 thousand) • Village: Mkhchyan (5,100) The average results are presented in the table below. Table 12. Waste composition survey, 2009-2011 Waste type Vanadzor Sevan Echmiadzin Talin Mkchyan Organic waste 27% 32% 39% 29% 14% Paper and cardboard 10% 5% 6% 9% 2% Plastics 17% 9% 10% 13% 4% Glass 6% 7% 9% 7% 8% Metal 4% 4% 4% 5% 6% Textile 4% 5% 5% 4% 2% Leather/rubber 2% 3% 4% 3% 2% Inert waste 8% 11% 6% 7% 15% Other waste 10% 6% 6% 9% 6% Middle grain 8% 13% 8% 10% 15% Fine waste 4% 5% 3% 4% 26% Total 100% 100% 100% 100% 100% It is the most representative survey conducted in the country, covering 4 seasons in 5 different types of settlements. However, the survey was conducted within the framework of a project analyzing the recycling potential in Armenia. Samples were limited to only 9 waste fractions. Sampling of municipal waste included also sieving of the waste to fractions < 10 mm and fractions > 10 mm and < 40 mm. As seen from the table above, this led to considerable percentage of waste not categorized by its type, but by its size. The Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap provides the following range/assessment of the waste composition in the country. Table 13. Estimated range of waste composition Waste type Range, % biodegradable (organic) 30-60 paper, cardboard 5-12 plastics 7-20 metal 1-4 glass 3-6 leather/rubber 1-4 textile 2-6 Source: Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap 5.3 Waste forecast 5.3.1 Population forecast 5.3.1.1 Population The table below presents the population dynamics of Yerevan City and the 10 Marzes of the country. Table 14. Population of Armenia, 2012-2023 37 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Marz 2012 2016 2020 2023 Yerevan city 1,061,000 1,073,700 1,084,000 1,098,900 Aragatsotn 133,000 129,800 124,700 125,700 Ararat 260,700 258,900 256,600 259,300 Armavir 266,200 266,600 263,800 266,600 Gegharkunik 235,400 231,800 227,700 228,700 Lori 235,600 225,000 213,300 211,500 Kotayk 254,600 253,900 250,900 253,800 Shirak 252,100 243,200 231,400 230,500 Syunik 141,800 139,400 137,300 134,600 Vayots Dzor 52,400 50,800 48,500 47,700 Tavush 128,600 125,500 121,500 119,800 Total 3,021,400 2,998,600 2,959,700 2,977,100 Source: Statistical Committee of RA For the period 2012-2023, the population of Armenia marked a decrease of 1.5%. The only settlement which witnessed increase of population is the capital city of Yerevan, with an increase of 3.5%. In terms of urban and rural population, the tendency remained fairly constant – with urban population being 63.8% and rural population being 36.2% of the total population. 5.3.1.2 Population forecast The population forecast is developed based on the tendency established for each Marz (and Yerevan City) for the period of 2012-2023. These dynamics are used to make a projection of the population for the next 20- year period. The table below shows the population forecast for the period of 2024-2043. Table 15. Population forecast, 2024-2043 Marz 2024 2030 2035 2043 Yerevan city 1,102,119 1,111,832 1,121,630 1,134,830 Aragatsotn 125,110 123,357 121,628 119,361 Ararat 259,184 258,835 258,487 258,023 Armavir 266,633 266,733 266,834 266,967 Gegharkunik 228,150 226,509 224,880 222,726 Lori 209,607 204,028 198,597 191,580 Kotayk 253,733 253,534 253,334 253,069 Shirak 228,786 223,719 218,765 212,330 Syunik 134,017 132,282 130,570 128,322 Vayots Dzor 47,328 46,229 45,156 43,763 Tavush 119,094 117,003 114,947 112,263 Total 2,973,761 2,964,061 2,954,829 2,943,234 Source: own elaboration According to the forecast, at the end of the 20-year period, the population of Armenia will decrease by 1%, while the population of Yerevan City will increase by 3%. 5.3.2 Economic growth Economic growth is the second main factor for waste generation growth. The Medium-Term Public Expenditure Framework (MTPEF) of the RA envisages GDP growth of 7% for the period of 2024-2026. The MTPEF outlines the main expenditure directions and priorities of the Government during the next three years and lays a basis for drafting the next year’s Annual Budget. 38 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Despite the strong economic growth experienced in 2022-2023, due predominantly to influx of migrants, businesses, and increased capital following Russia's invasion of Ukraine, the World Bank have made a projection that the growth will ease down and stabilize at rate of 4.3% in the next two years35. This rate is applied to GDP per capita forecasted growth since population remains almost constant. For the purposes of developing a waste forecast, the projection of the World Bank is used, being more conservative. Growth of municipal waste is assumed to be 0.2% per 1% income growth, according to correlation of waste and income levels drawn in the papers of the World Bank36. At annual income growth of 4.3%, annual waste generation growth of 0.86% is assumed. 5.3.3 Waste forecast Waste generation is dependent on two main factors: population and economic growth. The following assumptions are used for developing the waste forecast. • 2023 is the base year • Population dynamics as established by the Statistical Committee of the RA for the period 2012-2023 and presented in section 5.3.1 • GDP per capita is assumed to increase by 4.3% annually until 2035 and by 3% after that; the same percentages are applied to the increase of population income • Increase of waste generation is defined as 0.2 % of each percent income increase in accordance with the correlation by the World Bank • Waste generation rates are defined for different size of settlements as: o 0.88 kg/cap/day or 320 kg/cap/year for Yerevan City in the base year o 0.75 kg/cap/day or 274 kg/cap/year for cities with population above 40,000 residents (Gyumri, Vanadzor, Echmiadzin, Abovyan, Hrasdan and Kapan) o 0.6 kg/cap/day or 219 kg/cap/year for all towns with population less than 40,000 residents o 0.4 kg/cap/day or 146 kg/cap/year for rural areas The table below present the projected quantities of waste for the next 20-year period. Table 16. Waste forecast, 2024-2043, in tons Marz 2024 2030 2035 2043 Yerevan city 355,711 377,765 396,740 421,086 Aragatsotn 36,304 37,559 38,538 39,501 Ararat 43,478 45,593 47,314 49,383 Armavir 47,927 50,408 52,440 54,958 Gegharkunik 38,417 39,750 40,800 41,861 Lori 44,072 43,952 43,740 42,691 Kotayk 52,189 54,872 57,066 59,768 Shirak 49,523 49,827 49,953 49,334 Syunik 28,619 29,359 29,913 30,317 Vayots Dzor 8,149 8,165 8,158 8,016 Tavush 21,186 21,506 21,720 21,706 Total 725,576 758,754 786,382 818,621 https://www.worldbank.org/en/country/armenia/overview#3 35 Sandra Cointreau, Urban papers 2, July 2006 Occupational and Environmental Health Issues of Solid Waste 36 Management, table 3, p. 8 39 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Source: own elaboration At the end of the 20-year period the quantities of waste will increase by 12.8%, compared to 2024. Applying the results from the Waste Quantity and Composition Study (2020) – direct results for Yerevan City and average results from the other 5 cities for the rest of the country – the figure below shows the potential for waste recycling and recovery. POTENTIAL FOR RECYCLING AND RECOVERY Dry recyclables Biowaste Textile Other 201,155 394,027 48,914 81,492 1 28% 54% 7% 11% Figure 2. Estimated potential for waste recycling and recovery, tons As expected, the largest quantities are those of biowaste (about 400,000 t/y), followed by the quantities of dry recyclables (more than 200,000 t/y). The quantities of textiles are also significant – about 50,000 t/y. about 80,000 t/y are quantities which have insignificant recycling and recovery value (categorized as ‘other’). Regarding the dry recyclable waste, the figure below shows the quantities of packaging waste in the total dry recyclable quantities. Dry recyclable waste, tons Packaging 36,711 74,091 28,519 4,157 Total 49,257 104,687 32,444 14,767 0 50,000 100,000 150,000 200,000 250,000 Paper and cardboard Plastic Glass Metal Figure 3. Estimate of quantities of dry recyclable waste 40 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report About 143,000 tonnes are the estimated annual quantities of packaging waste, which is about 71% of the total dry recyclable waste, and close to 20% of the total quantities of municipal waste generated in Armenia. 5.4 Current waste management operations 5.4.1 Waste collection In 2019, waste collection was organized in 443 municipalities in Armenia. Waste collection service was not provided to 58 rural settlements37. The population of these 58 settlements without waste collection service was 46,000. This means that about 1.6% of the population was without waste collection service. In 2020, the waste collection service in Armenia was provided with about 785 vehicles (only 226 of those were with compaction system) and about 17,000 containers38. Vast majority of the trucks and superstructures are of Russian make. When equipped with compaction system, technical specifications indicate compaction ratio of 1:3. The practice, however, shows that the specified compaction ratio is rarely achieved. Lower compaction rate leads to increased number of runs and, ultimately, higher service costs. The majority of trucks are side loaders, manned with a driver and 2 loaders. Although rather inefficient, the use of such trucks has advantages too. Roads leading to disposal sites are usually in bad condition for which these trucks are well suited. Another strong side is that local drivers and fitters manage their maintenance and repair easier. Side waste loader KO 413 Typical 0.65 m3 containers for curbside waste collection Figure 4. Current waste collection equipment With the exception of the capital city of Yerevan, the majority of waste containers in use in the country are made of metal, without lid and wheels. Their capacity is 0.65 m3. These are produced locally and their price is about 70 USD per piece. Although nowadays predominantly abandoned, chute type of collection system for the multi-story buildings still exists. Apart from serious sanitary considerations, the chute system is rather inefficient due to the time needed to service the containers located in the bunkers of the building (often bunkers are even without containers). In terms of organising the waste collection service, municipalities can choose to either deliver the service themselves, or to tender out the service to private operators. In total, 274 organizations are involved in 37 Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap. Data about the number of municipalities was before the final phase of enlargement of municipalities took place in 2021. 