nigeria private sector participation in solid waste management activities in ibadan with support from ey & egipe sarl copyright © 2014 International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org This work is a product of the staff of The World Bank rights and permissions with external contributions. The findings, interpre- The material in this work is subject to copyright. tations, and conclusions expressed in this work do Because The World Bank encourages dissemina- not necessarily reflect the views of The World Bank, tion of its knowledge, this work may be reproduced, its Board of Executive Directors, or the govern- in whole or in part, for noncommercial purposes as ments they represent. long as full attribution to this work is given. The World Bank does not guarantee the accuracy of Any queries on rights and licenses, including sub- the data included in this work. The boundaries, col- sidiary rights, should be addressed to World Bank ors, denominations, and other information shown Publications, The World Bank Group, 1818 H Street on any map in this work do not imply any judgment NW, Washington, DC 20433, USA; fax: 202-522- on the part of The World Bank concerning the legal 2625; e-mail: pubrights@worldbank.org. status of any territory or the endorsement or accep- tance of such boundaries. Photo credits: Farouk Banna, Ivan Bruce |3 acknowledgments This report was commissioned by the Public, Pri- The team gratefully acknowledges the comments vate Infrastructure Advisory Facility (PPIAF) at the and support provided by Oyo State Government, World Bank Group, in collaboration with the World under the guidance and leadership of Governor Bank’s Social, Urban, Rural & Resilience Global Abiola Ajimobi, and in particular Professor Ademo- Practice. This project was led by Salim Rouhana la Ariyo, (Chief Technical Adviser to the Governor (Senior Urban Specialist) and benefited from con- on the IUFMP), Dayo Ayorinde (Project Coordinator, tributions from experts and specialists in Solid IUFMP), and the support staff of the project imple- Waste Management and support from staff focused menting unit of the IUFMP. In addition the team on Disaster Risk Management from the World Bank thanks Joseph Alabi, (General Manager, OYOW- Group. The report was supported from a team from MA) and his team for their engagement and open- Ernst & Young and Egipe SARL under the guidance ness that heavily informed this report. of Adrian Tan (Senior Manager Ernst & Young) and The study gained valuable inputs from World Bank a core team of comprised of Alexis Gazzo (EY), colleagues that provided peer reviews from variety Ayodeji Ogunyemi (EY), Gina Anderson (EY), John of offices and experts including Paul Kriss (Lead Okoronkwo (EY), Omonye Akhigbe (EY), Oyinda- Urban Specialist), Frank Van Woerden (Lead Envi- mola Oluyombo (EY), Raoul Grela (Egipe SARL), ronment Engineer) and Cesar Vargas (Investment Florentin Bulot (Egipe SARL), Salma Sabour (Egipe Officer, IFC). SARL). The report was supported by training work- shops, and research that was undertaken by Em- This report was sponsored by PPIAF of the World manuel Badejo, Mussa Dankwah. Bank Group and supported by the PPIAF team Bailo Diallo (Regional Program Coordinator) and Fatouma The report benefited from legal guidance from legal Toure Ibrahima (Senior Program Officer) and Sath- firms Ajumogobia & Okeke, and Pinsent Masons. eesh Kumar Sundararajan (Senior Infrastructure Fi- The study benefitted from guidance from numerous nance Specialist) World Bank colleagues, in particular Farouk Banna Thanks also to Amani Dargham for her editorial and (Urban Specialist Solid Waste Management), Claire graphic design inputs to finalize the report. Markgraf (Solid Waste Management Consultant), Thierry Martin (Senior Solid Waste Management Expert), Dina Ranarifidy (Urban Specialist), and Ivan Bruce (Urban Development Consultant). 4| World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria abbreviations and acronyms CBO – Community Based Organization MPPUD – Ministry of Physical Planning & Urban Design CDM – Clean Development Mechanism MRF – Materials Recovery Facility CWG – Collaborative Working Group on Solid Waste Man- MSW – Municipal Solid Waste agement in Low- and Middle-income Countries NESREA – National Environmental Standards & Regula- DBFO – Design, Build, Finance and Operate tions Enforcement Agency DBO – Design, Build and Operate NAIF – Nigeria Infrastructure Advisory Facility EHOs – Environmental Health Officers OSEPA – Oyo State Environmental Protection Agency EIA – Environmental Impact Assessment OSG – Oyo State Government EPC – Environmental Pollution Control OYOWMA - Oyo State Solid Waste Management Authority ESEA – Environmental Sanitation Enforcement Agency PAYT – Pay-As-You-Throw ESL – Environmental Sanitation Law PPE – Personal Protective Equipment EY – Ernst & Young PPIAF – Public Private Infrastructure Advisory Facility GDP – Gross Domestic Product PPP – Public-Private Partnerships GIS – Geographical Information System PSP – Private Sector Participation GPS – Global Positioning Service RDF – Refuse Derived Fuel GTZ – German Agency for Technical Cooperation SIP – Sustainable Ibadan Project HSE – Health, Safety and Environment SWM – Solid Waste Management IUFMP – Ibadan Urban Flood Management Project WB – World Bank Group IWMA – Ibadan Waste Management Authority WSA – Waste Service Agreement LASEPA – Lagos State Environmental Protection Agency TLS – Transfer Loading Stations LAWMA – Lagos Waste Management Authority UCODEA – Urban Community Development LGAs – Local Government Areas UN – United Nations LG – Local Government UNEP – United Nations Environment Program MEH – Ministry of Environment & Habitat UNFCCC – United Nations Framework Convention on Cli- MEHL – Ministry of Environment and Habitat Law mate Change MPPL – Ministry of Physical Planning and Urban Devel- opment Law All monetary amounts are Naira unless otherwise indicated. |5 contents executive summary 10 i. introduction 23 • context and objectives of the study 23 • expectations from this study 24 II. methodology 25 III. general information about ibadan 27 • administration and demographics 28 IV. the legal and institutional framework related to solid waste management 29 • federal level 29 • oyo state level / ibadan 30 - the oyo state ministry of environment and habitat 30 - the local governments 30 - the oyo state solid waste management authority (oyowma) 31 • operation of current contracts with private sector participants 34 • assessment of the existing legal and institutional framework 36 V. the current situation of solid waste management 37 • generation and collection 38 - Quantities of waste generated and collected 38 - Forms of waste collection 39 > Collection from public sector 39 > Private waste collectors 40 • resources and facilities of the public sector in charge 41 of solid waste management - Financial resources 41 - Human resources 44 - Equipment and vehicles 45 - Infrastructure and facilities 46 > Roads 46 > Transfer stations 46 > Facilities for the cleaning services 48 > Dumpsites 48 6| World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • resources and facilities of the private sector involved 52 in solid waste management - Financial resources 52 - Human resources 54 > Informal sector 54 - Equipment and vehicles 54 - Areas for improvement identified by the private refuse collection association 55 • assessment of the current challenges for private sector involvement 57 VI. best practices and experiences of psp in solid waste management 59 • collection of waste management fees / recovery of waste management costs 59 - Best practice recommendations 60 • governance – the role of public authorities 61 - Best practice recommendations 62 • waste management service performance 62 - Best practice recommendations 62 • incentives across the waste management value chain 63 - Best practice recommendations 63 • involving the informal sector 64 - Best practice recommendations 65 VII. optimizing psp in swm activities in ibadan 66 • external factors impacting private sector waste collection services in Ibadan 66 • general apportionment of activities between the private and the public sectors 67 - Activities best managed by the private sector 67 - Activities best managed by the public sector 67 - Activities shared and/or negotiated between public and private sectors 68 - Activities requiring the potential involvement of private waste contractors 68 • options for psp involvement in solid waste management activities in ibadan 69 - General options for psp in ibadan 69 - Street cleaning 78 - Waste collection 78 - Landfill management 78 - Resource recovery 79 - Drafting of provisions within a waste services agreement 82 VIII. recommendations and optimization plan for psp 83 • main recommendations 83 • plan psp optimization in solid waste management activities in Ibadan 85 - Assumptions 86 - Cost recovery and revenue collection 104 > Revenue collection mechanism 104 > Determining waste management costs and fees 104 CONTENTS |7 - Contract related actions 105 > Support investment and performance-based contracts 105 - Communication, education and awareness-raising 106 - Enforcement of waste management regulations 106 - Investing in waste management infrastructure and facilities 106 > Creating transfer stations 106 > Installing waste collection points 107 > Creating storage facilities for cleaning equipment 107 > Land acquisition by the OYOWMA waste management facility installation 107 - Investing in other urban infrastructure 108 > Improving the roads 108 > Developing buildings adapted for waste collection 108 - Pilot projects 108 > Technological innovation related to waste management vehicles and equipment 108 > Using different means of waste collection 109 > Use data and gis for planning of solid waste collection and transport activities 109 - Improving the management of dumpsites 110 > Planning 111 > Operations 112 > Performance monitoring 112 - Capacity building 112 > For the private waste contractors 112 > For oyo State 113 references 114 annex 1 – legal framework 119 annex 2 – potential waste services agreement provisions 139 annex 3 – stakeholder interviews 153 8| World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria list of tables Table 1: A synthesized table of identified challenges and proposed actions for Oyo 18 State Governments Table 2: Population, density and number of households in the Ibadan Metropolis 28 Area. Source: (Ogungbuyi, 2013) Table 3: Overview of public institutions involved in solid waste management in 33 ibadan Table 4: Quantity of waste collected in 2015. Source: OYOWMA 39 Table 5: The OYOWMA annual budget in 2014. Source: OYOWMA 42 Table 6: The OYOWMA annual budget in 2014. Source: OYOWMA 43 Table 7: The OYOWMA operation costs. Source: OYOWMA 43 Table 8: Number of staff employed by the authority in each category – 44 Source: OYOWMA Table 9: Overview of dumpsites in Ibadan 48 Table 10: Standard tariffs for waste collection and disposal services in domestic / 52 residential premises (effective January 2013). Source: OYOWMA Table 11: Standard tariffs for waste collection and disposal services in commercial / 53 industrial premises (effective January 2014). Source: OYOWMA Table 12: Standard tariffs for waste collection and disposal services in commercial/ 53 industrial premise – Monthly Bin rental services (effective January 2014). Source: OYOWMA Table 13: Options for PSP in solid waste management activities in Ibadan 70 Table 14: Overview of costs and benefits of each action to optimize PSP in SWM in 88 Ibadan Table 15: Potential Waste Services Agreement Provisions 139 |9 list of figures Figure 1: Map of Ibadan metropolitan area. Source: (Ogungbuyi, 2013) 27 Figure 2: Legal structures for waste management in Ibadan 32 Figure 3: Administrative requirements to be submitted with the application for waste operation 35 permits for Private Refuse Contractors in Oyo State Figure 4: Source and type of waste in Ibadan (average percentages by weight) 38 Figure 5: Household solid waste disposal methods in Ibadan (based on weight) 40 Source: (Ogungbuyi, 2013) Figure 6: A map of the main roads, Local Government Areas and dumpsite in Ibadan 49 metropolitan area Figure 7: Improved garbage truck used by the private sector 54 Figure 8: Stakeholder Model of a Reverse Integrated Solid Waste Management Project. Source: 64 (Athena Infonomics, 2012) Figure 9: The different solid waste management activities in the waste management chain 69 Figure 10: The Material Recovery Facility (MRF) in Alimosho, Lagos (LAWMA, 2015) 80 Figure 11: Composting plant in Lagos (LAWMA, 2015) 81 Figure 12: The pilot waste-to-energy biogas project at Ikosi Market in Lagos (LAWMA, 2015) 82 Figure 13: Overview of actions to improve private sector participation in solid waste manage- 84 ment activities in Ibadan Figure 14: Production of knowledge as a leverage for investment 111 10 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria executive summary introduction Ibadan is the capital of Oyo State and the third • Collect and validate the baseline informa- largest city in Nigeria. The population of the met- tion on the SWM sector to provide critical ropolitan area of Ibadan is estimated at close to 3,5 inputs to be actioned within the Ibadan Ur- million (IUFMP, 2014). ban Flood Management Project; The management of solid waste in Ibadan has been • Identify challenges and opportunities in a challenge for decades. A large portion of the solid terms of institutions and financing; and waste generated in the city is dumped on available plots of land, sidewalks, roads, streams, channels and drains – the collection rate is estimated at • Provide the Oyo State Government with pol- around 40% (Ogungbuyi, 2013). The clogging of icy recommendations to improve the SWM drainage systems is an particular issue as Ibadan in terms of short, medium and long term. is highly exposed to flooding. The city has a history This report will further support the ongoing World of deaths from floods caused by water channels be- Bank supported activities namely the Ibadan Urban ing blocked with waste, and outbreaks of infectious Flood Management Project (IUFMP) – a response to diseases from human contact with improperly dis- the floods of 2011 which caused significant human posed and untreated waste. and economic losses of Ibadan. The IUFMP project Improving solid waste management (SWM) is a has several components which include improving priority for the Oyo State Government, alongside and repairing damaged infrastructure assets, as reducing the burden of publicly funded waste well as undertaking a series of strategic studies management on the State’s finances. The State – urban, drainage and solid waste masterplans – has recognized the need to improve the level of which will better enable Oyo State to identify ad- private sector participation (PSP) in order to over- ditional areas for investment to improve Ibadan’s come the technical and financial deficiencies cur- ability to better manage floods and build long-term rently associated with solid waste management in resilience. Ibadan, and agrees that private investment in the In this regard this report aims to outline the chal- sector can help increase efficiency, lower costs and lenges faced in the solid waste management sector improve the quality of service. The level of PSP in in Ibadan, and to provide a set of recommendations waste management in Ibadan is currently limited to guide Oyo State Government, and other key to waste collection and transportation, and there- stakeholders to improve efficiency and to provide fore, the Governor of Oyo State requested support policy guidelines that will better enable private sec- from the World Bank to conduct a study on how the tor participation. private sector can help improve solid waste man- agement in Ibadan. The outputs of this study will complement the sol- id waste masterplan to be implemented under the The scope of the report was undertaken with the IUFMP, the masterplan will provide Ibadan with a following objectives: 20-year vision on improving the entire value chain for SWM in the city, this activity will therefore use • Assess the existing practices, challenges this study to as a baseline of engaging with OSG and current performances of the private sec- and other key stakeholders. tor in SWM in Ibadan; The private sector has been involved in solid | 11 waste collection in Ibadan for over 40 several years of Government at the Federal level, at the State lev- (Ogungbuyi, 2013). There are 317 registered private el and at Local Government level. The following four contractors collecting waste in the 11 Local Gov- solid waste management options are recommend- ernment Areas of Ibadan metropolis. They collect ed within the Policy guidelines: waste from residential, commercial and indus- trial zones that are ready to pay for their services 1. By Local Government/Municipal Agencies; (OYOWMA, 2016). Some of the private contractors 2. By Private Companies on contract with the have been involved in solid waste collection for over LGA/Municipality; 20 years in Ibadan. The waste collection operating 3. By Private Companies on contract with Home permits granted by OYOWMA to private refuse col- Owners; lectors determine the designated service areas that 4. By public-private partnership (PPP). each operator is permitted to service. The private contractors pay a registration fee for the operating permits, and the permits are only valid for a year at The responsibility for overseeing SWM in Ibadan a time. The private contractors collect waste collec- currently lies with the following three institutions, tion fees directly from waste producers (i.e. house- each with different roles and responsibilities: holds, commercial businesses and industrial com- panies) based on standard tariffs, with minimum • the Oyo State Ministry of Environment and and maximum charge rates set by the Oyo State Habitat has overall responsibility for the protection, Solid Waste Management Authority (OYOWMA). maintenance and development of the environment in the State, including solid waste management. OYOWMA sets the tariffs according to levels of income in each area, and the type of waste (resi- • the Oyo State Solid Waste Management dential, commercial or industrial). The private con- Authority (OYOWMA) has the direct and opera- tractors are to pay 20% of their monthly collections tional responsibility for solid waste management in to OYOWMA to defray its administrative costs, and the Ibadan metropolitan area. The Authority over- for the maintenance of the dumpsites and other fa- sees waste collection, street cleaning, transport, cilities. The collection of fees from waste producers the management of dumpsites, and the granting is a particular challenge for private sector operators, of operating permits to private waste contractors. and it causes a major risk to their income and busi- OYOWMA also monitors the activities of these ness viability. private waste contractors. OYOWMA has the au- thority to charge fees for the registration and subse- quent renewal of private refuse collection licenses. the legal and institutional The Authority is also able to charge dumping fees framework for solid waste per truck for access to the dumpsites. The Authori- management ty further has the power to revoke licenses and im- in ibadan pose fines on waste collectors for a range of possible At the national level, the legal framework for solid malfeasance, for example, collecting waste outside waste management forms a part of Nigeria’s laws of their designated areas or using unapproved and regulations that are focused on the protection waste disposal sites. and development of the environment, and this framework is set out within the National Environ- • the Local Governments are to support the im- mental Standards and Regulations Enforcement plementation of good practices in solid waste man- Agency (NESREA) Act of 2007. The National Envi- agement, and are to make annual budgetary provi- ronmental (Sanitation and Wastes Control) Regula- sions for solid waste management. Previously, the tions of 2009 further provides the legal framework Local Governments did not have adequate means for environmental sanitation and waste manage- to undertake waste management in their areas ment in Nigeria. These regulations provide general effectively, and OYOWMA was charged to collect guidelines on the management of solid waste, and waste around major roads, markets, inner city ar- include a requirement that the waste is handled by eas and other areas not covered by private waste a person licensed to transport and dispose of solid contractors. Due to change in policy, from October waste in a designated waste management facili- 2015, Local Governments once again became re- ty. Policy Guidelines on Solid Waste Management sponsible for waste collection within their individ- (2005) developed by the Federal Ministry of the En- ual jurisdictions. vironment also set out the roles and responsibilities 12 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria The Ministry of Environment and Habitat oversees collection trucks must drive out to one of the four the activities of the OYOWMA and is responsible for dumpsites once the trucks are fully loaded. This weekly Environmental Sanitation Exercises, which means that the trucks can only make up to two col- monitor the state of waste in the Local Government lection rounds per day. Areas of the state. The State Governor is the final The waste collection operating permits granted by decision maker on solid waste management and on OYOWMA to private refuse collectors determine private sector participation. the designated service areas that each operator can service. The private contractors pay a registration existing practice, challeng- fee for the operating permits, and the permits are es and current practices of only valid for a year at a time. The private contrac- the private sector tors collect waste collection fees directly from waste During the study period it was identified that pri- producers (i.e. households, commercial businesses vate contractors have been involved in solid waste and industrial companies) based on standard tar- collection in Ibadan for over 20 years. About 40% of iffs, with minimum and maximum charge rates set the total waste collected is currently done by pri- by OYOWMA. OYOWMA sets the tariffs according vate refuse collectors, an increase from about 30% to the level of income in each area, and the type in 2014. There are 317 registered private contrac- of waste (residential, commercial or industrial). The tors collecting waste in the 11 Local Government private contractors are to pay 20% of their monthly Areas of Ibadan metropolis, and they collect waste collections to OYOWMA to defray its administra- from residential, commercial and industrial zones tive costs, and for the maintenance of the dump- that are ready to pay for their services (OYOWMA, sites and other facilities. The collection of fees from 2016). Many of the private contractors are small – waste producers is a particular challenge for these the biggest contractors have up to 5 trucks with private sector operators, and it causes a major risk about 5 staff per truck, and most of them are mem- to their income and business viability. bers of the Private Refuse Contractors Association. In addition to the above, there is also an informal Members that do not own operational trucks can sector that is active in recovering recyclable mate- rent them from other contractors who have more rials from solid waste in Ibadan. This material re- than one truck. The Association is also able to lend covery activity happens at the point of waste gener- money to its members at low interest rates to fi- ation in households or companies, or at trash cans, nance the purchase of trucks. skips bins and at dump sites. There are so-called The private contractors use all kind of trucks, but “scavengers” that sort and recover valuable materi- they do not use trucks designed specifically for als from the waste. These actors are typically poorly waste collection. There are no packer trucks, no big equipped or not equipped at all, and although not capacity vehicles, and most of the vehicles in use formally a part of the private waste management are about 5 to 10 tons, i.e. generally smaller than sector in Ibadan, they recover significant amounts the vehicles in use by OYOWMA. The trucks are of waste and sustain a market in recyclable mate- also acquired second-hand. They have only one rials. drive axle and therefore they encounter difficulties when driving in wet and muddy conditions. There are also no transfer stations in Ibadan, so all waste areas to improve the quality and level of private sector participation Several areas where there is scope to improve the improve private sector participation in solid waste involvement of the private sector in solid waste management in Ibadan are as follows: management in Ibadan were identified. These ar- eas are interdependent and a multi-faceted plan 1. Revenue collection of waste management is required to achieve success. The key areas to fees | 13 • Firstly, there is a need to address the percep- 2. Cost recovery and financial model for tions among waste producers regarding the solid waste management waste collection fees. In order to maximize • Certain areas allocated to licensed waste the levels of compliance or patronage, there collectors are more lucrative or commer- is a need for consultation and transparency cially viable than others, leading to some li- in the setting of the collection fees. This will censed waste collectors not being able to re- help mitigate the view held by some waste cover adequate revenues to enable them to producers (i.e. households) that the waste invest in performance improvement. There collection fees they pay are too high. is a need to ensure each licensed collector is allocated a ‘commercially viable’ area if they • In order to ensure a wider provision of col- are to be able to deliver an effective service. lection services to all households, and a reduction in the level of resistance to fee • Separately, the report noted that as licenses payments, the setting of the fees should for waste collection must be renewed each be better regulated and better enforced. It year, there is not much incentive for private is also necessary to demonstrate to waste contractors to make long-term investments producers that the fees are reasonable and to improve the efficiency of their operations. they are the most cost-effective possible. The short contract duration also limits the This can be achieved through a transparent ability of the collection companies to raise process for the determination of fees, and finance for new equipment. In essence, they rigorous enforcement of the fixed rates. are unable to demonstrate to financial insti- tutions that they will be viable beyond a one • The selective application of fees within ar- year horizon. eas of the city and the lack of a transparen- cy around the fees being charged in each 3. Transport infrastructure and waste facil- area are clear obstacles to the sustainability ities of existing PSP in waste collection, and to • Packer-trucks cannot be used in every part the expansion of waste collection services of the city because of the poor state of many to cover the entire metropolitan area. of the roads. The private collectors have 14 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria already customized some of their trucks in • Furthermore, a significant deficit in the order to be able to reach inner city areas number of enforcement officers, limits the with narrow or otherwise inadequate roads. capacity to enforce existing waste regu- The majority of the trucks are however old lations. The World Bank team discovered and they breakdown very often, which re- the legal framework to be adequate for duces the reliability and the quality of the the involvement of the private sector. The service. This is not helped by the fact that laws are also clear on the proper handling spare parts for the old trucks are difficult to of waste by waste producers, as well as the obtain. There is a need for significant public attendant sanctions for non-compliance. investment in better road networks. For example, all households are legally re- quired to have appropriate containers for • There is also a need for solutions for bring- the storage of waste on premises, and ar- ing waste from the innermost areas where rangements for the regular removal of the motorable roads are non-existent to waste waste by paid service providers. The lack of collection points that can be easily reached proper enforcement of these legal require- by waste removal trucks. The productivity ments reinforces existing attitudes to waste of the collection teams relies on the state management and is a missed opportunity to of the roads on which the trucks are used, drive up behaviors that can boost revenues and smaller motorized and non-motorized and increase the commercial viability of pri- vehicles have been discussed as options vate operators. to deal with difficult terrain. However, the 5. Resource recovery (e.g. energy recovery aforementioned challenge of raising finance and material recycling) limits the ability of the private sector to ac- quire new and better adapted equipment. • From the engagement with relevant stake- holders, it emerged that there is a need • Facilities such as Transfer Loading Stations for greater coherence in arrangements for (TLS) are also non-existent. The use of TLSs involving the private sector in the waste will significantly reduce the distance trav- processing and material recovery end of elled by each waste truck from their collec- the waste management chain. Several in- tion point to their offload point (currently terested private sector operators expressed one of four dumpsites outside the city). difficulties in moving a range of proposed The waste truck would then have a much waste-to-wealth (e.g. material recycling reduced rotation time, less operating costs and composting) and waste-to-energy (e.g. and higher productivity. incineration and biogas plants) projects for- ward. 4. Public attitudes and behaviors regarding waste disposal The existing capacity to grant and manage con- tracts at this end of the chain is weak, and Oyo • Ibadan has a firmly entrenched culture of State will require expert transaction advice to en- resistance to paying for the waste man- sure it achieves the most effective performance agement. The World Bank team discovered based contracts. There is also a need to build ca- during hosting stakeholder engagement pacity within the relevant oversight agencies in that this view is slowly changing, partly as order to ensure any achievements in this area are a result of efforts by the State Government sustained. to raise awareness through various forms of media. The entrenched attitude has a direct impact on the viability of PSP, as a general trend not to pay for waste disposal has an impact on the levels of revenue that can be achieved by private collectors. Thus impacting upon the private sectors’ willing- ness to invest. | 15 recommendations Improving private sector participation is a compre- ing the costs and opportunities for revenue in rela- hensive process that requires extensive interven- tion to waste management activities. The analysis tions, consultations and strong regulation of both can be done as part of the preparation of Ibadan’s the waste producers and private operators in the Solid Waste Management Plan, however, a sustain- waste management chain. It requires the reliable able and longer term mechanism for gathering and collection of waste management data for decisions analyzing data on costs and on performance will be to be based on actual performance. It also requires required. Such a mechanism will enable the deter- significant investment to build infrastructure and mination of the right balance between subsidy and human capacity that will improve productivity to the level of costs to be borne by the waste producer create a viable and sustainable waste management on a year-on-year basis. system. If implemented correctly with gradual in- creases in the transfer of costs to the waste produc- • Ensure better recovery of waste collection ers, the level of public investment required will re- costs by compelling all waste generators duce over time, as the private sector demonstrates (households and businesses) to pay waste viability and delivers better services. management fees. This could be done by further This report contains a range of specific recommen- and wider communications to businesses and the dations towards achieving a high level of private general public (e.g. through contact with communi- sector involvement in the Ibadan waste manage- ty leaders and information campaigns that explain ment chain, and to develop a sustainable solid the importance of paying for waste management waste management framework for the entire Ibadan and how the money is being used). It was noted metropolitan area. The recommendations outlined that Oyo State is already increasing its communi- in the full report to Oyo State Government are: cations effort toward the tail end of the study. To complement the improvement in communica- • Analyze and verify the current perfor- tions and awareness raising, there is also the need mance of waste collection and transporta- to properly enforce the setting and collection of tion, and its costs. In order to attract the private fees. Proper enforcement will depend partly on hav- sector and encourage investments, Oyo State must ing an effective workforce of Environmental Health be able to report detailed waste management per- Officers. Alternative revenue collection mecha- formance data reliably and be transparent regard- nisms should also be considered in due course, for 16 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria example charging for waste collection via utility tivity of waste management activities, for example, (water or electricity) bills or property taxes, and in- restructuring the waste collection system to make troducing ‘Pay-As-You Throw’ schemes. A further each designated area more viable; improving the option would be to encourage waste producers to quality of roads; establishing Transfer Loading Sta- sort their waste and separate reusable or recycla- tions (TLS) across the metropolitan to reduce the ble materials, and involving the private sector to distance and time for trucks to travel to the dump- pre-collect sorted waste in return for some form of sites; the use of dedicated and ‘prepaid’ bins or recompense to the waste producer. plastic bags for the collection of waste; working with the private sector to establish recycling cen- ters to recover resources and reduce the need for • Develop performance based concession landfill etc. Many of these improvements can be contracts for key aspects of the waste man- done in collaboration with the private sector and agement chain (collection and transfer, pro- through PPPs, but Oyo State will need to ensure cessing, material recovery, waste-to-energy). the investment conditions are attractive, e.g. by These contracts should be of adequate duration, ensuring land identification and acquisition; guar- ranging from 3-4 years for waste collection (2-3 anteeing construction permits for facilities; clear- years could be applied during a transition phase) ly defining the revenue model and construction, to between 8 and 25 years for waste processing maintenance and ownership; etc. such as material and energy recovery and landfill management. The contracts with private contrac- tors should clearly define the scope of services and • Clearly define the roles and responsibil- responsibilities, and should be performance-based ities of the public institutions involved in with agreed incentives and sanctions. Oyo State regulating the waste chain and ensure that should also ensure it develops the necessary com- they have adequate capacity to perform their petencies and resources to manage the procure- responsibilities. At the moment there are three ment process and resulting public-private partner- different public institutions in Ibadan that are in- ships (PPPs), including monitoring the performance volved in solid waste management. In particular, of the private contractors to ensure they fulfill their there should be a clearer distinction between the duties. regulator and operator of waste management ac- tivities. Oyo State should ensure that the appro- priate public institution that is acting as the client • Develop better and more transparent pro- to private contractors has the competencies and curement processes. The private waste man- resources needed to successfully initiate, develop, agement sector can be made more competitive negotiate, award and manage private sector partic- through open tender processes based on strict and ipation engagements. Likewise, Oyo State should clearly defined technical, administrative and finan- ensure that there are adequate resources to enforce cial requirements. By providing reliable information the existing waste legislation, particularly related about the current opportunities and ensuring pro- to indiscriminate dumping of waste and proper dis- curement tenders are as widely published as possi- posal of waste through authorized (private) waste ble, Oyo State will be in a better position to attract collectors. larger waste management companies (domestic or international). The State will also be in a position to achieve the most cost effective deals based on the level of competition from interested private sector operators. It was noted that Oyo State was mov- ing in this direction towards the final stages of the study but will require a much greater concentrated effort • Implement measures that would improve the productivity of waste management activ- ities including investing in transport infra- structure and waste facilities. Oyo State should explore a range of options to improve the produc- | 17 18 | Bank - Private WorldIssues/ Sector Participation in Solid Waste Management Activities in Challenges Ibadan, Nigeria Proposed Action contractual aspects Service providers do not have methods to evaluate the Develop methods and build the service providers’ capacity in financing and man- performance, quality and productivity agement Contractual framework not supportive of the profes- • Develop investment commitment in the contract sionalization of the waste collectors • Ensure the allocation of budget for guaranteed payment of the service providers • Allow processes to renegotiate the contracts with the service providers Contracts for the private contractors are only renewed Develop concession contracts lasting several years, the contracts may first be ex- every year – too short to encourage long-term invest- tended to 2 or 3 years’ as a transition and then the contract duration should be ments and attract financing preferably at least 7 to 8 years cost recovery Waste operators have trouble getting paid in some • Compel all households to pay fees for waste collection areas •To foster community led collection and empowering community associations to enforce the collection of waste into waste collection points • Inform the waste producers about the benefits they can expect from the services provided Currently there is no financial model to estimate the • The financial model for investments and operation of waste management activi- cost of solid waste management in Ibadan ties in Ibadan should be established. • The fees/taxes collected should depend on the affluence of the waste collection areas. • To provide information required to establish the financial model in the contract. Exclusion of informal workers such as scavengers in • Identify the informal workers in Ibadan resource recovery • The waste pickers collect directly from the waste producers in areas difficult to access: the waste producers pay less if they sort the waste While the economic feasibility of resource recovery is • Monitor closely the private companies willingness to invest in resource recovery very uncertain, some companies have already proposed activities to develop waste-to-energy and material recovery facil- • Improve the management of the landfill to reduce the area covered by waste and ities in Ibadan free space for waste-to-energy activities. • Initiate a first negotiation with these companies to elaborate the requirements in order to prepare an open tender and write the terms of reference Table 1: A synthesized table of identified challenges and proposed actions for Oyo State Governments Expected Benefits/ Objective Principal Stakeholder Supporting Stakeholders Time Horizon | 19 • Improve the quality and the productivity of the Service providers / LGA / Oyo State 1 year services to build trust with the public OYOWMA • Help the professionalization of the waste manage- ment • Improve the quality and the productivity of the OYOWMA / LGA / Oyo State 2 to 3 years services Service providers • Improve the relationship between the private and public sector • Prove the capacity to repay loans, give credence to the operators • Bigger investments for the collection means OYOWMA / Banks / OYO State/LGA 2 to 5 years Private contractors • Access to loans for the private sector • Improvement of the quality of the services at a fixed price • Improve the security of the payment OYOWMA / Oyo State / OYOWMA / Service providers 1 to 2 years LGA / Private contractors / • Reduce the fees for the waste producers Community leaders • Enable to enforce high quality and productivity stan- dards • Enable collectors to access to bank loans to buy better equipment • More precise concession agreements OYOWMA / LGA / Oyo State 2 to 5 years Private contractors • More accurate knowledge about the costs and reve- nues • Price of the service justified by the open tender pro- cess • Streets cleaner in the areas covered by the informal OYOWMA / Recycling OYO State 3 years sector industrials / Informal stakeholders • Improvement of the income • Sorting of the waste • Formalization of the informal sector • Reduction of the quantity of waste arriving to the OYOWMA / Industrial Oyo State / 5 to 10 years landfills already identified by Ministry of Environment and OYOWMA Habitat/ Ministry • Cost reduction of Trade, Investment and Cooperatives 20 | Bank - Private WorldIssues/ Sector Participation in Solid Waste Management Activities in Challenges Ibadan, Nigeria Proposed Action infrastructure gaps The poor state of the roads hinder the performance of Continuously improve the state of the roads and traffic the waste management services and productivity There are no normalized measurements of the quantity Install a weighbridge in each dumpsite with a computer system with 3G to transfer of waste delivered to the dumpsites in real time the results of the weighing to OYOWMA Trucks not adapted to the roads in Ibadan Mobilize advanced technical expertise to produce designs, manufacturing templates, mounting and maintenance instructions required to equip four-wheeled medium size trucks according to the private collectors There are no transfer stations in Ibadan Oyo State should establish transfer stations around the metropolitan area as they are the most efficient solution to quickly improve the current performance of waste collection and transport Dumpsites poorly laid out creating truck traffic issues • Improve the quality of the inner tracks of the dumpsites and leachate issues • Higher levelling of the waste • Use of covering soils • Have a network to collect leachate and rain water • Have leachate storage pounds • Have enclosure wall of at least 3m high around the sites roles and responsibilities OYOWMA charges dumping fees for each dumpsite used Standardization of these fees and clear communication on them will help to foster by an operator. In addition, OYOWMA also levies an an- PSP nual licensing fee, however, this fee varies, depending on the areas and categories of operations. The current rules and regulations regarding solid waste OYOWMA and the Ministry of Environment and Habitat, adequately enforce the laws management are not adequately enforced which would protect all stakeholders Areas allocated to Private Collectors Develop a zoning of the city providing balanced collection areas (between low/ middle/high income) and leading to a daily tonnage corresponding to at least five collection trucks There is limited resource recovery such as waste-to-en- • Develop the whole waste management value chain to support resource recovery ergy and composting activities • Have a characterization of the waste conducted according to a standard method Expected Benefits/ Objective Principal Stakeholder Supporting Stakeholders Time Horizon | 21 • Enable the use of bigger capacity trucks OYOWMA Service Providers Continuous efforts • Reduce the number of break downs • Improve the productivity of the teams • Improve the coverage of the collection services Reliable statistical data: OYOWMA / Potential Company specialized in weigh- 6 months for the • New possibilities to pay the waste collection ser- Dumpsite operator ing systems / Universities implementation vices (continuous efforts) • Possibility to correlate this data with other available data (demographic, cost recovery, etc.) to produce management indicators Develop local expertise adapted to the local con- OYOWMA / Oyo State / Universities 2 years straints and enabling to use vehicles simple to main- Private contractors tain and repair The transfer stations would enable the collection OYOWMA / Oyo State 2 to 5 years vehicles to remain longer in the collection areas every Private contractors / LGA day and to reduce the risks of damage to the collec- tion vehicles. • Dumpsites with a longer life cycle OYOWMA / Oyo State LGA / Private contractors 6 months for the • Reduce the disturbances for the surroundings improvement inner • Reduce the risk of truck break-downs in the dump- tracks sites • The inner tracks can be used by packer trucks 3 to 10 years • Reduce the impact on the environment • Improvement of the operation of the dumpsites OYOWMA / Oyo State/LGA 2 to 5 years • More transparency in the cost recovery (better gov- Private contractors erning) • Eliminate illegal dumping of waste both by waste Oyo State OYOWMA / LGA 3 to 10 years producers and waste collectors • Productivity of the collection team improved • Cover all the territory OYOWMA / LGA / Private Oyo State 4 years • Structure future delegation markets contractors • Improve professionalism in the SWM sector for pri- vate operators 3 to 10 years 22 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria introduction context and objectives of the study Ibadan is the capital of Oyo State and the third World Bank initiated an urban renewal scheme in largest city in Nigeria. The population of the met- three neighborhoods in Ibadan. One of the areas ropolitan area of Ibadan is estimated at close to of focus of the project was SWM and included the 3,5 million (IUFMP, 2014). Ibadan is a city that is construction of a transfer station at Orita Aperin growing amorphously and is characterized by tradi- and a landfill at Aba-Eku (Ogungbuyi, 2013). The tional uncontrolled urbanization (Jacob, 2010). It is transfer station is no longer in use and the landfill heavily overcrowded and the environment is large- has been converted into a dumpsite. The project ly degraded. In terms of its spatial spread, Ibadan did include an institutional and management study sprawls over a radius of 12-15 km (about 700 km²) which eventually helped prepare the organizational and it is still expanding uncontrollably. Due to the and management structure of an authority to be re- inability of the State Government to keep pace with sponsible for SWM in Ibadan. In 1994 a Sustainable infrastructure needs and the speed of growth, most Ibadan Project (SIP) was launched with support parts of the city are unplanned and lack basic pub- from the United Nations Centre for Human Settle- lic services and facilities. There are only a few as- ments (UN-Habitat) and the United Nations Envi- phalted roads in the city. ronmental Programme (UNEP) Sustainable Cities Programme. The management of solid waste in Ibadan has been a challenge for decades. A large portion of the solid The SIP brought together stakeholders together to waste generated in the city is dumped on available discuss key environmental issues with waste man- plots of land, sidewalks, roads, streams, channels agement identified as one of three key priorities, and drains – the collection rate is estimated at but this only led to limited improvements. The Gov- around 40% (Ogungbuyi, 2013). The clogging of the ernor of Ibadan, Abiola Ajimobi , has launched sev- drainage system is a particular issue as Ibadan is eral initiatives to improve SWM (Adah, 2013) and highly exposed to flooding, and this exacerbates most recently declared SWM part of his priorities the health hazards during flooding. at his inauguration in 2015 (Ajimobi, 2015). While progress has been made, SWM in Ibadan remains a Improving solid waste management (SWM) is a major problem. While trying to improve SWM, there priority for the Oyo State Government. Various ini- is also an additional challenge of reducing the bur- tiatives over the years have attempted to improve den on public finances. SWM in Ibadan. A pilot study commissioned in 1984 by the World Bank looked at how to improve var- Oyo State has recognized the need to improve the ious aspects of housing, living and environmental level of private sector participation (PSP) in order to conditions of different slums in Ibadan (Fourchard, overcome the technical and financial deficiencies 2003). In 1988 another project also funded by the currently associated with solid waste management 24 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria in Ibadan, and agrees that private investment in the Egipe SARL undertook this assessment with the sector can help increase efficiency, lower costs and following objectives: improve the quality of