What You Need to Know about Pay-As-You-Throw Programs

What You Need to Know about Pay-As-You-Throw Programs

What’s one of the most effective ways to encourage people to change their behavior as it pertains to household waste? Make them pay to throw out their trash. That’s the principle behind “pay-as-you-throw” (PAYT) programs. Also referred to as unit-based or variable-rate pricing programs, the PAYT approach is becoming more common as municipalities around the world look for new ways to reduce waste, boost recycling rates, keep trash disposal cost-effective, and better serve residents. Read on to learn more about the ins and outs of PAYT.

An overview of PAYT

soda can trashOne of the central tenets of the PAYT approach is that it empowers individual households to take charge of their trash bills. Through the traditional payment model for municipal solid waste management, community residents paid a flat fee for waste disposal. While it’s easy to administer, the main drawback of this payment structure is that everyone pays exactly the same fee, no matter how much waste they actually produce themselves. Furthermore, since the cost is usually “hidden” inside utility or property tax bills, it can be difficult for residents to clearly understand exactly how much their waste disposal program is costing them. As a result, residents have little personal incentive to reduce the amount of waste they generate.

The PAYT model aims to address this issue by creating economic incentives for households to recycle more and throw away less trash. While there are many different variations of the PAYT concept, the broad requirement of all PAYT programs is that the fee households pay for trash collection is directly based on how much of it they produce.

A look at different PAYT programs

The term “pay-as-you-throw” covers a wide variety of programs and options. For municipalities and communities that are considering the implementation of some form of the PAYT system, it’s important to understand how the different available options work, as well as the pros and cons of each. Some of the most popular PAYT programs currently in use include:

  1. Cash—A cash-based PAYT model is as simple as it sounds: households dispose of their trash at a transfer station or other drop-off center, paying a set cash fee for each bag that they drop off. While cash programs are effective in that they are fair to residents and provide a strong incentive for waste reduction, they are often plagued by operational inefficiencies. They do not work with municipal curbside trash collection programs, instead putting the responsibility for trash drop-off directly on residents. In addition, such programs can put transfer stations at higher risk of theft by increasing the amount of cash that they have on hand.
  2. Overflow—An overflow system combines aspects of a traditional flat-fee payment model with cash-based systems. In this model, households are charged a flat fee for all the garbage they produce that fits into a collection cart of a certain size. Any waste in excess of this—that is, any garbage that doesn’t fit into the cart—is charged a per-bag fee. Overflow programs are useful in principle because they place a financial penalty on the largest waste generators. However, since the size of the carts is typically quite large, few residents ever actually reach the point of needing overflow capacity.
  3. Variable-rate carts—This program offers households the choice of a number of different-sized carts to use for trash collection. Carts are generally available in various sizes—35, 65, and 96 gallons—and the idea is that residents pay less for a smaller cart and more for a larger one. While this system offers some of the signature PAYT fairness in that people who produce more waste need to pay extra for a larger cart, what often happens in reality is that residents either choose the smallest and cheapest cart and then overstuff it (a practice known as “snow-coning”), or they simply choose the cart that fits their current waste disposal needs without making an attempt to change their behavior in order to generate less waste for a smaller cart. Another challenge of variable-rate cart programs is that they can be expensive to implement due to the need to purchase new equipment.
  4. Tags—Similar to the practice of using a postage stamp to mail a letter, the tag-based PAYT model enables residents to affix pre-paid tags or stickers to each bag of trash they throw away. The system provides the fairness of a cash-based system while removing some of its inconveniences. However, since each bag must be visually inspected for the sticker, this program does not work well for communities with automated garbage collection. Enforcement is also a challenge, as it can be difficult to detect bags that are heavier or larger than allowed, bags with split stickers, or untagged bags that are concealed beneath tagged bags.
  5. Bags—Bag-based programs are generally regarded as the most effective PAYT option with the fewest drawbacks. A bag-based model operates in much the same way as a tag model, but with waste disposed of in pre-paid, specialized bags that are approved by the municipality and easily identifiable. The programs are fair in that households only pay for the trash they throw away, and they are easier to enforce—even with automated collection. Many case studies have shown bag-based programs to be highly effective at increasing waste reduction.

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