38 Ibid. 41 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report delivery of waste collection service; 208 of those are communal departments and enterprises, while the rest are private operators39. Commercial sector concludes contracts with service providers for waste collection. In 2019, about 20,000 contracts were signed with business entities, which marked drastic increase from about 8,800 contracts signed in 201740. Some municipalities provide separate containers for the commercial sector (e.g. Gyumri), while in others the commercial sector uses the containers placed for collection of household waste (e.g. Yerevan). Until 2016, the Law on Public Procurement required tendering of waste collection services every year. This requirement prevented the businesses to invest in new equipment because of uncertainty in winning service tenders for a longer period. The current version of this law has no limitations on the duration of public procurement contracts. In urban areas, collection of bulky and construction and demolition wastes from households is typically organized through a hot line service whereby a schedule of collection of these wastes is appointed. 5.4.2 Waste recycling and recovery Source separation is done mainly on pilot-project basis. There are cases when private sector is organizing the source separation. Source separation is most widespread in the city of Yerevan, with about 300 points of source separation established fairly recently. Usually, source separation is a donor-driven activity. The predominant source of recyclable materials are the disposal sites where the informal sector is active in separating different materials. Informal waste pickers are often involved in the separation of recyclable materials, depending on the interest of the recycling operators. Recyclable fractions are stored at the dumpsites. Once the desired quantity is reached, materials are taken by the Figure 5. Separate collection containers in Yerevan private recycling operators. When collected from the containers in the cities, usually recycling operators establish collection centers, where the recyclable fractions are taken to by the informal sector. Further advancement of source separation in Armenia, including the introduction of extended producer responsibility (EPR) schemes, would need to take into account the potential effects on informal waste pickers and their livelihoods, and incorporate actions to ensure that their interests and well-being are protected. It is estimated that around 2,000 tons of recyclable plastics is processed by the waste recovery plants annually. There are no estimates for paper, metal and glass materials sent to recycling plants41. In 2019, the Acopian Center for the Environment at the American University of Armenia conducted a survey of the recycling centers in Armenia. It was established that more than 24 companies are active in the recycling of various types of solid waste. Ten of these companies recycle paper and cardboard, 5 recycle plastic, 4 recycle glass, 5 recycle 39 Ibid. 40 Ibid 41 AUA Acopian Center for the Environment (2020). Waste Governance in Armenia . American University of Armenia and Life Foundation, p.85 42 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report metals42. There also smaller companies engaged in recycling of specific types of waste, like batteries and end- of-life vehicles. Most of the recycled materials are sold to international markets. There are cases when recycled materials are used for production of goods sold on the national market. In 2016, a recycling project was implemented in Kapan Municipality (Syunik Marz). Within the framework of the project, recycling centers were established for production of various types of construction materials from recycled plastics. The infrastructure was financed with a grant from the EU and co-financing from the RA Government. 5.4.3 Waste disposal Almost without exception, waste disposal sites in Armenia are basically open dumpsites. In most cases, these dumpsites were not even legally designated as disposal sites. Often gullies and ravines are selected as waste disposal sites. It has to be noted that no disposal site in the country was designed and constructed in accordance with the “Manual on design and exploitation of landfills on the territory of the Republic of Armenia”43. The document does not have an obligatory character. Instead, the Manual advises on the design, sanitary and environmental requirement, which the future landfills should meet. The Centre of Hydrometeorology and Monitoring under the ME conducts regular monitoring of the major disposal sites. Between 2018 and 2022, more than 50 visits were conducted to major waste disposal sites 44. Arjut disposal site Spitak disposal site Figure 6. Pictures of current waste disposal sites In general, waste disposal sites in Armenia have the following characteristics: • Environmental protection measures (i.e. base sealing, leachate and landfill gas collection) are non- existent • Sites are not fenced • Control over waste disposed is not taking place • Waste trucks are not registered and not disinfected after leaving the sites • Fire protection measures do not exist with fires take place regularly • Since sites are not fenced, waste pickers are usually present at the sites 42 Ibid., p.99 43 Introduced with Order N 321-A of the Ministry of Urban Development of the Republic of Armenia, on 29 December 2009. 44 http://www.armmonitoring.am/page/860 43 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report In terms of operation, being predominantly open dumpsites, only sporadic activities take place. Covering of earth material is applied irregularly, often for the purpose of fire extinguishing. Very rarely disposal sites have access to water, which could be used for putting out fires. Sometimes municipalities use the emergency 911 service for fire control help. Monitoring tests showed significant contamination of soils and levels of polychlorinated biphenyls far exceeding the admissible norms. Since there is no control over waste accepted at the sites, old pesticides are being disposed leading to very high concentrations of persistent organic pollutants45. In 2017, the Marzpetarans and the MTAI conducted inventory of existing disposal sites. In the whole country, 2,031 disposal sites were identified with a total area of more than 494 hectares. Between 2017 and 2020, a significant number of existing dumpsites were closed. In June 2020, the reported number of dumpsites was 29746. Since 2020, it appears that there were no other attempts to reduce the number of dumpsites. The table below shows the number of dumpsites in each Marz. Table 17. Number of dumpsites, 2020 Marz № of dumpsites Aragatsotn 23 Ararat 22 Armavir 56 Gegharkunik 34 Lori 8 Kotayk 21 Shirak 58 Syunik 37 Vayots Dzor 12 Tavush 26 Total 297 Source: Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap In terms of plans for significant upgrade of municipal waste disposal, the most advanced project is the regional landfill for Kotayk and Gegharkunik Marzes. The landfill is located near Hrazdan. It was constructed in accordance with the requirements of EU Landfill Directive and included systems for landfill gas collection and leachate collection. Yerevan Waste Management Project was approved in 2016. However, as of early 2024, construction of new landfill has not started yet. 5.4.4 Landfill gas utilization In 2009, within the framework of the agreement signed with the Yerevan Municipality and the Japanese "Shimitsu" corporation, landfill gas collection and flaring project was implemented in the Nubarashen landfill. In the framework of the project, in an area of about 8 hectares, landfill gas collection system was installed. Collected gas is flared. The project envisaged landfill gas to be collected for a period of 16 years. 45 Ibid. 46 Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap 44 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Apart from the landfill in Hrazdan, no other disposal site in the country is equipped with landfill gas collection system. Future Yerevan landfill is planned to have such a system installed too. The potential for achieving co-benefits for climate change mitigation is significant in Armenia’s solid waste sector, given the current situation with the lack of sanitary landfills with landfill gas management. Globally, the solid waste sector is a substantial source of methane emissions, a greenhouse gas with a global warming potential up to 80 times greater than carbon dioxide. Moving from the existing situation of uncontrolled waste disposal to having sanitary landfills with landfill gas management will enable Armenia to improve local environmental conditions while also contributing to global climate change mitigation efforts. 5.4.5 Intermunicipal cooperation As a result of the implementation of Kotayk Solid Waste Management Project, 7 urban municipalities from Kotayk Marz and 5 urban municipalities from Gegharkunik Marz agreed to establish a municipally owned company. The Company will be responsible for the following operations: • operation of the regional sanitary landfill in Hrazdan • provision of waste collection service to rural settlements in the Kotayk Marz • operation of 2 transfer stations in the Gegharkunik Marz (in Gavar and Martuni) and transport to Hrazdan landfill There are no other examples of municipalities sharing infrastructure or services. 5.4.6 Role of informal sector The informal sector is actively involved in recycling activities in the country, primarily in the separation of recyclable materials. Separation takes place mainly on the disposal sites, but also from the street containers for mixed municipal waste. As it was already mentioned, it was estimated that some 2,000 tonnes of recyclable waste is recycled in the country annually. In most cases, the informal sector is directly engaged with private recycling operators. There are cases, however, where the informal sector is engaged by municipalities or waste collection operators. The latter ones are covering the costs for Figure 7. PET bottles separated at Tashir site separation and transport to recycling facilities, while retaining the revenue from sale of recyclables. 