service. The level of PSP in • Assess the existing practices, challenges waste management in Ibadan is currently limited and current performances of private sector to waste collection and transportation. in SWM in Ibadan; • Identify challenges and gaps in terms of in- The Governor of Oyo State has therefore requested stitutions and financing; and the support from the World Bank to conduct a study on how the private sector can be more actively and • Design an action plan in order to involve the effectively involved in SWM activities in Ibadan. private sector more actively to improve the efficiency and quality of SWM in Ibadan. In this context, a team led by the World Bank which included consultants from Ernst & Young (EY) & expectations from this study The reports focused analysis and recommendations The intended audience for this study is targeted is aimed to be used as a policy note to assist the towards policy makers and Government both lo- Oyo State Government in improving the efficiency cal and state. The Bank team will directly engage of the SWM sector for Ibadan but it is also expect- with the following stakeholders Executive Council ed to provide key inputs for other stakeholders in- of Oyo State, the Oyo State House of Assembly, volved in the waste chain. The Federal Ministry of Environment and Water Re- sources, OYOWMA to refine and include the report The study will aim to compliment the activities un- recommendations are integrated within the Oyo dertaken as part of the Ibadan Urban Flood Man- State Action Plans currently being developed. agement Project (IUFMP) specifically recommen- dations from this report will be integrated into the In addition, to the named stakeholders and geo- Solid Waste Masterplan which will be launched in graphical study it is envisaged that the observa- 2017. The Solid Waste Masterplan will take a great- tions and recommendations for improving SWM to er holistic assessment of the entire of Ibadan city have relevance to not only other Nigerian cities but to provide a more in-depth analysis to improve the in a broader global context for cities that face simi- SWM sector by identifying short, medium and long- lar challenges in SWM. term investments priorities over a 20-year period. The main expectations of OYOWMA from this Whilst it has been identified in this report the many study are that it will contribute to improvements challenges in the SWM sector, the report aims to in the process of building the solid waste manage- provide four actionable priorities areas with sug- ment capacities of Oyo State and of the private gestions of sequencing over the short, medium and sector in Ibadan. It is also expected to help raise long-term. public awareness on waste management issues (OYOWMA, 2016). The Oyo State Waste Manage- • The Contractual aspects of PSP in Ibadan, ment Authority (OYOWMA) expects this study towards further transparency and predict- and the workshops conducted to form a basis to ability; increase the role of PSP in solid waste management in Ibadan, to improve the quality of the service and • Cost recovery, and its importance to sector to help OYOWMA to shift from operational waste and PSP viability; Infrastructure gaps, tar- collection to the regulation and the monitoring of geting the Government Officals, essential the waste management operations. for sector efficiency, and reducing costs; • Roles & responsibilities, including the broader institutional arrangements framing PSP that will bring transparency and focus; methodology To perform this assessment, The World Bank team a private waste company (see Annex 2 – Potential first reviewed available reports and articles on the Waste Services Agreement Provisions). existing practices, challenges and current per- The assignment also included the organization formance of SWM in Ibadan, and in particular the and facilitation of discussions around options for involvement of the private sector in SWM. This increasing PSP and its performance at stakeholder review was followed by field visits and workshops events that were attended by the full range of ac- with a selection of key SWM stakeholders in Ibadan. tors in the waste chain (e.g. Oyo State Waste Man- The literature review included technical reports agement Authority (OYOWMA), law enforcement and academic articles on waste management in agencies and other relevant government entities, Ibadan/Oyo State and more broadly across Nigeria existing private refuse collectors, domestic and and other cities in developing countries facing sim- commercial waste generators, community associa- ilar issues. Reviewing information on challenges tions, market associations, potential private inves- at a national level as well as at a regional level has tors, etc.). helped to identify the specificities of the situation in All the data gathered during the course of the as- Ibadan. The team also examined reports from pre- signment was then analyzed to build a picture of vious studies which characterize the nature of solid the current state of PSP in SWM in Ibadan met- waste in Ibadan; provide estimates of the quanti- ropolitan area, and how it compares with leading ties of waste produced; describe existing collection practices in similar environments, bearing in mind systems and models; and, identify instances of PSP the specifics of the Ibadan context. and challenges in effectively managing solid waste. The team’s technical experts visited Ibadan Feb- This review was followed by a series of field visits ruary 11-14th 2015 to commence the study. During and workshops with a selection of key SWM stake- the visit the experts met with: holders in Ibadan. A review of the relevant legisla- tion was also performed by the local legal experts • Mr. Dayo Ayorinde (Project Coordinator, Ajumogobia & Okeke to understand the laws and IUFMP) and others at the Oyo State Gover- statutes likely to affect PSP, and the possible impact nor’s Office – Ministry of Local Government on the aspirations of the Oyo State Government in (February 11th 2015); • Mrs. M.A. Omonigbehin (Permanent Secre- relation to waste management in Ibadan (see An- tary of Environment and Habitat) and others nex 1 – Legal ). at the Ministry of Environment (February 12th 2015); World Bank PPP legal experts alongside with con- • Mr. Tunde Ahmed, President of the Pri- sultants from Pinsent Masons reviewed the exist- vate Refuse Contractors, and Mr. Adeogun ing waste collection and transport service agree- Olufemi, Vice-President (February 12th ment with private sector participants, and laid out 2015); • Mr. Moses A. Adedigba (GIS Analyst-Statis- potential provisions that could be contained within tician, Oyo State Government) to exchange a waste services agreement with OYOWMA and maps (February 12th 2015); 26 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • Engr. Adebisi O.G. Adesina, Chairman of OYOWMA, and his team (February 13th february 10th 2015: 2015). first stakeholder forum Topics covered: • Presentation of the World Bank study The following field visits were also subsequently • The current waste management system and conducted: level of PSP and its performance • Challenges in SWM and PSP and what • Shadowing the Ministry of Environment’s are the key areas of improvement monitoring team during an Environmental Sanitation Exercise (February 12th 2015); • Visits to two dumpsites (Lapite and Ajakan- ga) (February 13th 2015); june 4th-5th 2015: • Visit to the OYOWMA truck garage (Febru- second stakeholder ary 13th 2015); • Observations of the main collection routes workshop (2 days) Topics covered: of OYOWMA trucks (February 13th 2015); • Visits to areas where private collectors oper- • PSP in SWM activities in Ibadan related to ate (February 13th 2015); collection and urban facilities (Day 1) • Study visit with OYOWMA and other State • PSP in SWM activities in Ibadan related to Government officials, to observe existing landfills (Day 1) private sector operations in Lagos (15th De- • Presentation of the progress report and the cember 2015). challenges of the transition between the existing situation and a situation with long- term contracts (Day 2) The following interviews were conducted with pri- • The legal framework for SWM in Ibadan and vate sector participants (see Annex 3 – Stakeholder for stakeholders in collection, transporta- interviews): tion, sanitation and cleaning (Day 2) • Roundtable discussion on the roles and re- • Poroku & Co. (PSP operator in Oyo State); sponsibilities in SWM (Day 2) • Development Planning Consortium Limited (PSP operator in Oyo State); • Musiliu Asim Nigeria Company (PSP opera- october 15th 2015 tor in Lagos State); third stakeholder meeting • Grace-X (PSP operator in Lagos State). Topics covered • Olugbenga Adebola, Chief Executive Offi- cer, Richbol Environmental Services Ltd. • Sensitization of stakeholders involved in the • Abubakar Sadiq, Project Coordinator, Karka- new OYOWMA waste collection measures ra Rapid Development Limited • Waste management cost recovery and cost • Muyiwa Adeniyi, Managing Director, reducing solutions including transfer sta- Waste-Point Limited tions, payment methods and the penetra- • Boluwaji Oyewumi, Business Development tion of waste collection trucks into the inner Manager, Wecyclers districts • Kirsten Jack, Senior Manager, Nigeria Infra- • PSP involvement in landfill management structure Advisory Facility (NIAF) • Dr. Cornelius Shogunle, Chief Execu- november 25th 2015: tive Officer, Highland Energy Solutions training on public-private partnership arrangements Four stakeholder events and a roundtable were or- for solid waste manage- ganized during the study. The main objectives of ment in ibadan the meetings were to engage key stakeholders in open discussion on current challenges in the SWM sector in Ibadan as well as increase awareness and november 26th 2015: appreciation for potential for PSP in SWM in Ibadan. investor roundtable on psp The following stakeholder meetings were held in in solid waste management Ibadan: activities in ibadan general information about ibadan Ibadan is located in South-Western Nigeria and is The area around Ibadan is drained by three im- the capital of Oyo State. The city lies mostly on low- portant rivers: River Ogunpa, River Ona and River lands which are punctuated by rocky outcrops and Ogbere and their several tributaries including River series of hills. Elevation ranges from 150m in the Omi, Kudeti, Alaro and Alapata. The combination valley area to 275m above sea level. of hills and river valleys provides a good drainage niger nigeria oyo Abuja Ibadan Lagos Figure 1: Map of Ibadan metropolitan area. Source: (Ogungbuyi, 2013) 28 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria for the city, but water courses are often blocked by son lasts from November to March while the wet solid waste coupled with the construction of struc- season starts from April and ends in October. Rain- tures along the river courses (IUFMP, 2014). fall is about 1,150 mm per year on average. Average daily temperature ranges between 25 °C (77.0 °F) The climate is equatorial, notably with dry and wet and 35 °C (95.0 °F), almost throughout the year. seasons with relatively high humidity. The dry sea- administration and demographics Administratively, Ibadan comprises 11 Local Gov- According to the National Population Commission ernment Areas (LGAs): Ibadan Metropolis consists 2006 Census, the population of Ibadan metropoli- of five LGAs which cover the ‘inner city’: Ibadan tan area was almost 2.6 million and the number of North, Ibadan North-East, Ibadan North West, households 616,103 (see Table 1: Population, densi- Ibadan South West and Ibadan South-East; the ty and number of households in the Ibadan Metrop- six remaining LGAs constitute the suburbs of the olis Area. Source: (Ogungbuyi, 2013)). According to Metropolis. Local Governments Councils consist of the Ibadan Urban Flood Management Project’s 2014 the Executive Arm made up of the Executive Chair- report (IUFMP, 2014), the annual population growth man, the Vice Chairman, the Secretary and the Su- is around 3.2%, which would mean that the pop- pervisory Councilors. ulation of Ibadan Metropolis was about 3.4 million in 2015. Table 2: Population, density and number of households in the Ibadan Metropolis Area. Source: (Ogungbuyi, 2013) Local Government Area Population Area in km2 Population density Total households Total households (2006) (people / km2) (2006) (2012 - projection) Ibadan North 306 795 145.6 2 107 76 740 80 731 Ibadan North East 330 399 81.5 4 057 81 661 86 942 Ibadan North West 152 834 31.4 4 870 39 336 40 217 Ibadan South East 266 046 80.5 3 307 69 235 70 008 Ibadan South West 282 585 124.6 2 269 73 052 74 360 sub-total (urban) 1 338 659 463.3 2 889 340 024 352 258 Akinyele 211 359 427.3 495 49 883 55 617 Egbeda 281 573 136.8 2 058 65 466 74 094 Ido 103 261 865.5 119 24 745 27 172 Lagelu 147 957 283.9 521 32 688 38 934 Oluyole 202 725 369.4 549 44 200 53 345 Ona Ara 265 059 577.1 459 59 097 69 748 sub-total (semi-urban / rural) 1 211 934 2660.0 456 276 079 318 910 grand total 2 550 593 3123.3 817 616 103 671 168 The city can also be classified into seven morpho- age gross national income (GNI) per capita in Nige- logical regions: the core, the older suburb, the new- ria is around USD 2,760 (World Bank Group, 2014). er eastern suburb, the new western suburb, the No recent information was found for the average post-1952 suburb, the government-reserved area, income of households in Ibadan. and the government/private owned residential lay- outs and estates (Afon & Faniran, 2012). The aver- the legal and insti- tutional framework related to solid waste management Solid waste management is dealt with under the and state policies and regulations applicable to sol- environmental legal framework in Nigeria. This id waste management and private sector participa- chapter presents an overview of applicable federal tion in particular. federal level In Nigeria, the Federal Government is responsible 1. By Local Government/Municipal Agencies for the environment and in accordance with Sec- 2. By Private Companies on contract with the tion 20 of the Nigerian 1999 constitution: “The state LGA/Municipality shall protect and improve the environment and 3. By Private Companies on contract with Home safeguard the water, air and land, forest and wild Owners life of Nigeria.” The constitution also specifically as- 4. By public-private partnership (PPP) signs the responsibility of environmental sanitation Like much of Nigeria’s environmental laws and pol- to the Local Government (Omoleke, 2004). icies (Ijaiya & Joseph, 2014), the policy guidelines The Federal Ministry of the Environment is respon- have never been effectively implemented, and there sible for environmental protection, natural resourc- has not been any further development at federal es conservation and sustainable development. Ef- level of private sector participation in solid waste fective waste management is one of its main areas management. of focus. In 2005, it developed a set of policy guide- The National Environmental Standards and Regula- lines on solid waste management (Federal Ministry tions Enforcement Agency (NESREA), established of the Environment, 2005). The policy guidelines set in 2007 (and replacing the Federal Environmental out general objectives for solid waste management Protection Agency), is the body charged with the in Nigeria as well as defined the roles and respon- enforcement of environmental laws, standards and sibilities of Government at the Federal level, at the regulations in the country including solid waste State level and at Local Government level. The fol- management. The National Environmental (Sani- lowing four solid waste management options are tation and Wastes Control) Regulations of 2009 fur- recommended within the policy guidelines: 30 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria ther provides the legal framework for environmen- quirement that the waste is handled by a person tal sanitation and waste management in Nigeria. licensed to transport and dispose of solid waste in a These regulations provide general guidelines on designated waste management facility. the management of solid waste, and include a re- oyo state level / ibadan Solid waste management in Ibadan metropolitan ing and taking measures to ensure effective envi- area is one of the key responsibilities of Oyo State. ronmental structures in Oyo State for flood control Ibadan is made up of the jurisdictions of several au- through dredging, solid and liquid wastes collec- tonomous Local Government Areas (LGAs). While it tion and disposal, water and air pollution eradica- is formally possible for states in Nigeria (or indeed tion, noise control and general sanitation. cooperating LGAs, with state approval) to establish The Ministry of Environment and Habitat is also coordinating or planning authorities for cities, these responsible for raising awareness of waste man- cannot (for constitutional reasons) be recognized or agement and other environmental issues in Ibadan, considered as municipal governments with their and across Oyo State. It oversees the weekly and own ‘fiscal’ or administrative identity (World Bank, monthly Environmental Sanitation Exercises, 2015). By default, State Governments, such as Oyo which among other things checks on the state of State, assume the role of city managers, alongside waste management in the Local Government Ar- all their other functions. The responsibility for solid eas. During the Environmental Sanitation Exercis- waste management in Ibadan is held by three insti- es, citizens are expected to participate by clean- tutions, each with different responsibilities: ing their immediate environment. The role of the • The State Government and the (State) Min- Ministry of Environment and Habitat during the istry of Environment and Habitat sanitation exercises is to make sure that everybody • The Local Governments participates, and there are sanctions for people who • The Oyo State Solid Waste Management do not cooperate while the exercise is taking place. Authority (OYOWMA) (EGIPE Sarl, 2015). The head of the executive branch, the State Gov- the local governments ernor is the final decision maker on SWM and PSP. The duty of each Local Government is to participate OYOWMA is the operational authority for solid in the economic planning and development of its waste management in the city. The Authority is in area. The functions of Local Governments include charge of waste collection, registration and over- the collection of taxes and fees, and as the provision sight of private sector operators, transportation of and maintenance of waste management services. waste to disposal sites, management of disposal However, for several years the Local Governments sites and policy implementation. It is led by a Gen- in Ibadan did not have the means to effectively eral Manager who reports to the Chairman of the provide waste management services in their areas Authority (Ogunyemi, Personal Communication, and therefore, the responsibility was transferred to 2015). OYOWMA and the Local Governments handed over their waste management equipment to OYOWMA (EGIPE Sarl, 2015). In October 2015, the roles were the oyo state ministry of reversed and OYOWMA handed back the waste environment and habitat management trucks to the Local Governments. The At the State level, the Ministry of Environment and Local Governments currently collect waste within Habitat (MEH) in Oyo State was established by the their jurisdictions (at the time of writing this report). Ministry of Environment and Habitat Law in 2011 with its responsibilities including the protection, The Local Governments in Ibadan had partial- maintenance and development of the environment. ly funded OYOWMA in return for the solid waste The functions of the MEH also include: establish- management services provided. According to THE LEGAL AND INSTITUTIONAL FRAMEWORK RELATED TO SOLID WASTE MANAGEMENT | 31 Ogungbuyi (2013), the Local Government Councils OYOWMA is also responsible for granting and is- also have the following roles: suing waste collection operation permits to private refuse contractors after ensuring that they satisfy • Enact appropriate legislative instruments stipulated conditions. The operating permits have and establish necessary sanctions and en- to be renewed every year if the contractors have not forcement mechanisms for efficient service been found to contravene the rules and regulations delivery prescribed by OYOWMA. OYOWMA monitors and supervises the activities of the private refuse con- tractors (OYOWMA, 2016). • Recruit, train, and retrain staff for efficient service delivery In the future, OYOWMA would like to reduce and ultimately stop their operator activities, and revert • Establish a consultative forum with mem- to its role as a regulator (i.e., monitor and regulate bers of the public to build consensus on ap- waste management activities). In this context, they propriate strategies for waste management would retain some capacity to manage waste, but only in a supporting role. For example, in emer- gencies, where there is a need to replace a private • Develop information, education and com- contractor until a new contractor is in place. (EGIPE munication materials on solid waste han- Sarl, 2015). dling techniques at household level The graphic below represents the different legal • Promote private sector participation in the structures and their roles regarding the institutional delivery of waste management options framework for solid waste management, as defined by legislation. the oyo state solid waste management authority The Oyo State Solid Waste Management Authority (OYOWMA) is the main regulator of waste man- agement activities in Ibadan.1 Although OYOWMA currently operates waste collection and transfer ser- vices, it is not meant to. With the transfer of waste collection to the Local Governments in October 2015, OYOWMA is less involved in the waste col- lection operations, but still removes waste from all areas immediately along the main federal express- way that transverses the city, i.e. the toll gate to Ojoo end of the expressway, and intervenes when the LGAs are not able to perform their waste col- lection functions in their jurisdiction. In addition to this, OYOWMA manages the four dumpsites in Ibadan. The stated main role of OYOWMA is to set the rules related to waste management, enforce them and verify that they are well-respected. 1 OYOWMA was referred to as Ibadan Waste Manage- ment Authority (IWMA) between 1998 and 2008. 32 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria Each of these public actors has a role to play in im- below summarizes the mandates and actual activi- proving the conditions for PSP. The following table ties in SWM of each of these actors: federal-level National Environmental Standards and Federal Ministry of Environment Regulations Enforcement Agency (NESREA) • Develop, periodically review and update the Poli- • Enforce compliance with environmental regula- cy Guidelines on Solid Waste Management tions (including waste) and international agree- ments • Prepare a Solid Waste Master Plan as a national blue print for effective Solid Waste management • Review and evolve existing guidelines, regula- and ensure its Implementation at the appropriate tions and standards on environment including levels of Government waste management and environmental sanita- tion • Develop and circulate set standards on private sector particiaption in Solid Waste Management • Establish programs for setting standards and services regulations for poullution and other forms of en- vironmental degradation (including waste man- agement) oyo state level Oyo State Government • Support and ensure the implementation of the policy guidelines on SWM in Oyo State • Facilitate the implementation of the National Solid Waste Master Plan • Make adequate budgetary provisions for SWM Ministry of ENvironment and Habitat (MEH) • Formulate and enfore policies, statutory rules and regulations related to enviromental protection including waste management • Conduct public enlightenment campaigns and disseminate vital information on environmental and ecological matters • Coordinate the activities of the environmental monitoring units and sanitary inspectors of the Local Governments Oyo State Solid Waste Management Local Government Councils Authority (OYOWMA) • Responsible for the storage, management, con- • Provision and maintenance of waste collection version, transfer and disposal of solid waste in services in the Local Government Areas the State • Supervise and monitor environmental health • Enforce all laws and regulations concerning solid issues associated with waste and other relates waste management issues • Appoint, register, regulate and monitor private • Inspect the private refuse contractors waste refuse contractors including issuance of permits collection services within the Local Government Area • Prepare, collect and use data and information on SWM Figure 2: Legal structures for waste management in Ibadan THE LEGAL AND INSTITUTIONAL FRAMEWORK RELATED TO SOLID WASTE MANAGEMENT | 33 Table 3: Overview of public institutions involved in solid waste management in ibadan institution mandate related to swm activity in swm Oyo State • Formulate and enforce policies, statutory rules, and • Monitoring OYOWMA Government, regulations related to waste management Ministry of • Establishment and enforce- Environment and • Establish and take measures to ensure effective envi- ment of environmental policy Habitat ronmental structures in the State for solid waste man- and standards agement • Public awareness raising • Conduct public enlightenment campaigns and dissem- inate vital information on environmental and ecological matters • Coordinate the activities of the environmental moni- toring units and sanitary inspectors of the Local Govern- ments • As the Oyo State Environmental Protection Agency (OSEPA) structure is not yet in place, the Pollution Con- trol Unit of the Ministry is responsible for monitoring and controlling the disposal of solid, gaseous, and liquid waste generated by both government and private facil- ities in the State. Oyo State Solid Waste • Responsible for the storage, management, conver- • Street cleaning Collection Management Authori- sion, transfer and disposal of solid waste in the State ty (OYOWMA) • Transport • Register refuse contractors and renew such registra- tion annually • Regulation • Charge the refuse contractors registration and renew- • Landfill management al fees (amounts set by the Authority periodically) • Private contractors • Regulate and monitor the activities and operations of registration and monitoring the refuse contractors in the State • Make regulations subject to the approval of Oyo State Executive Council Local • Collect taxes and fees from the Local Government Areas • Had delegated all solid waste Governments management activities to OYOW- • Responsible for waste collection and transport in their MA until October 2015 own jurisdiction • Has since been responsible for • Supervise and monitor environmental health issues as- waste collection and transport sociated with waste and other related issues • Inspect the private refuse contractors waste collection services within the Local Government Area • Funded OYOWMA, when it was responsible for waste collection operations Other stakeholders • Help with awareness-raising efforts in relation to po- • Awareness raising about (YES-O,2 market tential sanitation problems related to waste management waste generation and collection associations) and the importance of waste collection. 2 YES-O (Youth Empowerment Scheme of Oyo State) Cadets are supervised by the Environmental Health Offi- cers 34 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria Besides the key institutions listed in the table in waste management in Ibadan. In partic- above, other institutions in Oyo State also have a ular, the Office of the Surveyor-General is stake in solid waste management and private sec- to provide up-to-date and purposeful geo- tor participation in Ibadan: graphic information on Ibadan. . • The Oyo State Ministry of Physical Planning • The Oyo State Governor has a Special and Urban Development is responsible for Adviser on Investment Promotion & Pub- formulating and implementing State poli- lic-Private Partnerships (PPP), Ms. Folakemi cies for urban and regional planning, phys- Akinleye, and she has a role to play when ical development of the State including the developing PPPs. spatial location of infrastructural facilities. It The Oyo State Environmental Protection Agency also includes initiating, formulating and im- (OSEPA) was established by law in 2012 to be an plementing strategies for the development integral part of the Governor’s office for the purpose of urban and rural settlements, processing of environmental protection, but it is not yet in op- and granting planning approval and clear- eration. The OSEPA is expected to establish and ance to prospective developers and various recommend acceptable safe methods of the collec- land users in Oyo State. Although not active tion and disposal of hazardous and toxic waste in in relation to solid waste management ac- Oyo State, however, the Pollution Control Unit of tivities, it is potentially responsible for the the Ministry of Environment and Habitat exercises construction and operation of dumpsites / the functions and responsibilities of the Agency. landfills and transfer stations. Please see Annex 1 for the detailed legal framework • The Oyo State Ministry of Lands And Hous- for solid waste management in Nigeria and in Oyo ing and the Office of the State Survey- State (Ibadan) or-General are also important stakeholders operation of current contracts with private sector participants Private waste collection contractors are required Based on the application OYOWMA will then issue to submit an application to OYOWMA for regis- an operation permit for the collection and dispos- tration as a Private Refuse Collector. The applicant al of waste from designated service areas. It is not must demonstrate financial capacity and provide clear how the process of allocating service areas to information on key staff, equipment and evidence private contractors is done. of similar work successfully performed in the past. The applicant must also own a refuse compactor The operation permit grants the private contractor truck (10 – 30 metric tons). Private contractors can the exclusive right to collect waste management apply for three categories of permits according to fees from the waste producers in the designated the type of waste producer – each category entails service area, and in return the private contractor a different application fee: commits to collecting waste in the area and trans- porting it to one of the four dumpsites in Ibadan. • Domestic or residential waste collection The waste services agreement does not define the (e.g. waste from households) – N2,500 (USD waste services in detail, but does specify that the 12.50) private waste operator must: • Commercial and institutional waste collec- tion (e.g. waste from offices, banks, restau- rants, etc.) – N5,000 (USD 25.00) • properly educate and train its staff on proper • Industrial waste collection – N10,000 (USD handling of waste; 50.00) THE LEGAL AND INSTITUTIONAL FRAMEWORK RELATED TO SOLID WASTE MANAGEMENT | 35 Figure 3: Administrative requirements to be submitted with the application for waste operation permits for Private Refuse Contractors in Oyo State Private contractors must submit an application form with the following: 1. Evidence of registration of company with Corporate Affairs Commission; 2. Evidence of registration of business premises with the Ministry of Trade and Investment, Oyo State; 3. Copies of the company’s financial records for the three years; 4. Tax clearance of two directors of the company for three years consecutively; 5. Evidence of ownership of at least one refuse compactor truck of 10-30 metric tons capacity; 6. Submission of the company’s profile containing information on key staff, op- erational bank details and evidence of experience with similar work in the past; and, 7. Evidence of registration with the Environmental Health Officers Registra- tion Council of Nigeria. • only use vehicles approved by OYOWMA for The private operators are entitled to 80% of the waste collection and transport, and ensure monthly waste collection charges collected from that any vehicle used is properly covered waste producers in the designate area, while the with tarpaulin to avoid waste falling by the 20% balance of the charges should be paid to / roadside during transport; or retained by OYOWMA for its administrative charges and maintenance of its facilities such as • maintain a proper record of their waste dis- the dumpsites. Oyo State compels waste producers charges at the approved sites, and also of to patronize the private waste contractors, but does waste discharges by their customers (cop- not offer any guarantees for private operators, when ies of such records shall be submitted to the waste producers do not pay the waste management Authority on a monthly basis); and, fees. The private contractors are responsible for col- lecting waste fees to ensure revenue. They must also keep up to date records of the fees collected. • have adequate working tools and equip- ment. The operation permits issued by OYOWMA are valid for only one year at a time and is renewable Failure to carry out the duties and comply with annually subject to satisfactory performance and OYOWMA’s guidelines, can lead to a fine and / or payment of the annual renewal fee. revocation of the operation permit. There are standard tariffs fixed by OYOWMA that the private contractors can charge for their waste collection services. The waste collection fees are depending on the area in Ibadan - the metropolitan area is divided in High Income, Middle Income and Low Income areas. Furthermore, all the waste col- lection categories (i.e. domestic, commercial and industrial) have a minimum and maximum fee, but it is not transparent how these are set by the pri- vate contractors. 36 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria assessment of the existing legal and institutional framework The legal and institutional framework for solid private sector participants to ensure revenue from waste management - and private sector partici- waste collection fees when waste producers do not pation in particular - is generally well established, pay. On one side, Oyo State does not have the ca- but Oyo State lacks the capacity to enforce exist- pacity to monitor and adequately enforce the regu- ing regulations adequately and develop its waste lations that compel waste producers to dispose of management activities. Oyo State already engages their waste correctly and also to pay for waste man- the private sector in waste collection and transport agement; and on the other side, ensure that private activities, but could expand this to include other contractors perform their services properly. waste management activities such as street clean- As there are differences in neighborhoods, some ing, resource recovery (e.g. waste-to-energy, recy- service areas are more lucrative than others. How cling, etc.) and management of landfills. private contractors are allocated service areas is An analysis of the legal framework by the legal ex- however not clear. Ideally contract awards should perts did not reveal any inconsistencies in the legal be done after a competitive procurement process. framework (see Annex 1 – Legal ). Despite Lagos The duration of licenses of only one year and un- being more advanced with regards to private sec- certainty regarding the award of service areas dis- tor participation in SWM, no major differences were suades private sector participants in any long-term identified in the legal framework of Oyo State and investments to improve waste management ser- Lagos State. It is however a major problem for the vices and their efficiency. the current situation of solid waste management The management of solid waste in Ibadan has been • The markets: Waste generated in markets a challenge for decades, as highlighted by a ‘Waste is collected both by private and public op- to Wealth’ initiative that was introduced several ad- erators through the arrangements outlined ministrations ago (Sridhar & Hammed, 2014). There above (EGIPE Sarl, 2015). There is also an are three different areas of the city: Environmental Sanitation Exercise every Thursday between 8 am and 10 am for the • The planned areas: The residents of these markets (IUFMP, 2014). areas are in the medium to high income bracket, and they are able to pay for waste OYOWMA, the Local Government Areas (LGAs) collection. These areas are accessible by and private operators together provide waste col- trucks and are served by private operators. lection services within the city. Private contractors are responsible for waste collection from designat- • The unplanned and new areas: The ed residential, industrial and commercial areas, populations of these areas have the lowest while LGAs are in charge of areas not covered by incomes and they are perceived as not be- the private contractors within their jurisdiction. ing able to afford to pay for waste collection OYOWMA is responsible for the public areas along services. As a consequence, the populations the main federal expressway that transverses the in these areas generally do not pay for waste city. collection services. Some of these areas do The role and responsibility of waste collection not receive any government services. They changed during the project. At the start of the proj- are currently not served by waste collec- ect OYOWMA was responsible for all public areas tors as their roads are unpaved and there in the city, but in October 2015 the responsibility are parts not accessible by waste collection for public waste collection was transferred back to trucks. Solid waste is often dumped into the the LGAs. This also meant that most of the waste surrounding bushes and along footpaths. collection trucks and equipment was also handed The process for waste collection is different back to the LGAs. in these areas as people have to bring their waste to the closest paved road for waste collection. Collection is done at regular in- tervals during the week. There is also an En- vironmental Sanitation Exercise on the last Saturday of the month for residents, which involves waste collection. 38 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria generation and collection quantities of waste (Ogungbuyi, 2013). Babayemi and Dauda (2009) generated and collected identify in addition to the above-mentioned waste Waste in Ibadan can be classified into four major streams, agricultural waste and waste from educa- classes: domestic waste; commercial waste; in- tional establishments. dustrial waste; and, public and institutional waste Figure 4: Source and type of waste in Ibadan (average percentages by weight) The composition of solid waste generated in Ibadan of data and studies. Reliable estimates of the quan- can vary but is mainly composed of organic waste tity of waste generated generally requires system- (accounting for 42% by weight), paper (10%), tex- atic and accurate data collection (e.g. by weighing tile, glass, metals, wood, plastics and (Ogungbuyi, the trucks coming in and out of the dumpsites), and 2013). According to Moruff (2014), organic waste depends on the collection rate in the various dis- including leaves and vegetable peelings constitute tricts. the bulk of the waste because raw food products are brought to the city unprocessed. The amount OYOWMA provided the figures below for waste of tins, metals, paper, ash, dust and stones in the collection (both public (OYOWMA and Local Gov- waste are increasing because of the changing con- ernment Areas) and public collection) in the city in sumption patterns of people in the city. 2015 (OYOWMA, 2016): The quantity of waste generated in Ibadan Metrop- According to these figures, the average amount of olis in 2012 is estimated at about 635,000 tons – or waste collected per month in 2015 was 38,250 tons. 0.55 kg/person/day (Ogungbuyi, 2013).3 According This corresponds to just about 0.25 kg/person/day to Moruff (2014), it is difficult to determine the exact collected (assuming that the population of the city quantities of waste generated in Ibadan, due a lack was 3,5 million in 2015). If the high estimate of 3 Estimates range from 0.30 – 0.71 kg/person/day. Adewumi (2005) estimated that 0.71 kg/person/day of solid waste were generated in Ibadan. THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 39 Table 4: Quantity of waste collected in 2015. Source: OYOWMA Tons of waste collected (metric tons) 0.7 kg/person/day of waste generated is assumed forms of waste collection (Adewumi, 2005), the collection rate is about 35%. This is in line with Ogungbuyi’s (2013) estimate of collection from public sector the collection rate to be around 40%. OYOWMA collects refuse day and night (because of About 40% of the total waste collected was done traffic, the Authority also picks up waste between 9 by private contractors, an increase from 2014, pm and 6 am) and is responsible for the collection of where only about 30% of waste was collected by 68% of the city’s waste (EGIPE Sarl, 2015).4 The city the private sector. The Local Government Areas is heterogeneous with different kinds of districts (LGAs) were responsible for about 6% of the waste and roads in various states of degradation. There- collected, while over 50% of the waste collected in fore, the terrain is not conducive to the efficient use 2015 was done by OYOWMA. As the responsibility of packer trucks, and requires the use of different of waste collection has returned to the LGAs, the means of collection. At present, the waste collec- share of waste collected by LGAs are now much tion methods being practiced depend on the ease higher and OYOWMA is only responsible for a small of accessibility by motorized vehicles. fraction of the waste collected. Ogungbuyi (2013) identified four prevalent forms of As only very limited data on waste collection are re- waste collection in Ibadan: house-to-house, com- corded, it was not possible to provide more informa- munal depots, block system and shop-to-shop. In tion on collection rates or the current performance addition to these forms of collection, commercial of waste collection in Ibadan. and industrial waste collection must be included (Omoleke, 2004). A study on dumpsite and waste collection points of 140 residents (carried out in 2013 in Ibadan) identified the following five dif- ferent methods of solid waste disposal based on a questionnaire: 4 This practice may have changed with LGAs now responsible for their own waste collection. 40 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • government/dumpsite waste collection point; vices. In some cases waste collected on the road • private drums; was dumped into river beds by the sweeping • bury/burn by households themselves; teams. • dumped into rivers/drainage and at road- sides. private waste collectors The study also showed that 41% of the waste pro- The private sector collects waste from residential, ducers used government waste services and paid commercial and industrial premises that are ready an average monthly charge of N500 (USD 2.50) to pay for their services (OYOWMA, 2016). They while 10% made use of private refuse contractors are responsible for the collection of about 40% of and paid an average monthly charge of N2,000 the volume of the waste reaching the dumpsites. (USD 10.00) (Oguntayo & Obayelu, 2013). House-to-house waste collection is carried out in areas with road networks, but these services usu- ally require some form of financial commitment. Ogungbuyi (2013) estimates that only about 16% of households dispose of their waste at approved pub- lic dumpsites. The poorest mostly resort to sporadic and indis- criminate dumping of their wastes on available plots of land, sidewalks, roadways, streams, chan- nels and drainages areas (Ogungbuyi, 2013). It has been reported that more than 70% of the refuse gen- erated in the city is disposed in this way. In addi- tion to the typical negative impacts of poor waste management, the blockage of waterways and the drainage system is a particular issue in Ibadan as this causes flooding as well as health hazards from Figure 5: Household solid waste disposal methods in Ibadan (based on weight) (Ogungbuyi, 2013) human contact with untreated waste. There is no reliable data on the quantity of inert waste such as construction and demolition waste, e.g. sand, concrete, etc., being generated or col- Three types of waste are collected by private sector lected. Besides construction and demolition waste operators: being used to fill pot holes in the dumpsites, there • Industrial waste (every day); are also currently no specific ways of managing this • Commercial waste (about three times a type of waste. According to OYOWMA, construc- week; up to four complete loadings of one tion and demolition waste is not common enough truck in a day for this kind of waste); • Household waste (about twice a month; to require its own specific means of waste manage- one or two complete loads for one truck in a ment. day, as there are many more stops than with commercial waste). Notes from observations of waste collection When registering with OYOWMA, the private op- practices made during field visits erators have to specify whether they are collecting During the first field visits in February 2015, many from commercial facilities, from industrial facilities sweeper teams were in operation. Some sweeper or from households. Each operator collects one type teams were accompanying the OYOWMA waste of waste; so there are contractors collecting only collection truck to help load the waste from contain- industrial, commercial or household waste. In ad- ers and in the middle of the streets. Other sweep- dition, private contractors also collect waste from er teams were working on their own to clean the special events such as parties, or on special request. street. In both cases, the sweepers did not always There is an association of private waste collectors, have appropriate containers to store the waste col- the Private Refuse Contractors Association. Ac- lected and transfer it to the waste collection ser- cording to the President of the Association, there THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 41 OYOWMA employees collecting waste from the middle of OYOWMA loading a truck with waste left at the side of the road the road are about 200 contractors in the association of experienced in maintaining their trucks and they which 150 work in Ibadan. According to OYOW- only buy trucks for which they can easily find spare MA, there are 317 registered private contractors parts (Mercedes, Volvo, DAF, etc.). (218 domestic refuse contractors, 95 commercial Some of the contractors have been working in and 4 industrial). There are also 50 private contrac- waste management for up to 20 years. They have a tors which are not members of the association as clear vision about the vehicles that would be most they are newly established companies, but may join adapted to their situation, but are limited in their the Association at in the future. Among these con- ability to raise the finance to buy new trucks. tractors, some companies own up to 5 trucks while others do not own any trucks, but rather rent them It should be noted that the private sector only oper- from other members who have the capacity to rent ates in the collection and transportation of waste, out trucks. The contractors only buy second hand and is not involved in other aspects of waste man- trucks, and in some instances, they finance the pur- agement. Furthermore, according to the private chase of their trucks through the Cooperative Soci- contractors, they do not carry out waste collection ety of the Association. This financing is provided at night mainly because the dumpsites are closed at low interest rates. The Association also supports at night, and also because of security issues. This is its members by providing back-up trucks in case of in contrast with OYOWMA as the Authority collects a breakdown. This is also done by borrowing from waste between 9pm and 6am (EGIPE Sarl, 2015). members who have the capacity to spare a truck for a short time period. The private contractors are 42 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria resources and facilities of the public sector in charge of solid waste management financial resources Limited information was provided on how exactly Refuse Contractors Association, the private waste solid waste management and street cleaning is collectors access the dumpsites for a fixed fee de- financed.5 According to OYOWMA, the majority pending on their category: of financing of solid waste management in Ibadan comes from the Oyo State Government, and the • Industrial: N5,000 (USD 25.00) per month; Local Governments contribute less than 13% of the total public funding. • Commercial: N3,500 (USD 17.50) per month; • Household: N2,500 (USD 12.50) per month. Table 5: The OYOWMA annual budget in 2014. Source: OYOWMA. source of costs costs According to OYOWMA, the actual revenue gener- financing ( n / year ) (usd/year) ated from the private sector, e.g. the PSP licenses, State Government 1 284 164 800 6 453 095 the dumping charges and fines, is about N11.8 mil- Local Governments 198 000 000 994 976 lion (USD 59,500) annually. Total financing 1 482 164 800 7 448 071 According to OYOWMA, the annual budget of op- erational waste management activities in Ibadan (2014) is as follows 6 : According to a World Bank report (2015), each of The staff costs above cover only the permanent staff Oyo State’s 33 Local Governments, irrespective of (about 70 persons) at OYOWMA. The cost of tem- whether they are urban or rural and irrespective of porary staff (about 1,400) is N45,432,000, accord- the amount of waste generated in their individual ing to OYOWMA. The cost of equipment, fuel and jurisdictions, provide monthly and equal “contribu- maintenance also includes the cost of the cleaning. tions” (N500,000 (USD 2,500) per month. Assuming Furthermore, the above annual budget numbers are that Ibadan and other cities in Oyo State generate not sufficiently detailed and it is not clear wheth- larger amounts of solid waste than other parts of er they take depreciation costs into account. It is the State, the equal and monthly Local Government therefore difficult to determine the cost per ton of contribution amounts to the rural and semi-urban waste collection in Ibadan. Local Governments subsidizing SWM in the State capital. Waste collection costs are estimated at about N4,500 (USD 22.50) per ton for the most productive By virtue of the OYOWMA Law, the Waste Man- trucks (e.g. rear loader packer trucks) and between agement Authority has the power to charge and N5,600 (USD 28.00) and N6,700 (USD 33.50) per ton to collect fees from private sector waste collectors for the trucks performing in the low productivity ar- for their registration and for the subsequent renew- eas7. al of their licenses. Section 6(1) of the OYOWMA Law provides that OYOWMA shall be responsible for maintaining sanitary landfill sites around Oyo 5 All the available information that was disclosed by State and can charge fees per month and per truck OYOWMA is presented in this section. to the private collectors (from N2,500 (USD 12.50) 6 The budget was for when OYOWMA was responsible to N3,000 (USD 15.00)). According to the Private for waste collection in the LGAs. 7 Based on Egipe’s experience and on the market prices in countries with per capita GDP similar to Nigeria. THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 43 Table 6: The OYOWMA annual budget in 2014. Source: OYOWMA. source of financing costs ( n /year) costs ( usd/year ) Registration of Private Refuse Contractors 1 355 000 6 809 Revalidation of old permit and change of title 889 000 4 467 Refuse dump usage charges (paid by the Private Refuse Contractors) 8 663 472 43 535 Fines for contravention of environmental laws 937 500 4 711 Total 11 844 972 59 523 Table 7: The OYOWMA operation costs. Source: OYOWMA. cost lines costs ( n /year ) costs ( usd/year ) Staff costs (Salaries) 42 200 000 212 060 Equipment costs 669 000 000 3 361 812 Truck fuel and maintenance 174 164 800 875 201 Other costs (Clean Street Initiative, etc.) 596 800 000 2 998 998 Total costs 1 482 164 800 7 448 071 These costs per ton are not really cost-effective es- pecially given the low cost of labor in Nigeria, but are comparable with costs observed in other coun- tries with similar per capita GDP. It was noted that due to limited budgets, the public sector in Ibadan does not have adequate capacity to handle the increasing amount of solid waste. The Local Government Councils are financially handi- capped. It is also noted that the private collectors are not able to access the finance they need to im- prove the quality and efficiency of their operations. 