To plicación of the principle
To plicación of the principle
contaminador-paying in
Latin America.
Evaluation of the environmental effectiveness
and economic efficiency of the rate by
water contamination in the sector
Colombian industrialist.
Luis Fernando I Neuter
Juan Carlos Caycedo
Andrea Jaramillo
Liana to Die
S AND R I AND
environment and development
47
Santiago of Chile, March of 2002
Division of Environment and
Human settlements
This document was prepared by Luis Fernando I Neuter, Juan Carlos Caicedo,
Andrea Jaramillo and Liana to Die of the Andean Center for the Economy of the
Environment (CAEMA, caema@), Bogota, D.C.,
Colombia, as consultants for the Division of Environment and
Human settlements of the CEPAL and in the framework of the project “Application
of economic instruments to the environmental management of Latin America and the
Caribbean”, with the financial support of the PNUD. This project does part of a
assembly of activities whose objective is to improve the institutional capacities
of the local and national governments to utilize economic instruments
as splits integral of its strategies of environmental management in Latin America and
The Caribbean.
The aforesaid opinions in this document, that has not been submitted to
editorial revision, are of exclusive responsibility of the authors and are able not
Coinciding with those of the Organization.
_______________________________________________________________________
Publication of the United Nations
LC/L.1691-P
ISBN: 92-1-321985-7
ISSN: 1564-4189
Copyright © United Nations, March of 2002. All the copyrights
N° of sale: S.02.II.G.15
Printed in United Nations, Santiago of Chile
The authorization to reproduce total or partially this work should be requested al
Secretary of the Meeting of Publications, Headquarters of the United Nations, New York,
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Governmental can reproduce this work without prior authorization. Only itself them
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CEPAL – SERIES environment and development Nor 47
3
Index
Summary ................................................................................. 7
1 . Introduction , objective and methodology ............................ 15
1.1 Antecedents and justification of the study............................. 17
1.1.1 Preceding ......................................................... 17
1.1.2 Justification........................................................... 19
1.2 Objectives and reach............................................................. 19
1.2.1 Objective general .................................................... 19
1.2.2 Reach.................................................................. 19
1.2.3 Objective specific............................................. 19
1.3 Theoretical Framework...................................................................... 20
1.3.1 The economic efficiency ........................................ 20
1.3.2 The environmental effectiveness ....................................... 20
1.3.3 The efficient generation of resources for the
investment and environmental management................................ 21
1.3.4 The charges by contamination as
complement al command and control for
the obtaining of the environmental goals desired
by the community................................................... 22
1.3.5 Charges by contamination as complement al
command and control: application in the cases of
fulfillment and not fulfillment.......................... 23
1.4 The Colombian model of charges by contamination
Water: efficient control beyond the command and control. 26
1.5 Methodology of evaluation................................................. 30
2. Economic, financial, and environmental results
of the program ........................................................................... 33
Application of the contaminador-paying principle in Latin America
4
2.1 Impact of the vengeful rate on the vertimientos
industrial in CVC, CORNARE and DADIMA.................................................................33
2.1.1 Results of the rate in the environment of the environmental authorities
regional.............................................................................................................34
2.1.2 Conclusions .......................................................................................................40
2.2 Impact of the incomes by vengeful rates on the budgets of the
environmental authorities ....................................................................................................40
2.2.1 Comparative Analysis of incomes........................................................................41
2.2.2 Environmental Investments with the I collect of the vengeful rates: the funds
regional for the descontaminación water .......................................................44
2.2.3 Conclusions .......................................................................................................46
2.3 The administrative cost to reduce the vertimientos industrial descended
notably after the introduction of the program of collections by
contamination ...................................................................................................................46
2.3.1 Command and control ..............................................................................................46
2.3.2 Vengeful Rates.................................................................................................47
2.4 Economic Efficiency: answer of the industrial sector al collection by
contamination ...................................................................................................................49
2.4.1 Study of case 1: The sugar industry in the valley of the river Cauca....................50