5.4.7 Public awareness Public awareness initiatives are predominantly NGO-driven. These are usually organised within the framework of municipal development projects financed by international development organizations. Larger- scale public awareness initiatives are predominantly oriented towards general clean-up campaigns, like Clean Armenia47 and CleanupArmenia48. Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap acknowledges the generally low level of public awareness related to waste management in the country and its importance for the introduction of source separation of household waste. 47 https://www.facebook.com/cleanarmenia/ 48 https://cleanuparmenia.org/ 45 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 6. Costs and financing 6.1 Financial framework Financing of MSW collection and disposal is provided through local, national and international sources. Waste collection General municipal waste collection service is financed by revenue from waste collection fee from households and legal entities, as well as from other revenues of local government budgets. Capital budget of the municipality is used for financing investment in waste collection equipment in case municipal body or company is providing the service. Grants, including from international donors, are provided for waste collection trucks and bins. Separate waste collection of recyclables is initiated in Yerevan municipality, financed from other municipal revenue. Cleaning of public areas Cleaning of public areas is funded from other revenues of municipal budgets. Landfill disposal Limited activities at landfills are funded from other revenues of municipal budgets. As mentioned, the first sanitary landfill for municipal waste was constructed in Hrazdan, designed to serve both Kotayk and Gegharkunik Marzes. The total cost of the project is 11 million EUR financed by international bank loans and grants. Similar financing structure is to be used for development of the sanitary landfill for Yerevan, which cost was estimated at €26 million back in 2016. Draft methodology for setting waste disposal charges has been developed by the MTAI and is expected to be adopted in 2024. The guidelines define full cost recovery and Polluter pays as main principles for tariff setting. The draft text identifies the necessary costs in relation to: • local management plans for waste collection and solid waste management • actual waste collection costs in the previous calendar year • prices established by existing contracts for service provision In determination the full range of costs the following aspects are considered by the draft methodology: • waste collection costs, i.e. maintenance of waste bins and platforms, waste chutes • waste removal costs, i.e. maintenance, fuel costs and depreciation of waste trucks • cost of waste disposal at the landfill and landfill operation costs • waste treatment costs, • waste transfer and waste storage facilities operation costs, • SWM system administrative costs, • public education and awareness costs. 6.2 Current financing of the waste sector Costing Municipal budgets do not show separately cleaning and collection costs, nor landfill disposal costs. Total municipal waste management costs in 2022 amount to 13.5 billion AMD of which 0.965 billion or 7% were capital budget expenditures. This is 50% higher than total municipal costs of 8.8 billion AMD reported 46 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report in 201549. The average monthly expenditures in 2022 are 380 AMD/capita. On the assumption that 2/3 of the costs relate to waste collection and 1/3 – to sanitary cleaning50 the average monthly cost for waste collection is 250 AMD per capita. Unit costs (costs per tonne of waste) Unit collection cost On assumptions for 707,000 t waste generated in 202251, the average collection cost per tonne of waste is 12,610 AMD or 32 $/t of generated waste, varying within the Marzes between 14 and 66 $/tonne of waste. To the extent waste collection equipment is provided as grant or financed from municipal capital budget, this unit cost does not include equipment depreciation cost and reflects transport costs to the nearest dumpsite/not permitted landfill. With full depreciation cost accounting and transport of waste to regional sanitary landfills or transfer stations, the unit cost is expected to increase and reach international full waste collection and transfer cost for upper-middle economies, as Armenia, which is in the range 50 and 100 $/tonne of waste52. Unit landfill cost Current landfill disposal costs are negligible. In 2015 these amounted to 170 million AMD or 7% of the total costs53. These costs in relation to the reported then as landfilled 470,000 tonnes mean 360 AMD/tonne of waste or 0.9 $/t, a cost much lower than open dumping cost in low-income economies54. As a benchmark reference, the minimum sanitary landfill disposal cost for upper-middle economies, such as Armenia, is 20 $/t55. Revenue from waste tariff Total planned revenue from waste tariffs in 2022 is 6.3 billion AMD and actually collected revenue is 6.1 billion AMD, compared to 4.1 billion in 201556, showing also 50% increase for the period. Planned monthly revenue is on average 178 AMD per capita and actual – 170 AMD per capita. On the assumption that 33% of the revenue is planned from legal entities57, the average monthly fee billed per person from household in 2022 is 120 AMD, ranging between 50 AMD and 200 AMD among Marzes. Detailed calculations are provided in Annex 1. The graph below summarises monthly actual municipal costs (OPEX, administrative budget) for cleaning and waste collection service per capita, split on the assumption that 2/3 of the costs are for waste collection and monthly actual revenue from waste collection fee per capita in 2022 58. Detailed data by municipalities and Marzes is provided in Annex 1. 49 Appendix to Waste Strategy 2017-2036, table 2 50 A Report on Waste Governance In Armenia, page 78, first paragraph : 63%- 37%. The report does not mention disposal cost. 51 Municipal Solid Waste Management 2021-2023 Strategy and a Roadmap, average waste generation rates of 0.9 kg/cap/y in Yerevan, 0.6 kg/cap/y in other urban areas and 0.4 kg/cap/y in rural areas . 52 What a Waste 2.0, WB, 2018, table 5.2 updated to 2022 $ values applying 1.2 CPI for the period. 53 Appendix to Waste Strategy 2017-2036, table 5 54 What a Waste 2.0, WB, 2018, table 5.2, range 2-8$/t 55 Ibid. 56 Appendix to Waste Strategy 2017-2036, table 5 57 A Report on Waste Governance In Armenia, figure 9. 58 Source: web sites of the respective Marzpetarans. Most recent data for Ararat Marz is for 2021, for Aragatsotn Marz data for 2023 (forecast) is available online. 47 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Monthly actual costs and revenue per capita 450 400 350 300 250 AMD 200 150 100 50 0 Monthly cleaning costs/cap Monthly collection cost/cap Monthly per capita fee Figure 8. Monthly actual waste cleaning and collection costs and revenue from waste fees, per capita, by Marzes, AMD, 2022 Cost recovery Revenue from waste tariff covers 70% of waste collection costs (170 AMD/250 AMD per capita average cost) or 30% of current waste collection costs is subsidised from other sources of municipal revenue, including state subsidy. Cleaning costs and current maintenance of non-sanitary landfills are financed from other revenue of the municipal budget. Municipal budget revenues constitute on average of 30% - 40% own-source revenue and 60-70% fiscal transfers from the state budget. It may be defined that current service is subsidised from municipal and state budget. 6.3 Solid waste tariff structure for households and commercial sector Current municipal waste service includes sanitary cleaning, waste collection and waste disposal. Sanitary cleaning is financed by other municipal budget revenues. As per 2023 amendments of the Law, in the case of community landfills, the fee for landfill disposal is determined by the community council (art. 12 (3)). Waste collection fee is considered in relation to collection, storage, transportation and disposal of waste. The Law does not consider collection and disposal service as separate cost centers and waste tariff is not structured in relation to cost centers. As 70% of collection cost is covered from waste collection fee (as shown in Section 6.2 above), landfill costs are in effect also currently funded by other municipal revenue and not covered by the existing waste fee. Article 14 of Law on waste and sanitary cleaning defined in 2011 the following ranges for monthly waste tariffs: A) For households: • 50-400 AMD per month for each registered resident or 5-25 AMD per m2 B) For legal entities: • Trade and public catering, household services - 50-100 AMD per m2 • Hotels and rest houses, transport stations, sport centers – 20-50 AMD per m2 • Administrative, financial institutions, communications, health care - 15- 20 AMD per m2 48 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • Schools, cultural centers, religious, worship, civil defense – 3-15 AMD per m2 • Production, industrial, agricultural buildings (including parking lot) – 5- 15 AMD per m2 The above values were established with adoption of the Law in 2011 and have not been revised since. In 2022 the average household fees per Marzes were still within the range of 50-200 AMD. On the other hand, officially reported cumulative inflation for the period 2011-2023 has 44%, resulting in a very significant erosion in the real value of waste fees. Until 2023 there was an option for determination of the fee for legal entities by volume or tonne (values defined allowed for less payment in comparison to households) that was repealed. The repealed clause identified low fee per tonne of waste equal to 166 AMD per person from household on the assumption that annual waste generated per person is 200 kg. 6.4 Billing and revenue collection systems and rates Proposal for waste fee determination can be put forward by the mayor (LOSG, Article 60). All proposals on fees determination are submitted as “draft decision” to Municipal Council for approval, accompanied by justifications such as cost estimates, statistical data, others as may be necessary. Waste fees are set by the Municipal Council in the form of Decision (LOSG, Articles 16). The draft decisions on the tariffs may be published by the mass media and may be put forward for public discussion (Law on Legal Acts, Article 29, p.3) In accordance with article 18 of Law on Waste and Sanitary Cleaning, waste fee is paid either electronically or in cash to fee collector, who also collects payments of condominiums’ service fees. The graph below shows 2022 collection rate of waste fee by Marzes59: Waste fee collection rate (actual/planned revenue from fees) 120% 100% 80% 60% 40% 20% 0% Fee collection rate average Figure 9. Waste fee collection rates The average waste collection rate for the country (actual revenue in relation to planned revenue from waste fee) is high - 93%, reaching 98-99% for Yerevan and Syunik Marz. 59 Source: web sites of the respective Marzpetarans 49 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 6.5 Cost recovery and cross-subsidization from legal entities Taking into consideration that current revenue from fees covers 70% of collection costs and revenue from legal entities represent 33% of the total revenue, legal entities waste fees cover 23% of the collection costs. On the assumption that legal entities generate 20% of waste in urban areas and 5% of the waste in rural areas, legal entities generate 16% of MS waste. Therefore, it can be concluded that there is slight cross-subsidisation from businesses. However, taking into account lack of payment for landfill disposal and partial reflection of depreciation60 in accounting for collection costs, fees for legal entities also are much below the level required by principles of full cost recovery and Polluter pays. 6.6 Affordability of tariffs for urban and rural population Affordability is interpreted as the price that customers can afford to pay without jeopardizing their ability to meet other basic needs. Affordability is mainly the ability to pay, which is assessed by analysis of statistical data. The adoption of affordability thresholds is useful for determining the tariff of public services, since it gives an objective assessment of adequate level of payment. The affordability of utility tariffs is important both for financial sustainability of the services and for justification of grant component of investments provided by International Financial Institutions, as grants are provided for (part of) investment that cannot be recovered by revenue from affordable tariffs. Affordability relates only to households; commercial users should meet the full cost of the MSW service. The ARMSTAT annually publishes the statistical and analytical report “Social Snapshot and Poverty in Armenia”. Reports are developed with the analytical and technical support of the World Bank. The data from 2023 report 61 is used here for income, consumption, and poverty level considerations. The graphs below summarise the 2022 monthly monetary per capita income data by decile groups, average disposable income per urban and rural households. Monetary household income includes the funds received by household members as remuneration for work (excluding income tax and other wage-deductible mandatory social contributions), social transfers (pensions, monetary social assistance, including unemployment, family, childbirth, childcare and other benefits), private transfers, property rental income, funds received as assistance from relatives and third persons. 60 Assets depreciation is included in costing in case companies provide the service with equipment they purchased. 61 https://armstat.am/en/?nid=82&id=2617 50 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 2022 Monthly monetary income 250,000 200,000 203,564 Average per capita income by decile groups 150,000 Average urban per capita income 116,112 Average rural per capita income 100,000 92,534 77,584 Extreme poverty line, per adult 66,842 57,811 50,000 48,737 39,861 29,608 15,398 0 I II III IV V VI VII VIII IX X Figure 10. Monetary monthly income by decile groups and average for rural and urban area, 2022, AMD Extreme or food poverty line is defined on the basis of how much it costs the III and IV decile groups to purchase a daily food basket of 2,307 calories (average adult consumption). The graph below represents the average monthly consumption and its structure in 2021 and 2022 in rural and urban areas. Monthly consumption 60,000 50,000 10,693 10,698 40,000 8,778 8,187 9,579 6,780 5,599 30,000 5,170 11,294 10,665 10,148 8,544 20,000 25,775 26,139 10,000 20,419 21,973 0 Rural 2021 Urban 2021 Rural 2022 Urban 2022 Food Non-food products Utilities Other services Figure 11. Average monthly consumption, rural and urban areas, 2022, AMD Income and consumption are not differentiated for Marzes, only for urban and rural areas. However, there are territorial economic differences which also impact income and expenditures. GDP per capita differs per Marzes and in Yerevan, as shown on the following graph: 51 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report GDP per capita by regions, AMD 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2020 2021 Average 2021 Figure 12. GDP per capita by Marzes, AMD Thus, while average GDP per capita in 2021 is 2,4 Million AMD ($4,960), it varies among Marzes within the range of 1.1 to 3.7 Million. As expected, poverty is higher in regions of lower income and the opposite, as shown on the table below. 1.2% of the population of the country was categorized as extremely poor in 2022, and 24.8% as poor with monthly income per capita of less than 44,000 AMD. Distribution of extremely poor population by Distribution of poor population, by regions, regions, % of total of the region % of total for the region 6 50 5 40 4 30 3 2 20 1 10 0 0 Extremely poor Average for the country Poor Average for the country Figure 13. Share of extremely poor and poor population in 2022 Yerevan and Syunik Marz GDP per capita is higher than the average and poverty levels are lower. Countries have established various affordability thresholds for WM tariffs, some of those are summarized in the table62 below: Table 18. WM tariff affordability thresholds 62 JASPERS, Staff Working Papers Application of the Polluter Pays Principle (PPP) in Waste Management Projects, page 6 52 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Countries Affordability threshold Applied to Armenia, 2022 statistics World Bank data for middle income 0.75%- 1.25% Average disposable 0.75%*74000 = 555 AMD economies63 HH income or 1% of HH 1% *52679 = 532 AMD expenditures Poland 0.75% median64 disposable 0.75%*60,00065 = 450 AMD household (HH) income Belarus, Bulgaria 1% average monetary HH income 1%*74000 = 740 AMD Current level of household waste fees in Armenia represents 10 to 45% of the lowest affordability threshold approach, 0.75% of median disposable household income, as shown in the table above. It is recommended 1% of household expenditures to be considered as affordability threshold, differentiated among Marzes, as there are substantial differences in income level and as a consequence – of expenditures among Marzes. While the EU countries differ substantially in level of economic development, full cost recovery by waste tariffs is the predominant tariff policy and it results in similar tariff level as a share of the spendable income, as seen from the table below. Data for Armenia is added for comparison: Table 19. Average MSW tariffs in EU and Armenia Zone/Country Average household Average household income/ Tariff as percentage of tariff/year, EUR year, EUR spendable income EU “South” 225 22,540 1% EU “North” 350 37,095 0.95% EU "East" 70 8,620 0.8% Armenia (4.3 p) 1466 8,68067 0.16% Source: Municipal Solid Waste Management: A Roadmap for Reform for Policy Makers, World BankGroup 201868. Box 8 and statistical data Armenian average household income is of similar level as that of EU East, the average size of household is higher (2.2 – 2.7 persons in EU East), the tariff is 5 times lower. While the policy aim must be to drive down costs and look for the least-cost option, financially sustainable and environmentally sound waste services require adequate application of cost recovery and Polluter pays and affordability principles. 6.7 Potential for private sector involvement Factors that can attract private sector involvement are the absence of regulatory or legislative obstacles, the ability to measure and price the outputs of the service, and the ability to recover the costs of the service 63 https://blogs.worldbank.org/opendata/new-world-bank-group-country-classifications-income-level-fy24, for upper – middle economies $4,256-13,205 GDP per capita in 2022. Armenia – $ 6,570 GDP per capita 2022 64 Half of the population has less and half – more income than the median 65 Consultant’s estimate, as figure for median income is higher than the average, Graph 2.5 – Armenia: Relative Poverty Measured at 60 Percent of Median Income and Equalized Median Income (AMD, nominal, per month), page 40 of 66 120AMD * 4,3 persons * 12 months / 440 (Exchange rate to EUR) = 14 EUR. 67 74021 AMD average monthly income per capita * 4.3*12/440 = 8680 EUR. 68https://openknowledge.worldbank.org/server/api/core/bitstreams/b82c9536-3c48-52c5-9190- 5bc64cbb7c06/content 53 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report largely or fully through user fees. Other factors are the scope for innovation and a pre-existing track record of partnerships between government and the private sector. While yearly procurement is removed, the constant level of waste fees regardless of inflation and despite the real growth of salary level in the sector employment discourages private sector participation. Municipalities reduce their costs organising waste collection service through their own departments, thus avoiding VAT on labour cost. Access to grant waste collection equipment is another factor that interferes with competitiveness of the private sector, and should be limited to small, poor municipalities, located at greater distances to regional sanitary landfills. Private companies can be competitive to municipal companies in waste collection, as they can easily lease waste trucks or access credits for purchase of trucks and implement requirements related to waste collection in case the term of the contract is long enough and the contract payment high enough to allow for repayment of leased equipment. Separate collection and sorting of waste is recommended to be funded through Extended Producer Responsibility (EPR) schemes. Private sector is much more flexible and can more adequately react to market fluctuations and waste sorting and recycling is major potential for public sector involvement. This is valid for other waste recovery facilities as well. Armenia's PPP framework has undergone significant changes in the past five years most notably with adoption of the PPP Law in 2019, and its further strengthening