44 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria human resources According to OYOWMA, the most recent figures for the number of staff employed by the authority are as follows:8 Table 8: Number of staff employed by the authority in each category – Source: OYOWMA s/n. designation number remark 1. Executive Chairman 1 POLITICAL APPOINTEE 2. General Manager 1 PERMANENT STAFF 3. Directors and Sectional Heads 10 PERMANENT STAFF 4. Administrative Staff 52 PERMANENT/TEMPORARY STAFF 5. Operational Staff 4(i-xxi) 1,471 i. Environmental Health Officers 22 PERMANENT/TEMPORARY STAFF ii. Technical Officers 5 PERMANENT STAFF iii. Works Superintendents 3 PERMANENT STAFF iv. Foreman 1 PERMANENT STAFF v. Truck Drivers 19 PERMANENT STAFF vi. Driver Mechanics 13 PERMANENT STAFF vii. Drivers 9 TEMPORARY STAFF viii. Plant Operators 3 TEMPORARY STAFF ix. Electrician 1 TEMPORARY STAFF x. Security 28 TEMPORARY STAFF xi. Fuel Attendant 1 TEMPORARY STAFF xii. Dump Attendants 20 TEMPORARY STAFF xiii. Vulcanizers 4 TEMPORARY STAFF xiv. Welders 2 TEMPORARY STAFF xv. Panel Beater 1 TEMPORARY STAFF xvi. Battery Chargers 3 TEMPORARY STAFF xvii. Mechanics 17 TEMPORARY STAFF xviii. Enforcement cadets 38 TEMPORARY STAFF xix. Motor Boys 68 TEMPORARY STAFF xx. Motor Girls 73 TEMPORARY STAFF xxi. Sweepers 1,160 TEMPORARY STAFF Total 1,562 There are gaps in the institutional arrangements, Furthermore, during the field visits, it was noticed expertise and people to run solid waste manage- that many sweepers were wearing OYOWMA uni- ment activities in Ibadan efficiently. This is based forms but without any specific sweeping equip- on the view that although the workers have rele- ment. According to OYOWMA, the sweepers were vant qualifications to perform their work, they need provided with personal protective equipment, but additional training, and the provision of such train- these were not being used by the sweepers. ing is yet to be institutionalized. 8 This information was provided when OYOWMA was responsible for waste collection in the LGAs. Some of the staff may have been transferred back to the LGAs after the change in policy in October 2015. THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 45 equipment and vehicles The Local Governments handed over their trucks to city the size of Ibadan, at least 400 - 570 collection OYOWMA in March 2013 in line with the transfer trucks would be needed. of responsibilities of operational waste collection to In the current context, given the state of the vehi- OYOWMA. However, in October 2015, OYOWMA cles, their number and the state of the roads, the handed back the trucks over to the Local Govern- estimated 70 trucks owned by OYOWMA and the ments reducing its fleet from 70 units to 26 units. Local Governments are not enough to carry out OYOWMA currently owns the following trucks for proper waste collection in the whole city. waste collection: During the field visits in February 2015, rear loading 1. Mitsubishi Canters (Ro-Ro) - Side Loading – 10 packer trucks in action without lifting mechanisms units; and Ford pick-ups equipped with side loading 2. Leyland Skip Eater Compactors - Rear Loading buckets without lifting mechanisms or waste pack- – 3 units; ing were observed. Also only the Ford and pack- 3. Sterling Goliath Compactors - Rear Loading – 9 er trucks were in operation, but none of the other units; trucks. 4. Leyland Ro-Ro - 2 units; The vehicles do not seem very old but are generally 5. Toyota Tipper – 1 unit; in a poor state of maintenance. Moreover, the state 6. Bedford Tipper – 1 unit. of the roads is a major factor for breakdown and can explain the poor condition of the vehicles. Normally a waste truck should be operational for about 25,000 The Local Governments own a minimum of the fol- working hours; however it is very hard to achieve lowing trucks for waste collection: that level of longevity while using the vehicles in the poor road conditions in Ibadan. The heteroge- 1. Leyland Skip Eater Compactor Rear Loading – neity of the fleet is also a major issue as it is not 20 units; possible to maintain a set of spare parts and spe- 2. Sterling Goliath Compactor Rear Loading – 15 cific competences for that many different types of units; vehicles. 3. Leyland Ro-Ro – 2 units; Furthermore, during the field visit, visits were 4. Toyota Tipper – 1 unit; made to OYOWMA’s two truck garages located in 5. Bedford Tipper – 2 units; the city center. The garages are quite large but clut- 6. Mitsubishi Canter Ro-Ro – 20 units; tered with disabled vehicles (whether waiting to be 7. McNelius Compactors - Rear Loading – 11 units repaired or scrapped). There are no weighbridges, belonging to Local Government councils; and besides servicing pits, there is not much equip- ment for vehicle maintenance. 8. Ford Compactors - Rear Loading – 33 units be- longing to Local Government councils. OYOWMA’s maintenance teams seem to encounter several issues in maintenance, servicing and repair Previously, there were about 229 containers (2 to 3 of waste collection vehicles. There were two trailer m3) scattered around the city for communal waste trucks in the garage that were not used anymore. (EGIPE Sarl, 2015), but these have been withdrawn Furthermore, the trailers used are not adapted to to pave way for the private waste collectors. tipping in dumpsites (unstable soils) or for driving on roads in a bad state (e.g. the access road to the Normally, one truck can handle waste collection for dumpsites). 7,000 habitants under public operation or 10,000 habitants under private operation. Therefore, for a 46 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria Disabled packer truck OYOWMA Headquarters garage RoRo containers Semi-trailer truck Source: (EGIPE Sarl, 2015) infrastructure and facilities roads transfer stations The state of the roads are good in the central ar- There are currently no transfer loading stations; eas of the city, however, in many parts of the city, however, OYOWMA acknowledges that the use there are no asphalted roads or the roads are in bad of transfer stations would reduce the costs of col- shape. This is a major cause of breakdown for the lection and transfer to landfill (Ogunyemi, Ibadan trucks and limits the productivity of the waste col- SWM project - kick-off meeting, 2014). A transfer lection process. station was constructed in Orita Aperin, but has been converted for other uses. Furthermore, the larger capacity trucks are not able to serve areas with narrower roads, and it is there- fore necessary to use smaller trucks until the quality of the roads is improved. THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 47 Main roads in Ibadan State of the roads in various parts of the city 48 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria State of the roads in various parts of the city facilities for the cleaning dumpsites services The dumpsites in Ibadan are strategically located, From observations during the field visits there are i.e. North, East, West and South of Ibadan City. currently no facilities dedicated to street cleaning Hence, refuse trucks access the site that is nearest services. to them. OYOWMA is responsible for the man- agement of all the dumpsites in Ibadan. The four dumpsites were originally placed in areas with no habitation, but due to poor urban planning, habi- tations have started to be built near the dumpsites (EGIPE Sarl, 2015). Table 9: Overview of dumpsites in Ibadan dumpsites aba-eku (east) ajakanga (west) lapite (north) awotan (south) In service date 1994 1997 1998 1998 Location N07°32 N07°46’3 N07°57 N07°31 E03°98 E03°85 E03°91 E03°84 Approximate size (ha) 10.7 10.7 9.3 20.3 Issues Waste not covered by Majority of waste Waste dumping is Waste not covered by soil comes from industry uncontrolled and hap- soil hazard and there is no attempt to cover the waste dumped by soil THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 49 Figure 6: A map of the main roads, Local Government Areas and dumpsite in Ibadan metropolitan area There are no weighbridges at the dumpsites. In- standards. The two the dumpsites visited (Lapite stead the number of refuse trucks coming to the and Ajakanga) were operated in the same way: dumpsites is recorded daily and the amount of tracks are traced between areas of waste and waste waste is estimated based on the capacity of each is tipped just off the tracks. The access road to Aja- truck. kanga is in a very bad state and contributes to truck breakdowns. All four existing dumpsites are no longer suitable and do not comply with environmental and safety 50 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria Track in Ajakanga dumpsite Truck tipping waste in Lapite Damaged enclosure wall in Lapite Waste sorted out in Ajakanga Once the tracks start being cluttered by waste, • The use of appropriate vehicles (bulldozers, OYOWMA mobilizes Caterpillar bulldozers to push power-shovels, etc.) would enable a signifi- the waste away from the tracks and to clear the cant improvement in the life expectancy of these sites while reducing the surface area spillover areas. The waste height is rarely above of the zones contaminated by waste. two meters and no tracks are created on top of the • There has been encroachment by housing waste. The field visits revealed that the surface area developments. The proximity of the hous- contaminated by waste is under used. es means there is a need for new dump- sites if the houses are to remain inhabited. In Lapite, the depth of the groundwater is esti- Any new sites would need to be preceded mated to be at about 10m (EGIPE Sarl, 2015). This by legislation to prevent encroachment (Ogunyemi, Ibadan SWM project - kick-off means that the groundwater is vulnerable to waste meeting, 2014). contamination. However, there is no data about the • The dumpsites are not well secured. While actual level of the groundwater, but based on the there are some unarmed guards oversee- field visits groundwater does not seem to reach the ing the dumpsites, at one of the dumpsites surface. visited, the enclosure wall was damaged in some places. The following was also observed: • With an available surface of about 50 ha, it is estimated that, if managed properly, these • The waste is only a few meters high at the four sites could store about 3,000,000 tons dumpsites (modern landfills can pack waste of waste. Currently, according to the figures up to 40m). from OYOWMA, about 450,000 tons of waste THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 51 are collected every year, this number is ex- of Casablanca which has a population of 4,000,000 pected to increase as only a part of the waste people has about 2,000 scavengers per dumpsite. produced is actually collected. These esti- That said, the lower number of scavengers may be mates confirm the need for new dumpsites. appropriate, as during the study period that the waste in Ibadan has a much higher organic content OYOWMA would like to implement formal material than is generally found elsewhere. recovery and recycling in these dumpsites and turn them into sanitary landfills. The Authority however It was noted that scavengers frequently set fire to does not have the financial means to buy the equip- waste to ease the recovery of metals. This is a very ment required to manage the dumpsites correctly common practice in dumpsites where scavengers (EGIPE Sarl, 2015). operate, not only in Nigeria. Regular fires in the dumpsites are also caused by spontaneous com- Instead scavenging (informal waste picking and bustion, or from hot ashes. The production of meth- material recovery) at the dumpsite is common. ane from decomposing waste in the dumpsites fur- There are about 200 informal waste pickers or ther fuels and propagates the fires. so-called scavengers across the four dumpsites - their numbers vary from one dumpsite to anoth- er (OYOWMA, 2016). This is a very small number given the size of the city. In comparison, the city Scavengers weighing waste in Ajakanga Burning waste in Lapite 52 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria resources and facilities of the private sector involved in solid waste management financial resources The private contractors get their revenue from col- • Commercial: between N2,000 (USD 10) to lecting waste management fees in the designated N4,000 (USD 20) per month depending on the frequency of collection; areas that they operate in. Oyo State compels waste • Households: between N800 (USD 4) to producers to patronize the private waste collectors. N1,500 (USD 7.50) per month, negotiated The fees charged by the private sector operators based on the capacity of the households to are as follows: pay and the accessibility of the premises. • Industrial: N15,000 (USD 75) to N20,000 (USD 100) per truck load (with 5 to 10 tons Please see the following tables for further detail on trucks); the fees charged by private contractors for waste collection and disposal. Table 10: Standard tariffs for waste collection and disposal services in domestic / residential premises (effective January 2013). Source: OYOWMA category area rate (n) rate (usd) High Income Areas – Alalubosa GRA, Iyaganku, Bodija & A Environs, Ikolaba GRA & New Extension, Idi - Ishin, Agodi N1,500 (minimum) USD 7.50 (minimum) @ USD GRA, Samonda, Kolapo Ishola, Felele Rab & Environs, Gen- @ N750 per pick 3.75 per pick eral Gas and Akobo Estate and other high income areas Medium Income Areas – Bashorun, Iwo Road, Ikolaba 1 (Old), Mokola, Eleyele, Sango, U.I. / Agbowo / Ojoo, Akobo Oju – Irin & Environs, Oke Ado / Molete, Ologuneru, Alakia, Airport, Isebo, Adegbayi, Alarere Orogun, Odo – Ona Elewe, N1,000 (minimum) USD 5.00 (minimum) @ USD B Alawon, Molade Asaju, Bishop Philips, Apete / Awotan, Ijokodo, Apata / Wire & Cable, Elere, Bembo, Elenusonso, @ N500 per pick 2.50 per pick Owode Housing Estate, Aba Paanu, Joyce B, Oluyole Exten- sion, Olunsanya Adeoyo, Imalefalafia, Mobil / Ring Road, Anifalaje, Ayegoro Isokan, Alafia Olorunda – Aba Area, etc. Low Income Areas – Beere, Oja – Oba, Oje, Idi – Arere, Bode, Oke – Adu, Yemetu, Igosun, Ode – Aje, Aremo, Agu- N800 (minimum) @ USD 4.00 (minimum) @ USD C gu, Oke-badan, Odejayi, Oluyoro, Onipepeye, Gbagi, Orita N400 per pick 2.00 per pick – Aperin Adesola, Olorunsogo, Ogbere / Tioya THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 53 As previously noted, not all waste producers pay for of Ibadan that all households in all of the low income waste management services, and it is a challenge areas would begin to pay a fee for waste disposal. for the private sector to collect waste fees. During They were to start with a minimal fee of N20.00 per the stakeholder events organized as part of this drop of waste (bag, sack, carton, etc.) into waste study, OYOWMA was able to forge an agreement collection points, and OYOWMA hopes to increase from the leadership of the Community Associations this to N50 per drop through further consultation; Table 11: Standard tariffs for waste collection and disposal services in commercial / industrial premises (effective January 2014). Source: OYOWMA monthly collection SN waste receptacle Once (N) Twice (N) Four times (N) 1 Drum Equipment (200 L) 3,250 6,000 10,000 2 Goliath Bin Equivalent (3 MT) 12,500 23,500 40,000 3 Canter Bin Equivalent (6 MT) 17,500 32,500 60,000 4 Skip-Eater Bin Equivalent (9.7 MT) 55,000 85,000 105,000 5 Compactor Truck Equivalent (20 MT) 90,000 162,000 300,000 6 Compactor Truck Equivalent (30 MT) 100,000 190,000 320,000 Table 12: Standard tariffs for waste collection and disposal services in commercial / industrial premise – Monthly Bin rental services (effective January 2014). Source: OYOWMA sn waste receptacle unit rate (n) 1 Goliath Bin Equivalent 1 12,500 2 Canter Bin Equivalent 1 17,500 3 Skip-Eater Bin Equivalent 1 25,000 The Private Refuse Contractors Association is able work efficiently (EGIPE Sarl, 2015). Supporting ini- to help its members finance the purchase of (sec- tiatives to access finance is one of the expected ar- ond-hand) trucks through the Cooperative Society eas that will build greater efficiency in the sector. of the Association. This financing is provided at low However, it was also noted that there are currently interest rates. But otherwise the private waste con- no commercial banks or financiers investing in solid tractors face difficulties in financing investments, waste management in Ibadan. and there is an expectation that OYOWMA should assist the private sector to develop the capacity to 54 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria human resources the dumpsites whenever there is rainfall and the unmade roads become muddy. It was however There are 317 registered private waste contrac- noted that some modifications made to the trucks tors in Ibadan (OYOWMA, 2016). Each of them used by the private contractors were relevant for has about 5 staff per truck and some have up to 5 reducing the physical work and curtailing possible trucks, so collectively they employ more than 1,000 disturbances. people. While the private contractors are formally obliged to educate and train their staff to proper- As there are no transfer stations in Ibadan, the pri- ly perform waste collection, the private contractors vate contractors’ trucks go directly to the dump- acknowledge the need for further capacity building sites once they are fully loaded. Therefore they and training for their staff is required. can only make up to two collection rounds per day (EGIPE Sarl, 2015). informal sector It was not possible to conduct an inventory of all Although not observed during the field visits in the collection vehicles operating in the city as the Ibadan, it is apparent that there is an informal sector trucks are dispersed throughout the city at any that collects waste either for a fee or by salvaging point in time. The trucks owned by each contractor any recyclable materials in return (Sunday, 2012) are parked at different locations in the city at the (Wahab, 2012). These informal waste collectors op- end of the day. erate at the community level using pushcarts and wheel barrows for the collections of wastes in the Experience from other cities in Africa (e.g. Djibouti, areas where OYOWMA and the registered private Morocco), with similar road conditions to Ibadan, waste contractors cannot or do not undertake waste shows that small vehicles like those used by the pri- collection services. OYOWMA does not encourage vate collectors are more efficient in terms of collec- the informal sector to collect waste in Ibadan as the tion cost per ton than larger and more sophisticated waste collected is not properly disposed of and is trucks (e.g., packer trucks whose efficiency relies often indiscriminately dumped. The practice of the largely on high quality roads).9 However, the small informal sector collecting waste has been outlawed vehicles are efficient only in the areas where the and it is an offence to operate hand carts, or patron- roads are narrow and of poor quality. On wider and ize an informal waste collector in Ibadan. better quality roads, bigger trucks would be more efficient. As previously stated under the description of the dumpsites, informal waste pickers are tolerated at In Ibadan 200L plastic waste containers are in- the dumpsites. The so-called “scavengers” operate stalled in a number of the streets for waste produc- inside the dumpsites collecting, sorting and resell- ers to drop their waste between collection rounds. ing valuable materials recovered from the waste. These containers are then emptied by the private They are poorly equipped or not equipped at all, contractors. and are organized under an Association. There are Private waste collectors do not venture into the about 200 scavengers spread across the four dump- high density and low income areas of the city be- sites in Ibadan (OYOWMA, 2016). cause of the poor state of the roads and poor truck mobility (EGIPE Sarl, 2015). equipment and vehicles The private sector uses all kind of trucks, but not trucks specific to waste management. For example, there are no packer trucks and no high capacity vehicles. The vehicles used by private operators, observed during the field visits, are about 5 to 10 tons in capacity, and are therefore generally smaller than the vehicles used by OYOWMA. The trucks are all second-hand with only one drive axle; there- fore they encounter difficulties on city roads and in Figure 7: Improved garbage truck used by the private sector THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 55 areas for improvement identified by the private refuse collection association Possible areas for improvements were discussed with the Private Refuse Contractors Association operating in Ibadan, and according to the Associa- tion, the following actions would help improve their productivity: • Policy and regulation • Better cooperation from the population in relation to disposing waste properly, storing waste for waste collection and paying waste management fees; • Equipment, facilities and infrastructure • Installation of bins in front of the houses to improve the packing of the waste and help the collection; • Smaller trucks to access the unplanned ar- eas and slums; • The construction and use of transfer stations in close proximity to the collection areas; • Better maintenance of the dumpsites; • Human resources, skills and competences • Capacity building and training for the work- ers; • Waste management services • Better waste treatment and recovery of re- sources; • Finance • Improvement of their cash flows; • Access to loans from the banks. 9 Based on an extensive weighing campaign of the collected tonnages, of paths and collection times as well as an analysis of the costs of depreciation, maintenance, fuel, tires, collection employees, etc. 56 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria Private contractors’ staff loading waste into their truck 200 L plastic waste containers Private contractors’ staff emptying the truck using a shovel THE CURRENT SITUATION OF SOLID WASTE MANAGEMENT | 57 assessment of the current challenges for private sector involvement Street cleaning and solid waste management ser- access certain neighborhoods or cause vices are currently being provided in a sub-stan- the vehicles to breakdown. As Ibadan dard manner in Ibadan metropolitan area. Although has no transfer stations, waste collection the private contractors are involved in the collec- vehicles can only perform a limited num- tion and transport of waste in Ibadan, there are sev- ber of collection rounds before they are eral factors that limit their productivity and ability filled and have to drive all the way out to improve their services: to the nearest dumpsite to be emptied. 1. Deficient revenue collection of waste manage- The dumpsites in Ibadan are poorly man- ment fees aged and maintained. The leachate is not properly drained and the tracks are not • Not all waste producers in Ibadan such as correctly managed. None of the dumpsites households, businesses and industries may in Ibadan comply with environmental and not be willing to subscribe to private waste safety standards for landfills. services or pay for waste management ser- vices. Due to the fact for some because they 4. Poor public attitudes and behaviors regarding have never paid for such services, as waste waste disposal was disposed indiscriminately or burned. For others, there is reluctance to pay for • Ibadan has a firmly entrenched culture of services that are either not reliable or not resistance to paying for waste management performed properly. For private contractors, from the stakeholder events that this view is the uncertainty related to payments for their slowly changing, partly as a result of efforts services is a real challenge to ensure reve- by the State Government to raise awareness nue and cover their costs. through various forms of media. The en- trenched attitude has a direct impact on the 2. Lack of data of solid waste management perfor- viability of private sector participation, as a mance and costs general trend not to pay for waste disposal has an impact on the levels of revenue that • A major issue is the lack of proper measur- can be achieved by private collectors. This ing and monitoring of waste management has impacted on the private sector’s willing- data and costs. Neither the private con- ness to invest. tractors nor OYOWMA have the data and methods to evaluate the productivity and 5. Weak enforcement of regulations quality of the waste management services. Shared information and knowledge of waste • Furthermore, a significant deficit in the management activities between public and number of enforcement officers, limits the private actors is needed to for establishing capacity to enforce existing waste regula- balanced partnerships and determining tions. The legal framework found the legal feasible service management fees. For ex- framework to be adequate for the involve- ample, currently the actual costs of waste ment of the private sector. The laws are also management and degree of cost recovery clear on the proper handling of waste by are not known. waste producers, as well as the attendant sanctions for non-compliance. For example, 3. Significant weaknesses in existing transport in- all households are legally required to have frastructure and waste facilities appropriate containers for the storage of • The urban planning, roads and infrastruc- waste on premises, and arrangements for ture in Ibadan are in such a poor state that the regular removal of the waste by paid they either prevent motorized vehicles to service providers. The lack of proper en- 58 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria forcement of these legal requirements rein- 7. Weak involvement of private operators in the forces existing attitudes to waste manage- waste processing and resource recovery activ- ment and is a missed opportunity to drive ities up behaviors that can boost revenues and • At present, the private sector participates increase the commercial viability of private in a limited scope of solid waste manage- operators. ment activities such as waste collection and transportation. The private sector could be 6. The contractual framework involved in other activities such as street • The allocation of operation permits for cleaning, waste processing, resource recov- designated areas for private contractors is ery10 and landfill management, this would not based on an open competitive tender- require that Oyo State has the right compe- ing process. This does not allow the most tencies and capacity to manage and monitor cost-effective companies to be identified. such types of public-private partnerships. The short duration of the operation permit / agreement with OYOWMA is an obstacle for The informal sector is involved in solid accessing finance and investing in equip- waste management activities. These actors ment to improve productivity the trucks and have a role to play in integrated solid waste equipment used are old and often break- management, but are currently not involved down. Financial institutions and investors as private sector participants. are not willing to finance companies and projects, if there is not more certainty that there is sufficient time for investments to be profitable. The contractual framework is not supportive of the professionalization of the waste collectors and does not allow the pri- vate contractors to improve their productiv- ity and performance. Private sector partic- ipants experience difficulties and delays in obtaining required approvals, bureaucracy and a lack of an enabling environment for public-private partnerships. 10 A waste-to-energy public-private partnership was launched in 2015 between Oyo State and Highland Ener- gy Solution Services Limited (HESSL). best practices and experiences of psp in solid waste management This section presents the best practices and ex- other cities in Nigeria and other countries such as periences identified in this study of private sector Ghana, Uganda and India, to identify best practic- participation (PSP) in solid waste management in es that could be replicable in Ibadan. The review of countries and cities that are in a similar situation as best practices also considered lessons learnt from Ibadan. Based on different reports and studies from unsuccessful initiatives. collection of waste management fees / recovery of waste management costs A major challenge to recover the costs of waste collection, leading to poor rates of fees collected. management services in areas that are not used to There are different revenue collection mechanisms having any waste collection services or have not for formal waste services (UNEP & ISWA, 2015): paid for the services before. Kassim (2009) showed • Direct charging via a waste management in his study in Tanzania that the collection of fees bill, e.g. Lusaka (Zambia) and Moshi (Tan- from households was not sufficient to cover the zania); costs of waste management. In Lagos the major fac- • Direct waste management fee + property tors affecting the performance of the private waste tax, e.g. Bamako (Mali); operators were the delays in payment of fees by • Indirect charging via the utility bill, e.g. Nai- robi (Kenya), Maputo (Mozambique); waste producers, low levels of subscription to a col- • Financed via property tax (no direct fee), lection service by households and the inadequate e.g. Dhaka (Bangladesh); enforcement of payments by defaulters (Idowu, • Finance from general public funds. 2011). There was also a lack of public awareness re- garding the importance of the solid waste collection service. This was cited as one of the main reasons Direct waste management fees are rarely able to re- for the low level of interest of households in waste cover the full cost of solid waste management, but 60 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria should aim to recover as much as possible. The best possible, the shortfall should be subsidized by the revenue collection mechanism depends on what authorities. Within this framework, and with the ob- there is tradition for doing and on the local culture. jective of reducing the financial burden of the local authorities in charge of solid waste collection, ac- A study on the application of economic instruments tions have been taken in order to involve the house- for sustainable solid waste management in low and holds in paying fees. A shift began recently towards middle-income countries found that integrated bill- cost recovery by charging households and other ing with utility bills has substantially improved cost beneficiaries on a Pay-As-You-Throw (PAYT) basis recovery in numerous cases (GIZ, 2015). This type for communal service and monthly fixed-charge for of revenue collection has the advantage of using house-to-house collection in Accra, Kamusi and the existing register and billing system of a utility Tema. The PAYT approach is mainly used in the and can be cost effective. low-income areas, and the monthly service fees for Maputo in Mozambique tried to introduce a waste the high income households (Mugagga, 2006). management fee per household of roughly two Lagos and Ekiti States in Nigeria have had success dollars per month to finance the city’s SWM (GIZ, in collecting waste management fees from waste 2013). Even though this represents less than 0.6% producers by providing “waste bills” with the State of the average household available income, the mu- Government’s name and logo (Olugbenga, 2015). nicipality had trouble collecting fees due to distrust Payment is not made in cash directly to the private of the government, poor service performance and contractors, but to a bank or another intermediary. no public information about the fee. A storm of pro- The payments are registered in a billing system tests led eventually to the fee’s withdrawal. It was that allows the tracking of waste producers’ pay- only later through a wide-spread awareness cam- ments. The revenue collection system provides paign that Maputo managed to collect the waste transparency and monitoring of payment of waste management fee charged through the electricity management fees for all parties. bill. It was key that Lagos Waste Management Au- The Collaborative Working Group on Solid Waste thority (LAWMA) intensified enforcement and the Management in Low- and Middle-income Countries drive to recover payments (e.g. through mobile (CWG), an international network that encourages environmental / sanitation courts) as well as com- interaction between partners on key solid waste munication and sensitization of payment of waste management issues, advises that the beneficiaries management fees to the general public, when im- of waste management services such as households plementing the distribution of waste bills. and businesses should be involved in the discus- sions and decision-making related to the plans and development of local solid waste management best practice (Coad, 2005). In particular beneficiaries should be recommendations kept well-informed about the benefits that they The main recommendations emanating from these can expect to receive from the proposed services. case studies to improve fees collection are as fol- Based on different case studies, the CWG revealed lows: that committees or stakeholder forums with local • improve the awareness of the public regard- government representatives and community mem- ing the importance of the solid waste man- bers were an effective way of communicating with agement services; the beneficiaries. A good relationship and commu- • correctly inform the public about the bene- nication with the beneficiaries facilitates the waste fits they can expect from the services pro- collection service and payment of fees. vided; • use a Pay-As-You-Throw (PAYT) approach Oduro-Kwarteng (2011) compared the practices of in low income areas; involving the private sector in solid waste collection • aim to increase cost recovery gradually through incremental increases in waste in five cities in Ghana, including the cost recovery management fees that are accompanied practices of the collection service. A policy in Gha- by tangible improvements in the quality of na states that direct cost recovery from all users service; should be applied where it is possible to charge • ensure support is available to the waste the full commercial price covering all operating and producers that cannot afford to pay for waste management services / ensure that capital costs of solid waste collection. If this is not the costs of waste management is suffi- BEST PRACTICES AND EXPERIENCES OF PSP IN SOLID WASTE MANAGEMENT | 61 ciently covered for private sector partic- gaged in discussions with the local commu- ipants that operate in low income areas. nity leaders and associations, and the heads OYOWMA is already attempting to imple- of the associations announced that they will ment these recommendations. Recently, ensure the proposed PAYT scheme is imple- during one of the stakeholder events, it en- mented within their communities. governance – the role of public authorities The competences and the governance capacity competing opportunities. A country must market of the local government is one of the key success itself to the private sector and develop its PSP strat- factors of private sector participation (Coad, 2005). egy with the domestic and international markets Several factors contributing to the failure of pub- in mind. Only a governmental organization with lic-private partnerships by the governance of the a competent professional staff and an adequately public sector have been identified. The first one designated authority with commensurate respon- is related to the style of management. If the pub- sibility would be fully able to develop, negotiate, lic authority is not able to delegate and trust that manage, monitor, and enforce a competent contract the private contractor, this can hamper the private instrument (Cointreau-Levine, 1994). contractor’s ability make its own decisions on how In India an expert committee was formed by the to best deliver the agreed service most efficiently. Supreme Court of India in 1999 to provide recom- Similarly, if the public authority is too demanding mendations for improving waste management and expects the private service provider to be at its practices (Athena Infonomics, 2012). The Ministry command, irrespective of any contract conditions, of Environment & Forest introduced Municipal Sol- this may result in the private contractors not being id Waste (MSW) Rules in 2000, incorporating key able to meet its contractual commitments, or sim- recommendations of the Supreme Court-appointed ply abandon the contract. Expert Committee. The MSW rules contained sev- Bureaucratic procedures are often put in place to eral remarkable features, e.g. door-to-door collec- prevent corruption, but unnecessary bureaucracy is tion, segregation of waste at the source and scien- another factor can cause delays in decision making tific disposal of waste, among others. Prior to the and can be very costly to the contractor. Transpar- announcement of the MSW Rules there were hardly ency is a much better defense against corruption. any standards to measure the quality of MSW man- Failing to set clear objectives; inadequate prepa- agement services provided by the local authorities. ration leading to serious delays in the tendering; Laws influence the private sector significantly in its contracting stages and execution; vague contracts assessment of whether to become involved in the leading to dispute and financial difficulties; or, in- provision of municipal solid waste management adequate monitoring to check the quality of the services (Cointreau-Levine, 1994). Before commit- service that is provided; are other sources of failure ting financial resources on the development of bid that have been identified. documents in response to government procure- Furthermore, the concept of partnership is crucial ment, private companies want assurance that the to the success of private sector participation. Both local government will follow procurement regula- sides should have rights that are upheld by the tions governing fair competition. courts and duties that are backed up by the threat A country’s legislative framework needs to provide of sanctions. Based on the case studies, an equal transparent and predictable legislation (EY, 2013). partnership is much more likely to result in effec- Well-defined PSP regulations must be in place along tive and economical services that continue for a with sufficient protection for investors from anoth- long period. er area or country. Other countries have planned The private contractor must be convinced that they or enacted primary legislation that addresses PSP are working with committed and reliable authori- and there are encouraging signs that Sub-Saharan ties (EY, 2013). Private companies involved in infra- African countries are seeing the need for a firm leg- structure projects have limited resources and many islative foundation for PSP. 62 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria For low cost services to be achieved by contracting, manage public-private partnerships, e.g. the contract should be long enough to enable the how to set clear objectives, prepare tenders, private sector to depreciate capital expenditure for follow the contracts, write clear contracts, monitor the quality of the services, etc.; appropriate equipment. • develop a contractual framework where the public authority and the private service pro- vider are bidden by mutual commitments; best practice • develop standards to measure the efficiency recommendations and the quality of the services provided; The main recommendations related to governance • follow relentlessly procurement regulations of private sector participation are: governing fair competition in order to gain trust from the private sector; • adopt a transparent and partnership-ori- • extend the duration of the waste collection ented approach to managing private sector contracts to at least four years. participation; • develop the capacity of the authority to waste management service performance One of the advantages of the private sector is its should be out of service. Maintenance and repair management flexibility (Cointreau-Levine, 1994). service is one area in which the private sector has The private sector has greater ease in terminating typically been able to perform very effectively. the appointment of personnel for non-performance and in providing upward mobility for workers with good performance. Also, the private sector is not best practice constrained to government hours and overtime recommendations constraints. In Petaling Jaya, Malaysia, the city The main recommendations related to the manage- reached an informal agreement with its waste col- ment of the private sector company are: lection workers to implement the “task” system of • create designated service areas big enough work, where workers may leave work whenever to allow private collectors to use more trucks they finish their assigned route. In Indonesia, the (5 to 7 for a start) and benefit from econo- constraining government hours have been a moti- mies of scale; • allow the private sector to motivate staff vating factor for increasing private sector partici- by incentive payments and career devel- pation. opment opportunities that typically would not be possible, if they were public sector The productivity of private companies increases employees; with increasing scales of operation and decreases • develop the capacity of the private operators when activities grow beyond an optimum scale of to monitor their own operations and to plan, operation. According to Oduro-Kwarteng (2011) an maintain and improve their management of optimum scale of operation is five to seven vehicles equipment and human resources. per company, but this depends on the local context. Another factor identified of good service perfor- mance was the supervision capability within the company. Good planning, in-house maintenance capacity, and high levels of worker morale led to higher productivity. Regarding vehicles and maintenance, there should be one mechanic for every four to five solid waste collection vehicles (Cointreau-Levine, 1994). For an efficient solid waste management service, at any given time, no more than 20%of the equipment BEST PRACTICES AND EXPERIENCES OF PSP IN SOLID WASTE MANAGEMENT | 63 incentives across the waste management value chain In general, it is preferable to base payments of transportation is based on both the quantity and waste management services on performance. It is quality of waste. A decentralized model can have good practice to include bonus payments to private a positive impact on community involvement. For contractors that perform according to or beyond the example, scavengers in the informal sector that agreed level of service (UNEP & ISWA, 2015). were originally making their own living on waste were integrated in the formal SWM activities by the In Kanpur, India, prior to the engagement of a pri- private sector participant by training them in col- vate player, the municipal authority was responsi- lecting waste, retaining them and paying them a ble for waste collection and disposal (Athena Info- monthly income. nomics, 2012). There was no mechanism for waste separation and no waste processing plant. In light In order to involve the private sector in sustainable of the waste management situation in the city, Kan- resource recovery and waste conversion activities, pur decided to adopt a PPP framework to manage waste collection should be better developed as the its solid waste. Two concessionaires were selected: current means of collection in Ibadan is not provid- ing consistent quantities of wastes to be commer- • a private developer (Concessionaire 1) was cial viable of downstream waste-to-wealth initia- responsible for waste collection and trans- portation, and tives. It also seems very unlikely at this stage to find • another private developer, (Concessionaire private investors willing to buy the waste in order to 2) was selected for waste processing and recover materials from it. disposal. After the start of operations of the processing plant It was identified during the study period that there by Concessionaire 2, it was realized that the waste are private investors interested to develop facilities transported by Concessionaire 1 to the unit did for waste-to-energy in Ibadan. Although, there is not hold enough calorific value to be converted little interest to purchase the waste for the moment. into Refuse Derived Fuel (RDF), compost or bricks. Given the potential difficulties that the private in- This increased Concessionaire 2’s financial risk as vestors may encounter, it should be an area that it was not able to generate revenue from selling would require further investigation. the processed products to cover its operations and maintenance costs. In this context, the local au- thority terminated the waste collection and trans- best practice portation contract with Concessionaire 1. Later, it recommendations entered into another contract with Concessionaire The main recommendations to ensuring incentives 2, making them responsible for both the aspects of across the waste management value are: solid waste management: collection & transporta- • ensure that incentives are created for the tion and processing & disposal, and thus aligning private sector within their service delivery, incentives. but across the waste value chain, e.g. in or- der to make composting or recycling more The concession agreement for collection and attractive, the public authority should en- transportation of waste provides an incentive to sure that waste is sorted at the source. • provide the right signals, e.g. through both the private contractor only in the form of a tipping ‘carrot’ incentives to make the behavior fee paid based on the quantity of waste collected. attractive financially, or in some other way This makes it challenging for the concessionaire and ‘stick’ penalties for non-compliance. responsible for the processing and the disposal of the wastes to mitigate its operational and financial risk, as it converts waste into revenue generating products. Hence, when solid waste management is decentralized with private sector participation for each segment of value chain, the resulting model may not be sustainable unless the tipping fee paid to the concessionaire responsible for collection and 64 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria involving the informal sector In emerging countries, informal collection accounts The German Agency for Technical Cooperation for a good part of waste management activities – (GTZ) showed the social advantages of integrating in particular material recovery. The informal sector the informal sector (Gerdes, 2010). Waste workers is able to achieve high recovery rates leading to a often constitute the lowest level of society; they huge variety of recyclables to be segregated and work under hard and unhealthy conditions. Howev- further