2.4.2 Study of case 2: Quarries Yarumal..................................................................52
2.4.3 Study of case 3: Monómeros Colombo Venezuelan S.TO...............................53
2.4.4 Answer of the regular sector to the vengeful rate in comparison with the
previous regulating system....................................................................................55
2.4.5 Conclusions of the studies of case ..................................................................56
2.5 Limitations and difficulties in the implementation of the program of rates
vengeful in the industrial sector .....................................................................................57
3. Conclusions and considerations for environmental authorities interested
in applying collections by water contamination..............................................................59
Bibliografía .................................................................................................................... 63
Anexos .................................................................................................................... 65
1 Vengeful Rates set against instruments of command and control ........................................67
2 Registration of users and loads contaminants ...................................................................72
3 Registration of contaminants measured in the basin ............................................................72
4 Evaluation of institutional costs .................................................................................73
5 Control of programming and costs of laboratory .............................................................73
6 Use of the resources of the program of control of the water contamination .......................74
7 Analysis of costs of the program of monitoring and control of the water resource....................75
8 Control of incomes by concept of vengeful rates .....................................................77
9 Industrial Investment in projects and actions of descontaminación water ......................78
Series environment and development: numbers published .......................................... 79
CEPAL – SERIES environment and development Nor 47
5
Index of pictures
Picture 2.1 Comparison among the sobretasa of the predial and the vengeful rates ........................... 43
Picture 2.2 Costs of the program of control of the water contamination CORNARE................. 47
Picture 2.3 Costs of the program of control of the water contamination CORNARE................. 48
Picture 2.4 Behavior of vertimientos in monómeros Colombo Venezuelan INC. ......... 55
Picture 2.5 Changes of strategy for complying with the regular sector ....................................... 55
Index of figures
It figures 1.1 High costs of reduction in Colombia by the decree 1594 of 1984........................ 22
It figures 1.2 The additional reductions low C&C are extremely costly
and inequitativas............................................................................................................. 24
It figures 1.3 The additional reductions by collections by contamination reduce the
cost and the inequity.................................................................................................... 24
It figures 1.4 Application in cases of breach of the norm of command and control ............. 25
It figures 1.5 ................................................................................................................................... 28
It figures 1.6 ................................................................................................................................... 29
It figures 1.7 ................................................................................................................................... 29
Index of graphics
Graphic 1.1 Vertimientos of the industrial sector before and after the vengeful rate ..................... 9
Graphic 1.2 Relation among them yourself of the nation and the incomes by rates
vengeful in the environmental authorities that at present charge
the rates....................................................................................................................... 10
Graphic 1.3 The institutional cost of the management by kilogram of DBO reduced
descended 79% with the introduction of the program of vengeful rates
in CORNARE............................................................................................................ 11
Graphic 2.1 Vertimientos of the industrial sector before and after the
vengeful rate............................................................................................................ 34
Graphic 2.2 Reductions of load after the negotiation and implementation
of the vengeful rates: CVC .................................................................................... 35
Graphic 2.3 Behavior of the load of SST by the industrial sectors
that pour al I Laugh Cauca: CVC .................................................................................. 36
Graphic 2.4 Behavior of the load poured al I laugh Black by the sector
industrial in CORNARE............................................................................................ 38
Graphic 2.5 Behavior of the load contaminant contributed by the
manufacturing industry: CORNARE......................................................................... 38
Graphic 2.6 Reduction of the vertimientos after the start of the collection of the
vengeful rate: DADIMA.......................................................................................... 39
Graphic 2.7 Contribute of the nation and incomes by vengeful rates in the three
environmental authorities ............................................................................................. 41
Graphic 2.8 Relation among them yourself of the nation and the incomes by rates
