Environmental Technologies Industries
||Environmental Technologies Industries
|South Korea Environmental Export Market Plan|
|Chapter 5 - Solid Waste|
Chapter 5 - Solid Waste
This chapter covers municipal and industrial solid waste management and disposal, including landfill, incineration, waste-to-energy, and recycling.
Korea’s legal system for managing solid waste is based on the Waste Management Act of 1992. Other Acts related to this sector are the Act on Promotion of Resources Saving and Reutilization, the Act on Promotion of Waste Treatment Facilities and Surrounding Communities, and the Act on Trans-boundary Movement and Disposal of Waste.
Local governments are responsible for the collection, transport and treatment of municipal waste, and discharging businesses should treat their own waste, whether it is industrial, construction or hazardous waste. The national government establishes basic policies and supports local governments on technological and financial issues, while provincial governments coordinate with the national and local governments and provide financial support to them.
The Ministry of Environment has a bureau in charge of this sub-sector, the Waste Management and Recycling Bureau consisting of five divisions:
- Waste Management Policy Division
- Municipal Waste Management Division
- Industrial Waste Management Division
- Resource Recycling Division
- Chemicals Management Division
In Korea, total solid waste volume gradually increased from 141,400 tons per day in 1993 to 194,700 tons per day in 1997. Korea’s total municipal waste volume has been on a downward trend since 1990, but industrial waste (consisting of “general” and “specified” waste) has increased at an annual average rate of more than 10 percent, surpassing the volume of municipal waste in 1993. Korea’s per-capita municipal waste volume declined from 1.3 kilograms in 1994 to 0.96 kilograms in 1998 as a result of the enforcement of a new government regulation since 1995.
The principle of the waste management policy involves prioritizing management approaches in the following order: reduction, reuse, recycling, energy recovery, incineration, and landfill. (Note: Reduction, reuse, recycling and energy recovery are collectively called “waste minimization.”) In 1993, the Ministry of Environment established the first long-term plan for this sub-sector, the Comprehensive Plan for National Waste Treatment for 1993-2001. In 1996, this long-term plan was revised into the Comprehensive Plan for National Waste Management for the remaining period to reflect changes in relevant regulations.
In Korea, the majority of municipal wastes are still treated by landfill. The proportion of recycled waste of all industrial waste is relatively high, but the volume of industrial waste treated by landfill is similar to that of municipal waste. The goals of the Comprehensive Plan are based on the following principles:
- Encourage recycling and discourage landfill.
- Prevent or reduce waste generation and expand recycling capacity.
- Expand incineration capacity for the waste that cannot be recycled.
The goals of the action plan for managing solid waste are briefed in the following table:
Goals of Waste Management (1995-2001)
Source: “1999 Environment White Paper,” MOE, October 1999
In order to support the underdeveloped recycling industry, the government has provided a total of $180 million of low-interest loans for 12 private firms between 1994 and 1999. In 2000, $45 million is allocated to support 3 new plants and 3 on-going projects in the private sector. In addition to the private recycling plants, the state-run Korea Resources Recovery and Reutilization Corporation (KORECO) operates 25 recycling plants for plastics, tires, and glass bottles. The government regulates the recycling of specified waste including iron and steel slag, coal products, and three types of construction material. The government objectives of recycling for selected product categories are as follows:
MOE Long-term Objectives of Recycling by Industry
(In percentage of total waste generated)
Source: “1999 Environment White Paper,” MOE, October 1999
Other products made of plastics
Since 1993, the Korean government has continued to expand investment in incineration facilities, public landfills, and food waste treatment facilities. In addition, MOE has supported local governments in building integrated waste treatment facilities in agricultural areas and maintaining used landfills. MOE’s budget for 2000 to support these projects is $134 million.
Municipal incineration: Under the Korean government’s strong drive to expand incineration capacity for municipal waste, local governments built 44 incineration plants, including 17 large-scale plants), between 1993 and 1999 with subsidies rendered by the national government (MOE) and regional governments. The total value of the 17 large incineration projects currently operating is $592 million. In 2000, 23 new municipal incineration projects and 24 expansion projects are being started nationwide), for which MOE grants a $60 million subsidy. From 2001 through 2005, local governments will start 21 new incineration projects and 41 expansion projects nationwide according to the master plan of MOE. Over this period, MOE plans to provide a total subsidy of $140 million to regional governments for 27 expansion projects at the existing incineration plant sites.
Municipal landfill: In 1998, there were 442 municipal landfills nationwide with a total land area of 29.6 million square meters and a total capacity of 408.9 million cubic meters (or the remaining capacity of 312,393,000 cubic meters). Between 1993 and 1999, 26 landfill projects (7 million square meters) were completed and operating, and 27 landfill sites (3.3 million square meters) were under construction as of the end of 1999. In 2000, 8 additional landfill projects are being started. For 2001 through 2004, the government plans to invest $389 million in building a new landfill site and expanding or upgrading 13 existing landfills.
Agricultural waste treatment plants: The Korean government plans to build integrated waste treatment plants designed to systematically integrate incineration, recycling, and landfill for agricultural areas where municipal waste treatments systems are less developed. Between 1993 and 1999, 65 such integrated waste treatment plants were constructed in agricultural areas, and 10 new projects are being started in 2000. For 2001 through 2004, the government plans to start 3 new projects and 78 expansion projects with a total investment of $166 million within the existing facilities in agricultural areas.
