Assessing determinants and readiness for willingness-to-pay (WTP) for unit-based pay-as-you-throw (PAYT) waste tariff structures: A case study of Kathmandu, Nepal

Abstract

Many cities in developing countries are searching for financially motivated behavior-based alternatives, such as pay-as-you-throw (PAYT) tariff mechanisms, over conventional methods. This study explores the determinants and readiness for willingness-to-pay (WTP) for introducing unit-based PAYT tariff structures in Kathmandu, Nepal. Two distinct colored volume-based recyclable plastic bags (1 L and 20 L) waste collection systems were introduced, and their acceptability was assessed using the contingent valuation method (CVM) spike model. The findings from a survey of 401 households revealed that the public shows their willingness to replace existing fixed tariff structures with PAYT systems, with WTP values of NRs 36.1 and NRs 42.14 (USD 0.28 and 0.32) for each 1 L and 20 L bags, respectively. Income, age, sex, family size, and household status were the key determinants. Tenants were more willing to pay than homeowners. The PAYT system has a substantial additional revenue generation of 326 % compared to conventional fixed tariff structures and reduces the financial burden of waste financing for public entities. Innovative PAYT tariff structures are also expected to be an effective tool not only from a revenue generation perspective, but also as a financially motivated behavioral tool for waste segregation, reduction, and recycling for sustainable waste management in developing countries.