vengeful in the environmental authorities that at present
charge the rate (1998-2000)......................................................................................... 42
Graphic 2.9 Costs of the program of administration, control and caution (ACV)
of the water resource set against incomes by vengeful rates in CORNARE................ 44
Graphic 2.10 The institutional cost of the management by kg of DBO reduced descended 79%
with the introduction of the program of vengeful rates in CORNARE ..................... 49
Application of the contaminador-paying principle in Latin America
6
Graphic 2.11 Behavior of the vertimientos contaminants in the industry
sugar..................................................................................................................... 50
Graphic 2.12 Investment in reduction of vertimientos in the sugar industry .............................. 51
Graphic 2.13 Behavior of the DBO and SST in Quarries Yarumal ......................................... 52
Graphic 2.14 Investments carried out by monómeros Colombo Venezuelan INC. and
the reduction of vertimientos of the business................................................................ 54
Acronyms utilized
AAR Regional Environmental Authorities
AAU Urban Environmental Authorities
CAR Regional Autonomous Corporation of Cundinamarca
CAR Regional Autonomous Corporations
CARDER Regional Autonomous Corporation of Risaralda
CDMBCorpor ación Autó noma Reg ional of the D efensa d and l to Me seta d and
Bucaramanga
CORNARE Regional Autonomous Corporation of the the Rivers Nare and Black
CORPOURABA Corporation of Sustainable Development of the Urabá
CP Political Constitution of Colombia
CVC Regional Autonomous Corporation of the Valley of the Cauca
DADIMA Environmental Authority of the Municipality of Barranquilla
DBO Demands Bioquímica of Oxygen
FR Regional Funds of Investment in Descontaminación Water
INDERENA National Institute of the Renewable Natural Resources
MMA Department of the Environment
OCDE Organization of Cooperation and Economic Development
SINA Environmental National System
SST Solid Suspended Total
TR Vengeful Rate by Vertimientos Punctual
CEPAL – SERIES environment and development Nor 47
7
Summary
With the Vengeful Rate, Colombia is applying a politics of
control of the most flexible contamination, less costly, and more compatible
with its needs of economic growth and competitiveness
International that the previous system of control. The program of control is
consistent with the context in which businesses assign its resources for the
production: charging costs by services, in this case services
Environmental. It introduces al operating budget of the business the cost of the
environmental service to assimilate, to transport and to degrade the load contaminant
That pours to the water. The rapid response and forceful of the sector
industrial to this economic instrument indicates that the program is of great
utility to reduce the social impacts of the contamination and to progress
Toward the environmental quality desired by the citizens.
The system of vengeful rates was developed in Colombia
by the Department of the Environment, for the purpose of controlling the
water contamination in the effective and most efficient basins of form
that the previous system, which was supported in the imposition of
limits permisibles and plants of processing in each source of
Vertimiento. After more than thirty years to utilize the politics of
command and control, the water of Colombia were seriously
They contaminated and with the majority of the sources out of fulfillment.
This carried to that the economic activities I laugh down, the ecosystems
tropical sensitive and the social welfare to suffer high external costs
And growing, product of the contamination. At the moment of the
implementation of the system of vengeful rates in the first semester
of 1997, 95% of the municipal black water, 70% and 90% of the
industrial residual water and agroindustriales, respectively,
They flowed to the Colombian basins without any processing.
Application of the contaminador-paying principle in Latin America
8
The interviews to the environmental authorities identified various problems with the system
Prior regulator. First, the vision, political and administration centralizada constituted a barrier
For the effective control of the water contamination in regions and distant basins. Additionally,
many firms refused to comply with the imposed norms by the high costs incurred in the
Residual water processing plants construction al final of the pipe. Third, the system not
it provided no incentive to seek options of mitigación in the process of production,
They based on greater productivity and cleaner technologies. The environmental authorities sufrían
Continuous budgetary cuts, especially in epochs of recession and fiscal crisis. Finally, the
local community affected by the contamination did not participate in the process of protection
Environmental, which resulted in scarce political support to the environmental authorities.
The Department of Environment designed then the vengeful rate by vertimientos
punctual with the main objective to reduce, to a smaller cost, the total discharges of demand
bioquímica of oxygen (DBO) and solid they suspended total (SST), until achieving the goals of
Preestablished reduction for each basin. The secondary objective was to generate sources of income
complementary to finance investments and activities related to the control of the
Water contamination.
In synthesis, the economic instrument is bases on:
? The contaminant load reduction goals establishment by basin (or section of
This), that they collect the environmental, social, and economic conditions of the zone.
? The application of a rate by poured contaminant load unit by the different
Sources of regular contamination.