processed. er, the integration of the informal sector aims to uti- Buyers of processed products Waste a. Manure Urban Local Body Generators/Consumers User Free b. Bricks c. RDF Payments Processed Payments for Tipping Fee Municipal Solid Products providing waste 50% of the fee Waste (1500TPD) 120% of the amount Flow of Funds ‘Processing & Disposal’ ‘Collection & Transportation’ Flow of Waste / Processed Waste Concessionaire Concessionaire Flow of Funds in case of default by the collection and transportation concessionaire Figure 8: Stakeholder Model of a Reverse Integrated Solid Waste Management Project. Source: (Athena Infonomics, 2012) lize the entrepreneurial abilities of waste collectors are currently not feasible, economically or techni- to create business models that can be accommo- cally, for the public or private sector (UNEP & ISWA, dated within the current economic situation. Inte- 2015). The informal sector can typically be effective grating informal sector workers has the potential to in the primary or pre-collection of waste in areas significantly improve their living conditions. where motorized vehicles cannot access. For ex- ample, the Municipality of Maputo in Mozambique • The integration of the informal sector within employs micro-enterprises for manual door-to-door the solid waste collection service could have economic advantages. Even if the informal collection using handcarts to perform primary col- sector does not directly impact the cost re- lection of waste in suburban areas with narrow and covery of the solid waste management ser- sandy roads that previously did not have access to vice, through labor and employment created waste collection (UNEP & ISWA, 2015). by scrap collectors, the informal recycling economy in solid waste management finan- Besides providing a waste collection service, the cially supplements the formal system. Scrap informal sector can contribute to better material collectors are entrepreneurs who add value by collecting and then transforming waste recovery and recycling. Depending on the cultural into tradable commodities. setting, the income level of the waste producers, the payment capacity of the public authority and the recyclable content of the waste collected, the Some cities have had success in formalizing the co- waste collector may get paid for the collection ser- operation with the informal sector by providing the vice; may do the service for free in order to access conditions for them to earn a small revenue in re- the recyclables; or, may need to offer a small fee in turn for providing waste management services that exchange for the recyclables. BEST PRACTICES AND EXPERIENCES OF PSP IN SOLID WASTE MANAGEMENT | 65 Involving the informal sector in private sector par- best practice ticipation in solid waste management activities recommendations should not be a pretext to just minimize waste man- The recommendations for best practices for inte- agement costs by evading labor and health regula- grating the informal sector in the waste manage- tions. The aim is to include the informal sector and ment services are: gradually support them in the process to become established waste management service providers • instead of excluding the informal sector and with a secure employment and revenue. Communi- depriving it of its source of revenue, build on existing ‘bottom-up’, small-scale entrepre- ty-based initiatives are typically the stepping stone neurial recycling by integrating the infor- for involving the informal sector in formal solid mal recycling within the mainstream waste waste management. management activities; • ensure the inclusion of the community and An example of this is Wecyclers11, a social enter- informal sectors within an integrated waste prise based in Lagos, that collect recyclable items and resource management strategy and from households using a fleet of cargo-bikes. In system. partnership with the Lagos Waste Management Authority (LAWMA), Wecyclers collect used plastic bottles, plastic bags and aluminum cans. Partici- pating households receive points for every kilogram recycled, which can be redeemed for electronics, household items, training classes and even money. After collection Wecyclers sort and aggregate the materials, and then sell the high quality recyclable materials to recyclers. Another example is Nigeria Infrastructure Advisory Facility (NIAF) that has successfully piloted a community partnership for small-scale solid waste collection in the high densi- ty, low income district Zaria in Kaduna State (NIAF, 2015). Together with Ahmadu Bello University and Kaduna State Environmental Protection Authority, NIAF worked with the informal sector to establish a new and improved solid waste management sys- tem. 11 http://wecyclers.com/ optimizing psp in swm activities in ibadan Greater private sector participation in solid waste • describing the external factors impacting management is no guarantee for better services or waste management services in Ibadan; • defining the general apportionment of ac- cost-efficiency. In order for private sector participa- tivities between the private sector and the tion to be a success, there must be a stable political public sector; and financial backing that allows balanced pub- • defining the conditions for success for lic-private partnerships to work fairly and transpar- each of the waste management activities; ently in a non-corrupt environment. Both the public and private sector need to have clearly defined du- The conditions for success can be used as guide- ties with agreed incentives and sanctions that are lines by the local decision-makers in Oyo State to appropriately enforced. evaluate the progress of solid waste management activities in Ibadan metropolitan area. This section aims to develop general guidelines and possible options for the PSP in Ibadan by: external factors impacting private sector waste collection services in ibadan It should be noted that public-private partnerships • The roads in Ibadan which may prevent or (PPP) in waste collection can be complicated as make it difficult for waste collection trucks there are many external factors or actors which can to penetrate into some districts; impact the effectiveness of waste collection, inde- pendently of OYOWMA or the private operators. For • The Ministry of Environment and Habitat example: and the Local Government Councils’ role in sensitization and awareness-raising efforts, • The waste producers themselves and their and the deployment of a communication self-interests, attitudes and behavior; strategy to change waste disposal behavior; • Buildings which may not have waste stor- • The Environmental Health Officers (EHO) age facilities; and their role in monitoring street cleaning OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 67 and waste management performance, en- In Ibadan, before extending private sector partic- forcing existing laws and changing the be- ipation in waste collection more widely, it will be haviors of the waste producers; useful to test and validate new solutions, for exam- ple: • The Board of Internal Revenue, responsible for collecting taxes and penalties due to Oyo • The introduction of waste collection vehi- State, in their role of supporting or ensuring cles that are well-adapted to non-asphalted revenue collection mechanisms for formal roads; waste management services; • The creation of waste collection points that • The role of the Ministry of Physical Plan- are suited for the unplanned districts and ning and Urban Development and the Local prepared for tropical rain / flooding; Government Councils in determining waste collection points and the siting of transfer loading stations and new landfills; • Innovative payment methods for the collec- tion of waste management fees; and, The public authority must be able to provide an effective framework for the engagement and man- agement of private sector participation, when del- • The development of a systematic dialogue egating waste collection to private contractors. with other government administrations Private sector participation should be carefully pre- to improve the ability of waste collection pared and planned. The framework for public-pri- trucks to go further inside districts and col- vate partnership should not just delegate the task lect more waste efficiently. of waste collection and transport, but also support the private operators to improve the quality and productivity of their services. general apportionment of activities between the private and the public sectors activities best managed by efficiency. For example, the design and the private sector adaptation of trucks to the prevailing road The activities generally best managed by pri- conditions. vate contractors are as follows: activities best managed by • Day-to-day management of operational staff: the supervision and the monitoring of the public sector The activities generally best managed by the field teams requires a flexible and rigorous public authority are as follows: organization structure, combined with per- formance and productivity based remunera- tion systems; • Definition of the service quality levels and specifications; • Operation of equipment, vehicles and facil- • Definition of the amount of taxes or fees for ities e.g. waste collection points, transfer waste management services as well as the stations, landfills, garages, etc.; justification of the fee levels; • Investments in and implementation of new • Communication to waste producers, i.e. cit- technologies and solutions adapted to the izens, companies and public administration local context to increase performance and staff about the service provided and the be- 68 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria haviors which are expected from them for • Collection, reporting and sharing of data on the service to be provided correctly; waste collection and management; • Planning and location of facilities and in- • Development, definition and implementa- frastructure e.g. location of waste bins and tion of coordinated solid waste manage- containers, waste collection points, transfer ment-related strategies, objectives and stations, landfills, etc.; action plans including communication and awareness-raising campaigns. • Maintenance and improvement of access and roads to waste collection sites and waste management facilities; activities requiring the potential involvement of • Enforcement of sanctions when relevant private waste contractors for both waste producers and private waste Aside from the above-mentioned activities, other contractors. relevant and related solid waste management ac- tivities and services may require the involvement of a range of waste experts from the private sector, activities shared and/or if Oyo State does not have the necessary skills and negotiated between public competencies in-house. Examples of these are as and private sectors follows: The activities that can be shared and/or negoti- ated between the public authorities and pri- • Design, production, modification or pro- vate contractors are as follows: curement of waste collection vehicles and waste management equipment; • The collection of waste management fees from waste producers for example: • Legal advice for drafting clear, coherent and adapted specifications for tenders, and pro- -- The private waste company collects fees and pays a percentage to the gov- visions for contracts with private contrac- ernment through OYOWMA - this is the tors; current practice; -- The Local Government Area or OYOW- • Land planning and management: using GIS MA collects fees from the waste produc- (geographic information system) and zoning ers and pays private waste companies a tipping fee paid based on the quantity to improve waste collection routes, improve- and quality of waste collected; ment of urban infrastructure and facilities; • Definition of different service levels and • Technical survey for the planning of urban minimum quality levels in each local area and peri-urban waste management facili- or district based on the waste producer’s ties and infrastructure e.g. garages, transfer ability to pay, and adapted to infrastructure stations, landfills; constraints (e.g. access to collection points); • Design, construction and renovation of ur- • Definition of fees or charges for waste man- ban and peri-urban waste management agement services; facilities and infrastructure e.g. garages, • Duration of contracts and service agree- transfer stations, landfills; ments; • Collection of waste management fees, mak- • Possibilities for sanctioning individuals and ing payments to private contractors and organizations for not following the rules and customer billing; regulations related to solid waste manage- ment (e.g. littering, improper waste dispos- • Information and communication services to al, putting waste in proper bins or bags, tak- raise awareness and change waste produc- ing waste out on collection day); ers’ behavior e.g. public service announce- ments, billboards, posters, leaflets, etc.; OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 69 • Training staff to improve skills and compe- • Technical and management advisory ser- tencies to be better able to perform their vices to develop and optimize the solid work effectively, efficiently and safely; waste management framework and activ- ities e.g. developing a Solid Waste Master Plan. options for psp involvement in solid waste management activities in ibadan The extent of private sector participation in each It should be noted that most of the workers em- step of the waste management value chain de- ployed by OYOWMA are on a temporary basis (i.e. pends on the definition of the relevant financial and apart from the management staff, mechanics and operating model, explained as follows: drivers), and this will reduce the challenge of trans- ferring these workers to a private operator should • The financial model establishes how the certain functions be handed over to the private sec- capital and operational costs of waste man- agement services can be best be financed tor to operate. through the capacity of the waste producer to pay for services, through the ability of pri- vate operators to generate income from the general options for psp in waste collected and through public funds; ibadan • The operating model establishes the op- Based on the current situation in Ibadan and on the erating costs for a given level of service, and apportionment of activities between the private the economies of scale and/or investments in human resources, equipment, facilities and the public sectors, the most appropriate op- and infrastructure that are needed to im- tions for private sector participation for each waste prove the performance and efficiency of management activity were proposed and are sum- waste management services. marized in the table below. Private waste contractors could be involved more in each step of the waste management chain, and This table can be used as a guideline for the differ- in accordance with the general apportionment of ent waste management activities, especially with activities. Areas for consideration in the context of regard to the conditions for success and the con- Ibadan are as follows: ditions for failure that are set out in the table and further expanded upon below. • Waste generation e.g. awareness raising, waste management fee collection, etc.; These options need to be carefully considered as • Street cleaning; more data on the overall waste management ser- • Waste collection; • Waste transfer and transport to landfills; vices becomes available. • Waste disposal / landfill management; • Resource recovery e.g. recycling, waste-to-energy, composting, etc. Street & drain Resource cleaning recovery Waste Waste Waste Waste generation collection transport & transfer disposal Figure 9: The different solid waste management activities in the waste management chain 70 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria Table 13: Options for PSP in solid waste management activities in Ibadan solid waste definition of the activity private contractor’s respon- oyo state’s role management activity sibility Monitoring ­­ of the service provided General Communications must target two distinct Communication work mobilizing var- Law enforcement • ­ and complementary objectives: ious media of varied competencies; for example: ­ • Engagement of community • Diffusion of knowledge allowing all the leaders, civil servants, teach- persons in charge to understand the var- • ­ Perform street animations ers, religious leaders, shop ious elements of waste management, as and business owners on the well as the factors of success and failure ­ • Develop radio spots, teaching importance of hygiene and of the services to be implemented material for schools, brochures, cleanliness of public spaces graphics for the waste manage- • Modification of the behaviors of waste ment equipment ­ • Communication to citizens producers. and companies about the ­ • Delivery of training to the other service provided and the be- Different options are possible for money re- stakeholders haviors which are expected covery: from them for the service to Awareness raising be provided correctly • Fees for waste management levied and collection of through utility bills or annual or monthly waste management taxes (e.g. property taxes) fee • Fees for waste management collected di- rectly by the private sector with support from OYOWMA • Development of government cost recovery agency • Subsidization of low income communities with high income communities or govern- ment funds • Avoid cash payments; formalize prices and methods of billing and introduce uni- form security printed receipts by all waste collectors OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 71 pattern for shared participation conditions for success condition for failure ­ rotection of all the waste management • P ­ facilities and equipment against theft and vandalism ­ aintain roads, access roads to the waste • M management facilities and sidewalks in good shape ­ onitor the quality of each service provid- • M ed based on reliable data ­ evelop a shared and precise knowledge of • D the field reality ­ uality of the contracts with clear definition • Q of payment and fees ­ efinition of different service levels and • D minimum quality levels for each service adapted to the constraints (capacity to pay, facilities, etc.) ­ egularity of the payments and respect of • R the commitments from all parties involved Communication towards all the stakeholders: ­ develop each year a communication • To ­ • Not ensuring a permanent and continuous strategy based on a concerted effort be- communication Training and information workshops • ­ tween all key stakeholders, and focused on the main awareness problems and the ­ use an “advertising” communication • To Courses specific to waste management • ­ (publicity of the waste management ser- behaviors to be addressed. vices) rather than a communication cen- ­ odels (scale models) of the infrastructures to • M To adapt the message to the targeted public • ­ tered on the problems of people and the be established and managed manner of solving them ­ permanently seek to improve the educa- • To ­ eports on the good practices carried out in • R tional-value of the messages countries with a GDP per capita similar to Ni- geria ­ develop easy to remember slogans that • To encourage good behaviors ­ orums and debates mobilizing the persons in • F charge of these problems ­ measure, using surveys, the impacts of • To communication actions and the evolution of the perception of waste management by Communication towards the waste producers: the population (a survey every 6 months with the same questions) ­ evelop each year a communication strategy • D ­ repeat, repeat and repeat again messag- • To based a concerted effort between all key stake- es holders and focused on the main awareness problems and behaviors to address ­ • Transparency for how waste management money is used ­ ommunication to citizens about the reasons • C for keeping the streets clean and the sanctions ­ • Enforcement of sanctions for waste produc- that will be applied to non-compliance ers (e.g. households and companies) for not paying for waste management services 72 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria solid waste definition of the activity private contractor’s respon- oyo state’s role management activity sibility Street cleaning includes: ­ he collection operator also pro- • T ­ • Provide facilities for the stor- vides street cleaning services age of street cleaning equip- • M ­ anual, regular and periodic sweeping of ment and of waste ­ • Supply and maintenance of the sidewalks, streets, squares, markets and bins ­ • Enforce sanctions for litter- different public roads ing and improper waste dis- ­ • Purchasing/Leasing of street posal ­ • Mechanical sweeping of streets and park- cleaning equipment and vehicles ing lots ­ • Design of the messages • High-pressure ­ washing for the stretch written on the bins through of roads or parking lots contaminated by a commission gathering substances that make traffic dangerous the different stakeholders involved in environmental ­ • Exceptional sweeping of areas after ac- management in Ibadan Street Cleaning cidents, events, festivals, concerts, fires, etc This service includes: ­ upply of the containers • S ­ esign of the messages ad- • D dressed to the users through • Determining ­ the location of the waste col- ­ • Collection and transportation of a commission that gathers lection points the waste the different stakeholders • Cleaning ­ and maintenance of the involved in environmental ­ • The information about the population waste collection points management in Ibadan concerned by these locations ­ • Provide land for the waste ­ • The installation of these waste collection • ­ Writing of communication mes- collection points points; sages on the containers ­ • The equipment for these waste collection points (containers) Waste collection ­ • The regular cleaning of these waste col- from common waste lection points and of their containers collection points The regular emptying of the containers • ­ ­ • The repair and maintenance of the con- tainers ­ • The printing messages on the containers about the respect of cleanliness of the waste collection points and of the contain- ers OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 73 pattern for shared participation conditions for success condition for failure • ­ Location of bins • Have public bins located near schools, ­ nsealed, unpaved or non-concrete areas • U markets, shops, administrations, etc. to be cleaned. Ill-equipped, poorly super- Definition of the minimum quality level • ­ vised and/or poorly motivated (financially) for each area • ­ Have a local regulatory framework pe- cleaning teams nalizing waste disposal to inappropriate No public rubbish bins • ­ places and communicate about it ­ partnership with the retailers, the gov- • No • Achieve ­ a complete and efficient collection ernments, the schools, etc. for the correct not only of household waste but also of in- management of waste ert waste (e.g. construction and demolition No citizen awareness work • ­ waste) and green waste (e.g. garden waste) ­ • No sanctions against people who throw ­ • Build awareness of community leaders, civil their waste on public roads servants, teachers, shop and business own- ers, religious leaders on the importance of hygiene and cleanliness of public spaces ­ • Ensure sweeping teams are properly equipped with suitable and quality equip- ment ­ • Have waste collection points for sweeping equipment near the areas of intervention ­ • Have methods for evaluating the quality of work and the team’s productivityImplement financial motivation for staff on the produc- tivity and the quality of work • ­ Choice of the location of the waste collection ­ he effective and efficient involvement of • T The use of open containers • ­ points and of their equipment all stakeholders, under the administrative ­ • Insufficient number of containers and un- or political authority of a single legal or nat- • ­ Design of the waste collection points der-dimensioned size of containers ural person having the sufficient authority • Definition ­ of the rules of use of the waste collec- ­ • Inefficient / inadequate placement of waste ­ • One waste collection point for each 200m of tion points collection points or inappropriate equip- road suitable for trucks ment used at collection points ­ • Develop a Pay-As-You-Throw system for un- Realistic planning and budgeting • ­ planned areas No regular cleaning of the containers • ­ ­ • Pilot project to enable each stakeholder to ­ • Lack of responsiveness to correct the situa- check the efficiency and the limits of the tion when the waste collection points or the solutions implemented containers are damaged, dirtied or under- • Work ­ on communication and follow up with sized waste producers related to the state and to the use of the waste collection points and containers ­ • Reinforcement of the waste collection points that often overflow with a higher number of containers and/or larger con- tainers ­ • Mobilization of the communities to gather the waste along the main axes when the ve- hicles cannot drive inside the districts ­ • Payment based on the amount of waste col- lected per collection point according to the agreed service level 74 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria solid waste definition of the activity private contractor’s respon- oyo state’s role management activity sibility The door-to-door collection of household ­ • Collection and transportation of ­ • Provide facilities or land for waste includes the following steps: the waste waste collection (garages, etc.) ­ • Purchasing of the collection vehi- ­ • Storage and conditioning of waste inside cles the buildings or inside the property ­ • Delivery of the waste correctly condi- tioned to the collection services on the day of collection Waste Collection Collection and transportation of the waste • ­ - Door to Door Collection ­ easure the amount of waste col- • M ­ • Monitoring of the amount of lected in each area waste collected • Day-to-day ­ management of waste ­ • Develop pre-collect activi- collection teams ties in areas with poor road access (e.g. community-led ­ • Operation of waste collection vehi- collection and policing) cles and equipment ­ • Internal monitoring of the service provided Waste Collection - General This service includes: ­ elegation contracts between the • D ­ onitoring the amount and • M authority and the service provid- the type of waste received at ­ hoice of the transfer sites • C er with commitments regarding each transfer station investments, maintenance, opera- • ­ Lay out of the site tion and payment of the service ­ • Provide facilities or land for the transfer station ­ • Storage of the waste brought by the waste ­ • Day-to-day management of trans- collectors fer stations Transfer of the waste to the landfills • ­ ­ • Purchase or leasing of waste trans- port truck Regular clean-up of the transfer stations • ­ ­ • Operation of transfer stations and Possible pre-sorting/separation of waste • ­ Waste transfer and transport of waste to landfills (e.g. registration of waste received and transport dispatch of waste to landfills); ­ • Repair and maintenance of waste containers ­ • Measure the amount and the type of waste received ­ • Payment based on waste received or transported to landfill • The operator of the transfer station should preferably be the operator of the closest landfill OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 75 pattern for shared participation conditions for success condition for failure ­ efine the rules for the condition of waste • D ­ • Population informed and respectful of the ­ part of the population served by the door- • A rules of waste management to-door collection rounds does not pay for ­ • Implement money recovery system such as the service yellow bags for market areas and poor house- ­ • Buildings and land properties adapted to holds: people pay for plastic bags, and these waste storage ­ • Waste remains on the public road without plastic bags are the only ones collected any reaction from the waste collectors and/ Legal framework in operation • ­ or no sanction for the offender Transfer stations in operation • ­ ­ • The roads are not suitable all year long for • Payment ­ based on the amount of waste the collection vehicles collected per household/shop/industry ac- ­ • The transfer stations are not in operation, cording to the agreed service level which increases collection costs by requir- • Require ­ waste producers to have a room ing the use of larger trucks and increases or a storage place for the waste inside the transportation time buildings or their property ­ • Require that waste producers take their waste bins out so they are easily accessible on the day of collection (and enforce the re- quirement not to place waste on the streets until the day of collection) ­ • Develop pilot projects to enable each stake- ­ efinition of taxes or fees for waste collec- • D ­ Neither sensitization nor supervision of the holder to check the efficiency and the limits of tion and explanation for what the money is behaviors of the waste producers the solutions implemented for and transparency for how it is used ­ • Standardized methods of waste collection at ­ • Collection methods adapted to the variety the household level based on waste composi- of districts in Ibadan tion and income status to determine uniform costs in the metropolis ­ vehicles are parked so that they limit • No or block the circulation of waste collection ­ • Define a contractual framework and the penal- trucks ties concerning improper performance of ser- vices ­ • Enforcement of sanctions for waste produc- ers (e.g. households and companies) for Maintenance of waste collection vehicles: • ­ not paying for waste management services ­ repairs and maintenance of vehicles are • All ­ • Regular monitoring of the services and pen- done centrally by private or public sector; alties slightly higher than the cost of the improperly performed services ­ • Light repairs and maintenance are done locally by each private waste operator, while major re- pairs and maintenance is done centrally by Oyo State ­ ocation of transfer stations • L ­ ood localization and design • G ­ ccess roads in bad shape • A Design and construction of transfer station • ­ ­ • Ensure that no vehicles are parked so that ­ • Poorly designed contracts and poor regular- they limit access to the transfer station or ity of payments Purchase of equipment • ­ landfill • Definition of the rule of use of the transfer sta- ­ • Regular monitoring of the services and pen- tions alties slightly higher than the cost of the • Security at transfer station improperly performed services • Maintenance of waste transport vehicles • All repairs and maintenance of vehicles are done centrally by private or public sector • Light repairs and maintenance are done at each transfer station by each private waste operator, while major repairs and maintenance is done centrally by Oyo State 76 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria solid waste definition of the activity private contractor’s respon- oyo state’s role management activity sibility The management of a landfill includes the Day-to-day landfill management • ­ ­ etting up a database con- • S following tasks: taining information on all ­ • Purchase or leasing of landfill vehicles that have come to • E ­ quipping the site (fence, road, track, equipment and vehicles bring waste weighbridge, cells, etc.) Landfill operation: • ­ ­ • Support the informal work- ­ • Reception, checking, weighing and identi- • Reception, ­ identification, check- ers (waste pickers) and the fication of entering and exiting vehicles ing, weighing of entering and exit- structuration of their work • Creation ­ of a database containing infor- ing vehicles ­ • Provide facilities or land for mation on all vehicles that have come to • Feeding ­ the database of amounts the landfill bring waste of waste and vehicles received ­ • Monitoring the amount and ­ • Implementation and maintenance of inter- • ­ Establish and maintain waste cells type of waste received at nal circulation tracks at the site each landfill Waste leveling and compaction • ­ Establish waste cells • ­ ­ • Organization and maintenance of • Organization of the internal circulation internal circulation tracks at the tracks of the site site Waste disposal / Landfill manage- Organization of spilling • ­ ­ • Operation and maintenance of de- gasification and drainage system ment ­ • Organization of the recovery, the sorting and the packing of reusable/recyclable ­ • Operation and maintenance of waste leaching collection and treatment Perform leveling and compaction of waste • ­ ­ • Repair and maintenance of landfill • Implementation ­ and operation of the de- equipment and vehicles gasification system ­ • Organization of the recovery, the • Implementation ­ and operation of the sorting and the packing of reus- drainage system and the leachate collec- able/recyclable waste tion ­ • Marketing of recyclable or recover- • Leachate ­ treatment before releasing it able waste into the natural environment ­ • Integration of the informal workers • Valorization ­ of biogas as heat, electricity already on site for waste sorting or fuel – on the long term ­ • Marketing of recyclable or recoverable waste This service includes three distinct steps in- Sorting and selling of the waste • ­ ­ • Provision of premises and volving different actors: commodities for the waste Packing the waste • ­ pickers ­ • Recovery of reusable, recyclable or recov- ­ • Day-to-day management and oper- erable waste from mixed waste. ­ • Supervise the health of the ation of waste recovery activities, waste pickers / scaven- • Buying ­ sorted and packed waste from e.g. recycling, landfill gas recovery gers and support the use of multiple sites and grouping them at a cen- • Purchase ­ or leasing of any equip- equipment to increase their tral site ment and vehicles productivity and reduce the drudgery of the work ­ • Recycling itself, which consists of produc- ­ • Repair and maintenance of any ing secondary raw materials equipment and vehicles ­ • Support waste pickers to im- prove their income and their Resource recovery ­ • Selling of recyclable waste, landfill social situation gas, electricity and/or heat ­ • Support the formal organi- zation of the informal waste pickers OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 77 pattern for shared participation conditions for success condition for failure Location of new landfills • ­ • Have ­ a clear and realistic tender with re- ­ • Late payments, especially if the service pro- quirements based on measured and ver- vider has to invest • ­ Design and build of new landfills ified data (quantities and composition of waste, leachate quality and flow …) ­ • Poorly managed coordination of the various ­ • Redesign, renovation and improvement of ex- trades carried out at the landfill, namely in isting landfill infrastructure (e.g. roads, fences, • Master ­ and rigorously implement the con- case of a conflict between the collectors and weighbridge, waste cells, bottom liner, top cov- tract and its conditions those responsible for waste leveling er, drainage system, leachate collection, stor- age and treatment system, etc.) • Development ­ of knowledge, based on lectricity Distribution Company opposed • E measurements of various operating param- to integrating small production units in its Purchase of equipment and vehicles • ­ eters, shared between delegator and dele- network­ gate Landfill security • ­ ­ • Cooperation of law enforcement forces to Definition of the rule of use of the landfills • ­ forbid site access to unauthorized persons (especially informal waste pickers) and to livestock ­ • Maintain contractual flexibility on the activ- ities of reuse / recycling / recovery to adapt them to reality and to the evolution of these markets Workers equipped with proper equipment • ­ (including waste pickers) ­ • Develop knowledge about the type of waste col- • Consider ­ the waste pickers / scavengers as ­ • Not involving the authorities and the police lected partners of the public authority and of the in the management of the site, particularly operator of the landfill and negotiate with for the prohibition of access to the site to ­ • Identify industrials willing to buy the recovered them on the integration of their activities in non-authorized persons material all activities at the landfill and in the waste management chain in general ­ • Not incorporating recovery activities from ­ • Negotiation of the integration of the waste pick- the design phase of the landfill site ers activities into all activities of the landfill ­ • Develop a network that integrates recyclers and that reduces the number and the im- ­ • Not identifying all reuse/recycling/recovery Maintain access roads in good shape • ­ sector actors and not initiating win-win rela- portance of intermediaries tionship with the actors to bring real added ­ • Develop commercial agreements with com- value to the sector panies that use secondary raw materials to reduce price fluctuations ­ • Not trying to enhance the productivity and to reduce the drudgery of waste pickers’ ­ • Structure the waste pickers organization work to improve their productivity, their working conditions and their selling prices ­ • Not accompanying the waste pickers in im- proving their income and their social and ­ • Establish internal regulations limiting site health situations access to authorized persons only, and im- posing rules of conduct and collaboration with waste pickers ­ • Respect the rules regarding the proper equipment required to pick waste 78 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria street cleaning • Forbid parking in areas that limit or block the movement of collection trucks; The waste collection operator also provides street • Sanction any waste disposal in public areas cleaning services for the following reasons: other than waste placed outside for collec- tion on the day of collection. • Poor waste collection leads to more cleaning operations; • The waste generated from cleaning must be removed by collection services; • Mobile teams of worker managers can easily landfill management monitor the two services simultaneously. The management of a landfill can involve different types of activities such as: waste collection • General management and operation of It is important to differentiate two main means of the landfill: registration and weighing of waste waste collection: collection trucks arriving to the landfill; unloading of trucks; landfilling, leveling and compaction of waste; maintaining the access roads and tracks; • Door to door collection: in areas suitable for constructing cells; etc. trucks. It would be difficult to conduct this kind of waste collection along the main asphalted roads where cars are parked along the road sides. This • Leachate control and treatment: involving type of collection is more relevant for the planned the biological or physical/chemical treatment residential areas that have large roads and build- of water. Leachate decontamination is very com- ings or land properties with ample space to store plex because the nature and the composition of the waste; the pollutants evolve over time, which necessitates adjusting the process on a regular basis. Moreover, there is no one universal treatment process adapted • Collection from communal waste collection to any climate and to any household waste compo- points: in unplanned areas or in communities with sition. Therefore, it is crucial to evolve progressively roads inaccessible to waste collection trucks. in this field by developing specific knowledge on In areas with waste collection points, pre-collection the leachates produced, based on the results of the is also an option. This could be organized by involv- operation of the site. Furthermore, as the means of ing the formal or informal sector to collect waste leveling and covering the waste strongly impact the from households in the community and bringing it flow and quality of the leachate produced, this trade to the communal waste collection point. is generally conducted by the same company that equips the landfill and carries out waste leveling. Waste producers could sort their waste, e.g. organ- ic, recyclable materials and other waste, to make resource recovery easier. The pre-collector could • Biogas management: the control, monitor- then charge different waste management fees for ing and potential recovery of biogas generat- collecting sorted and un-sorted waste, and may also ed in the landfill. This activity is more linked to be able to recompense the waste producer for sort- the energy trade than to the waste management. ing the waste - based on the volume and value of Often, the supplier of the system for biogas conver- the recovered materials. sion and the generator unit operates the equipment and buys the biogas at a price based on its energy The legal and regulatory framework must enable value. In the case of electricity production, it is also the following: possible to sell the residual heat (50 to 60 % of the energy of the biogas) contained in the hot water or • Enforce the obligation to have a room or a storage place for waste inside the waste in steam that is generated. producers’ premises, buildings and com- pounds; These activities generally require high invest- • Enforce the storage of waste inside the ments, with payback times of several years and waste producer’s premises until the day of low workforce numbers. The workforce is generally collection; professionally qualified and specialized. Due to the • Enforce the requirements around the condi- high investments and specialized competencies tion of the waste collected from the waste producers; needed, longer term service contracts are neces- OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 79 sary when involving the private sector in landfill private waste collectors do not sort waste during management collection as it reduces the productivity of the col- lection teams. Some public authorities also ban The landfill management activities listed above are the recovery of waste before collection in order to quite technical and require specialized technolo- reduce the dispersion of waste and to improve the gies, equipment and human resources. In order to cleanliness of the public domain. develop this level of specialization, it is often neces- sary to operate several landfills to achieve the best Waste recycling is formed of three distinct steps, economies of scale and distribute research and de- usually conducted by different actors: velopment efforts across a number of sites. This is one of the waste management activities that typi- • Step 1: Recovery of reusable or recyclable cally could be operated by a private contractor. waste from mixed waste. This is a labor in- Three scenarios are generally used to engage the tensive operation requiring unskilled or minimally private sector in landfill management: skilled workers. The recovered items are sometimes pre-clean and packed before being sold to special- ized recyclers or wholesalers. ; • Design, Build, Finance and Operate (DBFO): The service provider makes the necessary investments using its own financing re- • Step 2: Buying sorted and packed waste sources and the public authority pays a from multiple sites and grouping them at price per ton that covers the costs of the in- a central site. This is role is undertaken by the vestment and of operation; wholesalers and require a means of transport. The wholesalers sometimes perform an intermediary • Design, Build and Operate (DBO): The ser- treatment before selling the recovered materials to vice provider conducts the construction recyclers; work and is paid for it as soon as it is com- pleted. Then the public authority pays a • Step 3: The recycling itself, which consists price per ton covering the operational costs of producing secondary raw materials (possi- of the service provider; bly combined with other raw materials) that are marketed in the same trade channels as • Separate DBO: The public authority has the virgin raw materials. This activity is mainly car- main construction work (enclosure wall, ried out by manufacturers seeking to lower their roads, tracks, weight bridge, offices, garag- production costs. es, cells, leachate storage pool, etc.) under- At present the informal waste pickers or so-called taken by a third party and the service pro- scavengers perform the first step of recovering vider makes complementary investments. valuable materials from the waste at the dumpsites The public authority pays for the main in Ibadan. The informal sector could be integrated construction work, and then pays a price into the solid waste management value chain and per ton to cover the complementary invest- more professional material recovery facilities could ments and the operational costs of the ser- be established to improve the recovery of resources vice provider. as well as the productivity and health of the waste The two last options are more attractive to the mar- pickers. ket as they reduce the financial risks to the private Secondary raw materials are in competition with operator. virgin raw materials. They are typically less expen- sive than virgin raw materials as they rarely have resource recovery the same level of quality, often contain impurities Resource recovery involves extracting valuable and require some intermediate treatment before materials and energy from waste such as recy- being integrated into the production process. cling, composting and waste-to-energy. Resource The raw material commodities market is often un- recovery often requires, or benefits from, sorting of stable and is impacted by events and/or decisions waste. This can be undertaken at the waste pro- out of the control of local and national actors. This ducers premises and during waste collection. Many instability affects the purchasing prices for recov- 80 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria ered materials from waste, while the costs of recov- tions, water and electricity connections and by or- ery process (sorting and packing, etc.) are stable. In ganizing different favorable activities such as sort- this context, initially profitable recovery processes ing of waste at waste collection points and at the can become unprofitable over time. waste producers’ premises. Furthermore, intermediaries sometimes take There are several resource recovery initiatives that high commissions, while their added value is low. have been launched in Nigeria that could be appli- Finally, due to weaknesses in organization and in cable for Ibadan: the ability to achieve a minimum level of invest- ment, the productivity of recovery activities at • WestAfricaENRG are the owner-operator of landfills is sometimes very low and could be signifi- Nigeria’s first Materials Recovery Facility cantly improved by bringing in more capable man- (MRF) situated in Alimosho, Lagos. They re- agement. cover the valuable fraction of plastic, metal and paper from the municipal solid waste The public sector is often not well-adapted at re- for recycling. The facility was built in 2012 source recovery in developing countries. The qual- was built on the closed Solous 1 dumpsite ity of sorting and packing, which impacts waste under a public-private partnership (PPP) ar- picker-related labor costs must adapt very quickly rangement of Build, Operate, Manage and to market fluctuations and the rigid and hierarchi- Transfer with 12 years tenure at a total cost cal structures of government are not suited to this of N1.3 billion (USD 6.5 million).The facility type of management that requires flexibility and quick reactions. However, the public authority can has the capacity to receive about 130 waste promote the resource recovery by: the provision of trucks per day and process more than 2,000 premises and facilities, communication connec- metric tons of waste every day. Figure 10: The Material Recovery Facility (MRF) in Alimosho, Lagos (LAWMA, 2015) OPTIMIZING PSP IN SWM ACTIVITIES IN IBADAN | 81 • The World Bank sponsored Nigeria Earth- mainly organic waste per day. This reduces care Solid Waste Composting Project in La- emissions, on average, by approximately gos is a state-of-the-art composting facility 253,800 metric tons of carbon dioxide per (World Bank, 2015b). Waste is collected at year. The project employs about 90 workers. three food markets and treated to produce organic compost. The high quality compost • Waste-to-energy public-private partner- is then given to Nigerian farmers to use in ships have been announced in Ibadan agriculture and horticulture. As composting (Channels Television, 2015), Lagos (Punch, avoids the methane emissions that would 2013) and Abuja (Daily Independent, 2015), otherwise be released into the atmosphere but none of these projects have been imple- and contribute to climate change, the proj- mented yet. Lagos Waste Management Au- ect has been registered as a Clean Develop- thority has piloted a small waste-to-energy ment Mechanism (CDM) project under the project that produces biogas from organic UNFCCC. It is estimated that it will reduce waste from Ikosi Market and is used to oper- greenhouse gas emissions by 253,800 met- ate 2kVA generator at the market.    