in 2021, particularly with adding fiscal considerations of PPP projects into the decision-making framework and further aligning the law with a procedure for identification, calculation and analysis of contingent liabilities related to PPP projects (the Government Decision № 1785-L and the “Methodological Guide for Identification, Assessment, Monitoring and Accounting for Contingent Liabilities under Public-Private Partnership Programs”). Other amendments to the PPP law in 2021 concerned separation of the private partner selection procedure under PPPs from the traditional procurement regime and providing opportunity for the private sector to offer their proposals to the government via unsolicited proposals (USPs) and tendering the project on the basis of direct negotiations. In August 2022, the Government adopted the PPP Procedure Decree. The PPP Procedure is aligned and coordinated with the Public Investment Management (PIM) Decree. While the law and the decree remain to be fully tested to demonstrate their practicality and identify the areas for improvement, they provide a favourable legal framework for private investment in public infrastructure. State grant support and subsidies are also envisaged as co-funding69. This could be a good opportunity to explore for construction of sanitary landfills in the country, as the upfront investment costs to be borne by public funds may be potentially lower. Waste sector and environment protection have been deprived of political attention for a long period. Municipalities need to provide serious investments in the sector at the lowest possible cost. While loan conditions are more favorable to governmental bodies than to the commercial sector, the opportunity to take loans and to receive grants are very limited. Cost advantages can be achieved by engaging the private sector, as the private interest is to search for the least-cost solution for any initiative, and in case of long contract terms, this will help ensure the long-term least-cost solution. 7. Identified areas for improvement 69 Article 26 of PPP Law Types of state support in PPP programs 54 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report The current development status of waste sector can be characterized as intermediate, hardly satisfying the need for public health protection. There are evident gaps in services and infrastructure, and deficiencies in the existence and level of control exercised over waste disposal facilities. These gaps result in environmental risks and impacts. 7.1 Gaps in legal framework and recommendations As mentioned in Section 2.4, the Government of RA has committed to undertake measures for approximating its legislation to the respective legislation of the EU. This particularly applies to certain provisions of Directive 2008/98/EC on waste and Directive 1999/31/ЕС on the landfill of waste. Considering this, the section below outlines the areas in which the existing legal framework needs to be amended. Main gaps There are gaps in the current legislation which prevent the development of the waste and resource management sector. The main gaps relate to: • Adherence to the waste management hierarchy • Implementation of the polluter pays principle • Improved waste disposal standards • Implementation of extended producer responsibility The waste management hierarchy provides instructive guidance on the relative importance of different waste management methods. Currently, all the collected municipal waste goes to landfill, which is at the base of the hierarchy. There are no mechanisms in place to promote, encourage, or incentivize waste management practices to move upwards in the hierarchy. Landfill tax set at only 60 AMD/tonne (0.15 USD/tonne) does not play role in stimulating recycling and recovery of waste. Stimulating the diversion of waste from landfill into reuse, recycling or recovery is an important strategic priority which needs to be underpinned by legislation. The polluter-pays principle is not observed yet, and as a result waste management costs are not fairly attributed across waste producers and holders. Tariffs and fees do not yet account for the full cost of the services. Landfill gate fees, for instance, are either non-existent, or set too low to cover the full operational costs or include provisions for closure and post-closure care. Producers of products do not bear financial and organizational responsibility for the management of the waste stage of a product’s life cycle. Additional legal provisions are needed to underpin application of the polluter pays principle. Full cost recovery is not stated as a principle in the Law on Waste. Legal ceiling for waste management fees does not provide for full cost recovery and self-sustained financing of waste management services. Instead, international best practices show that fees for households and commercial entities should be based on full cost recovery of services provided in observance of affordability thresholds. Lack of full cost recovery is a barrier to private sector participation, which would otherwise be interested in investing in waste services and infrastructure. As noted in Section 5.4.3, current state of waste disposal does not prevent environmental and health risks. Apart from Hrazdan landfill (not in operation yet), not a single waste disposal site in the country meets the requirements for a modern engineered facility. This is due to lack of legal provisions imposing high environmental protection standards for selection of sites and construction of sanitary landfills. This gap in establishing provisions for management and closure of disposal sites has recently been addressed by the adoption of RA Government Decision №27-N "On approval of the minimum standards for the operation, remediation and closure of existing and acting landfills in the territory of the Republic of Armenia". This is particularly important in view of the large number of existing dumpsites in the country - about 300. 55 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Nowadays, extended producer responsibility (EPR) is applied globally to manage waste from different product types. EPR requires producers who put products on the market to assume responsibility for their products beyond their useful life and in particular for their end-of-life treatment and recovery. The rationale behind this is that, when faced with the obligation to collect and treat their products at the post-consumption phase, producers will have the economic incentive to reconsider their products’ design, which make products management much more resource efficient in the long run. The application of EPR often involves a requirement for the producers to establish systems for collection and recycling of their waste. For practical purposes, producers usually establish or join a producer responsibility organization to comply with this requirement. Producer responsibility organizations set up to run EPR schemes would become important investors in assets and infrastructure, following their establishment. Once fully implemented, the EPR systems would cover the full costs of separate collection, sorting and recovery of special waste streams, including packaging and packaging waste. This would significantly reduce the financial burden on public budgets. Significant technical assistance has been provided to the Government of RA in the last few years for the establishment of enabling framework for EPR. Although the process of developing the enabling framework is in an advanced stage, it has to be noted that usually it takes time and significant efforts from all key stakeholders to develop comprehensive EPR schemes . In the absence of EPR schemes, source separation and recycling activities lag behind and considerable amount of municipal waste (resources) end up in dumpsites. Biowaste is not covered by legal provisions. The existing legal framework misses to address the management of the most significant waste stream in terms of weight - biowaste. Data and reporting. The Law on Waste does not explicitly require the waste management operators to report on collected and landfilled municipal solid waste. Such a requirement exists for waste recovery operators, but not for waste collection and disposal operators. Reports on collected and disposed waste are submitted only by municipalities, which however are usually based on rough estimates. Recommendations Amendments to the law on waste. As outlined above, there are significant gaps in the current Law on Waste which need to be addressed. The following key provisions need to be included in the amended primary waste management legislative act: Waste hierarchy The law should establish that the following waste hierarchy shall apply as a priority order in waste prevention and management: (a) prevention; (b) preparing for re-use; (c) recycling; (d) other recovery, e.g. energy recovery; and (e) disposal. Designation of competent authority for waste management The law should streamline the responsibilities among institutions, particularly related to policy making and planning, and designate a ministry which would be primarily responsible for waste management in the country. This will eliminate unclarities and overlaps in terms of responsibilities and will help ensure transparency and accountability as good governance demands oversight of decision-making processes. Polluter-pays principle Polluter pays principle requires costs of pollution inflicted on the natural environment to be borne by those who cause it. In accordance with the polluter-pays principle, the costs of waste management, including for the necessary infrastructure and its operation, shall be borne by the original waste producer or by the current or previous waste holders. Waste tariffs/ fees should account for the full 56 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report cost of the services, and producers of products should bear financial and organizational responsibility for the management of the waste stage of a product’s life cycle. Extended producer responsibility Since EPR would be regulated by a separate law, certain provisions in the Law on Waste need to be included too, like: new definitions; provisions for licensing of waste recovery activities; purpose for the introduction of EPR, etc. Licensing and permitting The law should include provisions stipulating that any establishment or undertaking intending to carry out waste management activities obtain a permit from the competent authority. Economic instruments