? A system of gradual adjustment of the rate, that serves like permanent incentive for
reducing the contamination, and that determines the necessary rate to diminish the
Vertimientos to the goal arranged of the basin.
This study has as an objective general to evaluate the program of vengeful rates by
Vertimientos water, in terms of environmental effectiveness and economic efficiency. To effects of
this, the impact of the economic instrument on the industrial sector in jurisdiction was evaluated of
Three regional environmental authorities: CVC, CORNARE AND DADIMA.
The first chapter presents the specific objectives of the evaluation, the theoretical framework and the
Methodology utilized. The second chapter is divided into three main sections: in the first one himself
they present the results of the system of charges in relation to the decrease of the contamination
originating from the industrial sector and, as complement, three studies of case are exposed for
analyzing the answer of specific industrial plants al new programs and its cost of
Fulfillment. The second section evaluates the impact of the incomes by rates on the budget
Of the environmental authority, and the administrative cost-effectiveness of the program is analyzed.
Additionally, this section reports on the establishment of regional funds to handle
The recaudos by rates in the management and environmental investment in the basin. The third section, by its
it splits, presents the changes in the institutional cost obtained al to complement the system
Traditional of command and control with the program of rates. Finally, the last chapter, presents
a collection of the main limitations and difficulties found during the process of
Implementation of the system of charges in Colombia.
Environmental effectiveness: the vengeful rate in the decrease of the
it charges contaminant
Al to implement the vengeful rate for the control of the water contamination, left itself from two
General cases of fulfillment. In the first one, the community regulated was found in
Fulfillment with the imposed norms by the system of traditional regulation. From happiness
CEPAL – SERIES environment and development Nor 47
9
situation, the regular sector had invested abundant sums of money in plants of processing and,
Therefore, its marginal costs of descontaminación were extremely high. That is the case
Of the CVC and CORNARE. In the second case a community regulated was appreciated, but in low
levels of fulfillment: poured a lot and few plants had they had done investments in plants
Of processing. This was the situation of departure in the industrial sector in jurisdiction of the DADIMA.
In the first case, the imposition of the vengeful rate achieved significant reductions
incremental To the existing massive investment in plants of processing. In the second case achieved
An important reduction in the vertimientos industrial, as opposed to the previous years. In
both cases the Rate induces to greater control in the margin , and it achieves a reduction of vertimientos
Abundant and fast. As it indicates the following graphic, the collections by contamination serves for
descontaminar a lot beyond the levels achieved with the traditional programs based on
Plants of processing.
Graphic 1.1
VERTIMIENTOS OF THE INDUSTRIAL SECTOR BEFORE AND LATER OF
THE VENGEFUL RATE *
Source : Information supplied by CVC, CORNARE and DADIMA.
*LB = Line of Base. Sem B = Second semester year 2000.
In order to evaluate the cost of fulfillment in the regular businesses, studies were carried out
Of case that showed three results of importance. In the first place, the load contaminant itself
It reduced in a greater percentage al limit established by the system of command and control. It
previous despite the existence, in some cases, of plants of residual water processing in
Full operation at the moment to be implemented the rate. In second place, the incentive
it presented by the vengeful rates did that the businesses implemented solutions of production
Cleaner. Third, al to seek greater efficiency in the productive process, the businesses not only
they managed to reduce their vertimientos, but at the same time, in some cases, they enlarged their
Productivity.
Economic efficiency 1: the incomes by the Rate fortified the
environmental management, they minimized the impacts of the fiscal crisis
and they reduced the dependence in the national budget
Historically, the environmental authorities of Colombia have depended on the budgetary one of the
government, which has generated sharp financial crisis inside the environmental authorities in
Epochs of economic recession and fiscal cut. The vengeful rate has fortified the management, al
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
CVC CORNARE DADIMA
Kg. of Load Poured by Semester
DBO LB DBO Sem B 2000 SST LB SST Sem B 2000
Application of the contaminador-paying principle in Latin America
10
generating the necessary resources for the investment in environmental improvements and to finance the
You program of administration, control and caution of the water resource.1
The results of the study indicate that the vengeful rate: i) is an effective source of
financing of the so much, environmental authorities for the execution of its programs toward the
community as for the maintenance of its plant of personnel; ii) permits to achieve stability
economic for the environmental authorities in spite of the budgetary cuts of the government
central; iii) guarantees greater continuity to the programs of administration, control and caution of the
Water resource, and iv) becomes motor of new projects.