ric tons of carbon dioxide per year over 10 years. At its maximum capacity, the com- post facility can process 1,500 metric tons of Figure 11: Composting plant in Lagos (LAWMA, 2015) 82 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria drafting of provisions within a waste services agreement There are a number of potential provisions that could be contained within a Waste Services Agree- ment (WSA) between OYOWMA and a private waste contractor. The specific details of the Waste Services Agreement and the applicability of the provisions below will depend on the choices made regarding the options already described in this chapter. The most important factors related to the contractual provisions are: • the scope of the works/services being re- quested; Figure 12: The pilot waste-to-energy biogas project at Ikosi Mar- • how payment for the delivery of the works/ ket in Lagos (LAWMA, 2015) services is to be received by the private waste company; and • the expected size and capability of the pri- vate sector counter-party. Annex 2 – Potential Waste Services Agreement Provisions provides details of the potential contrac- tual provisions and considerations that need to be made. recommendations and optimization plan for psp This section presents the study’s recommendations es identified are addressed by the action plan); the and proposes an action plan for optimizing PSP in main recommendations from the stakeholders and SWM activities in Ibadan metropolitan area. The the best practices from the case studies; the differ- action plan is based on the main challenges ob- ent options possible for improving PSP; and, the as- served throughout the study (each of the challeng- sessment of the current situation of SWM in Ibadan. main recommendations Based on the assessment of the analyses and dis- the true costs of waste management and then es- cussions with stakeholders in this project, a set of tablish a financial model to cover the capital and recommendations for Oyo State for how private sec- operational expenditures for solid waste manage- tor participants could be more actively involved in ment. The next step is then to determine affordable improving the efficiency and quality of solid waste and acceptable waste management fees for each management in Ibadan metropolitan area (see Fig- type of waste producer (e.g. households, commer- ure 13: Overview of actions to improve private sec- cial businesses and industrial companies) in each tor participation in solid waste management activi- of the different areas of Ibadan. Finally, Oyo State ties in Ibadan). The two main focus areas with high must support the private sector participants in col- priority are: lecting the waste management fees through an im- proved billing system and strict enforcement. 1. Ensure cost recovery of waste manage- ment services and increase the revenue 2. Establish a transparent procurement collection of waste management fees from process for private sector participants and waste producers. In order to engage private develop performance-based contracts. An- companies in solid waste management activities, other condition for successful public-private part- adequate and stable revenues for providing waste nerships is clearly defined and balanced waste management services must be ensured. Full cost services agreements. Oyo State should develop recovery of waste management is not currently pos- performance-based contracts (with agreed in- sible in Ibadan, so Oyo State must secure funding centives and sanctions) considering the potential from other sources. The first step is to determine concession agreement provisions proposed in this 84 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria study. This includes aspects such as extending and awareness-raising efforts should continue to the duration of contracts, allocating greater col- change attitudes and behaviors of the general pub- lection areas, defining service quality levels and lic related to waste disposal and payment of waste introducing investment commitments. In order to management fees. This should be complemented attract private sector participants, the procurement by strong enforcement of waste management reg- process should be transparent and based on open ulations, particularly with regards to payment of competitive tendering. This requires that Oyo State waste fees. Improvements in transport infrastruc- has the competencies and capacity to initiate, de- ture and waste management facilities such as com- velop, negotiate, award, manage and monitor such munal waste collection points, transfer stations and public-private partnerships. proper landfills will require significant investments, but will reduce operational costs for both the pri- Besides these two main areas Oyo State should vate and public sector. Supporting pilot projects in over time implement a variety of measures that waste management adapted to Ibadan is a good would improve the productivity of public and pri- way of testing cost-effective innovative solutions vate sector waste management activities. First and before rolling them out on a greater scale. Final- foremost, OYOWMA should improve the measure- ly, the informal sector should be involved through ment and monitoring of SWM performance. This community-led initiatives to improve waste collec- is needed to determine the actual waste manage- tion in low income areas and material recycling. ment costs, establish the financial model and serve to define service quality levels and incentives for The recommended actions are interlinked, e.g. the the private contractors. Communication, education performance-based contracts are dependent on the Cost recovery and Actions to improve the productivity of waste Procurement process revenue collection management activities and performance-based contracts 1. Improve the measurement and monitoring of solid waste management 1. Determine the actual performance waste management costs and establish a financial 2. Continue to communicate, educate 4. Improve the management and 1. Develop performance- model and raise awareness of proper operation of the dumpsites based concession con- waste disposal tracts for waste 2. Establish a cost recovery management services policy based on the 3. Increase enforcement of waste 6. Develop and test innovative collection of affordable management regulations waste management solutions 2. Establish a transparent waste management fees adapted to Ibadan through procurement process with and other funds 5. Invest in transport infrastructure pilot projects open competitive tender- and waste management facilities 3. Improve collection of 7. Integrate the informal sector in ing of waste such as waste collection points, waste management fees community-based waste collec- management services transfer stations and landfills from waste producers tion and recycling actvities Capacity building Private sector Public sector • Staff training to improve safety and productivity • Enforcement of waste management regulations • Planning of waste collection routes and transport • Procurement process, e.g. initiating, developing, negotiating, award- logistics ing, managing and monitoring performance-based contracts • Measuring and reporting the quality of service • Determining cost recovery and waste management fees and their performance • Developing solid waste management strategies, master plans and • Accounting and preparing financing applications action plans; • Management • Landfill management • Design, modification and maintenance of waste • Land management and planning using GIS; vehicles and equipment • Resource recovery, e.g. composting, waste-to-energy, material recycling • Performance monitoring of services Figure 13: Overview of actions to improve private sector participation in solid waste management activities in Ibadan | 85 cost recovery and financial model. The actions to formance. It also requires significant investment to improve waste management productivity contrib- build infrastructure and human capacity that will ute to lowering costs and improving the quality of improve productivity to create a viable and sustain- services. able waste management system. If implemented correctly with incremental step-wise increases in To support the above mention actions, a range of waste management fees followed by real improve- areas in need of capacity building were identified. ments in the quality of service, the level of public Areas for strengthening skills, competencies and investment required will reduce over time, as the abilities necessary for effective solid waste man- private sector demonstrates viability and delivers agement were proposed for both the private and better services. public sector. The actions to how the PSP can improve the effi- Improving PSP is a comprehensive process that re- ciency and quality of solid waste management in quires extensive interventions, consultations and Ibadan metropolitan area are detailed in the PSP strong regulation of both the waste producers and optimization plan in the next section. private operators in the waste management chain. It requires the reliable collection of waste manage- ment data for decisions to be based on actual per- plan psp optimization in solid waste management activities in ibadan Table 14 provides an overview of actions, resourc- report. Most of the proposed optimization actions es required and a proposed timeline for optimizing should be conducted during the next two to three private sector participation in SWM activities in years, as can be seen in the table below. Ibadan. The plan was developed based on the iden- tification of the main challenges, the main recom- mendations from the various stakeholders and the conditions for success identified previously in this 86 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria assumptions For the calculations of the staff costs, the assump- tions listed in the table below were used12 13: locally recruited permanent staff annual salary (usd/y) annual salary (n/y) Minimum wage 3,150 630,000 Administrative employee 4,410 882,000 Management employee 7,560 1,512,000 GIS specialist 30,000 6,000,000 Inspector/Surveyors (checking the quality of the waste collection services) 12,000 2,400,000 Sworn inspectors 12,000 2,400,000 Law enforcement employee (checking that residents pay for waste collection) 6,300 1,260,000 Statistician 12,000 2,400,000 Economist 18,000 3,600,000 Auditor 18,000 3,600,000 Lawyer 36,000 7,200,000 experts engaged on short term contracts 14 daily salary (usd/d) daily salary (n/d) Economist 300 60,000 Accountant 100 40,000 Expert accountant 300 60,000 Auditor 450 90,000 Lawyer 300 60,000 Waste management expert 300 60,000 This action plan is designed for strategic planning, Decision makers using this action plan should also to provide an overview of the possibilities of PSP op- keep in mind the conditions for success and the timization. Therefore, every line of this action plan conditions for failure developed in the previous needs to be detailed further as each action includes chapter of this report. several sub-actions. Moreover, many of the actions are inter-connected, and the estimation of the in- vestment and operation costs of one specific action can depend upon the results of another action. 12 Based on discussion with a number of sources in 13 The rates can vary widely, depending on the level of Nigeria: waste collectors, OYOWMA officials and other qualifications, proficiency, etc. Oyo State civil servants, locals currently employed in the 14 The costs of engaging experts on short term con- stated roles, etc. tracts will be significantly higher than the cost of perma- nent local staff. | 87 88 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria Table 14: Overview of costs and benefits of each action to optimize PSP in SWM in Ibadan15 action swm issue / challenge proposed action comments / conditions resources required # activity 1.1 General The poor state of the Continuously improve the • Have ­ the collection rounds GIS Specialist • ­ roads hinder the per- state of the roads and recorded in a GIS used by issues formance of the waste traffic OYOWMA and the collection ­ • Integrate the obligation management services providers to report the collection and the productivity of rounds in the concession the teams ­ • Discussion between the col- contracts lectors, OYOWMA, the services in charge of the state of the ­ • Initiate a coordination cell roads to develop a coordinated for waste/roads within Oyo program prioritizing the roads State improvements 1.2 General The private service Introduce financial motiva- • Integrate ­ quality and quality ­ • Develop a quality rating provider teams are not tion and incentives for staff measurement requirements system issues motivated to deliver a on the productivity and the in the concession agreement good quality service quality of work contracts Hire quality surveyors • ­ and high productivity ­ • Mobile devices for real ­ • Develop measurements of quality time surveys • Integrate penalties for bad ­ database of the quality • GIS qualities which may lead to monitoring contract breach and disqualifi- cation of the service providers for other markets ­ • Develop an external claims management service (mobile app to introduce and follow the complaints) producing reports and statistical data on the complaints and transfer them to the related collectors 1.3 General The solid waste man- Build OYOWMA’ capacity to • Strengthen ­ the local capacities ­ pecific expertise depending S agement strategy and plan, regulate, follow-up, through training/support on the action validated by the issues action plan is poorly monitor and draft the tech- board of OYOWMA written, communicated nical and administrative ­ • Proposal of a strategy and of and discussed requirements governing the an action plan by the services services provided of OYOWMA to the board of OYOWMA ­ • Occasional mobilization of specific experts to quickly implement the actions Clear organization chart • ­ ­ • Computer based process to re- cord the data and automatically produce indicators 15 The estimations of the investments and the opera- The estimations are given for the prospect of a collection tions are given for individualized actions but some cost conducted at 100% by the private sector and considering reduction is highly possible by grouping the proposed that the 4 dumpsites are kept actions RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 89 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders Unknown at this stage further Half-time salary of a GIS special- • Enable the use of bigger OYOWMA Service Pro- Continuous investigation required ist in OYOWMA (N3,000,000/ capacity trucks viders efforts year) • Reduce the number of break downs • Improve the productivity of the teams • Improve the coverage of the collection services • N2,000,000 : 3 training days • N120,000,000/year: 50 sur- The service providers will be OYOWMA / OYOWMA / 1 to 2 years per surveyors veyors at N2,400,000/year paid depending on the quality LGA LGA / Service of the service provided through Providers / • N15,000,000 for mobile • (1 surveyor per 100,000 sanctions and penalties Oyo State devices (N300,000 per mobile habitants) device per surveyor) Thus they will motivate their • N2,400,000/year for replac- team accordingly • N6,200,000 to implement the ing / repairing the mobile system (Database expert for devices 40 days (N100,000/d) + 10 days on the ground (N120,000/ day) + 10 days debugging and finalization (N100,000/day)) • N15,000,000 for mobile devices (N300,000 per mobile device per surveyor) • N6,200,000 to implement the system (Database expert for 40 days (N100,000/d) + 10 days on the ground (N120,000/day) + 10 days debugging and finalization (N100,000/day)) N6,000,000/year for capacity Not determinable • Enable the production of re- OYOWMA LGA / Oyo 1 to 5 years building (1 GIS expert, 1 Database liable and checked financial, State expert, 1 Quality expert/law technical, environmental and expert at N60,000/day each for statistical data 4 days per quarter of training and • Help professionalization of 4 days per quarter to implement the waste management corrective actions) • Quality requirements more demanding • Better cost and price control 90 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria action swm issue / challenge proposed action comments / conditions resources required # activity 1.4 General The service providers Develop methods and • Training/support ­ for the meth- ­ • Receive the results for 1.2 do not have meth- build the service providers’ ods to monitor mobile teams in real time from OYOWMA issues ods to evaluate the capacity to evaluate the performance, quality performance, quality and ­ • Weighing of the trucks in the ­ • Master the GPS monitoring and productivity of productivity of their work dumpsites methods their work ­ • Data from 1.2 to evaluate the Receive the data from 4.2 • ­ work of the employees and motivate them financially • GPS monitoring of the vehicles 1.5 General The service providers Develop methods and • Training/support ­ for: accoun- Instructors • ­ do not have adequate build the service providers’ tancy, taxes, unit cost, financial issues capacity to properly capacity in financing and applications, social care of the • Accountants evaluate the financial management employees, etc. • Accountancy software and management as- pects of their activities ­ • Willingness of the private oper- ators to receive the training 1.6 General Contractual framework • Develop investment com- ­ ctions 1.2, 1.3, 1.4, 1.5, 3.1, 4.1, A Lawyer • ­ not supportive of the mitment in the contract 4.2, 4.3, 4.6 issues professionalization of (obligation to deposit • All data collection actions the waste collectors 25% of the investment • A bank receiving monthly over a 18 months period) deposits from the com- • Ensure the allocation of panies in order to pay the budget for guaranteed non-borrowed part of the payment of the service investments providers • OYOWMA checks the • Allow processes to rene- guarantee of capacity of gotiate the contracts with investment of the Private the service providers Operators 2.1 Waste gen- The waste is scattered • Communication (aware- • Local ­ regulations enabling low Lawyer • ­ eration around the collection ness raising, information, enforcement containers causing law enforcement) Communication firm • ­ aesthetic degrada- ­ • Communication team special- tion and increase in • Inform the public about ized in behavior modification disease vectors the benefits they can expect from the services ­ • Separate the recoverable waste provided from other waste in the waste collection points 2.2 Waste gen- Waste is scattered Have an appropriate GIS of the city • ­ GIS Specialist (Action 1.1) • ­ eration around the collection number of waste containers containers causing and bins and locate them ­ • Work in partnership with the ­ • Buying of the containers by aesthetic degrada- properly (near schools, communities the collection operators tion and increase in markets, shops, administra- ­ • Work in partnership with the disease vectors tions, etc.) services in charge of the roads ­ • Enforce the obligation to ded- icate space for this equipment in every development project in the city ­ • Enforce the equipment of a given number of waste collec- tion points in the concession agreement contracts RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 91 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders • See Action 4.2 for the weigh- N200,000/year: 1 day per week • Improve the quality and the Service LGA / Oyo 1 year bridges of the administrative employees productivity of the services providers / State of OYOWMA to build trust overtime with OYOWMA • N50,000 per collection vehi- the public cles (passive tracking) • Help the professionalization • N2,000,000: 3 training days of the waste management per private operator and per administrative employee of • Master the factors impacting OYOWMA productivity N12,000,000 : 3 days of training N1,500,000/year/Private Collec- • Improve the quality and the Service LGA / Oyo 1 year for the boss of each private tor: Salary of the accountant (1 productivity of the services providers / State collector (200 people) day every 2 week) to build trust overtime with OYOWMA the public • Help the professionalization of the waste management • Sort out the good managers from the bad managers N1,800,000: 30 days of an expert • Accountant from Action 1.5 • Improve the quality and the OYOWMA LGA / Oyo 2 to 3 years accountant productivity of the services / Service State • N35,000/year: 10 days of an providers administrative employee of • Improve the relationship OYOWMA between the private sector and the public sector • Prove the capacity to repay loans, give credence to the operators • Sort out good managers from the bad managers • Help the professionalization of the waste management 0 N10/habitants/year • Change the behaviors OYOWMA LGA / Oyo 1 to 10 State years • Reduce the proliferation of pests • Improve the aesthetics of the city • Improve the productivity of the collection teams • Reduce the cost of the collection This is a cost reduction action for This is a cost reduction action • Improve the productivity and Private LGA / Oyo 1 to 10 the operators (depending on the for the operators (depending on reduce the amount of waste contractors State years evolution of the roads, the kind the evolution of the roads, the spilled / OYOWMA of containers, and the kind of kind of containers, and the kind trucks chosen) of trucks chosen) • Improve the cleanliness of the city, reduce the damaging of the roads 92 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria action swm issue / challenge proposed action comments / conditions resources required # activity 2.3 Waste gen- The current rules OYOWMA and the Ministry • ­ Develop judicial instruments ­ • Imaginative and construc- eration and regulations of Environment and Habitat, (from the problems encoun- tive lawyer regarding solid waste adequately enforce the tered) leading to an actual pun- management are not laws which would protect ishment for deviant behaviors ­ • Mobile devices to keep adequately enforced, all stakeholders track and document the and this means Have a legal and practicable • ­ problem encountered existing attitudes and solution for all the kinds of (pictures, notes, etc.) behavior regarding waste produced (namely C&D waste disposal remain waste and green waste) entrenched 2.4 Waste gen- Waste operators have Compel all households • Specific ­ regulation requiring ­ Lawyer eration trouble getting paid in to pay fees for waste the population to prove they some areas collection patronized a waste collector ­ • Law enforcement units trained to manage the complaints of the waste collectors on waste producers that do not pay waste management fees ­ • Evidence of payment sealed, numbered and protected against copy produced by the State (see Action 4.1) 2.5 Waste gen- The packing of the Develop legal instruments Define, develop and enforce • ­ ­ • Imaginative and construc- eration waste varies from one the rules for waste packing (from the problems encoun- tive lawyer part of the city to the tered) leading to an actual pun- other ishment for deviant behaviors ­ • Mobile devices to keep track and document the ­ • Have a legal and practicable problem encountered solution for all the kind of (pictures, notes, etc.) waste produced (namely C&D waste and green waste) 3.1 Street There is no planning of Identification of public ­ with the characterization of • GIS ­ IS Specialist (Action 1.1) for G & drain the cleaning services spaces, markets, primary all the areas to be cleaned 4 months provided by OYOWMA and secondary roads to cleaning clean and definition of ­ • Measurement of the time need- cleaning frequencies ed for the cleaning 3.2 Street The quality of the Achieve a complete and ef- ­ See Waste Collection & drain collection services ficient collection not only of hinders the quality of household waste but also cleaning street cleaning of inert waste (e.g. con- struction and demolition waste) and green waste (e.g. garden waste) RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 93 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders • N3,000,000 for the initial • N120,000,000/year : 50 in- • Eliminate illegal dumping of Oyo State OYOWMA / 3 to 10 study (1 lawyer for 20 days at spectors at N2,400,000/year waste both by waste produc- LGA years N 60,000/day + 3 stakeholders ers and waste collectors workshops for 20 people at • N2,400,000/year for replac- • Clean city N600,000 each) ing/repairing the mobile • Productivity of the collection devices team improved • N15,000,000 for mobile devices ( N300,000 per mobile device per inspector) N1,200,000: 3 days of training N37,800,000/year : 30 law • Improve the security of the Oyo State / OYOWMA / 6 months for the law enforcement units enforcement employees at payment LGA Service pro- N1,260,000$/year viders • Reduce the fees for the waste producers • Enable to enforce high quali- ty and productivity standards • N3,000,000 for the initial • N120,000,000/year: 50 in- • Improve the productivity Oyo State OYOWMA / 3 to 10 study (1 lawyer for 20 days at spectors at N2,400,000/year LGA years • Improve the quality of the N 0,000/day + 3 stakeholders service provided workshops for 20 people at N600,000 each) • N2,400,000/year for replac- • Reduce the amount of waste ing / repairing the mobile spilled on the roads due to devices bad packing • N15,000,000 for mobile devices (N300,000 per mobile device per inspector) 0 Half-time salary of a GIS special- • Have a clear definition of OYOWMA / OYOWMA / 4 months ist in OYOWMA (N3,000,000/ what needs to be done LGA LGA year) • Capacity to communicate this definition of the service to all the stakeholders Reduce the amount of waste to be removed from the streets and drains 94 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria action swm issue / challenge proposed action comments / conditions resources required # activity 3.3 Street The cleaning team Provide the workers with • Buy ­ several models, test them, ­ • Workshop for the manufac- & drain does not use appropri- the appropriate equipment, conduct ergonomics studies turing of the prototypes ate cleaning equip- train them for its proper (in partnership with local uni- cleaning ment use and sanction loss of versities) to have a model well ­ • University team to follow equipment adapted to the local constraints up the work and the im- pressions of the users ­ • Have a plan for the disposal of the quantities collected by the ­ • Design of at least three cleaning service evolutions of the proto- types ­ • Definition of the final design ­ • Production of the final design 3.4 Street The cleaning team Have safe storage areas for ­ including the zoning of the • GIS GIS Expert • ­ & drain does not use appropri- sweeping equipment near cleaning areas ate cleaning equip- the areas of intervention, in • 20 to 50m² area to build cleaning ment locations secure from theft ­ • Definition of the cleaning a storage facility for every and vandalism teams team of 30 to 50 sweepers ­ • Identification of 20 to 50m² areas to building a storage facility 4.1 Waste There is insufficient • Provide evidence of pay- ­ good knowledge of the actual • A OYOWMA officials • ­ collection data and informa- ment (receipts) printed and full prices of waste collec- tion on the levels of by the State with the fee tion ­ • Bosses of the private revenue that can be paid written on it collection companies achieved within the ­ good knowledge of the realis- • A • Account the receipt tic service coverage rates ­ • Specialized printer (fiscal areas franchised for stamps printer for exam- waste collection books handed to each service provider and ­ • Consultation between OYOW- ple) inform the population MA and the collectors Communication team • ­ that it must pay only in ­ • Communication to the pop- exchange for this kind of ulation in order to keep the Sworn inspectors • ­ receipt receipts ­ • Regulatory framework • Print the date of payment • Law ­ enforcement actions enabling to prosecute and month concerned on against people who cannot households not able to the receipts (done by the present a receipt present a receipt service providers) Lawyer • ­ ­ • Start at first on pilot areas • This receipt should be for at least one year before kept as a proof that the generalizing (first to the more waste producer patron- affluent districts) ized a waste collector ­ low income area, see action • For 4.4 4.2 Waste There are no normal- Install a weighbridge in • Design ­ the layout of the Weighbridges • ­ collection ized measurements each dumpsite with an entrance of the dumpsites of the quantity of computer system with 3G correctly Databases • ­ waste delivered to the to transfer in real time the ­ • Statistician to analyze the dumpsites results of the weighing to ­ • Buy and install a weighing system with maintenance data and produce indica- OYOWMA tors contracts of at least five years RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 95 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders • N16,000,000 (N12,000- N4,000,000 (N4,000 per broom Reduce the difficulty of the job OYOWMA / OYOWMA / 6 months N16,000 per broom/shovel/ / shovel / cart) and improve the productivity LGA / Clean- LGA / Cleaning cart) ing service service pro- providers viders • N600,000 preliminary assess- ment (5 field inspectors for 5 days at N10,000/day each + 1 expert for benchmarking and analysis for 5 days at N60,000/day) • N2,400,000 for the design of the prototypes: N800,000 for each prototypes (N260,000 for the production of the prototype + 5 field inspectors to monitor the use of the pro- totype for 5 days at N10,000/ day each + 1 expert for 5 days at N60,000/day) • N100,000,000 for the storage N3,000,000 for maintenance • Promotion of the work OYOWMA / OYOWMA / 1 to 3 years facilities (about 40 facilities (3% of the investment) LGA LGA • Improve the efficiency of the throughout the city 40m2 each work at N60,000/m2 + study and monitoring fees) • Dumping of the waste of the cleaning services by the collection services • N1,200,000 for the initial GIS study : GIS expert for 20 days • Longer equipment life (N60,000/day) • N1,200,000 for the regulatory • N200,000/year : 1 employee, The private collectors and the OYOWMA LGA / Oyo 2 years (1 framework (1 lawyer for 20 1day/week to monitor the government will have a better / Private State years for days at N60,000/day) receipt books and analyze the knowledge of the revenues that contractors prepara- reports from the collectors can be generated which will tion, 1 year • N200,000 for the printing of regarding the collected fees form the basis of the projected for the pilot the receipts remuneration of the private areas) • N12,000,000/year : 5 sworn collectors • N1,200,000 for the precise and inspectors for the pilot areas scientific follow up of the pilot areas (1 scientist for 20 days at N60,000/day) • N600,000 for the training of the inspectors (2 training at N300,000 each) • A safe box to store the receipt books for OYOWMA N40,000,000 (4 weighbridges at • N5,000,000/year for mainte- Reliable statistical data OYOWMA Company 6 months N10,000,000 each) nance (database maintenance / Potential specialized for the and upgrading, electronic of • New possibilities to pay the dumpsite in weighing implemen- the weighing system, cali- waste collection services operator systems / tation bration at least twice a year, University • Possibility to correlate this replacement of the captors, of technical (continu- data with other available damage related to rain or institution to data (demographic, cost ous effort) thunder, etc.) produce new recovery, etc.) to produce knowledge • N600,000/year (25% of the management indicators for from the data salary of the statistician) better decision-taking generated 96 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria action swm issue / challenge proposed action comments / conditions resources required # activity 4.3 Waste Currently there is no • The financial model • Actions ­ 1.4,4.1 and 4.2 ­ n economist working one A collection financial model to esti- for investments and achieved with the expected month every six month on the mate the cost of solid operation of waste results analysis of the reports deliv- waste management in management activities ered by the private sector Ibadan in Ibadan should be ­ • Concession agreements should established. This should be improved to integrate the define the fees that need commitment to deliver data to be collected to cover quarterly to OYOWMA (op- the costs of operating erational reporting, financial and upgrading waste reports, discounting of assets, management to ensure etc.) that the operators are ­ • Build the capacity of the private adequately remunerated. collectors so their teams can The fees/taxes collected produce the data required should depend on the affluence of the waste collection areas. • Include the obligation to provide the information required to establish the financial model in the contracts with private contractors 4.4 Waste Waste operators have • To foster community led • A ­ good knowledge of the actual ­ • OYOWMA and Oyo State collection trouble to get paid in collection and empow- and full prices of waste collec- officials some areas and some ering community asso- tion areas are not easy to ciations to enforce the ­ • Bosses of the private waste reach by trucks spe- collection of waste into ­ good knowledge of the realis- • A collection companies cifically in low income waste collection points tic service coverage rates Community leaders • ­ districts where door to ­ • Consultation between OYOW- door collection cannot • Inform the waste produc- ­ • Specialized printer (fiscal ers about the benefits MA and the collectors be done stamps printer for exam- they can expect from the ­ • Communication to the com- ple) services provided munities in order to keep the receipts Communication team • ­ • Apply actions from 4.1 to these community ­ • Law enforcement actions Sworn inspectors • ­ associations against communities who ­ • Regulatory framework cannot present a receipt enabling to prosecute • Start ­ at first on pilot areas for communities not able to at least one year before gener- present a receipt alizing ­ a Pay-As-You-Throw • Try approach in some pilot areas and different money collection option (community money collection among others) ­ • Start at first on pilot areas for at least one year before gener- alizing RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 97 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders The investments are made in N600,000/year : Salary of the • More precise concession OYOWMA LGA / Oyo 2 to 5 years Actions 1.4, 4.1 and 4.2 economist (40 man day per agreements / Private State year) contractors • More accurate knowledge about the costs and reve- nues • Possibility to write open tender offer with an accurate estimation of the cost and the fees of the services and the quality of the service de- manded clear and communi- cable to the waste producers • Price of the service justified by the open tender process • N1,200,000 for the regulatory • N200,000/year : 1 employee, Enable collectors to access to OYOWMA / 2 years (1 framework (1 lawyer for 20 1 day/week to monitor the bank loans and to buy better Oyo State years for days at N60,000/day) receipt books and analyze the quality equipment along with / LGA / prepara- reports from the collectors securing the market for poten- Private con- tion, 1 year • N200,000 for the printing of regarding the collected fees tial bigger investors tractors / for the pilot the receipts Community areas) • N12,000,000/year : 5 sworn leaders • N1,200,000 for the precise and inspectors for the pilot areas scientific follow up of the pilot areas (1 scientist for 20 days at N60,000/day) • N600,000 for the training of the inspectors (2 training at N300,000 each) • A safe box to store the receipt books for OYOWMA 98 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria action swm issue / challenge proposed action comments / conditions resources required # activity 4.5 Waste No incentives, financial Oyo State Government • ­ Actions 4.2 and 4.3 ­ • OYOWMA, LGA and Oyo collection or otherwise are of- could provide incentives State officials for the gov- fered by the Oyo State to the PSP operators ­ • Transfer of all the operational erning of this account and Government especially those working in costs regarding waste manage- of the services provided the low income areas when ment by OYOWMA and LGA to allocating waste collection a dedicated account to pay the areas private collectors in these areas ­ • Payment of the collectors per ton of waste collected in these areas 4.6 Waste Contracts for the Develop concession con- Actions 1.4, 4.1, 4.2, 4.3, 4.4 ­ ­ A lawyer and an economist collection private contractors are tracts lasting several years, only renewed every the contracts may first be year – too short to extended to 2 or 3 years as encourage long-term a transition and then the investments and contract duration should attract financing be preferably at least 7 to 8 years 4.7 Waste Inadequate main- Oyo State offers lands and ­ • Identify two potential • 2ha of industrial area collection tenance and repair facilities to attract compa- heavy-duty vehicles resellers in connected to the networks facilities for trucks, i.e. nies selling and maintain- Nigeria (road, electricity, water, garage and engineer- ing heavy-duty vehicles etc.) ing equipment, as (minimum two areas of 1ha ­ • The resellers should master the well as the difficulty of each) maintenance of the vehicles • Attractive financial offer, getting spare parts and have an agreement with for instance: at least two or three renowned brand of trucks ­ • provision of the land for the first 20 years and definition ­ • Improve the cash flow of the of the buying price at the private operators term of the 20 years ­ facilities, employee • tax training, etc. 4.8 Waste Areas allocated to Develop a zoning of the ­ Actions 4.1, 4.2, 4.3, 4.4 ­ • Specialized consulting firm collection Private Collectors are city providing balanced (1 senior engineer, 1 junior too small collection areas (mix engineer, 1 technician) between low/middle/high income areas are econom- ­ • Workshop between ically balanced areas) and OYOWMA and the private leading to a daily tonnage operators corresponding to at least five collection trucks 4.9 Waste Trucks not adapted to Mobilize advanced techni- • Mobilize ­ a supporting fund/ Specialized engineering firm ­ collection the roads in Ibadan cal expertise (an engi- gift to finance the work of the neering firm specialized in mechanical engineering firm to mechanical engineering) to define precisely the require- produce designs, manufac- ments for trucks adapted to the turing templates, mounting local constraints and maintenance instruc- tions required to equip Construction of a prototype • ­ four-wheeled medium size ­ • Workshops/Discussions with trucks (five to eight tons) the private contractors according to the needs expressed by the private collectors RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 99 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders Unknown at this stage further • Existing official with training/ Have a solution for waste col- OYOWMA / 2 to 5 years investigation required support of N600,000/year ( lection including the very low OyoState / 2 workshops to present and income districts or the districts LGA /Private discuss the financial analysis where money recovery will be contractors at N300,000 each) very hard • N600,000 preparation of the workshops (1 financial expert for 6 days at N100,000/d) • N3,000,000/year Auditor (1 Auditor, 4 days private com- pany assessing 8 company per year at N90,000/d) N4,200,000 for the drafting of N4,000,000 every 3 years to • Bigger investments for the OYOWMA Banks/OYO 2 to 5 years the agreements (1 lawyer for 50 revise the agreements collection means / Private State/LGA days at N60,000/day + 1 econo- contractors • Access to loans for the mist for 20 days at N60,000/day) private sector • Improvement of the quality of the services at a fixed price N120,000,000: 2ha of equipped 0 Settlement of transportation OYOWMA / 3 to 5 years (electricity, roads, water, et.;) vehicles professionals LGA / OYO land at N6,000/m² State • N60,000,000: one year of the N20,000,000/year for three • Cover all the territory OYOWMA Oyo State 4 years consulting firm years: follow up of the zoning by / LGA / • Enable the grouping of pri- Private con- the consulting firm • N4,000,000 to 6,000,000: vate operators to contribute tractors 10 to 15 workshops (for the to the professionalization of rental of the venues and the the sector equipment and the salary of • Structure future delegation the workshop leader) markets • N10,000,000 for the prototype 0 Develop local expertise adapt- OYOWMA Oyo State / 2 years ed to the local constraints and / Private Universities N60,000,000: one year of the enabling to use vehicles simple contractors engineering firm to maintain and repair • N2,400,000: 6 workshops 100 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria action swm issue / challenge proposed action comments / conditions resources required # activity 4.10 Waste OYOWMA charges Standardization of these Actions 4.1, 4.2, 4.3, 4.4 ­ ­ economist to analyze all • An collection dumping fees for each fees and clear communi- the data collected dumpsite used by an cation on them will help to operator. In addition, foster PSP ­ • Potentially academic stud- OYOWMA also levies ies an annual licensing fee, however, this fee varies, depending on the areas and catego- ries of operations. 5 Waste There are no transfer Oyo State should establish ­ representation of the • GIS GIS Expert • ­ transport stations in Ibadan transfer stations around services - this increases the the metropolitan area as • 2,000 to 5,000m² per & transfer costs for waste trans- they are the most efficient Actions 4.2 and 1.4 • ­ transfer station depending portation solution to quickly improve on the waste streams ­ • Accurate knowledge of the the current performance costs Civil engineering office • ­ of waste collection and transport ­ • Expert report on the evolution Construction company • ­ of the vehicle park based on the operation data ­ weighbridge for each • A transfer station ­ • Land use analysis to determine the available areas 6.1 Resource There is no reliable Assess the work of the • Weigh, ­ keep a record and char- ­ Action 4.2 recovery data on the current scavengers in the dump- acterize all the quantities going rate of resource sites out of the dumpsites recovery • Action 4.2 6.2 Resource Exclusion of informal • Identify the informal Action 6.1 • ­ 1 supervisor for three years • ­ recovery workers such as workers in Ibadan scavengers in resource ­ • Develop pilot cases: infor- • 3,000m² facility with recovery • The waste pickers collect mal stakeholders identified, access to water and directly the waste from structured in an association, electricity the waste producers in provided with a place to store areas difficult to access: and pack the waste they collect • Small collection equipment the waste producers pay (tricycles, etc.) and waste less if they sort their ­ • The supervisor of the storage/ packing equipment (com- waste packing facility contributes pactor, crusher, etc.) to the improvement of the incomes of the informal waste pickers 6.3 Resource There is limited re- • Develop the whole waste ­ All other actions recovery source recovery such management value chain as waste-to-energy to support resource and composting recovery activities • Have a characterization of the waste conducted according to a standard method 6.4 Resource Lack of waste sorting Action 6.2 recovery by households RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 101 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders N4,000,000 (1 economist for 60 N4,000,000 every 3 years to • Improvement of the opera- OYOWMA Oyo State/LGA 2 to 5 years days at N60,000/day + N400,000 revise the analysis tion of the dumpsites / Private communication) contractors • More transparency in the cost recovery (better gov- erning) • N300,000,000 for 6 transfer • Cost reduction for transpor- The transfer stations would en- OYOWMA Oyo State 2 to 5 years stations tation able the collection vehicles to / Private remain longer in the collection contractors • N10,000,000 weighbridge • N9,000,000 for maintenance areas every day and to reduce / LGA (3% of the investment) the risks of damage to the • 50m² of buildings at collection vehicles on their way N70,000$/m² to the landfills. • 80m of closing wall at N8,000/m • 3,000m² of land acquisition at N6,000/m² • 1,500m² of asphalting at N6,000/m² • 10% for studies and levelling) • N1,200,000 for the initial GIS study : GIS expert for 20 days (N60,000/day) Action 4.2 0 • Better knowledge on the OYOWMA Scavengers of 1 to 2 years potential recycling the dumpsites • Possibility to entrust private companies for these opera- tions through open tenders Depends of the number of infor- N1,512,000: salary of the • Streets cleaner in the areas OYOWMA OYO State 3 years mal workers supervisor covered by the informal / Recycling sector industrials / Informal • Professionalization of the stakehold- activity ers • Improvement of the income • Sorting of the waste • Formalization of the informal sector 102 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria action swm issue / challenge proposed action comments / conditions resources required # activity 6.5 Resource While the economic • Monitor very closely Action 1.3 • ­ Well managed landfills • ­ recovery feasibility of resource the private companies recovery is very willingness to invest in Action 6.1 • ­ • Validate, explain et justify uncertain, some com- resource recovery activ- the prices proposed by the ­ • Initiate a dialog with these industrials panies have already ities as the whole waste industrials to draft the proposed to develop management value chain requirements and to define ­ • Have a specialized firm waste-to-energy and should be more mature the financial commitments drafting requirements that material recovery to develop these kinds of (investments) they are willing the industrials are willing facilities in Ibadan activities at a full scale to respect and the penalties to accept with penalties for • Improve the manage- non-compliance ­ • Clearly define the processes to ment of the landfill to renegotiate the contracts • 1 engineer to monitor at reduce the area covered part-time by waste and free space for this kind of activity • Initiate a first negotiation with these companies to elaborate the require- ments in order to prepare an open tender and write the terms of reference 7 Waste • Dumpsites poorly • Improve the quality of • Private ­ operators mastering the C ­ ompany specialized in the disposal laid out creating the inner tracks of the civil engineering methods and levelling works and capable truck traffic issues dumpsites the treatment of waste water of treating wastewater or a and leachate issues required to the implementation company already experienced • Higher levelling of the of the different actions in landfill management • No mitigation mea- waste sures ­ • Recover all the waste that can • Use of covering soils avoid to be dumped • Have a network to collect leachate and rain water • Have leachate storage pounds • Treat the leachate • Have enclosure wall of at least 3m high around the sites • Have administrative facil- ities, garages, changing rooms, etc. RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 103 estimated investment costs estimated operation costs expected benefit / objective principal supporting time hori- actor / re- actors / zon sponsible stakeholders Action 7 • Cost reduction for the land- • Reduction of the quantity of OYOWMA Oyo State / 5 to 10 filling waste arriving to the landfills / Industrial Ministry of years already Environment • N1,250,000/year : 1 part-time • Cost reduction identified by and Habitat/ engineer for 5 years OYOWMA Ministry of Trade, Invest- ment and Cooperatives • N1,300,000,000 for minimal • N2,000/ton without the • Dumpsites with a longer life OYOWMA / LGA / Private 6 months operations : N325,000,000 per mitigation measures cycle Oyo State contractors for the dumpsite (see below for the improve- • N5,000 to N10,000/ton with • Reduce the disturbances for ment inner details of the calculation) the surroundings more or less demanding tracks mitigation measures • Reduce the risk of truck • N4,000,000,000 for operation break-downs in the dump- 3 to 10 including mitigation measures sites years to significantly reduce the • The inner tracks can be used impacts of the dumpsites by packer trucks • Reduce the impact on the environment 104 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria cost recovery and revenue that different models should be tested before the collection solution that is most adapted to Ibadan’s local con- text and the different social categories of the waste producers can be identified. revenue collection mechanism The waste collection service providers must be paid For the areas where people do not have the capac- by the recipients of the service, and the service ity to pay, an innovative ‘pre-pay as you go’ solu- is mandatory in order to maintain public health. tion could be implemented. The suggested recom- Hence, it is necessary to develop shared actions mendation is that the waste is put inside of tough between the operators and the public authorities in brightly colored (e.g. yellow) plastic bags or sacks order to monitor and sanctions any bad payers. that people can buy at a fixed price. This solution may be particularly effective for community mar- For the waste producers that can afford to pay, a kets and for poorer households, where the afford- number of options are possible to address the chal- ability of the monthly waste collection fee set by lenges around revenue collection, for example: OYOWMA is an issue, but where there is still some willingness to pay. A carefully devised price could 1. The Local Governments pay the private be set per bag (each bag would have a minimum contractors and collect a fee from waste capacity of 50L). It was estimated that N50 to N100 producers to finance the service. In this per bag will be affordable for most market traders, case, the creation of a dedicated account depending on the actual capacity of the bag. The for waste management services could appropriate price for the bags will depend on a help to secure