Market Size, Competitive Situation, and Market Opportunities
Based on the Bank of Korea’s environmental expenditure data released in October 2000, the Korean market for all solid waste treatment products and services was estimated to be $2.5 billion in 1999, consisting of $1.6 billion for the public sector and $0.5 billion for the private sector. Over the last several years, government investment in solid waste treatment facilities progressively increased: from $323 million in 1995 to approximately $500 million in In the private sector, facility investment in waste treatment peaked at $314 million in 1996. The size of the private sector market declined to $234 million in 1997 and further to $165 million in 1998 amid the financial and economic crisis starting in late 1997. In 1999, the private-sector market for solid waste treatment facilities grew 4.8 percent over the previous year to reach $173 million.
Since 1993, Korea’s municipal incineration infrastructure market has offered lucrative opportunities for foreign firms that have advanced technology and/or equipment. U.S. firms seem to have largely neglected or lost these opportunities in this fast growing market segment, while Japanese, German and other European engineering and equipment firms have entered and built their positions in the Korean market by taking part in major projects under licensing agreements with Korean partners. The active foreign engineering and construction firms and their Korean partners in this field include:
Foreign Companies Active in Korea’s Market for Municipal Incinerators
Source: Adapted from the “Status of Municipal Incinerators (June 2000),” MOE
In the Korean market for municipal incineration, major Korean engineering and construction companies typically act as prime contractors for large municipal incineration projects. The majority of these contractors are subsidiaries of conglomerates, such as Hyundai, Samsung, LG, SK, Kolon, Dongbu, and Daewoo. Foreign engineering firms and equipment manufacturers typically take part in these projects as sub-contractors or technology/equipment suppliers. As shown in the table above, no U.S. engineering firm has participated in Korea’s major municipal incineration projects.
Korean equipment manufacturers are now capable of making medium to low-tech components and parts with acceptable quality. But they still lack core technology, such as the heat treatment technology for fabricating the furnace stall part of incinerator and the incineration ash treatment technology to abate hazardous matters such as heavy metals. Since the municipal incineration market emerged in the 1980s, Japanese suppliers have built strong positions based on their proximity in terms of geographic, practical and cultural aspects as well as on their low-cost advantage. The Japanese environmental industry has advanced largely by acquiring European, mainly German, technology through licensing. Generally, German and other European companies have enjoyed quality images in the Korean industry and the government.
Like in advanced nations, the stroker type of incineration technology with a whirl reactor has become the industry standard for municipal incineration in Korea beginning in the early 1990s. In the past, municipal incinerators typically had a daily processing capacity of 100 to 200 tons. In recent years, several larger incinerators with a capacity of over 400 tons per day have been installed.
The solid waste recycling segment of the market is still largely less developed compared to U.S., European or Japanese standards. There are five large-scale recycling plants nationwide (one operated by the state-run KORECO, and four privately owned and operated), which conduct shredding, sorting and separating steel, other metals, plastics, other combustible and non-combustible wastes. According to industry sources, domestic producers supply the great majority of recycling equipment used in the Korean industry.
For U.S. environmental companies, opportunities can be found mainly with plasma technology that can be applied to both municipal and commercial incinerators in various sizes. Another area of opportunity associated with incineration is that of controlling dioxin emissions and other toxic substances such as volatile organic compounds (VOCs). The Ministry of Environment has drafted the standards for dioxin emission for smaller, unregulated incinerators. At the same time, the government has prohibited building small incineration facilities with an hourly capacity of no larger than 25 kilograms.
Future opportunities will also emerge in Korea’s less developed recycling and energy recovery or waste-to-energy fields. Although the Korean government has placed a higher priority on these fields than incineration or landfill in establishing the long-term policy goals, Korea still lacks infrastructure, technology, and regulation in these fields. For instance, many local governments now collect large volumes of recyclable waste exceeding storage capacity, but they do not have proper systems to recycle them. The government plans to expand the proportion of recycling industrial waste to a 75 percent level by 2005 from the current level of approximately 67 percent. The government has also reviewed a model project of the so-called Eco-Industrial Complex oriented toward the Zero-Discharge of solid waste. At the same time, Korean industries will increasingly need advanced technologies to reuse or recycle industrial waste, scrapped cars, computers and home appliances in order to meet the growing demand for global environmental protection from advanced economies.
In Korea, the waste-to-energy market is just emerging, where Korean firms lack technological capability and experience. In October 2000, the Ministry of Environment notified an invitation to bid for a waste-to-energy project involving the reuse of landfill gas in power generation using steam turbines at the Inchon landfill site. The budget allocated for this project is $62 million. Meanwhile, the Korean government has introduced new regulations to reduce food waste. As part of these efforts, the government has encouraged industry to build private facilities for the reuse of food waste into animal feed or fertilizer by granting government subsidies while continuing to build new public facilities for food waste reuse. The government plans to continue its efforts to raise the percentage of food waste reuse to 50 percent by 2002 from 34.4 percent in 1999.
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