Additionally, for an economy is more efficient tasar ‘negative activities’ of the
company .as the contamination, the cigarettes and the alcohol. that tasar ‘positive activities’
As the work, the savings, and the consumption of goods and socially desirable services. Tasar the
contamination has the triple dividend to reduce the harmful impacts of the vertimientos, to generate
incomes for the environmental management, and to reduce the tax load to the positive activities of a
Company.
Graphic 1.2
RELATION AMONG THEM YOURSELF OF THE NATION AND THE INCOMES
BY VENGEFUL RATES IN THE ENVIRONMENTAL AUTHORITIES
THAT AT PRESENT CHARGE THE RATES (1998-2000)
Source : Data supplied by the Direction of Planning and Management
Of the sina of the Department of the Environment of Colombia.
Economic efficiency 2: the program of vengeful rates
it increased the institutional cost-effectiveness in the control
of the water contamination
The introduction of the system of charges by contamination has turned out more cost-effective
for the Colombian environmental authorities that the previous system of limits permisibles and
Plants of processing. In the case of CORNARE, although the total cost of the programs is similar
Al previous, the reductions of vertimientos have been a lot greater. The expenses related to the
Caution of the design, construction and processing plants operation have been smaller. By another
splits, the regional environmental authorities (AAR) they have assigned more to the measurement of vertimientos
And monitoring of the basin. The administrative cost by kilogram of contamination reduced
It diminished a 79% (of 165 pesos, with the previous system, to 35 pesos) with the program of rates.
This result occurred because the collection by contamination produced greater reductions of
Vertimiento of the industrial sector.
1 In CORNARE, for example, during the process of coordination, was established that only 10% of the I collect for rates would be invested in
Operation and 90% in investment in works and activities oriented to descontaminar the basin.
0
5,000
10,000
15,000
20,000
IIngresos
(Millions of cabbage$ current)
Contribute of the
Nation
Vengeful rates
CEPAL – SERIES environment and development Nor 47
11
Graphic 1.3
THE INSTITUTIONAL COST OF THE MANAGEMENT BY KILOGRAM
OF DBO REDUCED DESCENDED 79% WITH THE INTRODUCTION OF THE
It PROGRAMS OF VENGEFUL RATES IN CORNARE
Source : Own Elaboration based on information supplied by
CORNARE.
Economic efficiency 3: The program of rates rationalized the
investments to reduce vertimientos in the industrial sector
With the object of evaluating the economic efficiency of the system of rates with respect to the assignment of
resources by the industrial sector, the study developed three studies of case, two of businesses
Individual and one of economic subsector. The cases were selected by the three authorities
Environmental that they participated in the study, an in each jurisdiction. Likewise, the team evaluator
it carried out interviews with the environmental directors and they revised the documentation and registrations
They related to each case.
The studies of case show a series of rational answers in the decrease of
vertimientos from a framework of economic regulation, where have flexibility in the form of
Doing its reductions. The cases show how the economic sign can have as
consequence rational assignments of so much investment in cases where existed fulfillment with the
Previous norm as in cases where there was not fulfillment. They show how each business
it optimizes its options of reduction in answer to the economic sign and to its own priorities of
Production, and minimizes its costs of fulfillment. Finally, sample how the economic sign
it combined with the flexibility to permit the cleanest production as alternative of reduction,
can result in reductions beyond than the prior limits of the command and control, somewhat essential
to reduce the vertimientos total in the foci of associated contamination to the concentration of
Industrial production in basins with capacity limited of asimilación.
In the case of the sugar industry of the River Cauca, in spite of count on plants of
residual water processing built before 1996 and in full operation al moment
in which the vengeful rate was implemented, additional reductions were achieved through the
cleaner production of 24% in DBO and 65% in SST.