Article 59 of the Law on Waste envisages the use of economic instruments for financing of the waste management activities. However, the law does not establish the legal basis for variety of economic instruments that may be introduced by the Government. The law on waste should make provisions that economic instruments should be used to provide incentives for the application of the waste hierarchy, such as: • Charges and restrictions for the landfilling (and incineration) of waste which incentivize waste prevention and recycling, while keeping landfilling the least preferred waste management option. • ‘Pay-as-you-throw’ schemes that charge waste producers on the basis of the actual amount of waste generated and provide incentives for separation at source of recyclable waste and for reduction of mixed waste. • Fiscal incentives for donation of products, in particular food. • Extended producer responsibility schemes for various types of waste and measures to increase their effectiveness, cost efficiency and governance. • Deposit-refund schemes and other measures to encourage efficient collection of used products and materials. • Sustainable public procurement to encourage better waste management and the use of recycled products and materials. • Phasing out of subsidies which are not consistent with the waste hierarchy. • Use of fiscal measures or other means to promote the uptake of products and materials that are prepared for re-use or recycled. • Support to research and innovation in advanced recycling technologies and remanufacturing. • Economic incentives for regional and local authorities, in particular to promote waste prevention and intensify separate collection schemes, while avoiding support to landfilling and incineration. • Encouraging voluntary agreements on waste management. Other provisions • Setting up a date for closure of all municipal disposal sites which do not comply with the legal requirements. • Introduction of a requirement for pre-treatment of waste prior to landfill; stipulating a date from which onwards landfills should not accept untreated waste. • Conditions for waste which has undergone a recycling or other recovery operation is considered to have ceased to be waste. Adoption of a RA Government Decision on waste landfill construction . The decision should transpose requirements set out in Directive 1999/31/EC on the landfill of waste regarding general requirements for landfills for non-hazardous waste, such as: • Location of the landfill (distance to residential areas, existence of groundwaters, geological and hydrogeological conditions, etc.) 57 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • Water control and leachate management (control of precipitation and surface waters, leachate collection, etc.) • Protection of soil and water (geological barrier, bottom liner, top liner, etc.) • Landfill gas control (control over accumulated landfill gas, treatment of landfill gas, etc.) 7.2 Gaps in policy framework and recommendations Main gaps Lack of regional planning. The country will be divided into several waste management zones. A role for regional waste management plans, which are essential if regional waste management facilities are to be identified and invested-in, is currently missing. In the absence of regional integrated waste management plans it is difficult to forecast the upcoming needs for collection, recovery and disposal services and infrastructure. Municipalities have no basis on which to take strategic decisions on the elements of the integrated waste management service that make sense to be shared with neighboring municipalities, and as a result investment in the sector stagnates. Insufficient scope of the existing municipal waste management plans . Existing municipal waste management plans are generally waste collection schemes. New local waste management plans are needed, which would reflect the requirements set out in the National Strategy and include elements as outlined in the Guidelines for development of local waste management plans. Recommendations • Development of regional waste management plans . Since the long-term national strategy envisages regionalization of waste disposal, municipalities will have to develop regional waste management plans to reflect the agreed services to be provided on a regional basis. • Development of local waste management plans . There is a legal requirement for developing municipal plans. These plans should be developed in accordance with the provisions of the national and regional waste management plans and following the structure and scope of the Guidelines for development of local waste management plans. • Preparation of a national strategy reducing the amount of biodegradable municipal waste going to landfill. In accordance with the CEPA requirements, a national strategy reducing the amount of biodegradable municipal waste going to landfill needs to be developed. The strategy must outline the measures envisaged and timeline for phased reduction of biodegradable waste going to landfill, not exceeding 35% of the quantities established for the baseline year. 7.3 Gaps in institutional arrangements and recommendations Main gaps Fragmentation of responsibilities for waste management. Waste management policy making is a function assigned to several authorities – the Government, ME, MTAI and Marzpetarans. Confusion arises also from the fact that although, according to the LoW, Ministry of Environment is the state authorized body in the field of waste management, the primary planning authority in reality is the Ministry of Territorial Administration and Infrastructure. In addition, certain waste management functions are currently not fulfilled by any institution, like: • Technical regulator function for waste recovery services and facilities is missing. 58 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • Responsibilities (client function) for recovery of waste are not explicitly assigned. In Estonia, the Ministry of Environment is the national lead authority in the field of environmental protection and, specifically, waste management. The Ministry is responsible for the development of national waste management legislation and national plans and programs in the field. The functions of the Ministry of Environment at national level are supported through several executive bodies: the Environmental Board that issues environmental permits for waste recovery and disposal facilities and gives opinions on local waste management plans, the Environmental Inspectorate that supervises all areas of environmental protection and as part of these functions implements control over waste management operations and facilities, the Environmental Agency that deals with the documentation, reporting and analysis of waste data, and the Environmental Investment Centre that collects landfill tax and other pollution charges and provides financing to local authorities, private companies and NGOs to implement projects in the field of waste management. (Source: Bridging the Gap in Solid Waste Management, Governance Requirements for Results, the World Bank, 2021) Data management and reporting. Apart from unreliability of data on waste quantities, the main problem with data management and reporting is that too many institutions are involved in data collection and distribution. This makes decision making and waste governance complicated. Recommendations Designation of a single responsible ministry. As already mentioned, development of waste management policy is distributed among several institutions. According to the LoW, Ministry of Environment is the state authorized body in the field of waste management. To streamline processes and decision-making, ideally a single ministry should be mandated to become primary responsible for waste management in the country. Waste management involves chain of activities which have a significant impact on environment. Streamline licensing and permitting, and data management . To streamline the licensing and permitting as well as data management, it would be pertinent that a separate body is established dealing with these aspects. This body could be responsible for the following functions: • Licensing and permitting. In this way, decisions on which waste management facilities are granted permits, and the conditions included in these permits, are separated from policy making, planning and funding decisions. This separation is healthy in the context of the waste recovery and disposal sector, where there is real risk of pollution incidents occurring in case of poor or non-compliant management. • Data collection and management. The entity could act as the national body for waste data collection and processing and responsible for the establishment and maintenance of waste management database and for compilation of reports on waste. Internationally, it is a common practice to have an Environment Protection Agency, dealing with licensing, permitting and data management. Such institutional arrangements ensure the separation of key waste management functions. Clear delineation of permitting responsibilities . Licensing and permitting responsibilities should be separated between national authorities and municipalities. It is recommended that the following services/facilities be licensed/permitted, monitored and controlled by municipalities: • Licenses for separate collection service operators, including those working under EPR schemes. • Permits for local facilities/sites for the receipt, processing, and temporary storage of waste and recyclables (including transfer stations and facilities for green and biowaste, packaging, and other recyclables). It is recommended that the following services/facilities be licensed/permitted by the national body, and monitored and controlled by a national-level inspectorate: 59 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report • Licenses for mixed waste collection service operators. • Licenses for waste recovery and disposal operators. • Licenses for producer responsibility organizations. • Licenses for special (including hazardous) waste operators. • Permits for regional waste recovery/treatment and disposal facilities. • Permits for special (including hazardous) waste recovery/treatment facilities. Channeling adequate financial resources and technical assistance to waste management projects . A systematic approach can be taken to ensure that sufficient finance resources, technical assistance and capacity building support for projects is available. Such an approach would establish clear objectives and transparent criteria for provision of support to project proponents (at subnational levels of government), in alignment with existing strategies and plans. Technical assistance can be provided for project preparation, followed by financial support for project implementation once projects are fully prepared. Capacity building support can be provided on technical and operational aspects, as well as for monitoring and reporting. The functions described above are often performed through the mechanism of an environmental fund, for which examples and experience exist in many countries. Environmental funds are typically designed to support environmental protection policy and initiatives, and rely on public funding sources, such as taxes, fees, or levies. In Armenia, an Environmental Protection Fund already exists within the structure of the ME. However, this Fund is established only for the purposes of mineral extraction industry. Possibilities could be explored to expand the scope of the existing Fund to include waste management and other environmental aspects. 