the service contract and range of factors, such as the cost of production and reduce the risk of late payment (which is distribution, and the levels of revenue that can be often an issue for private waste collectors generated based on the perception of affordability. in countries similar to Nigeria). In this way The lower the price, the more likely the scheme will private sector participation becomes more be well received. attractive and the costs of the service can be lowered. Private collectors or OYOWMA will then only col- lect the yellow bags from the designated collection 2. OYOWMA and the private contractors points. Strict enforcement of the scheme will be re- negotiate a basic service and its fee. quired through community/residents associations, The fee and its constituent elements are market associations, neighborhood watch schemes made public. The waste producers pay and similar to prevent defaulters placing their the private contractors the set waste waste for collection in bags other than the yellow management fee for providing the agreed bags. In essence, the scheme is more likely to be services. If a waste producer wants a better successful if local community associations ensure service (e.g. more frequent collection) that no traders, residents or members place refuse than the basic one, they must negotiate in the designated areas without using the bags. It the price of this extra service with the may be possible to concentrate the work of the En- contractor of their choice. Where a waste vironmental Health Officers (EHOs) in these areas producer does not pay the contractor, the to enforce compliance. contractor reports the waste producer to OYOWMA which can: Yellow bags can be security printed (e.g. bar coded and numbered). They could also be reusable. The a. Impose a fine under existing laws printing, distribution, sale, collection of used bags, on behalf of Oyo ; can all be done by the private sector. b. Ensure a special cleaning service invoiced at a very high price; The actions related to cost recovery and revenue collection (i.e. collecting waste management fees) c. Sensitize the waste producer are as follows: 2.4; 4.1; 4.3; 4.4; 4.5; 4.10. and inform him or her in writing about possible sanctions; Discussions with stakeholders during this study determining waste management showed a preference for the second option given costs and fees There are currently no financial models to estimate the current local situation in Ibadan, but it likely the cost of waste management in Ibadan, and a RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 105 financial model for investments and operation of aggregate lead to reductions in set waste manage- waste management activities in Ibadan should be ment fees. established. This should be the basis to define the Being strategic and optimal in the location of waste fees that need to be collected to cover the costs of collection points and transfer stations may also help operating and upgrading waste management facil- reduce waste collection costs and fees even further. ities and to ensure that the operators are adequate- ly remunerated. That said, the decision for which means of revenue collection to apply either a tax contract related actions (which depends on the capacity of the person to pay and is redistributive) or a fee (which is based support investment and perfor- on the service provided) is a political choice. mance-based contracts In order to manage waste management costs and The contractual framework should also support the develop an economically feasible system involving professionalization of the private waste collectors. the private sector, it is important to: Hence, it should include as a minimum the follow- ing points: • Officially determine the “real” cost of collec- tion services in different situations; • Penalties in case of non-compliance; • Decide on equitable fees for the different • Longer duration of the contract; kinds of waste producers based mainly on • Performance commitments and targets; the waste producers’ capacity to pay; • Investment commitments (for example, an • Carry out a broad communication campaign obligation to deposit 25% of the investment on waste collection fees. over a 18 month period on a dedicated bank account) especially for resource recovery ac- tivities; The service provided must be universal, hence • Control methods; there is a need for the waste collection fees to be • Objective and data driven performance measurements; more equitable. The equity of collection fees will • Mandatory reporting of waste management also help reduce the level of ‘reluctance to pay’ and performance from the private contractor; will help secure the revenue streams of the private • Budgets allocated and guaranteed; contractors. The equity of collection fees can be • Processes to renegotiate the contracts. based on the weight of the generated waste and on an accurate costing of all factors affecting the It should also support investments, hence, it could collection process. For example, the distance from also involve to: the households or districts to the dumpsites: some • Define by agreement with the current con- areas may be located far from the dumpsites sites, tractors the possible evolution of their pro- which may mean their collection costs and fees are fession: the current private waste collectors higher than those of other areas that are situated in Ibadan have a clear idea of what can be closer to dumpsites. done to help them improve the quality and the productivity of their work and they have In order to generalize the collection services to a very good understanding of the situation all households, the payment of the fees should be on the field. This definition of the possible evolution of the profession should also be more coercive and compulsory and it is necessary based on reliable field data about the po- to demonstrate and explain that the fee asked is tential revenues, the characteristics of the reasonable or the most cost-effective possible. The different areas of the city, etc.; non-compulsory nature of the payment of the fees • Introduce five year contracts (or licenses) or the lack of a rigorous control of the fees from Oyo with investment commitments for the pri- vate contractors starting in the first year; State are obstacles for the economic feasibility and • Help private contractors to negotiate loans the generalization of private waste collection ser- so they are more likely to be granted finance; vices to cover the entire metropolitan area. More- • Mobilize advanced technical expertise to over, waste management fees are also based on the produce designs, manufacturing templates, fee collection rates, as, if the number of people pay- mounting and maintenance instructions re- ing the fees increases, the fees to be paid by each quired to equip four-wheeled medium size trucks (five to eight tons) according to the household should decrease. Enforcing the payment needs expressed by the private collectors; for every waste producers leads to more revenues to the private collectors and Oyo State, and may in 106 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • Develop a technical training center for vehi- awareness) and ‘wallets’ (by setting waste man- cle maintenance and repair in partnership agement fees appropriately, ensuring the polluter with heavy-duty vehicle resellers in Nige- pays and introducing potential fines for non-com- ria. This technical training center could be pliance). All of this can be achieved through a broad led by the private sector or by the vehicle resellers in Nigeria. The possibility for the communication strategy. private collectors to use this facility and to train its staff in this center should be part of A major communication strategy is required to the service contract. change waste disposal behavior and improve the general level of knowledge of good waste manage- ment practices in Ibadan. This can be deployed Finally, the following steps should be included for via schools, churches, mosques, associations, performance-based contracts: television, radio, etc. It is noted that some aware- • Define precisely the service and quality lev- ness-raising programs were already being initiated el that must be achieved, the methods to as at the end of the fieldwork in this study (the last measure quality and stipulate penalties if quarter of 2015). quality levels are not reached, and the con- ditions which may lead to contract breach Furthermore, there is a need for waste management and disqualification of the service provider; service providers to build the trust of the waste pro- • Define precisely the activities to be per- ducers in the quality and reliability of services be- formed and the service outcomes; ing provided. • Define how to objectively measure the per- formance of the service provider; The actions related to communication and aware- • Define what should be done when a con- tractor does not respect the contract: ness-raising are as follows: 1.2; 2.1; 2.2; 2.5; 4.1; 4.3; 4.10. -- Foresee the process for identifying any non-conformities: How to establish the incident of non-conformity, and what actions should be taken; -- Foresee the process for quickly imple- enforcement of waste menting corrective actions for non-con- management regulations formities; There is also a need for more effective persuasive -- Foresee financial sanctions which will enforcement of rules and legislation. There is cur- ensure the service even though the cor- rently a huge gap in the number of EHOs required rective actions are not implemented; to properly cover a city the size of Ibadan. There -- Foresee adapted and realistic processes are currently less than 500 EHOs for the whole city, aligned with the resources of the regula- with the majority approaching retirement within a tor, and sanctions proportionate to both few years. The Youth Empowerment Scheme for the non-conformity and the remunera- tion level of the contractor. Oyo State (YES-O program) may be helpful in pro- See Annex 2 – Potential Waste Services Agreement viding a pool of resources to address this gap. Provisions for more detail on contractual provisions. The actions related to law enforcement are as fol- The actions related to the implementation of a con- lows: 1.2; 2.1; 2.2; 2.3; 2.4; 4.4; 4.10. tractual framework to support investment and per- formance-based contract are the following : 1.2; 1.6; 3.2; 4.3; 4.5; 4.6; 4.10; 6.5; 7. investing in waste management infrastructure and facilities communication, education The actions related to the planning waste manage- and awareness-raising ment infrastructure and facilities are as follows: 2.2; The behavior of the general public is crucial to the 3.4; 4.7; achievement of efficient waste management in Ibadan. It is important to address the waste produc- creating transfer stations ers’ ‘heads’ (by arguments to prove the importance Transfer stations would definitely contribute to im- of good waste management), ‘hearts’ (by raising provements in collection efficiency. They could be RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 107 located on the main roadways leading to the dump- The actions related to the waste collection points sites, about halfway between the center of the city are the listed under 2.2 and 2.5. and the dumpsites. These transfer stations could reduce collection costs, primarily by allowing the trucks to make more collection rounds per day. This creating storage facilities for will improve their productivity and reducing the cleaning equipment time wasted in transportation. There are also wider It would be helpful to install storage facilities in the benefits to the collectors, as the use of transfer sta- different districts of the city, to allow the cleaning tions will reduce their costs, wear and tear on the teams to store their equipment, and to have a con- vehicles, etc., as the collectors will no longer need tainer to store the waste that they collect (20m2 to drive to the dumpsites. As previously noted, driv- to 50m² buildings). This is important regardless ing inside the dumpsites is a major cause of break- whether the cleaning is conducted by the private downs given the current state of the dumpsites and or public sector. Given the current situation, it is their inner road tracks. Transfer stations are key to very unlikely that the private sector will have the cost reduction but must be properly managed and capacity to finance such facilities, and so the re- not develop into temporary dumpsites. Therefore, sponsibility to provide these facilities will be with the waste arriving at transfer stations should be the Oyo State. compacted and not stay more than 12 hours in the transfer station. The stations should also be cleaned land acquisition by the daily. oyowma waste management A challenge to establishing transfer stations in facility installation Ibadan is finding suitable available sites as the city Before establishing any new waste management is already very densely built up. As mentioned un- infrastructure and facilities, Oyo State must ensure der section , securing the land for transfer stations access to and acquire the necessary land to the may involve resettlement of the people that already planned waste management facilities. The land is live on the plot of land. needed in central areas in Ibadan metropolitan area for: The actions related to transfer stations are listed under Action 5. • Installing transfer stations equipped with weighbridges; installing waste collection points • Making available to the private contractors Waste collection points can also help improve the areas to park and maintain their vehicles; efficiency of waste collection. In particular, collec- tion points could: • Develop attractive areas for potential heavy-duty trucks resellers; • be installed on the asphalted main roads of the city, with closed containers that are • Create facilities to process the recyclable emptied and cleaned on a regular basis; materials collected in the town. • be used more intensively along asphalted It can be a challenge identifying suitable locations roads with large capacity containers (3 to and plots of land in Ibadan as many inner city ar- 5m3) that are emptied and cleaned on a reg- eas are already occupied. Oyo State would need to ular basis. undertake significant work to ensure suitable sites, e.g. land identification and acquisition, performing The local communities can help to use and organize an environmental impacts assessment and any oth- the waste collection points. They can also help with er relevant survey as well as guaranteeing planning the identification of the ideal locations for such and construction permissions. points. The strategic and optimal location of the collection points is also key to cost reduction and improve- ments in productivity. 108 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria investing in other urban waste collection which include a dedicated room or infrastructure area to keep waste out of the rain. This area should be connected to the road (for container transporta- The following are recommendations that may be tion), and designed in a way to prevent waste from beyond the scope of private sector participation, being spilled out onto the street. The need to im- and should be implemented by the public sector prove waste collection efficiency by improving the in order to improve the overall efficiency of waste packing of the waste could also be built into the management services. design. The accessibility of the waste storage area must be linked to the roads by a driveway, allow- improving the roads ing the waste to be easily transported by the waste The current penetration rate of waste collection ve- producers to the area where it will be collected. hicles (the percentage of streets that are reached by This could be implemented by developing building the collection vehicles) is quite low in areas without codes that require new buildings to have adequate asphalted roads. Some minor road improvements, storage for solid waste and that the area must be covering a few meters, could enable the trucks to accessible by waste collectors. Construction per- go deeper inside the districts that currently do not mits would not be given to buildings that do not benefit from waste collection services. It is estimat- respect these guidelines. ed that about 30% to 50% of truck breakdowns are linked to the poor state of the roads. An inventory of road locations using a geographical pilot projects information system (GIS) could be used to develop The actions related to the development of pilot proj- a plan for improving and maintaining the roads that ects are as follows: 3.3; 4.1; 4.4; 4.5; 4.9; 6.2; 7. would improve the penetration rate of waste collec- The various specificities of Ibadan do not allow the tion vehicles in Ibadan. Fitting each vehicle with direct application of waste management solutions a GPS would allow for better data collection and that work effectively in other countries without a performance monitoring as well. Once the roads process to adapt these solutions to the local con- are improved, an increase in waste collection rate text; validate their effectiveness in the Ibadan con- will follow. The road improvements would benefit text; and, develop new and innovative solutions. not only the waste management services but all the Hence a phase of testing and improvement is nec- public services using the road (e.g. fire brigade, po- essary before implementing a general roll-out of any lice, etc.), as well as the populace. solution across the whole metropolitan area. A short-term action for road improvement would As the general state of waste management in be to repair the current roads inside the districts, Ibadan currently does not attract foreign compa- and make them accessible. They do not need to be nies experienced in solid waste management, and asphalted but just to be cleared, and potholes and as OYOWMA does not currently have the requisite bumps removed so they are relatively flat and safe experience in the drafting and the monitoring of to drive on. The second step would be to asphalt the long-term contracts; Oyo State should rely upon ex- roads enabling two trucks to pass one another at 60 isting waste management stakeholders in Ibadan km/h on the same road. This measure is unrealistic to develop and test innovative solutions in order to in a SWM perspective alone; however, it could be progressively increase the volume and the general integrated in a comprehensive multi-year develop- quality of the services. ment plan of the city. Another point is to enforce the integrity of the ur- ban roads by clearing the roads of parked cars that technological innovation prevent access to waste containers. related to waste management vehicles and equipment The actions related to improving the roads in The productivity of the cleaning and the collec- Ibadan are listed under Action 1.1. tion services relies heavily on the adaptation of the equipment being used to the constraints in the field. developing buildings adapted for waste collection Today, the private collectors in Ibadan have valu- It is important to develop buildings adapted for able experience in the design and the adaptation RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 109 of trucks given the local context. However, these subsequent collection by the smaller trucks. adapted trucks could be lighter and more reliable The creation of waste collection points will if the various elements of the tipper truck were de- require investments. In these areas, it may signed and optimized by a specialized engineering also be possible to develop community-led firm. collection, and/or waste collection and sort- ing by the informal sector. Hence, the pilot project in this instance will be about: There is not one single solution, and careful plan- ning is vital to provide an appropriate response to a. defining adapted truck design specifica- the waste collection challenges in Ibadan, e.g. de- tions through collaboration between the termining where and how many waste collection private collectors and the specialized engi- points should be installed. neering firm; Various cost recovery options, solutions and inno- vations could also lend themselves to piloting in b. designing and optimizing the trucks espe- small areas. cially regarding ergonomics; use data and gis for planning c. building prototypes and testing the designs of solid waste collection and by several collection teams to propose fur- transport activities ther improvements;, and It is very important to develop a digital platform to capture and share the representation and the char- d. finalizing the design and generalizing the acterization of the city. The different stakeholders design of the waste collection trucks. working within Ibadan should make their data available to the other stakeholders and there should The same approach could be used for the design of be cross-sharing of GIS data by all stakeholders. street cleaning equipment. During the last workshop of this study, OYOWMA announced that it was going to implement modern using different means of waste databases to collect data on waste management collection services. This initiative should be encouraged, sup- In order to optimize the current waste collection ported and sustained. process, it is important to differentiate the means Knowledge could be shared: of collection throughout the city and to undertake in pilot areas prior to city wide implementation, for example: • On the state of the roads in the metropolitan area; • The packer trucks can be used on the main motorways, if these motorways are in good • On the need for waste collection points and shape; their possible locations; • The improved small trucks (similar to those • To test new collection methods for the un- currently used by the private collectors) can planned districts; be used in the districts with non-asphalted roads. These trucks are the most cost-effec- • On spaces available for the location of urban tive in this situation because larger trucks waste management facilities; have a high rate of breakdowns in poor qual- ity roads and have trouble navigating nar- • To characterize the existing services (e.g. row roads; performance, quality, productivity, reve- nues, etc.), to define what new services are • For the areas unreachable by trucks, waste needed, and how to achieve improvement; collection points can be installed at the pe- and, riphery of these areas to gather waste for 110 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • On the characterization of the waste to en- This approach also promotes the integration of courage better waste management and re- new technology and human resources, by enabling source recovery. talented young people to apply new technologies (e.g. smartphone) to develop products or services This shared knowledge would enable the different adapted to the local context at an affordable cost. stakeholders to have the same view on the current Combinations of this type of solutions can be used situation in SWM in the metropolitan area. The best to foster a dynamic of innovation based on the pro- way to share territorial information is via a GIS and duction of new knowledge from the current situa- should include the following: tions and from local data. The resulting information • the waste collection rounds; will help promote citizen satisfaction, as set out in • the quality of the service in the different dis- the diagram below. This diagram also shows that tricts; the production of knowledge should be seen as an • the state of the roads; investment that provides leverage for other invest- • the layout plan of the city; ments, and ultimately promotes the development of • the location of the waste collection points; • the different level of revenue in the city; the city. • information on the cleaning areas (state of the roads and sidewalks, storage facilities, The actions related to the production of reliable areas, zoning, etc.); data and the improvement of shared knowledge are • the zoning of the waste collection services; as follows: 1.1; 1.2; 1.3; 1.4; 2.2; 3.1; 3.4; 4.1; 4.2; 4.3; and 4.4; 4.8; 5; 6.1; 6.2; 6.3. • the location of the transfer stations. The actions related to the development of a GIS rep- resentation of the city are as follows: 1.1; 1.2; 1.4; Today many technologies are becoming increas- 2.2; 3.1; 3.4; 4.8; 5. ingly accessible and affordable even for developing countries. However, these technologies are some- times operated by costly software. Where labor improving the management costs are lower, some of these software systems are of dumpsites less cost effective, and in many cases, the costs of The storage of waste produces pollution and cre- acquiring the software and training staff presents ates nuisances that should be address at a man- a barrier. ageable cost. The environmental and health im- pacts of dumpsites could be mitigated by applying However, many open source or low cost alternatives modern levelling methods, creating secured tracks are becoming available, with similar performance on top of the waste as well as implementing leach- levels and functionalities. For example: ate and biogas management techniques. Many of these actions can be conducted using local means • Mobile terminals: Android smartphones and materials. However a preliminary study of the rather than rugged terminals under Win- useful local means is necessary before mobilizing dows CE or Windows Mobile (at least twice the viable low cost options in order to design ap- more expensive for the same performance/ propriate solutions or combinations of solutions. results); Post the completion of this study it would be highly recommended that a pilot project to be undertak- • Software for mobile terminals downloadable en to validate the conclusions and expectations of via Google Play Store (e.g. using prepaid the preliminary studies, and to adjust the proposed cards purchasable worldwide); solutions before rolling them out across all of the dumpsites in Ibadan. • Open source GIS software: QGIS; The achievement of a level of quality equivalent to those of sanitary landfills should be the objective • Using data and drafting model documents for improvements to the existing dumpsites. Well using Libre Office Suite (an open source managed dumpsites are key to improving the pro- software applications); ductivity of waste management services. Indeed, well-maintained sites will lead to a reduction in the number of truck breakdowns inside the dumpsites, • GPS data logger – at a low cost and with the and provide data to measure productivity. It will ability to migrate later to smartphones and also help improve the design of waste management allow real time tracking. RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 111 Low cost measuring equipment Open source software New working process Better quality data and more data Better representation Better knowledge of the reality, of the territory and of the services Better decisions Better investments Better communication Better legal framework Better services for Better security the waste producers of the business More satisfaction Better acceptance of the prices Figure 14:. Production of knowledge as a leverage for investment operations, and be able store waste more safely. Develop action plans: The following multiple aspects are involved: plan- • Preparing and using key documents, such as a ning, operations and monitoring, as detailed below. landfill implementation program, landfill operation- al plan, landfill design information, drainage design planning plan for the dumpsites, etc.; Improve the access roads: • Measuring and gathering data to be used in the • To the dumpsite; and calculation of the water balance of a landfill; • Inside the dumpsite, for example, by covering • Developing a leveling plan and ensuring surface dumpsite tracks with soil and elevating the tracks optimization. so they are drained more easily when it rains. 112 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria operations -- Monitoring of air quality to ensure com- pliance with approved standards in in- • Improve waste leveling in the dumpsites, and dustrial sites and dumpsites create tracks for the trucks on top of the waste. This will improve site life expectancy and reduce spilling -- Proper monitoring against fire outbreak due to spontaneous ignition of waste areas; • Provide intermediate and final soil coverage (not Regarding resource recovery, rigorous waste quan- just one layer); tification and characterization is necessary in order • Repair the enclosure walls; to have reliable and accurate data of waste and waste management that can be used to initiate, • Equip the dumpsites with weighbridges to develop and conduct negotiations with companies weigh the trucks when they come in and out of the interested in investing in solid waste management landfills, obtain a precise measurement of the waste in Ibadan. collected, and gather such information on a regular basis; • Training and capacity building for dumpsite staff, for example, on how to operate and maintain the capacity building new equipment, and to keep reliable records; The actions related to the capacity building are the following: 1.3; 1.4; 1.5; 4.9; 7. • Health, Safety and Environment (HSE): -- Improve water management, including for the private waste storm water and leachate; contractors -- Ensure the safety of the temporary mo- The private waste contractors in Ibadan would ben- tor boys and girls on the trucks during efit from being assisted with capacity building sup- transport from collection points within port in the following areas: the metropolis to the dumpsites; -- Improve worker’s health and safety by • Staff training to improve safety and produc- using protective kits; PSPs can be re- tivity; quired to provide and maintain their • Staff monitoring of health and safety, e.g. de- own protective equipment; velop regular medical check-ups and health insurance for workers that are exposed to -- Provide shelter from bad weather; environmental hazards, and discourage -- Provide changing rooms, toilets and workers from sitting on the collected waste washing facilities. during transport; • Management of human resources; • Personal Protective Equipment (PPE); performance monitoring • Training on management and the calcula- Examples of performance data to be monitored on tion of unit costs; an ongoing basis are as follows: • Mobile team monitoring and quality man- agement; • The number of trucks per day; • Using GIS to monitor and organize waste collection; • The dumping duration per truck; • Planning waste collection routes and trans- port logistics; • The waiting time per truck; • Accounting and preparing financing appli- cations; • Amount of soil used for the intermediate and the • Engineering support for four-wheels vehi- final coverage layers; cles (five to eight tons) to continuously im- prove quality, ergonomics and productivity; • Amount of waste collected (measured by using • Design and modifications of waste collec- weighbridges); tion vehicles; • Vehicle maintenance; • Health, Safety and Environment (HSE): • Training of mechanics; • Landfill management. -- Leachate production and composition, collection of weather data (insolation, rain, wind, air, humidity, etc.); RECOMMENDATIONS AND OPTIMIZATION PLAN FOR PSP | 113 for oyo state Oyo State should pay particular attention to the The public sector can be assisted with capacity drafting of the contracts, financial commitments building support in the following areas: and the penalties to be applied in the event that ex- pected benefits from investments are not achieved. • Developing, implementing and enforcing Indeed, if the penalties are not correctly set, pri- solid waste management regulations, e.g. vate contractors may try to take advantage by not sorting of waste at the waste producers’ premises, building codes to ensure ade- passing the expected benefits (e.g. profits made on quate storage of waste and access; collec- selling recovered materials) on to the public sector. tion of waste management fees, etc.; Due care and attention is required on the part of the • Procurement process, e.g. initiating, devel- public authorities, especially around private sector oping, negotiating, awarding, managing investments into resource recovery operations. and monitoring performance-based con- tracts; • Determining cost recovery and waste man- agement fees as well as setting penalties; • Developing solid waste management strate- gies, master plans and action plans; • Land management and planning using GIS; • Modes of waste processing and resource recovery; • Performance monitoring of services. 114 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria references Adah, A. 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Richbol Environment Services Ltd. 116 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria annexes | 117 annex 1 - legal framework annex 2 - potential waste services agreement provisions annex 3 - stakeholder interviews 118 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria | 119 annex 1 – legal framework ASSESSMENT OF THE LEGAL FRAMEWORK OF PRIVATE SECTOR PARTICIPATION IN SOLID WASTE MANAGEMENT ACTIVITIES IN IBADAN introduction federal laws Further to the Preliminary Report dated 8 April 2015 national environmental stan- on the legal framework of Solid Waste Management dards and regulations enforce- in Ibadan, Oyo State, please find below our Report ment agency (establishment) on the legal framework in respect of the following act, 2007 (“nesrea act”) aspects: The NESREA Act establishes the National Envi- ronmental Standards and Regulations Enforcement • Incentives/disincentives available for use Agency (“NESREA’’) which is charged with the re- by the various government levels; sponsibility for the protection and development of the environment in Nigeria and for related matters. • Regulatory gaps and inconsistencies; and • SERVICES AND RESPONSIBILITIES • Government constraints in Private Sector Participation (“PSP”). The responsibilities of the Agency include: ( i ) To enforce compliance with environmental regulations on the importation, exportation, incentives/disincentives production, distribution, storage, sale, use, available for use by the var- handling and disposal of hazardous chemi- ious government levels cals and waste generated in the non-oil and gas industries; and Largely, the legal framework on solid waste man- agement in Oyo State covers all aspects. However, ( ii ) To enforce compliance with the provisions there are certain provisions of the relevant laws on of international agreements, protocols, con- solid waste management below that may appear to ventions and treaties on the environment, including chemicals, hazardous wastes, be deterrents to PSPs. We will attempt to point out pollution, sanitation and such other envi- the provisions of these relevant laws that appear to ronmental agreements as may from time to either encourage or discourage the involvement of time come into force. private sector participants in solid waste manage- ment. 120 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • EMPOWERMENT • SERVICES AND RESPONSIBILITIES The Agency shall have the power to: The responsibilities of the NESREA include: ( i ) Submit to the Minister for his approval, pro- ( i ) Ensuring the implementation of the provi- posals for the evolution and review of exist- sions of the National Environmental Sani- ing guidelines, regulations and standards tation Policy and Guidelines at all levels of on environment other than in the oil and gas Government; sector including - waste management and environmental sanitation; and ( ii ) Ensuring compliance with the provisions of the regulations; ( ii ) Establish programs for setting standards and regulations for the prevention, deduc- ( iii ) Ensuring that the waste management facil- tion and elimination of pollution and other ities comply with the Environmental Impact forms of environmental degradation. This Statement; power shall be exercised in collaboration ( iv ) Embarking on intensive environmental ed- with other relevant agencies and with the ucation and awareness campaign on sound approval of the Minister. environmental sanitation and waste man- agement; • INCENTIVES ( v ) Ensuring that states and local governments make provisions for land for waste manage- There appear to be no incentives to PSP under the ment facility; and NESREA Act. A potential incentive/disincentive identified is the fact that the Agency, the state en- ( vi ) Ensuring safe and sustainable control of vironmental protection agency and waste manage- waste generated by specialized agencies. ment authority can grant and revoke licenses. How- ever, it was confirmed that the Agency can only • EMPOWERMENT issue licenses for waste management treatment. The powers of the NESREA include: • DISINCENTIVES ( i ) The power to grant licenses to persons qualified to offer services and the power to There appear to be no disincentives to PSP under revoke such licenses as contained in the the NESREA Act. National Environmental (Licensing and Per- mitting systems) Regulations, 2009. national environmental (sanita- ( ii ) The power to serve enforcement notices on tion and waste control) regula- any owner or occupant in care of premises tions, 2009 (the “regulation(s)”) or in control or management of a business who is in contravention or is likely to con- The purpose of these Regulations is the adoption travene the provisions of any regulation, of sustainable and environmentally friendly prac- guideline or condition of the permit. tices in environmental sanitation and waste man- The enforcement notice shall specify the matters agement to minimize pollution. The Regulation is constituting the contravention and specify the administered by the NESREA. steps that must be taken to remedy the contraven- The Regulations impose general duties on the pub- tion and the period within which those steps must lic on the control of solid waste these duties include: be taken. ( i ) The duty on any person whose activities generates waste to ensure that the waste • INCENTIVES is handled by a person licensed to transport There appear to be no incentives to PSP under the and dispose of the wastes in a designated Regulations. waste management facility; and ( ii ) The duty on all owners and occupiers of • DISINCENTIVES premises to provide waste receptacles for storage before collection by licensed waste There appear to be no disincentives to PSP under managers. the Regulations. ANNEX 1 - LEGAL FRAMEWORK | 121 laws of oyo state be renewable annually and subject to re- view from time to time. oyo state solid waste man- agement authority law 2004 • INCENTIVES (“oyowma law”) There appear to be no incentives to PSP in the The OYOWMA Law provides for the establishment, OYOWMA Law. functions and powers of the Oyo State Solid Waste Management Authority (“OYOWMA”/ “the Author- • DISINCENTIVES ity”) and other matters connected therewith. In view of the fact that the registration fee payable Under Section 2 of the OYOWMA Law, solid waste by the refuse collectors are renewable annually, it is includes garbage, refuse and other discarded solid clear that the duration of licenses issued to private materials resulting from domestic, industrial, com- waste collectors by OYOWMA is for only one (1) mercial and agricultural activities from the commu- year. One of the challenges identified by the private nity. waste collectors is that it is difficult to obtain loans from financial institutions because of the short • RESPONSIBILITIES OF OYOWMA duration of these licenses as financial institutions desire longer license periods which would serve as Section 6 provides for the duties of OYOWMA and guarantees. it includes: ( i ) The storage, management, conversion, oyo state solid waste transfer and disposal of solid waste for the management authority State; (amendment) law 2012 ( ii ) Appointment, registration and control of (“oyo wma amendment law”) private refuse contractors; The OYOWMA Amendment Law amends Section ( iii ) Enforcement of all laws and regulations con- 37 of the OYOWMA Law which provides for the cerning Solid Waste Management and any power of the Authority. other sanitation laws and regulations as may be in force in the State; • EMPOWERMENT ( iv ) Preparation, collection and use of data and management information on Solid Waste Section 4 of the OYOWMA Amendment Law which Management; and substitutes Section 37 of the OYOWMA Law em- ( v ) Carrying out the management of Solid powers the Authority to do the following: Waste throughout the State. • Register refuse contractors and renew such registration annually; • EMPOWERMENT The OYOWMA Law empowers the Authority to • Charge the refuse contractors registration carry out the following activities: and renewal fees amounts to be fixed by the Authority from time to time; • Acquire land and equipment necessary for its operations for the purpose of Solid Waste • Regulate and monitor the activities and Management in the State; operations of the Refuse contractors in the state; • Enter land premises in order to carry out its • Ensure compliance with the provisions of objectives under the Law; and this law or regulations made thereunder; • Register refuse contractors and fix neces- • Make regulations subject to the approval of sary amount as registration fees which shall the executive council; and 122 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • Demand the production of evidence of reg- posal, water and air pollution eradication, istration from a contractor by a written no- noise control and general sanitation; and tice and for the purpose of inspection of any such evidence; an authorized officer may • Coordinating the activities of the environ- enter the contractor’s premises between mental monitoring units and sanitary in- 8am and 4pm. spectors of the Local Governments in the State. • INCENTIVES • EMPOWERMENT There appear to be no incentives to PSP in the OYOWMA Amendment Law. The MEH Law empowers the MEH to inter alia: • DISINCENTIVES • Register the environmental management contractors and impose such conditions Under the OYOWMA Amendment Law, the Au- necessary for carrying on the environmental thority has the power to review and vary registra- management business; tion and renewal fees without notice. The law is si- lent on issuing notice of a variation and therefore it • Enter into contracts with other organiza- appears that the Authority may exercise this power tions or companies for the fulfilment of its arbitrarily. functions and responsibilities under this Law; ministry of environment and habitat law, 2011 (“meh law”) • Declare a day as environmental sanitation day, restrict movement for specified hours and mobilize the populace for environmen- The MEH Law establishes the Ministry of Environ- tal sanitation activities; and ment and Habitat (“MEH”) in Oyo State, which pro- vides for the functions of the MEH and other mat- • Oversee the activities of the Oyo State Solid ters connected therewith. Waste Management Authority and Agen- cies in charge of environment matters. Solid waste under MEH includes garbage, refuse and other discarded solid materials. In addition, air pollution in the MEH includes gaseous or noise • INCENTIVES emission originating from industrial, commercial, There appear to be no incentives to PSP in the MEH musical, domestic, sports, recreational, transporta- Law. While the term “Environmental Management tion, and other similar activities. Contractor” is not defined, it was confirmed that registration of a waste chain collector is only done • RESPONSIBILITIES OF THE MEH with OYOWMA; therefore only one registration, rather than multiple ones, is needed. The MEH Law states that the responsibilities of the MEH shall include the following: • DISINCENTIVES • Formulation and enforcement of policies, Section 14(4) of the MEH Law provides that the statutory rules, and regulations on waste Permanent Secretary may suspend or revoke any collection and disposal, general environ- registration if it was not renewed after twenty one mental protection, control and regulation of (21) days when same was due, if a condition of reg- the ecological system and all activities re- istration was violated by the contractor or for any lated thereto; other reason it is in the opinion of the Permanent Secretary, reasonable and just to suspend or revoke • Establishment and taking of measures to the registration. ensure effective environmental structures in Suspension or revocation may however be reversed the State for flood control through dredging upon satisfaction that the reasons therefore have solid and liquid wastes collection and dis- ANNEX 1 - LEGAL FRAMEWORK | 123 been redressed and the contractor has paid a fine • EMPOWERMENT of N5000. Under the MPPUD Law, the MPPUD is empowered It appears that this is a disincentive because it to impose sanctions on any person who violates vests a substantial amount of discretion in the Per- any provisions of the MPPUD Law. Section 12 of manent Secretary to determine whether or not a the MPPUD states that any person who engages license should be suspended or revoked. Further- in development without approval, contrary to the more, some of the parameters on which the Perma- physical development plan or approval of the Min- nent Secretary may base the decision to suspend or istry, shall be liable to N30,000 fine or nine months’ revoke appear unduly rigid towards an operator, for imprisonment. example, the requirement to renew a registration within twenty one (21) days of expiration. In addition, Section 35 provides that a stop work or- der may be issued on a developer where it appears that an unauthorized development is being car- ministry of physical planning ried out or where the development does not com- and urban development law 2012 ply with the development permit. Non-compliance (“mppud law”) with a stop work order renders the person liable to a fine not exceeding N10, 000 and in the case of a corporate body the fine is N50, 000. The MPPUD Law establishes the Ministry of Phys- ical Planning and Urban Development (MPPUD), which is charged with the responsibility of formu- • INCENTIVES lating and implementing state policies for urban The MPPUD Law is a law about physical planning and regional planning, physical development of the and urban development of Oyo State and its func- state including the spatial location of infrastructur- tions include the formulation and implementation al facilities. The responsibilities of the MPPUD in- of state policies for urban and regional planning, clude: physical development of Oyo State including the ( i ) Formulating and implementing state poli- spatial location of infrastructural facilities. There- cies for urban and regional planning, phys- fore, it is useful with respect to various developers ical development of the state including the wishing to construct dumpsites for the manage- spatial location of infrastructural facilities; ment of waste in the state. ( ii ) Providing technical and professional assis- Consequently, Section 23 of the MPPUD Law pro- tance including capacity building to state vides that a development permit is valid for 2 years Government Agencies, Local Planning Au- from the date of communication of the approval but thorities and other Physical Planning Agen- subject to revalidation. In addition, a dissatisfied cies; holder of a development permit may appeal against ( iii ) Overseeing and coordinating physical plan- the decision of the MPPUD to the Urban and Re- ning projects and programs which are tech- gional Planning Tribunal with respect to the revo- nically and financially supported by interna- cation of its permit. tional donor agencies; In relation to Section 25 (i) of the MPPUD Law, ( iv ) Processing and granting planning approv- which allows for the revocation of a development al and clearance to prospective developers permit, where the site is required for overriding and various land users in the state; public interest, the law does not specify any infor- ( v ) Initiating, formulating and implementing mation on compensation. However, under Nigeri- strategies for development of urban and ru- an Law, parties are free to agree on any terms and ral settlements; conditions so far as there are no vitiating elements, e.g. fraud, duress, misrepresentation etc. Therefore, ( vi ) Controlling outdoor advertisement, signage even though the law is silent on compensation, it and bill boards in the state; and does not preclude the coverage of compensation ( vii ) Coordinating and implementing all United and exit fees in a separate contract/agreement. Nations Programs on habitat, urban devel- opment and human settlements, including the World Habitat Day. 124 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria • DISINCENTIVES ( i ) Formulating and enforcing policies, statuto- ry rules and general environmental protec- Section 25 of the MPPUD Law provides that a devel- tion, controlling and regulating the ecologi- opment permit is subject to revocation on grounds cal system and all activities related thereto; which include: and ( i ) Where the site is required for overriding ( ii ) Initiating measures to ensure pollution free public interest; and air, land and water throughout the state. ( ii ) Where false information was given by the developer who applied for the permit. Whilst the functions of the Committee include: As regards Section 25 (i) of the MPPUD Law, since ( i ) Recommending management options such a development permit may be subject to revocation as minimization, recycling of waste for in- where the site is required for overriding public in- dustries and government operations in order terest, it may create skepticism for any potential to reduce degradation of the environment; PSP. This is due to the fact that it is difficult to de- ( ii ) Reviewing and recommending the basic termine when the Government may decide that an standard requirements for solid, liquid, gas- area which has been developed or undergoing de- eous or toxic or hazardous waste manage- velopment should be acquired for overriding public ment in the State; and interest. ( iii ) Establishing and recommending acceptable It may be pertinent to also add that the MPPUD safe methods of collection and disposal of Law is silent on compensation in this regard, and hazardous and toxic waste. as such may be difficult to obtain same from the Government in such event. • EMPOWERMENT The powers of OSEPA include: oyo state environmental protection agency law 2012 ( i ) To require to be produced, examine and (osepa law)16 take copy of any license, permit, certificate or any document required under the OSEPA The OSEPA Law, which repealed the Oyo State Law; and to apply enforcement measures Environmental Protection Agency Law 1999, es- to combat environmental degradations in manufacturing, commercial and residential tablished the Oyo State Environmental Protection premises and government operations;17 Agency (OSEPA). The OSEPA Law makes provision for the constitution, functions, duties and powers ( ii ) To apply enforcement measures to combat of OSEPA and for other matters connected there- environmental degradations in manufactur- with. The OSEPA Law also establishes the Adviso- ing, commercial and residential premises, ry Technical Committee on the Environment (the and government operations; “Committee”), the Local Government Environmen- ( iii ) Enter into programs agreements of techni- tal Protection Bodies and the Environmental Protec- cal assistance with public or private bodies tion Tribunal (“the Tribunal”). The Tribunal has the concerning environmental protection; and jurisdiction of a Chief Magistrate Court. ( iv ) Establish environmental criteria, guidelines, specifications or standards for the protec- • SERVICES AND RESPONSIBILITIES tion of the air, land inter-state waters as may be necessary to protect the health and The functions of OSEPA include the following: welfare of the population from environmen- tal degradation. 