Also massive reductions of load contaminant in businesses are observed where the
System of command and control had not generated fulfillment. Before implementing the Rate, the
series of closings and imposed fines to Monómeros Colombo Venezuelan in Barranquilla and Quarries
Yarumal in Antioquia had not turned out in the reduction of vertimientos with respect to its indices
Historic. The turnover of the environmental authority by rates generated large obligations
economic to the businesses, and they responded implementing solutions of reduction during the
First year of collection. Both they achieved upper reductions al 90% of the load contaminant.
0
20
40
60
80
100
120
140
160
180
Command and control vengeful Rates
Administrative cost by kg reduced
in Colombian pesos
Application of the contaminador-paying principle in Latin America
12
The businesses have managed to reduce its contaminants even in periods of growth of the
Production, improving, at the same time, its productive processes. The production of the sugar industry
5,6% grew between 1998 and 1999. The productive improvement that also reduced the contamination
came of the increment in the efficiencies in teams and management of supplies, especially the use of the
Water. In Monómeros Colombo Venezuelan INC., the employment of its efluentes with large
Concentrations of fosfato tricálcico has given rise to new products for commercialization.
Quarries Yarumal obtains sand washed of its solution of reduction, that enlarges the volume of
Sands sold. In this manner, the businesses managed to descend its payment of vengeful rates, its
Main motivation.
Small and large businesses have acted quickly to reduce the payment of rates to the
Environmental authority through the reduction of their load contaminant. The reductions of load
they have represented for Monómeros Colombo-Venezuelan INC., a multinational business that
it offers chemical producers, they permitted savings for more than 400 million pesos al year by payment
Of vengeful rate. Quarries Yarumal, a business historically very contaminant, saved
22.6 million annual pesos, al to reduce its vertimientos.
Limitations and difficulties in the implementation of the program of
vengeful rates
Although there are important achievements in economic and environmental terms, is to be expected that
A system so present innovator difficulties and limitations in its implementation. This study
it sought to identify the main problems, with the objective to support al perfeccionamiento of these
Instruments in the region. Inside the main obstacles are found:
? Management of limits permisibles and the collection: Although the majority of environmental authorities
in Colombia charge the vengeful rate for all the load poured, some alone charge on
the contamination poured inside the limits permisibles, although themselves they be not
Complying. As measure of harmonization, the Department have adopted the tool of
the plans of fulfillment to give him time to the business to identify solutions of
more cost-effective reduction, giving him field to the production but clean, always that
They pay the rate by the total of their poured. The not to charge for all the contamination limits the
Effect incitativo of the rate to change the behavior of the contaminadores.
? It lacks of permission of vertimiento: the present regulation in Colombia requires a permission
of vertimiento to every user of the water resource that throw efluentes to the bodies of
Water. Al to implement the rate, was discovered that thousands of sources in all the jurisdictions
of the country they had been able to evade the formalización and they were functioned without permission of
Vertimiento. The formalización and establishment of the permission has been arduous task and has
Delayed the collection of the rate in some zones.
? Resistance of the municipalities and businesses of public utilities: the major violator of the
regulation of vertimientos in Colombia, as in the the majority of countries in
Development, has been the municipal sector and its businesses of public utilities. This was the
Historic case for command and control, and continues being the case for the vengeful rate. For
a 65% of environmental authorities, the businesses of public utilities dilate or deny the
payment of the rate; citing other priorities for its budget, regularly do not invest
In descontaminación neither pay for its vertimientos. In the 35% remainder, have been established
regional funds of environmental investment with plans of investment where the authorities
Environmental cofinancian the investment in plants of processing. In those regions,
where they were defined put joint for the industrial sector and the domestic sector, the
breach and not payment by contamination is exercising an unnecessary pressure
On the industrial sector. Spokesmen of the sector have opened the discussion on the inequity
CEPAL – SERIES environment and development Nor 47
13
it presented al to invest in descontaminación and to pay for its vertimientos residual,
While the sector more contaminador of all refuses to pay.