7.4 Gaps in waste operations and recommendations Main gaps Inefficient waste collection. The efficiency of current waste collection is low due to several reasons. Firstly, containers which are predominantly in use are outdated, without wheels and lids, heavier than modern designs and as a result need more time for lifting and maintenance. Whilst the investment cost of the locally produced containers is low, their use injects inefficiencies into the operation and maintenance of the waste management system. Secondly, municipal waste is collected with rather aged and outdated vehicles. Small part of the collection vehicles in use are fitted with compaction. In rural areas, most often open dump trucks are in use which necessitate manual loading of the waste. Thirdly, chute system in high-rising buildings is still in use. Chutes are inappropriate system from both public health and operational point of view. Environmentally unsound waste disposal . Apart from Hrazdan landfill, all other disposal sites in the country are basically dumpsites, which are inappropriate from environmental point of view. The sites do not meet any modern standards of waste disposal. Lacking control mechanisms, dumpsites cannot ensure that hazardous industrial and healthcare wastes are not disposed along with municipal waste. Current operational practices are not in accordance with recently adopted higher standards for waste disposal 70. Lack of formally organized waste recycling and recovery system. Source separation is only a sporadic activity in the country and mainly donor driven. There are sufficient recycling capacities, particularly for glass and paper and cardboard. However, apart from privately organized recycling activities, there is a lack of formally organized recycling services integrated with other municipal waste management services. 70RA Government Decision №27-N "On approval of the minimum standards for the operation, remediation and closure of existing and acting landfills in the territory of the Republic of Armenia" dated 04/01/2024. 60 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Lack of biowaste management system. Although being the largest percentage of municipal waste, currently neither green waste nor food waste are subject to any treatment. Lack of designated areas for disposal of construction and demolition waste (CDW) . Generally, municipalities have no designated sites for disposal of CDW. Citizens dispose CDW either near the containers for household waste or in random areas polluting the environment. Since municipal waste disposal sites are generally open dumpsites, CDW often ends up mixed with municipal waste. Recommendations Upgrade of waste collection equipment. To increase the efficiency of waste collection, the currently used waste collection equipment needs to be replaced with more efficient one. Rear-loading vehicles with higher compaction rate should replace the presently used side-loading trucks with low compaction capacity when such is installed. Waste collection needs to be based on wheeled 1.1 m3 containers with lids. Such containers are loaded several times quicker than those currently in use. In addition, they provide significantly higher capacity than the current ones. Villages with difficult access could be serviced with skip containers of 4-5 m3 capacity. Construction of new sanitary landfills . Waste disposal needs to be conducted on new landfills meeting the criteria set out in the EU Landfill Directive. The number of future landfills needed will be established by the EBRD-financed scoping study in cooperation with the MTAI. Feasibility studies should establish the exact location of these sanitary landfills. Closure of all dumpsites. Parallel to construction of new sanitary landfills, an inventory of all dumpsites needs to be developed. Based on the quantities and types of waste disposed, a Dumpsite Closure Plan should be developed, detailing the type of closure and rehabilitation measures needed along with costing of the measures. Introduction of EPR. Once the legal framework is agreed among key stakeholders and established, implementation of EPR schemes should follow. One of the key requirements towards EPR schemes is that the financial contributions paid by producers are able to cover the net costs of separate collection of waste, transport and recovery/recycling. Municipalities should be legally obliged to cooperate with EPR schemes/PROs in the setting up systems for separate collection of packaging waste. Establishment of biowaste management system. Perhaps not as pressing an issue as waste disposal, Armenia’s integrated waste management system should include treatment and recovery of biowaste. The biowaste management system should include recycling of green waste as well as recovery of kitchen waste. While recycling/composting of green waste works as both centralized and decentralized solutions, recovery of kitchen waste will be economically justifiable only as a centralized solution and should be incorporated in the future regional waste management plans. Establishment of CDW management system. Although not a municipal waste stream, when CDW is not managed properly it often becomes part of the waste collection system (without being part of the waste fee) and/or ends up in municipal waste disposal sites. Parallel to the construction of regional landfills and improvement of waste collection systems, municipalities will have to put in place systems for collection and recycling of CDW. Examples from other countries show that economic efficiency dictates that CDW should be managed on a regional basis, with recycling facilities located near the largest waste generators and designated storage sites for smaller municipalities. 7.5 Gaps in financing of waste operations and recommendations Main gaps 61 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Cost budgeting considers existing level of service and not the targeted one. Services are being provided to match the amount of funds available instead of the funding being determined to provide a defined level of service quality. Insufficient equipment for waste collection, use of depreciated and inefficient collection equipment, containers and trucks. There is a dependence on grants for waste collection trucks and containers. In case municipalities provide the service, or municipalities possesses the assets, depreciation of assets is not part of the cost71. If private operators provide the service with depreciated equipment, depreciation may also not be considered in the service cost. Separate collection of recyclables is in initial stage. Recycling is a vulnerable business, as virgin material is lower-priced, and there is a slump in the global prices for recyclates. Cost budgeting does not reflect cost centres . There is no separate accounting for collection and transfer, treatment, disposal. Cost of landfill disposal is ignored . CEPA agreement includes requirement for the full recognition of landfill cost: Article 10 of Council Directive 1999/31/EC, Cost of landfill of waste, part of CEPA, requires states to take measures to ensure that all of the costs involved in the setting up (design, permits, construction) and operation of a landfill site, including as far as possible the cost of the financial security or its equivalent referred to the estimated costs of the closure and after-care of the site for a period of at least 30 years to be covered by the price to be charged by the operator for the disposal of any type of waste. Cost recovery and Polluter pays principle are not defined in legislation and policy documents. There are numerous dumpsites and illegal dumping will continue even in Marzes with sanitary landfills if problem is ignored. It is cheaper to municipalities to dump the waste nearby instead of transporting it to a regional landfill and paying the landfill gate fee. Any treatment of waste is more expensive than landfill disposal. Waste hierarchy cannot be achieved without adequate service costing and establishing of economic incentives as current legislation envisages. Recommendations Municipal (local) waste management plans need to be the base of cost budgeting, as advised by the Draft Methodology on waste charges, with option analysis for waste collection and defined investment and operating costs for implementation of the best financial option. Option analysis is needed in particular regarding collection and transport to new sanitary landfills. Separate budgeting by cost centres - collection and transfer, disposal, treatment – is to contribute to transparency, efficiency and accountability of the service costs and will improve adequacy of cost budgeting. Polluter pays principle and full cost recovery principle to become legislative requirement for waste charge , in line with CEPA commitment. Waste fee structure to comprise of separate components corresponding to full recovery of cost-by-cost centres - collection and transfer, waste treatment and disposal. Full cost recovery cannot be achieved immediately, waste fee increases need to be justified and foreseen in municipal waste management plans as well. Cleaning costs may be considered as a separate cost centers, however as currently to be covered by other municipal revenue and not by waste charge. 