Solid waste as an alternative source of energy. A pilot project for urban Lahore

Project Report 2015 9 Pages

Environmental Sciences




Statement of the Problem Objectives of the Study

Current practices of Solid Waste Management
Potential of Electricity Generation from Solid Waste of Urban Lahore
Discounted Cash Flow Analysis of the Project

Interpretation of the Results (Discounted Cash Flow Analysis)

Sensitivity Analysis of the Project

Interpretation (Cost& Benefit Sensitivity)

Logical Framework Analysis


Solid Waste as a Renewable Source of Energy


Solid waste management has emerged as one of the most important entity in the recent past. It is the proper system of collecting waste till its proper disposal. Most developed countries now a days are properly managing their solid waste to generate electricity and other sources of energy. United States and Europe are processing their solid waste up to 32% to 41% respectively. It is the need of the hour that energy deficient developing countries with their huge potential for generating energy from their solid waste to pay heed at this front. Pakistan is the most urbanized country throughout the whole south Asia with 35% of the population resides in urban areas. So there lie huge potential for the production of energy in the form of electricity, biogas, natural gas etc. in Pakistan because according to the Pakistan Environmental Protection Agency (2005) only 51-69% of the generated waste is collected and the rest remains in the streets or collection points.

It is assessed that approximately 55,000 tons waste is generated per day (Pakistan Environmental Protection Agency, 2005). It is based on the estimated calculation of 0.6- 0.8 kg of waste produced per capita in Pakistan. The growth of this solid waste is directly linked with the growth of economic activity. So in order to reap benefits from this resource we have to endeavor in this front which will have dual effects i.e. the proper disposal of the waste which will make environment clean as well as the fulfilling the energy needs of the energy deficient economy.


Pakistan is facing serious environmental problems with growing industrialization and increasing urbanization. It is now an admitted fact that every country is striving for higher rates of growth in the gross domestic product (GDP) without comprehending/mitigating the environmental degradation problems. With increased industrialization the proper disposal of industrial waste is causing a serious threat to the society at large likewise rising urbanization and migration of huge no. of laborers to cities increasing urban population and exerting immense pressure on the physical infrastructure of the cities. The consumption pattern of the people living in cities are also changing and the amount of waste produced by them is increasing with every passing day, so it is the need of the hour to realize this worsening of situation of the solid waste and address this problem by devising an effective solid waste management system which ensures not only the proper disposal of waste but also the recycling of the trash to renewable source of energy thus dipping serious challenges that this problem is posing to the environment and health hazards to the society


This study intends to provide a sound mechanism to utilize the waste produce in the capital of Punjab, Lahore and its effective management. It also provides a comprehensive solid waste management system that entails the collection of waste to its proper disposal. Following are some of the highlights of the objectives:

- To evaluate the current solid waste management practices
- To devise an effective solid waste management system that ensures the appropriate disposal of waste
- To use this solid waste as an alternative/renewable source of energy
- To reduce environmental degradation that is done by the inappropriate disposal of the waste
- To provide a cost effective and environment friendly solution to the energy crisis

Current practices of Solid Waste Management

Unfortunately no city in Pakistan has a proper municipal solid waste management system. Hand dumping extinguishing and burying of waste are still some of common practices in most of the cities in Pakistan. Now the world has become more environmentally aware than ever before. Now dumping and burning of waste is not popular solution anymore, to just loss the valuable daily waste that can produce a value to society. (IME, 2013) .According to the Pakistan Environmental Protection Agency (2005) only 51-69% of the generated waste is collected and the rest remains in the streets or collection points, so there is great need of a pilot project for an effective solid waste management system that can be extended to other cities as well. For that we

Potential of Electricity Generation from Solid Waste of Urban Lahore

In this section we will analyze the huge potential that lies in the 9 town of urban Lahore that generates almost 5672 tons per day (Lahore waste management company, Lahore) The amount of generated waste from different 9 towns of Lahore is estimated by multiplying the used 0.65 and 0.7 same common factors with increasing population trends of each town in 2007 and 2010 respectively. The estimated total amount of waste was 5186 tons per day in 2007 (Imtiaz, 2008), and in 2010 this estimated waste was 5672 tons/day (Lahore Waste Management Company, 2010) the following table summarize the town wise waste generation

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(Source: Lahore Waste Management Company, 2010)

As from the table above shows clearly that how much there is potential only in the 9 towns of Lahore as these town only produce 5672 tons of waste and it sums up to 2041920 tons annually only in Lahore so there lies huge potential of electricity production from this renewable source of energy Now we will further consider the financial analysis of investment criteria for the selection and rejection of the project under consideration

Discounted Cash Flow Analysis

In this section we will look at the financial feasibility/viability of the project by conducting discounted cash flow analysis in which judge the profitability of the project by different discounted measures of project worth criterion i.e.

- Net Present Worth(NPV)
- Internal Rate of Return(IRR)
- Benefit Cost Ratio (B/C Ratio)

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Interpretation of the Results

Net Present worth Criterion:

As our above given calculations NPV= 930322926 >0 thus according to the decision rule we have to accept this project as NPV>0 and this means that after discounting all the net benefits we are left with 9, 30,322,926 Rs as our Cash Balance

Internal Rate of Return

Internal rate of return is one of the best measure of project worth if the project is of developmental nature. In our this project IRR= 28.31% which is much greater than the opportunity cost of capital so the decision rule of IRR says that Accept the project when IRR>Opportunity Cost of Capital

Benefit Cost Ratio Criterion

Benefit to cost Ratio is also considered as one of the evaluation measure of a project worth. B/C ratio for this project comes out to be 1.256197132 .The decision Rule for this measure is accept the project as far as B/C ratio>1 So our B/C ratio is far much greater than 1 Hence project is feasible

Sensitivity Analysis

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Interpretation of the Results

Benefit Sensitivity

Initially we changed (decreased) the benefits by 15% but the NPV was still positive and through trial and error method we found 20.394698843% decrease in the benefits is the maximum limit that we can accept as the limit up to which decrease in benefits is acceptable beyond which project will be non-viable, So it is highly resilient project

Cost Sensitivity

Initially the cost is increased @ 15% and at this increment in cost produces positive NPV. Then by trial & error method through Cell Fixation in Microsoft Excel we found 25.61971319991% increase in cost at maximum can be increased beyond which the project viability is questionable, so as 25.61%



ISBN (eBook)
File size
1 MB
Catalog Number
Institution / College
GC University – GC University Lahore
solid lahore



Title: Solid waste as an alternative source of energy. A pilot project for urban Lahore