16 The OSEPA structure is not yet in place. Currently 17 It is our understanding that this includes waste the Pollution Control Unit of the Ministry of Environment management, given the functions of the Committee and Habitat exercises the functions and responsibilities established by the OSEPA law. It must be noted however of the Agency. that the OSEPA structure is not yet in place. Its intended functions and responsibilities are currently performed by the Pollution Control Unit of the Ministry of Environment and Habitat. ANNEX 1 - LEGAL FRAMEWORK | 125 • INCENTIVES a.m. and 6 p.m. to enter and examine any tenement or frontage, back or any side of a There appear to be no incentives to PSP under the tenement in order to ascertain the existence OSEPA Law. of any nuisance; ( ii ) The ESL further empowers the Ministry • DISINCENTIVES to construct any structure which may be deemed necessary for the clearing, cleaning There appear to be no disincentives to PSP under or inspection of a drain or drainage system; the OSEPA Law. ( iii ) The Local Government may authorize in writing any of its officers to: laws of lagos state -- Inspect any open space, public place, recreation ground, drain or drainage environmental sanitation system, restaurants and such places as law 2003 may be designated; and This Law provides for environmental sanitation in -- Carry out other work in a lawful manner Lagos State and imposes general duties in relation on a drainage system for the continuous to keeping the streets of Lagos clean, including flow of such drain or drainage system. prohibiting dumping of waste in public areas. The ESL establishes the Environmental Sanitation Section 23 of the ESL empowers the Ministry in col- Corps and stipulates that no person shall dispose laboration with the LG to designate certain areas in of domestic refuse or waste except through a the state as refuse disposal sites for the deposit of Private Sector Participation Operator. The Environ- refuse or waste. mental Sanitation Enforcement Agency collabo- rates with the Ministry of Environment and Physi- • INCENTIVES cal Planning in carrying out its functions under the ESL including registration and licensing of PSPs. The ESL protects the interests of registered private sector participants by penalizing any person who • SERVICES AND RESPONSIBILITIES fails to patronize an appointed private refuse oper- ator by subjecting such persons to the payment of Pursuant to the ESL, it is the duty and responsibili- fines and/or penalties. ty of individuals to: a. Keep clean the sidewalk and gutter area • DISINCENTIVES along the building frontage, side and back There appear to be no disincentives to PSP under at all times; the ESL. b. Put refuse into securely tied plastic bags or leak proof dustbins with tightly fitting lids; environmental sanitation en- forcement agency law 2003 (“esea law”) c. Keep refuse dustbins within their premises until the time of collection; and The ESEA Law establishes the Environmental San- itation Enforcement Agency (ESEA). d. Not litter, sweep out or throw ashes, refus- es, paper, nylon and rubbish into any street, public place or vacant plot. • SERVICES AND RESPONSIBILITIES The ESEA is tasked with the responsibility of en- forcing the provisions of all Laws relating to en- • EMPOWERMENT vironmental sanitation in the State as well as any other duties as may be directed by the Governor. ( i ) The ESL empowers authorized officers of the Ministry of the Environment and Phys- These Laws include: ical Planning (the “Ministry”) and Local Government (LG) between the hours of 8 1. Street Trading and Illegal Markets (Prohibition) Law; 126 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria 2. Sand Laterite and Gravel Spillage (Prohibition) dumping of waste or burying of toxic or radioactive Law; and other harmful wastes is strictly prohibited. 3. Road Traffic (Removal of Abandoned Vehicles) Law; • SERVICES AND RESPONSIBILITIES 4. Survey Law and its Regulations; The functions of the Advisory Committee include 5. Environmental Sanitation Law; formulating policies on environmental sanitation, 6. Town and Country Planning Law and its Reg- pollution and environmental conservation matters. ulations; 7. Environmental Pollution Control Law. The functions of the Sub-Committee as stated in the EPC Law include: • EMPOWERMENT Pursuant to the ESEA Law, the ESEA shall have the • Establishing and recommending basic stan- power to: dard requirements for solid, liquid, gaseous or toxic waste management in the State; a. Demolish any structure constituting public nuisance; and • Examining and recommending recycling of waste as a management method for the in- dustries and State government; and b. Impound or take custody of any vehicle, goods, wares, articles or things found in any place that is prohibited under any of the • Establishing and recommending acceptable Laws. safe methods of collection and disposal of hazardous and toxic waste in the State. Further to the provisions of the ESEA Law, a Spe- cial Offences Court is empowered to inter alia, try The Ministry shall be responsible for implementing all offenders who contravene any of the provisions any policy formulation of the Advisory Committee of the Laws specified in the Schedule to the ESEA. and shall provide the Advisory Committee with the data required for policy formulation. • INCENTIVES The responsibilities of the Ministry include: There appear to be no incentives to PSP in the • Monitoring and surveying solid, gaseous ESEA Law. and liquid wastes generated in the State; • DISINCENTIVES • Educating the public on the types of dispos- al methods acceptable by the State govern- There appears to be no disincentives to PSP in the ment for domestic and industrial waste; and ESEA Law. • Initiating and reviewing environmental pro- environmental pollution con- tection legislation to reflect the latest dis- trol law 2003 (“epc law”) coveries and practices. The EPC Law was enacted to provide for the control of pollution and protection of the environment from • EMPOWERMENT being abused due to poor waste management. The The powers of the Ministry are exercised by the En- EPC Law establishes the Environmental Pollution vironmental Pollution control and Sewage Depart- Control Advisory Committee (the “Advisory Com- ment and include the powers to: mittee”) and the Environmental Pollution Control Advisory Sub-Committee (the “Sub-Committee”). • Demand Pollution Discharge Charge from The Ministry of the Environment and Physical any industrial/commercial company dis- Planning (the “Ministry”) is enjoined to work with charging any form of pollutant (including the Advisory Committee in furtherance of the pro- solid) into the environment; and visions of the EPC Law. Under the EPC Law, the ANNEX 1 - LEGAL FRAMEWORK | 127 • Control siting and management of waste b. Carrying out public enlightenment and dump sites. education of the general public on sound methods of environmental sanitation and Sections 11, 12, and 13 of the EPC Law provide that management; the Ministry may issue to any person who gener- ates waste in in the process of manufacturing oper- c. Co-operating with Federal, State and Local ations, written permission to discharge said waste Governments, statutory bodies and research provided the waste has been purified and treated to agencies on matters and facilities relating to the satisfactory standards of the Ministry. environmental protection; Prior to discharge, once the waste has been treated and certified by the Ministry as being in compliance d. Promoting co-operation in environmen- with its standards, the Ministry shall issue a writ- tal science and technologies with similar ten permission, renewable every twelve months to bodies in other countries and international such person for such discharge. A copy of the writ- bodies connected with the protection of the ten permission obtained shall be displayed at the environment; and premises where the waste is generated. Any industrial/commercial company who fails or e. Co-operating with the Federal, State and neglects to pay the Pollution Discharge Charge Local Governments, statutory bodies and mentioned above shall upon conviction be liable to research agencies on matters and facilities a fine not exceeding N500,000. relating to environmental protection. The functions of the Committee include: • INCENTIVES ( i ) Examining and recommending on continu- There appear to be no incentives to PSP in the EPC ous basis other management options such Law. as minimization, recycling of waste, etc. for industries and government operations in order to reduce degradation of the environ- • DISINCENTIVES ment; There appear to be no disincentives to PSP in the ( ii ) Reviewing and recommending the basic EPC Law. standard requirements for solid, liquid, gaseous or toxic waste management in the State; and lagos state environmental pro- ( iii ) Establishing and recommending acceptable tection agency law 2003 safe methods of collection and disposal of hazardous and toxic waste in the State. The LASEPA Law establishes the Lagos State En- vironmental Protection Agency (LASEPA). The LASEPA Law also establishes a body known as the • EMPOWERMENT Advisory Committee (the “Committee”). LASEPA In carrying out its functions as stipulated under the is the environmental regulator for Lagos State. LASEPA Law, LASEPA is empowered to, inter alia: The LASEPA Law makes specific provisions for the discharge and treatment of waste by prohibiting a. Require to be produced, examine and take the discharge of waste into the environment. copy of any license, permit, certificate or any other document required under this • SERVICES AND RESPONSIBILITIES Law; The functions of LASEPA include: b. Enter into programs, agreements of techni- cal assistance with public or private bodies a. Monitoring and controlling the disposal of concerning environmental protection; solid, gaseous, and liquid waste generated by both government and private facilities in c. Apply enforcement measures to combat en- the State; vironmental degradations in manufacturing premises and government operations; and 128 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria d. Make regulations generally for the carrying ( ix ) Issuing, renewing and revoking licenses of into effect the purpose of the LASEPA Law private waste collectors; and in particular waste management options. ( x ) Making provisions for waste management services to State agencies, local govern- • INCENTIVES ment, industries, business entities and pri- vate persons within the State by receiving There appear to be no incentives to PSP in the waste at the Authority’s facilities pursuant LASEPA Law. to contract agreement between the Author- ity and such other party. • DISINCENTIVES Under the LAWMA Law, the Authority may carry out its functions in association with any other per- There appear to be no disincentives to PSP in the son or body lawfully empowered to do so in accor- LASEPA Law. dance with the provisions of the LAWMA Law. lagos state waste management • EMPOWERMENT authority law (“lawma law”) 2007 By virtue of the provisions on LAWMA Law, the Au- thority is empowered to: This Law was passed to establish the Lagos State Waste Management Authority (the “Authority”) a. Set, collect and revise rates/charges for and to regulate other matters connected therewith. the use of facilities or services provided by The day-to-day administration of the Authority is LAWMA; carried out by the Governing Board (the “Board”). It also regulates the licensing of private waste col- b. Establish and manage organizational struc- lectors. Section 9 provides that no person shall es- ture for recycling in the State; tablish or operate any waste collection business without a license issued by LAWMA. c. Enter into agreement which may be neces- sary for and incidental to the discharge of its functions under the LAWMA Law or any • SERVICES AND RESPONSIBILITIES other enactment; The Authority’s responsibilities under LAWMA Law include: d. Enter into contracts with Local Govern- ments, State agencies, regional authorities ( i ) The removal, collection and disposal of do- mestic, commercial and industrial waste; and private persons to provide waste man- agement services and to design, construct ( ii ) Clearing and maintaining public drainage and manage/operate solid waste disposal facilities; and processing facilities on their behalf; and ( iii ) Cleaning the streets; e. Charge commercial tariffs which may vary ( iv ) Preparing and updating master plans for from area to area and make direct charges waste collection and disposal in the State; on users for services rendered where such ( v ) Controlling the waste system within the circumstances may arise. State; Furthermore, the Board may, with the approval of ( vi ) Approving and monitoring all waste dispos- the Governor, make regulations for the efficient im- al systems in the State; plementation of this Law with respect to matters including: ( vii ) Monitoring the enforcement activities and operations of private sector participants; a. The price and charge for removal and collec- ( viii ) Ensuring compliance with waste manage- tion of waste; ment activities; ANNEX 1 - LEGAL FRAMEWORK | 129 b. The amount to be paid for issuance and re- highway or road in Lagos shall be liable upon con- newal of licenses; and viction to a fine of N100.00 or six months impris- onment. c. The prescription of penalties for offences against any regulation made under this sec- • INCENTIVES tion. There appear to be no incentives to PSP in this Law. It is worthy of note that the Lagos State government shall have the power to designate a place as sani- tary landfilled area where waste collected may be • DISINCENTIVES dumped and that LAWMA exercises the sole right There appear to be no incentives to PSP in this Law. to design, plan, operate, manage, construct and maintain such designated areas. regulatory gaps • INCENTIVES The study has taken out a comparison between There appear to be no incentives to PSP in the Oyo State Waste Management Laws and those of LAWMA Law. Lagos State (which is the largest urban State in Ni- geria) in order to provide a report on the regulatory gaps we have identified in certain Oyo State Waste • DISINCENTIVES Management Laws. The limited validity period of licenses (one year) is- sued to private sector participants is a disincentive, 1. Oyo State Solid Waste Management Au- as it may be a challenge for private sector partici- thority Law 2004 (OYOWMA Law) and Oyo pants to obtain loans from financial institutions or State Solid Wastes Management Authority private investors. (Amendment) Law 2012 a. LICENCES sand, laterite and gravel spillage prohibition law 2003 There appears to be no regulatory gap between the OYOWMA Law and LAWMA Law. The OYOWMA This Law prohibits spillage of sand, laterite and Law is the equivalent to the Lagos State Waste grave on the highways and other roads in the State. Management Authority (“LAWMA”) Law 2007, in Section 1 of this Law requires the driver of any v e - Lagos State. Under the LAWMA law, PSPs are ex- hicle carrying sand, laterite or gravel to cover said pressly provided for and issued upon application, vehicle with tarpaulin or plastic to prevent spillage. a Private Waste Collector License. Similarly, under It also prohibits drivers from discharging sand, lat- the OYOWMA Law, refuse contractors are required erite or gravel on the side of any highway or road in to register with the Oyo State Waste Management Lagos. Authority (OYOWMA) and subsequently issued a license to operate. Licenses issued by LAWMA and OYOWMA are valid for one (1) year and may be re- • AUTHORITY newed upon expiration. Environmental Sanitation Enforcement Agency Section 10 of LAWMA Law provides that: (ESEA) “Subject to the provisions in this law with respect to the suspension or • EMPOWERMENT cancellation of license for contraven- Any driver who fails to cover the vehicle with tar- tion, a license shall remain in force paulin or plastic in accordance with section 1 or for a period of one (1) year from the discharges the sand etc. on the side of the road date of issue and shall expire at the shall be liable upon conviction to a fine of N50.00 or end of that period.” three months imprisonment. Similarly, section 37 (2) of the OYOWMA Law pro- Any driver who negligently spills sand etc. on any vides that: 130 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria “The Authority shall also have tection, beautification or maintenance of the envi- power to fix necessary amount as ronment without registration. As indicated above, registration fees which shall be re- this registration takes place with OYOWMA; mul- newable annually and also subject to tiple registrations with different authorities are not review from time to time.” required. b. DESIGN AND MAINTENANCE OF DESIG- 3. Ministry of Physical Planning and Urban NATED AREAS Development Law 2012 In Lagos State, LAWMA exercises the sole right This law regulates regional planning, physical de- to design, plan, operate, manage, construct and velopment of the State including the spatial loca- maintain areas designated by the Lagos State Gov- tion of infrastructural facilities. The Ministry of ernment as sanitary landfill areas where waste col- Physical Planning and Urban Development pro- lected may be dumped. The OYOWMA Law does cesses and grants planning approval and clearance not vest such power and authority in OYOWMA; to prospective developers and various land users in even though section 6(1) of the OYOMA law states the State. It would appear that this would also apply that the authority shall be responsible for the main- to developers of prospective land fill sites or other tenance of sanitary Land fill sites around the State infrastructural developments related to waste and and charging rates for their usage. Although Sec- its disposal. tion of 22 of the OYOWMA Law states that for the purpose of carrying out any of its objects under the However, in Lagos, LAWMA, as stated above exer- law, the Authority may after giving notice to the cises the sole right to design, operate and construct owner or occupier of any land or premises within designated waste disposal areas. In view of the fact the State, enter upon any such land or premises and that OYOWMA is tasked with the responsibility of thereon do other acts reasonably necessary for car- storing, managing, converting, transferring and the rying such objectives and enter any road or place to disposal of solid waste, it may be helpful for OYOW- which the public have access for carrying out such MA to be able to exercise the above mentioned objectives; it may be pertinent to have the law spe- right. cifically have a provision giving OYOWMA the sole right to design, plan, operate and maintain landfills. inconsistencies The World Banks’ review of the Oyo State Waste 2. Ministry of Environment and Habitat Management Laws; it appears that there are no in- Law, 2011 (“MEHL”)DISPOSAL OF REFUSE OR consistencies in the provisions of these laws. WASTE THROUGH A PSP OPERATOR Under the MEHL, the Ministry of Environment and information from oyo Habitat (“MEH”) of Oyo State is empowered to de- state waste management clare any day as environmental sanitation day, re- authority strict movement for specified hours and mobilize From the World Bank engagements with OYOWMA the populace for environmental sanitation activ- information was provided on the general processes ities. In Lagos, the Environmental Sanitation Law at OYOWMA, we were provided with information 2003 (“ESL”) and the Environmental Sanitation En- on the general processes and procedures adopted forcement Agency Law (“ESEA”) provide for envi- by OYOWMA with respect to registration and li- ronmental sanitation in Lagos State and impose du- censing of PSP operators. These are outlined below: ties on the general populace to keep the streets of Lagos clean. ESL further stipulates that no person 1. Procedural Requirements: shall dispose of domestic refuse or waste except through a PSP Operator. a. The proposed PSP must submit an applica- tion form for the category or categories in The MEHL contains no such provision however, which they intend to operate: the MEHL states that no person shall engage in ( i ) Domestic - N2,500.00; the business of solid or liquid wastes disposal, soak away pits evacuation, horticultural practice or any ( ii ) Commercial - N5,000.00; other business connected with the sanitation, pro- ( iii ) Industrial - N10,000.00; ANNEX 1 - LEGAL FRAMEWORK | 131 b. The prospective PSP must be registered in of LAWMA, who provided details on, inter alia, the accordance with the provisions of the Com- procedure for becoming a licensed PSP operator panies and Allied Matters Act 2004; and informed the study to follow: 1. Procedural Requirements: c. Evidence of registration of business prem- ises with the Ministry of Trade and Invest- a. The applicant must submit an application to ment, Oyo State; LAWMA on the company’s letter head; d. Copies of the company’s financial records b. The applicant must purchase and present for the three (3) years immediately preced- two (2) compactors for inspection within a ing the application for registration/license; specified number of days; e. Tax clearance of two (2) directors of the c. The compactors will be inspected by autho- company for three (3) years consecutively; rized LAWMA officials to ensure they are in good and satisfactory condition; and f. Evidence of ownership of at least one (1) refuse compactor truck of 10-30 metric tons d. The compactors must be branded with the capacity; company’s Logo. In addition, private waste collectors are required to g. Copy of the company’s profile containing pay a registration fee of N200,000, payable annually information on key staff, operational bank and the applicant is also required to submit a certif- details and experience; and icate of incorporation and the vehicle documents in relation to its trucks Furthermore, LAWMA imposes h. Evidence of registration with the Environ- a fee on PSP operators for the use of TLS at the rate mental Health Officers Registration Council of N1,000 per trip. of Nigeria. 2. Government Constraints and Challenges 2. Duration of Contract The World Bank team was informed that the gov- A license granted to operate as a PSP operator is ernment has promulgated legislation which safe- valid for one (1) year and may be renewed at an guards operators and insulates them from risks assessed fee to be determined by OYOWMA. This within the business. Also under PSP arrangements, suggests that there is an element of discretion as operators are at liberty to bill end users directly for regards fees for renewal. This is likely to pose some the services offered. In addition, there is a manda- difficulty to prospective PSP operator who would re- tory remittance rate of 40% of earnings to the State quire at least, an idea of what costs are associated Government; however this is applicable only to with registration and subsequent renewals. commercial waste operators. 3. General Information One of the challenges faced by the operators and Lagos State Government is malfunctioning of the As regards billing, private sector participants in waste-management equipment owned by the oper- Oyo State are expected to bill end users directly for ators. Where this occurs, the government is usually the services they offer. However, PSP operators are obliged to take over the waste management ser- mandated to remit 20% of their monthly income to vices in the interim. However, should this down- the State Government. time persist for a protracted period of time, LAW- MA will be compelled to suspend the contract and to assume full responsibility for waste management information from lagos services over the franchised area. state waste management authority 3. Duration of Contract The World Bank team made enquiries at LAWMA, speaking with a member of the Customer Care Unit LAWMA will issue a provisional license first which 132 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria is valid for a period of six (6) months – one (1) year. register with LAWMA. A minimum of two (2) com- Thereafter, a permanent license will be issued, the pactors must be presented for inspection by autho- terms of which may be negotiated by the parties. rized LAWMA officials at the time of registration. We were unable to get confirmation on the maxi- 2. Categories of Operators mum validity period which may be negotiated for a There are two (2) categories of operators under the license. An annual registration fee is however lev- PSP Scheme in Lagos namely domestic and com- ied on operators. mercial operators: 4. General Information • Domestic Operators: These operators Generally, PSPs in Lagos State are permitted to are primarily responsible for the collec- charge end users directly for the services they pro- tion and disposal of waste generated from vide. However, the Lagos State Government has set domestic settings. They go from house to a fixed fee which an operator may impose on end house collecting waste and disposing same. users in respect of some areas, such as low-brow areas on the mainland. With respect to services • Commercial Operators: They are re- provided in highbrow areas such as the Island, op- sponsible for the collection and disposal erators may determine the amount of fees charged, of two (2) types of waste, namely medical subject to a maximum cap imposed by the govern- waste and industrial waste which are col- ment. lectively known as Commercial Waste. A proposed operator is required to conduct an as- Medical waste is waste which emanates sessment of the relevant franchised area which will from healthcare facilities whereas Industrial form the basis of the projected remuneration that waste is produced from industrial sites such is likely to be generated by the operator. The op- as factories. erator will then submit this assessment/projected LAWMA occasionally awards franchises to large remuneration to LAWMA and will consequently be PSPs for the performance of waste management expected to make up to 60% of the projected emol- services in areas known as ‘’Franchised Areas’’. ument. LAWMA conducts annual audits on the Where an operator is awarded a franchise area, operators in order to ensure fulfilment of the 60% this empowers them to exclusively perform waste requirement. If the operator’s earnings fall short, the management services in respect of the relevant government will advise the operator on ways to im- franchised area. It also permits an operator to bill prove performance and boost profits. directly for the provision of the foregoing services. Furthermore, where there is a short fall, the govern- The operator is however required to remit a fee of ment may provide support to operators in the form 10-15% of its annual turnover to LAWMA. In addi- of financial incentives in order to cover the shortfall tion the Lagos State Government is empowered to and to sustain the viability of the business in the audit the accounts of any operator as part of its su- short-term. Such financial incentives are typically pervisory functions. granted to PSP’s operating in low brow/income ar- eas. However, operators in highbrow/income areas 3. Government Assistance may apply for loans from the government as may be The Lagos State Government provides an enabling required to stay afloat. environment for operators to thrive in the form of laws and regulations some of which mandate that every household must dispose of its waste through a PSP operator. research conducted on 4. Duration of Contract two (2) private sector PSP contracts are renewable annually but may be participants in lagos state negotiable. Franchise contracts on the other hand are usually awarded for a duration of 5 (five) - 10 (ten) years. The standard PSP contract is for one (1) Musiliu Asim Nigeria Company year. However, PSP operators can renegotiate their contracts with LAWMA and will then be treated on 1. Registration an individual basis. LAWMA will also review the It is a requirement for interested PSP operator to ANNEX 1 - LEGAL FRAMEWORK | 133 PSP’s operations based on their performance, effec- mance criteria include: capacity levels (such as ve- tiveness, frequency of evacuation, mandate given, hicular capacity and staff) and frequency of evacu- capacity and number of compactors. ations. Performance criteria are set in the contracts however; it may be reviewed at subsequent meet- ings with the PSP operators. Grace-X (OGX) 2. Financial Support OGX confirmed the above categories of opera- In some areas in Lagos State such as Ajegunle and tors under the PSP scheme, namely domestic and Ijora, operators often face difficulty in collecting commercial operators and a third category (Public payment for services rendered. In these circum- Waste Operators) responsible for the collection and stances, the government may subsidize these ex- disposal of public waste. penses by providing stipends to operators to ensure that they continue to provide waste management services in those areas. • Public Waste: This is waste that origi- nates from public areas such as bins posi- tioned closely to markets and waste gath- ered from public highways. Management of this category of waste is usually assigned to public waste operators. • Domestic Operators: Local Govern- ment Areas in Lagos State, for the purposes of PSP operations are divided into wards. Domestic Operators who deal with domes- tic waste are therefore usually awarded franchises in respect of these wards. • Commercial Operators: LAWMA out- sources management of commercial waste to commercial operators. However, pay- ments for these services are directly remit- ted to the government who will first deduct a certain percentage (between 20%-40%) as a fee and then remit the outstanding bal- ance to the PSP operators. The percentage deducted by the government varies be- tween 20%-40% and depends on a variety of factors including the types of facilities utilized by the operator, etc. 1. Duration of Contracts An employee of OGX also confirmed that the dura- tion of PSP contracts are negotiable. They, however, stressed the importance of performance which he highlighted as a key factor in determining the du- ration of contracts. They specifically mentioned by way of example, that a contract of 3 (three) years could be shortened/withdrawn should an operator fail to perform to a satisfactory standard. The World Bank team was informed that the contract may be revised upon complaints by residents in the area allocated to the PSP operators. Examples of perfor- 134 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria research conducted 2. Government Fees on two (2) private sector OYOWMA charges dumping fees in respect of each participants in oyo state landfill utilized by an operator. In addition, OYOW- MA also levies an annual licensing fee however this Poroku & Co. fee varies, depending on the areas and categories 1. Registration Formalities: of operations. • The applicant is required to submit an ap- 3. Guarantees plication to OYOWMA after which the ap- The Oyo State Government (OSG) does not offer plicant will be invited for an interview; any guarantees to operators. 4. Incentives and Disincentives / Financial Incen- • The applicant must demonstrate financial tives capacity, competence (in the form of experi- No incentives, financial or otherwise are offered ence and technical know-how) and capabil- by the OSG. This is unlike in Lagos State, where ity (in the form of manpower); the Lagos State Government offers subsidy for pay- ment to encourage the PSP operator stay functional • The applicant must also present two (2) where revenue collection proves difficult form cer- compactors for inspection and its corporate tain customers. documents including: 5. Government Assistance -- Certificate of incorporation; There is no assistance offered by the OSG to the -- Tax clearance certificate for the preced- operators. ing three (3) years; and -- Vehicle documents etc.; 6. Duration of Contract /Billing Procedure The contract with OYOWMA is typically valid for • OYOWMA will then issue a provisional li- one (1) year and is renewable annually subject to cense to the applicant. This license autho- satisfactory performance and payment of the annu- rizes an operator to commence operations al renewal fee. on the condition that it will settle any out- standing payments (if any) and meet any With regard to the billing procedure, operators are outstanding requirements upon commence- authorized to bill their clients directly. ment of operations; 7. Leasing and Maintenance of Equipment • Upon the issuance of a provisional license, Under Oyo State Waste Management laws, OYOW- OYOWMA will assign an area of operation MA is empowered to lease its equipment to oper- to the licensee in any of the following three ators. However, in practice, OYOWMA usually ex- (3) categories: perience shortfalls and sometimes lease equipment from the operators themselves. -- Industrial (such as waste generated by manufacturing industries); -- Commercial (waste emanating from of- fices, businesses, banks, eateries, mar- Development Planning Consortium Limited kets, etc.); and (“DPCL”) -- Domestic (waste gathered from domes- tic settings).; 1. Registration In DCPL it is a requirement for interested PSPs to • It is pertinent to mention that after com- register with OYOMA and for OYOMA to inspect mencement of operations, and upon the sat- the equipment to be utilized for the disposal of isfaction of any outstanding requirements, waste. The equipment must be suitable for the OYOWMA will replace the provisional li- proper disposal of waste / be able to convey solid cense with a permanent license. In addi- waste efficiently. The World Bank team was in- tion, if there are no available areas of oper- formed that any such equipment must be branded ation in Ibadan, OYOWMA will assign the with the company’s logo. operator to other areas outside Ibadan such as Iseyin. ANNEX 1 - LEGAL FRAMEWORK | 135 2. Incentives and Disincentives / Financial Incen- • OYOWMA can change the registration and tives renewal fees without notice, which creates A member of the DPCL stated that they are not uncertainty for the private sector partici- aware of any incentives to participating in solid pants. waste management in Oyo State but added that a major disincentive is the fact that the agreement • The Oyo State Government should amend with OYOWMA is constantly changing. Conse- the law in order to ensure that OYOWMA quently, that there is no job guarantee. (like LAWMA in Lagos State) has the sole In addition, although DCPL does not have any form right to design, build and operate areas of financial support from the State, it has an inter- designated as sanitary landfill areas in Oyo nally arranged support programs through a co-op- state; erative society. • Oyo State laws should be reviewed with a 3. Government Assistance view to vesting greater powers in OYOW- OSG provides no proper structure and it appears MA to do any acts reasonably necessary for that OSG is nonchalant whether the private sector carrying out its objectives; and is involved in waste management in the State. In addition, the OSG does not enforce the proper dis- • Significant amounts are expended by pro- posal of waste by the residents in the State. spective PSPs in order to comply with all the requirements for registration and obtaining 4. Duration of Contract /Billing Procedure a license. This may dissuade a lot of poten- PSP contracts are for 1 (one) year, renewable annu- tial operators from venturing into the waste ally. management business. 5. Leasing and Maintenance of Equipment A member of the DPCL stated that in the past it was recommendations possible to lease equipment from OYOMA; howev- er, this is no longer possible as OYOMA trucks are • The current rules and regulations regarding worn-out due to lack of maintenance. Consequently solid waste management are not adequately most PSPs in Oyo State lease trucks / equipment enforced, and this means existing attitudes from private companies. to waste disposal remain entrenched. Con- siderable effort should be put towards en- suring that the relevant authorities in Oyo challenges State, tasked with the supervision of solid From a review of the relevant laws and interviews waste management, e.g. OYOWMA and the with the above mentioned PSPs, the World Bank Ministry of Environment and Habitat, ade- team is of the view that the following are the major quately enforce the laws that would protect challenges for private sector participation in solid all stakeholders, particularly PSPs. This is waste management in Oyo State: because, where the government fails to en- force the provisions of the laws, such as the • Monitoring and enforcement of the various requirement on householders and business laws by the relevant authorities; owners to properly dispose of waste through authorized waste management contractors, • The duration of licenses issued to private this results in losses for the PSPs and de- waste collectors in Oyo State is limited (cur- creases their interest as well as their ability rently one year). This should be increased to operate with a profit; to ensure long term investment on the part of the operators: ranging from 3-4 years for waste collection (2-3 years could be applied • There is insufficient information on the lev- during a transition phase) to between 8 and els of revenue that can be achieved within 25 years for waste processing such as ma- the areas franchised for waste collection. terial and energy recovery and landfill man- The Oyo State Government should ask for agement; private waste operators in Oyo State to conduct an assessment of relevant fran- chised areas which will form the basis of 136 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria their projected remuneration and submit • The PSP should be expanded in the short to their assessment/projected remuneration to medium term to street cleaning, the opera- OYOWMA. In order to gather unbiased in- tion of transfer stations and landfills and in- formation we should: tegration of the informal sector in recycling. On the medium to long term improvements -- implement weighbridges; in equipment, facilities and infrastructure -- design and feed databases; should also be open to public-private part- nerships, e.g. Build-Operate-Transfer. Be- -- produce quarterly and annual operation fore all of that can be implemented we need reports; to clearly define: -- strengthen the human resources capac- ities of OYOWMA; -- the technical, financial and environmen- tal requirements for the Private Sector • Currently there are no financial models to (e.g. whether the private operator can estimate the cost of waste management in change its pricing after two or three Ibadan. The financial model for investments years?); and operation of waste management activ- -- which entity owns the technical means ities in Ibadan should be established. This when the contract ends or when the de- should define the fees that need to be col- preciation period is over; lected to cover the costs of operating and -- the public service commitments of the upgrading waste management to ensure service providers (the service providers that the operators are adequately remuner- can never stop their activities); ated. Still the decision to choose between a -- the means of action of OYOWMA in tax (which depends on the capacity to pay case of failure of the service provider. of the person and is redistributive) and a fee -- All of the above requires a comprehen- (which is based on the service provided) is sive thinking and a minimum of time. a political choice. The scenarios resulting from this choice will be developed in the fi- nal report; • Areas where waste operators face difficulty in collecting payment for services rendered, the Oyo State Government may provide guarantees and subsidize expenses in- curred by the operators to ensure that they continue to provide waste management ser- vices in those areas; • There are no transfer stations in Ibadan which increases the cost for waste trans- portation. Oyo State should establish trans- fer stations around the metropolitan area as they are the most efficient solution to quickly improve the current performance. The transfer stations would enable the col- lection vehicles to remain longer in the col- lection areas every day and to reduce the risks of damage to the collection vehicles on their way to the landfills. Larger and more robust waste truck could be used to trans- port waste from the transfer stations to the landfills; ANNEX 1 - LEGAL FRAMEWORK | 137 CONCLUSION The Oyo State Government recognizes the impor- tance of legislation as an instrument for ensuring an effective and integrated waste management system. However, as stated above, the current laws on solid waste management are not adequately en- forced. Therefore, enforcement of existing laws and regulations is vital to improving solid waste man- agement and increasing interest and profitability of private sector participants. Furthermore, there is room for growth in the area of solid waste management in Oyo State, for example the area of waste treatment is virtually unexplored. Notwithstanding the apparent saturated list of pri- vate sector participants, much of this is in relation to waste collection and disposal. There are very few waste treatment plants being operated in Nigeria as such, this is an area that private sector partici- pants in Oyo State could further explore. 138 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria | 139 annex 2 potential waste services agreement provisions introduction Set out below are a number of potential provisions ( i ) the scope of the works/services being re- that could be contained within a Waste Services quested; Agreement between OYOWMA (“the Authority”) ( ii ) how payment for the delivery of the works/ and a private sector waste company (“Waste Com- services is to be received by the Waste pany”). The detail of the Waste Services Agreement Company; and and the applicability of the provisions below will depend on a number of factors that will need to be ( iii ) the expected size and capability of the pri- determined by the Authority. The most important of vate sector counter-party. these factors are: Table 15: Potential Waste Services Agreement Provisions contractual detail of contractual provision further considerations provision Public Sector The exact identity of “the Authority” will need to be con- The Oyo State Solid Waste Management Authority Party firmed as it is not currently clear whether the Oyo State are the entity that currently provides the opera- Solid Waste Management Authority or the relevant regional tional permit (the “Operation Permit”) to waste government will be the contracting party. This may depend contractors. on the proposed area that the Waste Services Agreement is intended to cover (i.e. whether there is intended to be a sin- gle Waste Services Agreement covering the entirety of Ibadan or a number of separate Waste Services Agreements covering smaller areas within Ibadan). The interface between the contracting Authority and other interested public sector parties will need to be considered. Private Sector The level of complexity of the Waste Services Agreement, the Party size of the area that the Waste Services Agreement covers and the risk transfer sought under it will be dependent on the type of organisation that the Authority is seeking to con- tract with. If the proposed waste companies remain small local op- erators with little or no financial strength (similar to those carrying out the current waste management services) then a significant degree of risk transfer, a large collection area and the inclusion of any major facility maintenance or construc- tion obligations are likely to be inappropriate. 