71 There is no legal requirement for municipalities to include depreciation of assets in service provision cost, and investments are funded from capital part of the budget and waste fee and operating costs are revenue and expenditures of the administrative part of the budget. 62 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Adequate budgeting for investment. Collection service budgeting needs to plan annual replacement of minimum 20% of required number of containers/bins. Timely replacement of depreciated equipment and purchase of equipment needed for the service to become component of local waste management plans, on the base of options assessment and assessment of available equipment. Replacement of depreciated trucks/containers to be included in capital budgets of the municipalities/in business plans of municipal companies or in tender requirements for maximum age of equipment used by service operators to be defined in case of tendering of waste collection. Costs of separate waste collection and recycling of packaging waste is recommended to be covered by EPR schemes, and by producers, as per article 8a (4) of the EU WFD (2018). It is expected that the national EPR Law, will follow recommendations of the EU WFD as committed by CEPA. The costs of separate waste collection, sorting and transport to recycling facilities are in general higher than revenue from sale of recyclables, therefore it is recommended this cost to be met by EPR scheme and not by households. Landfill gate fee - Establishment of full cost recovery of landfill costs as committed in CEPA. To the extent initial infrastructure and equipment is provided as grant, its depreciation may not be included in calculation of landfill gate fee defined per tonne of waste, which is to cover adequately budgeted operating costs. Not providing sufficient funds for leachate treatment and/or for waste compaction will lead to environment pollution and early landfill capacity depletion. Contract requirements for minimum landfill compaction as well as enhanced control from state authorities and higher penalties for pollution can limit malpractices. Landfills have substantial fixed costs and accepting less waste than planned may lead to substantial financial deficits and compromise the operation of expensive infrastructure. All dumpsites in the Marzes with sanitary landfills need to be closed as soon as possible, otherwise dumps will continue to be used. Waste collection operators to be paid per tonne of waste delivered at treatment and disposal facilities with permits for operation, against documentary evidence. Municipalities need to commit to pay for the operation of sanitary landfills. Environmental guarantee/provisions for intermediate cell closure and final landfill closure and 30 year after care. Landfills are developed in cells72 and cell closure and final landfill closure and 30 year after care and rehabilitation has to be secured from the start of its operation by environmental guarantee/provisions for cell closure and after care. Collecting of environmental guarantee together with landfill gate fee from start of operation will secure funds for future cell and landfill closure. Future landfill cell construction and replacement of depreciated equipment need to be included in the landfill gate fee at a second stage. Grant initial investment in sanitary landfills in Marzes with lower economic capacities is needed to speed up construction of environmentally safe disposal facilities. Polluters need to pay for contaminating environment in case of using dumpsites . Introduction of annually growing tax for disposal at dumpsites will accumulate funds for cleaning of dumpsites. Tax for using dumpsites need to be included in waste charge. Higher waste charge will incentivize PPP in construction and operation of sanitary landfills. 72Cells are much more stable and easier to cap than open landfill spaces, making the space faster and more affordable to reclaim. In addition, it contributes to decrease of leachate and leachate treatment costs. 63 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Utilization and recovery of waste can become financially viable only if cost of sanitary landfill is sufficiently high and landfill tax is reinstalled on top of landfill gate fee. Alternatively grants and subsidies are required for construction and operation of waste recovery facilities. Increase of waste fees need to be supported by affordability analysis and waste fee privileges for vulnerable groups. Establishment of stronger national legislation on enforcement proceedings for collecting due payments will be needed with increase of waste tariffs. 64 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 8. Annex 1. MSWM costs and revenue, 2022 Waste Waste Monthly Monthly Capital Fees Fees Cleaning Administrative Population per Generated Collection Budget, Revenues Revenues and Regions/municipalities Budget, January capita waste, cost73 thousand Plan, Fact, collection thousand AMD 2023 fee, tonnes $/tonne AMD thousand thousand OPEX/cap, AMD AMD AMD AMD Shirak Marz Gyumri 553,096 1,833 228,775 187,416 110,822 416 141 24,270 38 Artik 108,354 0 36,100 37,110 48,433 186 64 8,347 21 Ani 32,716 772 4,000 2,610 19,933 137 11 3,299 16 Akhuryan 73,496 9,349 47,687 26,286 43,137 142 51 6,298 19 Amasia 3,240 0 3,377 3,321 6,108 44 45 892 6 Ashocq 288 0 3,000 2,691 10,263 2 22 1,498 0 Total 2022 771,189 11,953 322,938 259,434 238,696 269 91 44,604 29 Lori Marz Vanadzor 292,466 3,292 n/a 170,364 86,023 283 165 18,110 27 Lermontovo 780 260 680 742 1,121 58 55 164 8 Fioletovo 1,146 0 700 80 1,219 78 5 178 11 Pambak 41,678 0 3,200 4,233 12,806 271 28 1,870 37 Spitak 52,860 0 31,114 28,269 39,912 110 59 6,753 13 Tashir 70,631 0 23,347 14,218 21,498 274 55 3,669 32 Alaverdi 141,051 3,491 29,825 16,705 32,552 361 43 5,817 40 Tumanyan 12,400 0 4,450 3,260 5,700 181 48 938 22 Stepanavan 55,265 4,945 27,200 24,612 13,276 347 154 2,816 32 Gyulakarak 183 3,440 4,229 2,440 7,796 2 26 1,138 0 Lori Berd 6,000 2,819 2,190 3,253 5,022 100 54 733 14 73 Defined on the basis that 2/3 of administrative budget expenses are for waste collection service. 65 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Waste Waste Monthly Monthly Capital Fees Fees Cleaning Administrative Population per Generated Collection Budget, Revenues Revenues and Regions/municipalities Budget, January capita waste, cost73 thousand Plan, Fact, collection thousand AMD 2023 fee, tonnes $/tonne AMD thousand thousand OPEX/cap, AMD AMD AMD AMD Total 674,460 18,247 126,936 268,177 226,925 248 98 42,187 26 Tavush Marz Ijevan 268,768 485 39,628 33,812 41,014 546 69 7,432 60 Dilijan 132,134 0 37,786 28,106 24,163 456 97 4,773 46 Berd 344,085 0 19,000 18,119 24,316 1,179 62 4,057 140 Noyemberyan 58,846 148 11,850 11,586 27,819 176 35 4,505 22 Total 803,832 633 108,264 91,624 117,312 571 65 20,767 64 Gegharkuniq Marz Vardenis 2,482 0 22,180 9,750 35,718 6 23 6,113 1 Gavar 162,915 7,000 71,546 51,662 50,979 266 84 8,745 31 Tchambarak 0 0 14,884 16,491 13,491 0 102 2,370 0 Martuni 101,994 0 62,683 41,966 84,677 100 41 13,199 13 Sevan 211,471 0 42,320 32,924 38,748 455 71 7,032 50 Total 478,862 7,000 213,613 152,793 223,613 178 57 37,458 21 Aragatsotn Marz Ashtarak 88,000 77,718 70,461 92 11,515 0 Shamiram 0 0 2,067 0 302 0 Aparan 28,100 21,299 23,283 76 3,827 0 Alagyaz 1,620 1,620 4,131 33 603 0 Tsaghkahovit 3,300 1,617 10,251 13 1,497 0 Metsadzor (Avtona) 50 0 302 0 44 0 Arevut (Baroj) 0 0 1,091 0 159 0 Talin 28,000 27,948 34,968 67 5,402 0 Total 2023 364,639 660 149,070 130,202 146,554 207 74 23,349 26 Kotayk Marz Hrazdan 318,750 18,070 91,970 90,376 48,286 550 156 9,977 53 66 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Waste Waste Monthly Monthly Capital Fees Fees Cleaning Administrative Population per Generated Collection Budget, Revenues Revenues and Regions/municipalities Budget, January capita waste, cost73 thousand Plan, Fact, collection thousand AMD 2023 fee, tonnes $/tonne AMD thousand thousand OPEX/cap, AMD AMD AMD AMD Abovyan 815,564 15,000 224,000 188,156 73,188 929 214 13,988 96 Byureghavan 81,865 4,350 21,840 21,960 10,311 662 177 2,177 62 Nairi 182,850 54,000 49,100 50,832 35,880 425 118 6,132 49 Tsaghkadzor 83,655 5,000 35,840 37,217 6,723 1,037 461 1,067 129 Nor Hachn 52,909 0 49,749 47,795 28,383 155 140 4,817 18 Charencavan 170,942 0 69,000 59,210 29,468 483 167 5,786 49 Akunq 33,321 42,047 9,000 8,552 9,427 295 76 1,376 40 Arzni 10,509 0 2,500 2,607 2,868 305 76 419 41 Garni 91,726 0 17,450 9,707 12,613 606 64 1,841 82 Jrvej 113,821 22,000 36,258 34,085 9,844 964 289 1,437 131 Total 1,955,912 160,467 606,706 550,496 266,991 610 172 49,018 66 Ararat Marz (2022 data is not available) Ararat Marz 2021 398,651 4,955 378,748 317,669 120 96 45,612 14 Armavir Marz Vagharshapat 260,240 585 184,045 166,994 50,049 433 278 10,712 40 Araqs 40,397 18,750 11,814 28,171 119 35 4,113 16 Khoy 35,497 21,967 18,512 32,196 92 48 4,701 12 Paraqar 155,648 450,702 43,100 29,467 27,872 465 88 4,069 63 Ferik 0 379 0 0 55 0 Armavir 223,134 4,445 48,230 49,027 57,192 325 71 10,382 35 Metsamor 150,037 20,000 28,385 75,249 166 31 11,605 21 Baghramyan 35,340 3,000 3,683 18,731 157 16 2,735 21 Total 900,292 455,732 339,092 307,883 289,839 259 89 48,372 31 Vayots Dzor Marz Yeghegnadzor 93,629 0 34,000 23,952 17,923 435 111 3,129 49 Jermuk 99,202 0 18,771 15,243 5,463 1,513 233 1,081 151 67 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report Waste Waste Monthly Monthly Capital Fees Fees Cleaning Administrative Population per Generated Collection Budget, Revenues Revenues and Regions/municipalities Budget, January capita waste, cost73 thousand Plan, Fact, collection thousand AMD 2023 fee, tonnes $/tonne AMD thousand thousand OPEX/cap, AMD AMD AMD AMD Vayk 97,500 0 12,500 10,757 10,685 760 84 1,944 83 Areni 7,523 0 5,620 5,623 10,964 57 43 1,601 8 Yeghegis 11,680 0 12,000 1,524 5,693 171 22 831 23 Total 309,534 0 82,891 57,100 50,728 508 94 8,586 59 Syunik Marz Kapan 458,402 21,313 100,000 113,149 47,173 810 200 9,902 76 Kajaran 104,060 0 0 0 8,025 1,081 0 1,671 103 Goris 79,500 0 50,000 44,920 27,583 240 136 5,452 24 Tatev 0 0 2,300 1,364 5,963 0 19 871 0 Tegh 15,295 0 2,700 2,143 5,442 234 33 795 32 Sisian 119,719 0 54,898 49,175 25,710 388 159 4,811 41 Gorayk 0 0 1,400 466 1,256 0 31 183 0 Meghri 146,133 0 51,000 48,474 9,882 1,232 409 2,032 119 Total 923,108 21,313 262,298 259,690 131,034 587 165 25,716 59 Yerevan total 4,955,447 284,335 3,740,996 3,658,292 1,098,900 376 277 360,989 23 Source: websites of Marzpetarans 68 Armenia SWM Sector Assessment and Reform Plan Sector Assessment Report 69