11 Июня 2020

Waste Disposal System Awaits Reform

Krasnodar, 11 June. The price of the waste recovery services will reportedly rise in some municipalities, starting from July 1.

Since last year, Russia has been gradually turning to a new system of solid waste handling. Currently, there are five regional waste-processing operators in Krasnodar krai. The tariffs for garbage disposal are set by the Regional Power Commission. According to the regulations, the tariffs were introduced on January 1 and should be valid for the entire year – but some companies are entitled to raise their tariffs once more, from July 1. For instance, Garbage Collecting Company JSC (the operator of the city of Krasnodar and Dinskoi rayon) is now charging 366.74 roubles per cubic metre, but since July 1 its tariff will be 387.44 roubles. Or, say, Kraizhilkomresurs JSC (the operator of Apsheronsk, Belorechensk, Tuapse rayons and the cities of Goriachy Kluch and Sochi) will raise its tariff from the current 371.96 roubles up to 387.44 roubles.

On the whole, the experts do not forecast further steep increases of the tariffs.

“First, the current economic situation is not conducive to that, because both people’s and business’ revenues dropped seriously during the quarantine, and the growth of the tariffs for garbage disposal would only aggravate the socio-economic situation in the country. Secondly, this sphere is regulated very strictly both at the federal and regional levels, so the operators would hardly be able to substantiate the need to raise their tariffs. Thirdly, the regional operators have been offered various backup means which would help them cut their expenses. So there is no need to raise the tariffs, for they may lose the [governmental] support, which is why the operators would hardly be taking this step,” Dmitri Baranov, leading expert of Finam Management, asserted.

Last week, the Russian Government approved the ‘roadmap’ on the introduction of separate collection of solid household waste, developed by the federal Ministry of Nature Protection together with the Russian Environmental Operator. This document should define the legal field and improve the transparency of the system of waste handling.

“Subject to the spread of the infection and introduction of constraints, it was important to ensure the continuation of the reform on waste handling, and to support the regional operators, which was why a number of measures was taken,” Mr. Baranov commented.

The subsidies in amount of 8.1 billion roubles will be dispensed among 67 Russian regions which provided the Ministry with data proving that they met the conditions required to organise the work of regional operators with regard to handling of solid waste. In addition to that, many regions have adopted their own support programs for waste handling operators. The support mechanisms developed at the regional levels looked quite diverse and broad. Our interlocutor stated that the list of such mechanisms included advanced reimbursement of subsidies to the regional operator, zero income tax rate, subsidies for infrastructure, and a subsidy for compensation of the lost earnings.

In Mr. Baranov’s opinion, all these factors allowed to assert that the reform in the sphere of waste handling is proceeding nationwide.

According to Pavel Sigal, First Vice President of OPORA (all-Russian NGO of small and midsize businesses), despite the projects adopted at the federal level, hard work must be done at the local and regional levels.

“The project of the federal plan to deal with household waste has been approved by the Russian Government, but now this document will have to be coordinated with the regions by the beginning of the autumn: before being introduced, it must work out the logistics and choose the sites for the infrastructural facilities, introduce the system of supervision over the regional operators, and develop a fair tariff for local residents. It may result in a 5 to 7% rise in the prices for waste disposal, but this growth will be gradual and not abrupt (not to worsen people’s financial situation,” Mr. Sigal said.

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