140 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria contractual detail of contractual provision further considerations provision If, however, the procurement process will contain financial and technical prequalification that will favour larger waste management companies with more experience and financial backing (either through their own balance sheet or by being able to secure suitable external funding) and the Authority is willing and able to structure the terms of the Waste Services Agreement so as to attract such larger waste management companies then there is scope for greater risk transfer and area coverage and an expectation of an improved and more streamlined service. Term of The intention of the Waste Services Agreement should be The current approach in Ibadan involves the issu- Agreement to set out a long term partnering arrangement between the ance of an annual Operation Permit. A term renew- Authority and an appropriate Waste Company and the length able annually would not be appropriate for a more of the Agreement should reflect this principle. detailed Waste Services Agreement. If the intention is for waste companies to bid against each Local legal input is required as to whether the other for the right to enter into a Waste Services Agreement Waste Services Agreement would supersede the then the length of the Agreement has to be sufficient for Operation Permit or whether the Operation Permit these waste companies to see value in the time and cost needs to be issued in accordance with relevant leg- associated with entering into a competitive process. If the islation and would therefore need to sit alongside terms of the Waste Services Agreement also envisage the the WSA. If the Operation Permit is still required successful waste company having to incur any up front cap- then the WSA should require the Authority to grant ital expenditure (for instance if any construction or major the Operation Permit annually, with termination of maintenance work is required or if new equipment would be the Operation Permit as a result of default by the needed) then the Waste Services Agreement needs to be of Waste Company also being a termination event sufficient length to allow the Waste Company to recover such under the WSA. capital expenditure under the WSA. Finally, if the Waste Com- pany is intended to have to secure external funding, the term of the Waste Services Agreement must be of sufficient length and certainty to allow such funding to be obtained. The length of the WSA would always be subject to the right of the Authority to terminate the WSA where the Waste Com- pany is in default (see further details below). Obligations on The WSA will specify the Services required of the Waste Com- The obligations contained within the Operation Service Provider pany and the standards that the Waste Company must meet Permit can be included within the WSA (and ex- in the performance of those Services. The Waste Company panded upon where necessary). will be required to comply with all applicable legislation, guidance and good industry practice and (unless there are As per the terms of the Operation Permit, the specific exclusions listed within the WSA) to obtain, maintain Waste Company may still be separately prosecuted and comply with all necessary consents (whether granted by for breaches of any legislation. the Authority or a third party) ANNEX 2 | 141 contractual detail of contractual provision further considerations provision Exclusivity The Authority will need to determine whether a number of The Operation Permit already provides exclusivity WSA will be entered into in relation to different waste col- protection in respect of allocated areas and in- lection areas (for instance, having one WSA for each of the cludes a penalty for breach by the Waste Company 11 local government areas within Ibadan) or whether the of the exclusivity protection offered to other waste procurement is designed to attract waste companies of suf- companies. This penalty could be included within ficient size (or able to form a consortium of sufficient size) the WSA (unless only one WSA is intended to be that a single WSA can be entered into in relation to the entire entered into, in which case the provision would not Ibadan area. be necessary). In either event, the Waste Company should be granted ex- It is understood that the Oyo State Solid Waste clusivity over the specifically identified area within the WSA Management Authority would ideally like to cease to avoid competition from other waste companies or the its waste collection activities and that a transfer Authority itself. of the public sector waste collection services to the Waste Company would be preferable. Street The Authority should also consider the interface between sweeping activities will not be passed to the Waste the public sector waste collection and the Waste Company. It Company. would not be unusual for the public sector waste collection service to be taken over by the Waste Company to avoid any unnecessary interfaces and ensure that the Authority need only deal with the Waste Company on matters relating to waste management. Waste The main Services to be provided will relate to waste collec- Technical adviser input will be required in relation Collection tion. Identified in the report it was expected that the Author- to the exact scope of works/services. ity would specify the Services required on an “output” rather than an “input” basis. This means that the Authority sets out in general terms what their requirements are (for instance, the area and premises/collection points to be covered by the waste collection service and the frequency of collection) but expects the Waste Company to confirm the detail of how the Authority’s general requirements are to be met (for instance by specifying the collection route and collection timetable, the number of required staff and number of required vehi- cles). Existing Landfill One consideration for the Authority is whether the Waste The Operation Permit envisages that 20% of the Operation Services Agreement should also cover the operation/man- monthly collection charges are paid to, or retained agement of the existing landfill sites to avoid interfaces by, the Authority for its administrative charges and between the Authority employees in control of the landfill maintenance of the landfill sites. It may be more sites and the Waste Company employees (including potential efficient to allow the Waste Company to keep the issues relating to the transport of waste from the point of monthly collection charges and control the landfill collection to the point of landfill). This may only be possi- site operations themselves. ble if the existing landfill operations are fit for purpose (as otherwise the Waste Company may not want to take on such If the existing landfill sites require major mainte- operations) or if the Waste Services Agreement includes re- nance or other upgrading then the Authority will quirements on the Waste Company to upgrade such existing need to consider how this would be paid for. The landfill operations (in return for appropriate payment). Authority could agree to upgrade such facilities themselves prior to the Waste Company taking over such facilities, or the Authority could seek a 142 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria contractual detail of contractual provision further considerations provision Waste Company that is capable and willing to procure the upgrade itself under the Waste Ser- vices Agreement. Either of the above options is dependent on the Authority having the appropriate funds to pay for the development, either initially or through the WSA, as the Waste Company is unlike- ly to be able to generate sufficient revenues from the landfill site operation to be able to cover any initial or on-going capital expenditure. Construction of More complex WSA often include construction obligations as The more complex the construction, the greater New Facilities well as services obligations. If the Authority is considering the risk of a construction related default under new landfill site operations or the construction of transfer the WSA. It would be possible to separate out stations (or any other waste management related sites) in the construction and service obligations so that a order to increase the efficiencies of the waste collection construction default didn’t necessarily also lead service, it is possible to consider the inclusion of such con- to termination of the services but if this approach struction as part of the WSA. However, note that this would was to be taken it may be preferable to source require that the waste companies bidding for the right to en- any new construction outside of the terms of the ter into the WSA’s either have construction expertise or, more Waste Services Agreement and bring the facilities likely, are able to appropriately sub-contract the construction into the scope of the WSA once they have been obligations to an entity that does have such expertise. completed. This would align the approach to other infrastructure improvements that would assist with If new facilities are to be proposed then the Authority would the efficiency of the waste collection service but need to undertake significant work prior to entering into which would be procured outside the terms of the the WSA to enable the relevant sites to be available for the WSA (for instance in relation to improvement of Waste Company (for instance land identification and acqui- the road network). sition, environmental impact assessment and any other rele- vant surveys and any planning and other permissions). Construction of new facilities would also involve additional considerations in relation to consents, for instance any planning permissions or permits that would be required. It is unlikely that the Waste Company could take the risk of obtaining all of the potential additional consents. Property Property matters would not be a significant consideration Local legal advice would be required in this area as Matters if the scope of the WSA was limited to a waste collection it will require knowledge of Nigerian property law. service. However, if the Waste Company was also required to take control of existing Authority sites (such as the landfill sites) and/or new Authority sites (if any new construction was anticipated) then the Authority would need to ensure that the Waste Company had the appropriate property rights. Unless the Authority provided a warranty that there were no property matters that could impact on the Waste Company and its performance under the WSA, it may be necessary to carry out due diligence on the relevant properties to ensure there are no such restrictions. ANNEX 2 | 143 contractual detail of contractual provision further considerations provision Ground Condi- The Waste Company should be responsible for any contami- tion, Contam- nation or other environmental liabilities that it causes. ination and Environmental Where existing landfill sites and/or new facilities are to be Matters included within the scope of the WSA it will be necessary to allocate responsibilities in relation to the condition of the ground and any existing contamination at the relevant site. Maintenance The Waste Company will be required to be responsible for all The Operation Permit specifies which vehicles and Replace- maintenance and replacement of its own equipment need- can be used and also specifies the standard of ment Obliga- ed to provide the services (for instance the waste carrying equipment required (albeit in very general terms). tions vehicles). The Authority may want to specify the level of If required, these provisions can be included in replacement/maintenance that it expects (for instance that the WSA along with the penalties contained in the the waste carrying vehicles must be of a certain type and/or Operation Permit for any infringement. must always comply with applicable legislation). The WSA could also pass other maintenance and replace- ment obligations onto the Waste Company, for instance any waste receptacles used by low income households as primary waste delivery points (as an increased number of receptacles is likely to increase waste management within poorer areas and provides a partial solution until the road network is sufficient in all areas to allow door to door collec- tion). However, it would be important to understand how the Waste Company would be paid in respect of such additional maintenance or replacement obligations. The Authority may want the right to undertake surveys of any equipment or facilities to ensure that the Waste Company is complying with its obligations Payment This is a key area. The Waste Company will have difficulty being able to offer an increased service level above the level that is currently being experienced if it is expected to take the risk of recovery of any monies from third party users. The ideal and recommended position for the Waste Company is that all payments are made directly by the Authority to the Waste Company and that the Authority then puts in place mechanisms to recover relevant amounts from end users (whether through direct taxation, linking payment to utility bills or another method). Non-voluntary payments are likely to require Government assistance in relation to the poorer households as they may be unable to pay for such services. In order to limit this risk it would be possible to have a non-voluntary basic service level, with a voluntary enhanced service level that more affluent households can pay for them- selves if they require. 144 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria contractual detail of contractual provision further considerations provision If the Authority is unwilling or unable to guarantee payments to the Waste Company in respect of the waste collection service then the WSA can specify that recovery risk remains with the Waste Company. However, as noted above, this re- flects the current system and is therefore unlikely to allow for a significantly increased service delivery as non-recovery by current waste companies remains high. It is also likely to be a barrier to larger waste companies bidding to enter into the WSA and to obtaining external funding. For these reasons, this approach is not recommended. Where any capital payments would be required to be made, the Authority would need to consider whether these will be expected to be funded by the Waste Company and then recovered by the Authority (over the term of the WSA or over some other shorter period) or whether the Authority will fund such capital payments. In either case, ideally the Waste Company should be required to carry out the works and then recover the payments but if they do not have sufficient funds or availability of debt then this may not be possible. In this case the Authority would take the risk of the money not being properly allocated and having to seek recovery against the Waste Company. Performance An important element of a WSA should be that payment is The Operation Permit requires records to be sub- Monitoring performance based. The WSA should set out any key perfor- mitted monthly by the Waste Company and for and Key mance indicators in respect of the Services. These key per- audited records to be provided to the Authority for Performance formance indicators are the service standards that the Waste review. Indicators Company is expected to meet. In order to measure performance, the Waste Company should be expected to provide all necessary records to the Author- ity and to provide summary reports on their performance at regular intervals (monthly, for instance). The Authority should also have the right to undertake its own performance monitoring of the Waste Company to ensure the Waste Com- pany is complying with its obligations (including its reporting obligations) Penalties for Failure to meet any of the key performance indicators re- non-perfor- ferred to above would ordinarily result in a financial penalty mance on the Waste Company. This penalty would be made by reducing any amounts payable by the Authority or by seek- ing recovery against the Waste Company. The exact process for the application of penalties is dependent on how the payment mechanics are expected to work. It may be that non-collection simply equates to non-recovery of the amount otherwise payable in respect of the collection but if the ser- vice is to be enhanced such that additional key performance indicators are to be imposed on the Waste Company then a more detailed penalty regime is likely to be more appropri- ate. ANNEX 2 | 145 contractual detail of contractual provision further considerations provision Incentive Where the Waste Company performs above anticipated levels Payments it may be appropriate to include bonus payments in order to incentivise such increased performance. This approach would also recognise the potential additional risk accepted by the Waste Company where key performance indicators are included in addition to a simple mechanic whereby non-deliv- ery equals non-payment. It is important that the incentive payments are not simply based on increased collection that is then passed onto end users as there is a point at which the end users would not benefit from such increased collections and may not be able to meet any increased payments. Financial Depending on the Waste Company and the potential for any Security security to be provided, the Authority may want to consider whether it would require any bonds or guarantees covering the obligations of the Waste Company. Relief from The WSA should contain any agreed relief from obligations Obligations required by the Waste Company so as to avoid either a penal- ty for non-performance or a termination for Waste Company default. The exact list of relief will need to be agreed but is likely to include elements such as: (i) a breach by the Authority of its obligations under the WSA, (ii) war, terrorism or armed conflict, (iii) fire, flood or other natural disaster, (iv) general strikes or fuel shortages, or (v) closure of an Authority controlled site (where responsibili- ty is not passed across to the Waste Company). Further types of relief may be required in circumstances where the WSA would include the operation of the existing landfill sites and/or the construction of new facilities. Where certain matters beyond a Party’s control (such as war or natural disaster) continue for an extended period of time and the Parties have been unable to agree how to deal with such matters, either Party should have the right to termi- nate the WSA on a no fault basis. This would mean that no compensation would be payable by either party (unless the Authority would be unjustly enriched by the Waste Company returning equipment or new or enhanced facilities to the Au- thority that it had not paid for (or not fully paid for), in which case the Authority would be required to make an appropriate payment to the Waste Company in respect of such equipment or facilities. 146 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria contractual detail of contractual provision further considerations provision Authority Obli- The Authority should accept very few obligations under the gations Waste Services Agreement. Such obligations will include: ( i ) meeting any payment obligations that it has agreed to pursuant to the WSA; ( ii ) obtaining any specific consents that the Waste Com- pany cannot obtain and which are in the control of the Authority to obtain; ( iii ) where the Authority retains the control of the landfill sites or other relevant sites, allowing access to these sites for the Waste Company; ( iv ) ensuring that the Waste Company’s right to exclusiv- ity over the specified area is retained. Ownership of If the services are limited to waste collection it is therefore Local legal advice to confirm if there is a specific Waste envisaged that the ownership of waste would not transfer requirement under Nigerian law in relation to own- (albeit the risk of managing the waste would rest with the ership of waste. Waste Company during collection and transport). If the ser- vices include the control of the landfill sites then it may be more appropriate that the ownership of waste transfers to the Waste Company. Where the Waste Company owns the waste it may be possi- ble to consider the extent to which income can be received through enhanced recycling and whether such income could be used to enhance the economics of the WSA (i.e. can recy- cling income be used to help reduce the levels of payment expected from the Authority). Termination for The ultimate sanction for a failure by the Supplier to perform Supplier Default would be a right for the Authority to terminate the WSA. The exact list of defaults would need to be agreed but would be likely to include: ( i ) material or persistent breach or abandonment; ( ii ) reaching certain non-performance thresholds, by reference to the key performance indicators or the level of financial penalties made against the Waste Company; ( iii ) transferring the WSA to another party without con- sent; ( iv ) failure to take out the necessary insurances; ( v ) insolvency of the Waste Company; ( vi ) failure of the Waste Company to pay amounts (over a certain threshold) due to the Authority; ( vii ) bribery of the Authority; ANNEX 2 | 147 contractual detail of contractual provision further considerations provision ( i ) reaching the annual liability cap (if applicable – see below for further detail); ( ii ) ineffectiveness of any financial security unless re- placed (if applicable). Any defaults which are rectifiable would be subject to a cer- tain rectification period before the right to terminate took effect. Termination for The right for the Waste Company to terminate the WSA for Authority De- Authority Default should be very limited. It would include: fault ( i ) failure of the Authority to pay amounts (over a cer- tain threshold) due to the Waste Company; ( ii ) expropriation or requisition of the Waste Company’s assets without due cause; ( iii ) breach by the Authority of its obligations under the WSA which frustrates the Waste Company from per- forming the Services for an extended period of time; ( iv ) transferring the WSA to another party that does not have the capability of performing the Authority’s ob- ligations under the WSA. Any defaults which are rectifiable would be subject to a cer- tain rectification period before the right to terminate took effect. Compensation On a Waste Company default, the Waste Company will be on Termination liable for all losses incurred by the Authority as a result of such default (including any increased costs of performing the Services, any re-tendering costs, any temporary measures required prior to any re-tender, any relevant break costs and any necessary rectification costs). As mentioned in more detail below, this may be subject to a cap on liability. On an Authority default, the Authority will be liable for all breakage costs properly incurred (including any redundancy costs caused by no longer needing any relevant employees and not being able to re-locate them to other contracts or services), plus a certain amount of the Waste Company’s expected profit (usually between 6 months and 2 years) to reflect the fact that the Authority has defaulted on a long term contract. 148 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria contractual detail of contractual provision further considerations provision Where the scope of the WSA includes capital expenditure be- ing incurred by the Waste Company that is anticipated to be repaid by the Authority but hasn’t been (or hasn’t fully been) repaid at the point of termination (for instance in relation to the purchase of equipment that is to revert to the Authority or any maintenance of construction of relevant facilities), the Authority will still be responsible for making such payments (even following a Waste Company default), subject to any adjustments needed to reflect the fact that the equipment or facilities may not be in the condition expected under the WSA as a result of the Waste Company not complying with the terms of the WSA. Insurance The Waste Company should take out all insurances as re- Specialist insurance advice would usually be ob- quired by law. The Authority may want to specify certain tained in relation to this area. insurances and/or insurance provisions that the Waste Com- pany should obtain. The insurance package will depend on whether the Waste Services Agreement includes responsibility for existing landfill sites and/or construction of new facilities. Additional insurances are likely to be required in these circumstances. Changes in Law The Waste Company would be expected to take the risk of general changes in law affecting the services unless the rel- evant authority brought in a law specifically to discriminate against the Waste Company or the obligations under the WSA. Where the Waste Company takes responsibility for the landfill sites or for any new facilities, the Waste Company is unlikely to be able to take responsibility for all changes in law which result in material additional capital expenditure being incurred (albeit larger waste companies may be able to take some risk here, on an agreed cost sharing basis with the Authority). Subject to any cost sharing agreement, this ex- posure would be something that the Waste Company would expect the Authority to cover. In reality the exposure for the Authority here is no different than if it had retained control of the facilities as it would still need to comply with all applica- ble laws. Indemnities The Waste Company should compensate the Authority for any losses caused to the Authority as a result of death or injury to any person, loss or damage to any property, or third party claims being made against the Authority, in each case where these losses were caused by the Waste Company. ANNEX 2 | 149 contractual detail of contractual provision further considerations provision Limits on Liabil- The Waste Company may want to include a cap on liability If the Waste Company was an externally financed ity and Exclu- under the WSA in order to limit its exposure. This limit would special purpose vehicle then the inclusion of sions usually be a certain agreed amount over each year of the overall caps on liability would not be appropriate WSA and a separate agreed amount following termination as the fact that the special purpose vehicle is sep- for Waste Company default. Where the WSA is purely service arate to its investors already provides protection based it would be common for the annual cap to be 100% in this respect. This is known as limited recourse of the income receivable in the year in question and for the financing. termination cap to be 200% of such income. However, in circumstances where construction was included within the scope of the WSA an additional cap would need to be includ- ed covering an agreed percentage of the construction costs. Where caps on liability are included there would neverthe- less be a number of exclusions from such cap. The exclusions would need to be agreed but would be likely to include: ( i ) liability under the indemnity for death, injury, dam- age or third party claims; ( ii ) amounts recovered under insurances; ( iii ) willful default, fraud or criminal conduct; ( iv ) enforcement costs; ( v ) default interest following late payment; ( vi ) liability under employment law and/or intellectual property law; and ( vii ) breaches of confidentiality. Contractual Contractual variations need to be in writing signed by both Variations the Authority and the Waste Company. Step-in and Where the Waste Company is in default, the Authority may Suspension want the right to be able to step into the provision of the services (or procure that another party does) to the exclusion of the Waste Company in order to rectify any default. In these circumstances, the Waste Company should cover all costs and losses of the Authority incurred as a result of such step- in. Where the Waste Company employs sub-contractors, the Authority may also want a direct contractual relationship with such sub-contractors which would be triggered in the event that the Waste Company was in default of the WSA, so the Authority could step in and instruct the sub-contractors directly. 150 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria contractual detail of contractual provision further considerations provision Employment The WSA should contain various obligations on the Waste Local legal advice will need to input on this area as Matters Company in relation to its employees, including ensuring that it will involve knowledge of Nigerian employment the Waste Company complies with all applicable employment law. related laws as well as any employment welfare matters and obligations in relation to training and general education of employees and the public on the importance of waste man- agement. In the event that the public sector waste collection service is taken over by the Waste Company, provisions will need to be included to deal with the proper transfer of public sector employees to the Waste Company (and potentially the sub- sequent transfer of employees to the Authority or to another incoming waste company following termination or expiry of the WSA). It may also be necessary to include provisions relating to equal pay/benefits, to avoid a mismatch between private sector workers and workers transferring from the public sector. Dispute Reso- Specific dispute resolution provisions will be included to Local legal advice will need to input on this area as lution ensure there is a specifically defined process for the reso- it will involve knowledge of the Nigerian disputes lution of any disputes between the Authority and the Waste system. Company. Intellectual Provisions will be included relating to the use by one Party Local legal advice will need to input on this area as Property of the other Party’s intellectual property in relation to the it will involve knowledge of Nigerian IP laws. carrying out of the obligations under the WSA or following termination/expiry. Handover on Any facilities or items of equipment that have been paid for Termination or (or are intended to be paid for but haven’t been due to an Expiry early termination) by the Authority under the WSA should revert to the Authority on termination or expiry. The Waste Company should be entitled to keep any of its own equip- ment that the Authority is not expected to pay for. The Waste Company will be required to pass to the Authority all documentation, records and other information as is re- quired to enable the Authority or a successor waste company to perform the Services. All relevant consents should also be surrendered or transferred (as the Authority requires). Where material maintenance or construction is included within the WSA the Waste Company should also pass on any guarantees, bonds, warranties that relate to such mainte- nance or construction. The Waste Company should also do all things reasonable in order to assist with any transfer of the Services. ANNEX 2 | 151 contractual detail of contractual provision further considerations provision Boiler Plate There will be a number of other standard contractual clauses, Local legal advice will need to input on this area Clauses including: as it will involve knowledge of the Nigerian legal system. ( i ) governing law and jurisdiction (i.e. Nigerian Law); ( ii ) restrictions on assignment and sub-contracting (en- suring that the Waste Company doesn’t transfer or sub-contract the WSA without the Authority’s con- sent); ( iii ) entire agreement (confirming that all other prior agreements between the Parties are superseded by the WSA); ( iv ) severability (confirming that if one element of the WSA is determined to be invalid or unenforceable that this doesn’t affect the remainder of the WSA); ( v ) sole remedy (specifying that the only rights of the Waste Company against the Authority are those which are explicitly provided for within the WSA); ( vi ) confidentiality (ensuring that the Parties do not dis- close each other’s confidential information). 152 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria | 153 annex 3 stakeholder interviews introduction EY conducted interviews with stakeholders with State / Ibadan? Have you ever work with the context below: them? In which context? etc. 2. What is your experience in solid waste • Engage key stakeholders in the discussion management activities in Africa / Nigeria on current challenges in SWM activities in / Oyo State / Ibadan? Please describe it. If Ibadan yes, did this include PSP? 3. From your experience, what are the key • Assess the current attractiveness of the sec- challenges to overcome for a successful tor to PSP in Ibadan PSP in waste management in Nigeria / Oyo State / Ibadan? (Financial challenges) • Increase awareness and appreciation for the 4. From your experience, what are the key potential for PSP in SWM in Ibadan challenges to overcome for a successful PSP in waste management in Nigeria / Oyo • Identify challenges and gaps in terms of in- State / Ibadan? (Operational challenges) stitutions and finance 5. From your experience, what are the key challenges to overcome for a successful • Design an action plan coupled with capac- PSP in waste management in Nigeria / ity building assistance for OYOWMA and Oyo State / Ibadan? (Legal challenges) the private waste collectors 6. Why you are not currently involved or The aim of the interviews was to: interested in solid waste management in Ibadan? What would make you interested • Understand the willingness and ability of investing or participating in PSP of solid the private investors and commercial banks waste management in Ibadan? to invest within the solid waste sector, and What sources of financial support or the conditions for investment. investment capital could be made available to the waste management • Learn from experiences and best practices private sector in Nigeria / Oyo State / of implementing PSP challenges in SWM Ibadan? activities 7. Have you identified good practices (operational such as collection, maintenance, equipment, training, staff and financial such as fees collection, financial questions support, etc.) that could be applicable to 1. How would you describe your relationship PSP in solid waste management activities with the local authorities in charge of the in Ibadan? solid waste management in Nigeria / Oyo 154 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria list of stakeholders interviewed private sector service offerings current/past number of name and position expressed outright partner areas of opera- years of of person inter- interest in operat- tion in nigeria operation in viewed ing in ibadan? nigeria • Waste collection • Lagos State • Over 18 • Olugbenga Adebola • No, except with a years guarantee of cost • Consultancy • Ogun State • Chief Executive Officer Richbol recovery system. Environmental • Cost recovery & • Delta State training Services Ltd. • Landfill manage- ment • Waste to energy • None yet • Not appli- • Abubakar Sadiq • Yes. They have already Karkara Rapid De- conversion cable begun the application • Project Coordinator process for partici- velopment Limited pation. • Waste collection • Lagos State • Eight years • Muyiwa Adeniyi • No. except with a guarantee of cost • Cost recovery • Federal Capital • Managing Director recovery; Waste-Point Territory Limited • Ekiti State • Edo state • Collection of recy- • Lagos State • Three years • Boluwaji Oyewumi • Yes, they expressed clable waste only strong interest espe- Wecyclers • Business Development cially in Sasa area. • Processing of Manager recyclable waste • Consultancy • Kaduna State • Over four • Kirsten Jack • Yes. However, their services on years current mandated Nigeria Infra- the end-to-end • Kano state • Senior Manager area of operation is structure Advisory activities in waste • FCT northern Nigeria. This Facility (NIAF) management will be reviewed in six months and is likely to • Training change. • Waste to energy • Lagos • Over eight • Dr. Cornelius Shogunle • Yes. Currently a PSP in Highland Energy generation years Ibadan. • Ibadan • Chief Executive Officer Solutions ANNEX 3 | 155 interview questions and answers relationship with public sector regarding solid waste management in nigeria 1. How would you describe your relationship with the local authorities in charge of the solid waste management in Nigeria / Oyo State / Ibadan? Have you ever work with them? In which context? etc. We have vast experience working with LAWMA and also have a long standing relationship with Oyo State § Richbol Ministry of Environment. However, we are not currently partnering with OYOWMA in waste management ac- Environmental tivities. We had a proposal for an Integrated Waste management facility funded by us with guarantee pur- Services Ltd. chase of the end product (fertilizer) by the government. But the business proposition was not accepted. We have a good relationship and have been in communication with OYOWMA for about three years. We have § Karkara Rapid De- a pending approval and appropriate documentation for our proposed waste to energy facility in Ibadan. Al- velopment Limited though the relationship is cordial, there is a lot of bureaucracy in the system preventing us from getting our approvals. We have a very cordial relationship with OYOWMA. We have been invited in the past by OYOWMA for partic- § Waste-Point Lim- ipation. However we declined because of a lack of enabling environment and strategy tailored to the geo- ited graphical and socio-economic environment of Ibadan We have been in a relationship with LAWMA as PSPs for three years. It has been a very good relationship and § Wecyclers they have made available locations for us to store our recyclables and other field operations. We currently have a relationship with Kaduna, Kano and FCT. We work with them as consultants throughout § Nigeria Infra- the value chain of waste management; cost recovery, operating a viable PSP model, procurement of equip- structure Advisory ment, benchmarking and best practices, training on operational issues and proper operation and mainte- Facility (NIAF) nance of equipment etc. We currently have a cordial relationship with OYOWMA although it is not an enabling environment. The au- § Highland Energy thorities have on several occasions tried to frustrate the efforts of the firm however having a direct line of Solutions communication with the state governor has reduced the challenges experience with solid waste management in nigeria 2. What is your experience in solid waste management activities in Africa / Nigeria / Oyo State / Ibadan? Please describe it. If yes, did this include private sector participation (PSP)? We have worked as private sector partners in Waste Management for many years and some of our previous § Richbol jobs with local authorities include: Environmental § Lagos State Government: Refuse collection, transportation, disposal and landfill site management and Services Ltd. consultancy; § Delta State: Waste collection and disposal. N/A § Karkara Rapid De- velopment Limited We have worked as private sector partners in the capacity below: § Waste-Point Lim- § Lagos: Waste collection and disposal (operation of materials recovery facilities to begin October 2015); ited § FCT: Waste collection and disposal, street sweeping and landscape gardening; § Ekiti: Waste collection and disposal. 156 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria We are PSPs who operate a social entrepreneurship model. We collect recyclable waste with a focus on low § income communities and reward them with redeemable points (points are traded in for household items Wecyclers such as TVs, sewing machines etc. when they accumulate. We are expanding our operations to Osun and Ogun States before December 2015. § Nigeria We operate in waste management in an advisory and consultancy capacity to state governments in Northern § Infrastructure Nigeria. Advisory Facility (NIAF) We have had previous experience working with Oyo state government but we had to pull out from the en- § Highland Energy gagement because the proposed plan was not feasible or sustainable. Solutions We are also working on generating 2MW renewable source of energy for Tafawa Balewa Square, Onikan, § Lagos. financial challenges related to psp in waste management 3. From your experience, what are the key challenges to overcome for a successful PSP in waste management in Nigeria / Oyo State / Ibadan? (Financial challenges) The key financial challenge that PSPs have is in the area of financing and cost recovery. § Richbol Access to funding is a major issue as trucks and other required facilities are expensive to purchase. § Environmental Also, interest rates for borrowing from banks are very high and most PSP can’t afford it. Also banks do not § Services Ltd. give long term loans. Only short term loans (which are not adequate in this sector, since cost recovery in itself is an issue in the beginning stages) are available to PSP from banks. N/A § Karkara Rapid De- velopment Limited Financing is a big problem for PSPs. The sector is capital intensive and gives return on a longer term than § most other sectors. Equipment are expensive to purchase, a brand new truck is about EUR 70,000. Waste-Point Lim- PSPs need long term facility to stay afloat. For instance, my businesses almost collapsed at a point but for § ited the bail-out fund provided by Lagos State Government which I have now fully repaid. At that time, no bank was willing to give me money except for the then Oceanic Bank who gave me some financial assistance which was still not enough. We have not really had any financial challenges, neither have we had any cause to apply for loans from banks. § Wecyclers We have received a lot of donations from local and international bodies like MIT and Coca Cola international. A big issue we have noticed is in the area of financing their business for purchase of equipment and training. § Nigeria Infra- A lot of finance is required as these machines such as trucks are expensive. This is particularly important be- structure Advisory cause cost recovery is also an issue. The ability of PSPs to recover their cost is usually limited and so finances Facility (NIAF) are usually limited. We have not had financial challenges because the project is currently funded by the company and we have § Highland Energy received guarantee from the government that they intend to buy the energy generated. Solutions ANNEX 3 | 157 operational challenges related to psp in waste management 4. From your experience, what are the key challenges to overcome for a successful PSP in waste management in Nigeria / Oyo State / Ibadan? (Operational challenges) The tenement structure of some parts of Ibadan (lack of proper definition of streets), will make it difficult to § operate a door-to-door structure and as such a communal waste collection strategy will work better. Richbol The private collection companies are too small in capacity and lack the wherewithal in terms of financial and § Environmental technical capability. Also, the areas allocated to private collecting companies are too small. This places the Services Ltd. capability of the overall sector on a micro level. There is a lack of equipment on the part of the collectors. Trucks and other equipment are expensive and § facilities are not readily available from financial institutions. The key issue we have identified is bureaucracy. There are a lot of bottle necks in the system that makes § Karkara Rapid De- obtaining approvals and decisions difficult. For instance, we have been trying to get approval for waste to velopment Limited energy operations for about three years now even though we have all the requirements. There is no adequate infrastructure on the part of government. For instance , there are no adequate landfills § and the dumpsites being used in their place are in such bad condition that they cause trucks to breakdown Waste-Point Lim- ited Also, there needs to be strong will on the part of government that will translate into creating enabling envi- § ronment, capital investments and infrastructure and ensuring only qualified officials and PSP are engaged by the government The only issue we have noticed is the attitude towards waste management. For instance some of our collec- § tors, even though they are nicely dressed and operate with tricycles, still do not want to go to neighbour- Wecyclers hoods where they know people. They do not want to be associated with “dirt”. Nevertheless, we get cooper- ation from the public because their participation is incentivised by the redeemable points Some waste management government agencies try to plunge into more advanced back-end process like § waste to energy, integrated waste management facilities and world standard landfills too early. It is a com- Nigeria Infra- plicated process that can quickly become a burden if not managed properly. In the beginning stages, more structure Advisory emphasis should be placed on getting the collection, disposal and general recycling right. Waste to energy Facility (NIAF) can be done in smaller scales e.g. having specialized arrangement with large companies who require the energy or recycled products for their operations. When the whole waste management process has mature, then full-scale waste to energy can be done. A major challenge for waste management in Ibadan is that the topology of the state is hilly and not flat like § Lagos hence it is difficult for PSP to collect waste and take it to the dumpsites. Most of the waste disposal Highland Energy trucks struggle to climb the hill to where the dumpsites are. Solutions Another operational challenge is that there are no adequate and appropriate tools in place for an efficient § and effective system of managing waste. 158 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria legal challenges related to psp in waste management 5. From your experience, what are the key challenges to overcome for a successful PSP in waste management in Nigeria / Oyo State / Ibadan? (Legal challenges) Richbol A big issue in this area is cost recovery and the ability to enforce. Most PSPs are unable to recover their cost § Environmental from the public due to non-compliance. This could be particularly difficult if there is no power on the side of Services Ltd. the PSP to enforce. N/A § Karkara Rapid De- velopment Limited The key issue here is on the part of cost recovery and enforcement. In the case of my business, we have been § able to manage because we did a thorough enumeration of the area. Also, the cost for commercial residents Waste-Point Lim- is recovered by LAWMA. However, if not properly managed by enforcement it could be a big problem. Howev- ited er, we have noticed that the public is willing to pay when services are prompt and efficient. Another legal issue is on sorting of waste by the public. However, Nigeria is not mature enough for that yet § but it is also something that can be achieved with proper legal framework and enforcement A key issue that can be resolved with legal backing and enforcement is proper sorting of waste at the point of § Wecyclers generation in households. However, we think Nigeria is not that mature and might not get full public support. The first stage will be to ensure the public dispose of general waste properly and pay for such services. A legal challenge we have noticed is cost recovery and enforcement. The PSPs do not have the power to § enforce payments. From our experience, what works best is either integrating fees into other local taxes in areas where their compliance in local tax payment or direct recovery through an agency which is given the Nigeria Infra- right to enforce. structure Advisory Facility (NIAF) From our experience another issue is enforcement on the part of the waste management boards. They also § sometimes cannot enforce PSPs to demand prompt and quality service delivery because some companies are owned by government officials. Highland Energy N/A § Solutions reasons for not being involved in solid waste management in ibadan 6. Why you are not currently involved or interested in solid waste management in Ibadan? What would make you interested investing or participating in PSP of solid waste management in Ibadan? What sources of financial support or investment capital could be made available to the waste management private sector in Nigeria / Oyo State / Ibadan? If a system that gives an assurance for cost recovery is made available, we will be willing to participate in § Ibadan. Some suggestions are; Indirect recovery by including it in local taxes and tenement rates, communal Richbol waste collection and cost recovery, specialised government cost recovery agency and subsidising the levies Environmental of low income communities with the high income communities or government Services Ltd. Also, an intervention fund by the government or World Bank for bout 7-10 years will act as a guarantee for § PSPs. N/A § Karkara Rapid De- velopment Limited ANNEX 3 | 159 Firstly there needs to be cooperation on the part of government and government officials. There needs to be § a strong political will to sustain the sector and government officials should be well trained and should be Waste-Point Lim- transparent and willing to cooperate with PSPs ited Proper funding. If the government can provide long term funding and training for PSPs it will be an encour- § agement for participation. Wecyclers We are interested and hope to expand our operation to Oyo State by next year. § Nigeria Infra- The mandate of our operations is Northern Nigeria. However, this will be reviewed in six months and when § structure Advisory that time comes, we will be willing to participate if we receive a formal invitation. Facility (NIAF) Highland Energy A key issue that could be resolved by legal backing is to ensure that citizens dispose their waste at appropri- § Solutions ate waste disposal locations and this could be achieved by proper sensitization and training of the citizens. good practices applicable to psp in solid waste management in ibadan 7. Have you identified good practices (operational such as collection, maintenance, equipment, training, staff and financial such as fees collection, financial support, etc.) that could be applicable to PSP in solid waste management activities in Ibadan? Richbol Environ- Refuse disposed by the public by the median of the roads in Ibadan are collected promptly. However the ideal § mental Services for a private sector company is that waste should be collected from door to door so as to enable payment Ltd. for services. Karkara Rapid De- N/A § velopment Limited LAWMA has done well in organising the private sector and enforcing service providers. They have a grip on § Waste-Point Lim- PSPs, the selection process is tough and they do not tolerate inefficiencies. ited We believe LAWMA is a good example and has done a lot in waste management. They are very helpful provid- § Wecyclers ing PSPs with resources. For instance they gave us our current operating locations. Waste management agencies have been able to make do with the facilities they have like dump sites § Governments are doing a lot in creating awareness to the public in the place of their responsibility in waste § Nigeria Infra- management and have increased focus in the sector. structure Advisory Facility (NIAF) Also, governments have been able to retain informal labour such as scavengers into a more standard op- § erational model by having them retain their jobs (with proper organisation, training and safety gears) and regulating the operations of PSPs in this area of operation. Highland Energy The company is currently in Ibadan trying to generate 5MW of energy from solid municipal waste and this § Solutions process is going to take about 14months before project objectives are achieved. 160 | World Bank - Private Sector Participation in Solid Waste Management Activities in Ibadan, Nigeria key topics and recommendations from interviews assessment key topic observation recommendation Cost recovery It was noted that the issue of recov- § § Indirect recovery; through local tax- ering cost was a top concern for all es the stakeholders interviewed § Direct recovery; through an agency with the legal ground to enforce § Direct recovery; by the PSP. Howev- er, this is the least preferred choice Financing; From the interviews it appears that § § Financial support/intervention Procurement of there are very limited sources of fund from government, banks (at a equipment fund for PSPs. low interest rate) or other investors Political will It was noted that PSPs generally § § Sustained political will in improv- have the belief that governments ing waste management activities. do not see waste management as a The government needs to show a priority issue and that they also do sustained effort and will in the di- not realise the commercial poten- rection of solid waste management tial of the sector activities Cooperation of PSPs were concerned that govern- § § Improvement of relationship and government offi- ment officials are sometimes not cooperation between PSPs and gov- cials well trained in topical issues and ernment officials trends in waste management. They also expressed concern that there was a lack of cooperation in the at- titudes of some officials Government infra- There were general concerns about § § Standardisation of current dump- structure the lack of a proper landfill site for sites or building of adequate landfill waste. sites Public cooperation From the interviews it was noted § § There should be sustained effort that the cooperation of the public in building a relationship of trust can be easily garnered through ef- and cooperation with the public by fective and efficient services and PSPs and government and high fees building of trust and relationship among low income earners is not over time encouraged Unemployment From interviews conducted during § § All informal and unorganised labour from standardiza- the study period, it was noted that in the value chain be re-organised, tion of processes all informal and unorganised labour trained and incorporated into the in the sector such as scavengers are standardisation process to avoid not endangered by a standardisa- massive loss of jobs tion of the sector Legend Strong nega- tive opinion Moderate neg- ative opinion Positive opin- ion