? Resistance al management of the goals of vertimientos total by basin : in some spheres
of the environmental authorities, where the productive sectors are very strong, themselves
they negotiated goals of descontaminación that they kept in mind mainly the effort
individual that each sector could carry out and not the general effort that could be performed in
The basin. In this case, the sectors that reduce its vertimientos present resistance
when the regional factor is adjusted; say that the goal of the basin himself was not reached because the
Municipal sector have not begun to descontaminar. On the one hand, this responds to a
so low index of most minimum rate al start; the rate should rise to significant levels before of
That all the businesses feel the pressure to descontaminar. A greater index is required of
rate to cause changes of behavior in general form, but the businesses seek
That the rate be adjusted above the most minimum rate. By another, many businesses not
they understand still the economic importance that all the sources of the basin they pay
the same level of rate by Kg., which is the only form to equalize of the costs
marginal of reduction of vertimientos and to minimize the total cost of fulfillment in the
Basin.
? Change of paradigm and inefficiencies of some environmental authorities: other
limitations to implement the system of charges in Colombia are related al
Change of paradigm that represents the system of rates. After to have done by
decades under another system, based on the processing plants imposition, the
adaptation to a system based on collections by contamination has been institutional
Difficult for some authorities. Other problems are related directly with the
Inefficiency in the administration and management in some environmental authorities. Without
embargo, the rate has generated sufficient interest in the community so that the authorities
they improve the conditions of the professional group, the systems of information and management of
data, as well as the procedures related to the control and caution of the resource
Water.
CEPAL – SERIES environment and development Nor 47
15
1. Introduction, objective
and methodology
The developing countries have been have based on politics of
promotion to the industrialization, in order to achieve the high rates of
economic growth required to enlarge the social welfare of
Its populations. The growing flows of vertimientos contaminants to
the rivers, beaches and gaps, that have been generated like consequence of
these politics, have carried to a proportional increase in the impacts
And external costs of the contamination. Problems in the health arise
public, the international tourism falls, the tropical ecosystems themselves
deteriorate and the costs of production and processing of the water itself
They increase constantly.
The indices of contamination reach quantities each day more
Worrying. Thus, so much by the environmental result as by its
economic efficiency, the politics of control of the water contamination
.they based on the imposition of limits permisibles by source and the
processing plants construction. They are being questioned. The
economies in development do not have the infrastructure neither the capacity
economic to assign large totals of resources to programs
environmental they destined has to attend the priorities of investment
They required, in order to achieving a greater progress. It is required a
greater cost-effectiveness in its regulating programs with relation to
That of the prosperous countries.
The traditional regulating frameworks, based on limits
permisibles and processing al final of the pipe, oblige a great one
number of businesses to assume costs of very large control, that
They affect its competitiveness in an economy each more globalized day.
Application of the contaminador-paying principle in Latin America
16
Likewise, the massive investments in plants of processing compete directly with investments
productive, that they limit the growth and the productivity of the businesses; as well as the high cost of
Fulfillment creates resistances in the regular sector. The breach of the environmental norms
it carries al closing of the businesses, therefore generates antagonisms and refusals among the productive sector and the
Regulating companies. This antagonism does not permit the supportive search of solutions of
cleaner production , the which can they increase the productivity and competitiveness of the
Businesses.
The generalization of the hot commercials . In many countries in development continues being aggravated the
Situation of certain basins where concentrate the populations and the industrial production. The
abundant and the capacity of asimilación of the bodies of water are each smaller day, but the
vertimientos enlarge with the production, the population and the number of businesses located in those
Places. The problem of the effective control in the hot commercials is to force a greater reduction al control
Existing it reached with the traditional politics of command and control. Nevertheless, with relation
to the businesses that already have built and handle plants of processing, the reductions in the
Margin with the same technology al final of the pipe are extremely costly. Many companies
They cannot enlarge its costs of fulfillment and to be maintained competitive at the same time.
On the other hand, although the responsibilities of the environmental institutions are enormous,
Frequently reductions in the national budget suffer themselves. The cycles of economic recession
and fiscal crisis that the countries in development live produce commonly trim of budget that
They restrict the use of professionals, the access to modern technologies and the capacity of management. The
instability in the provision of resources of the nation does not permit, consequently, to protect of
Adequate way the company and the environment front al growing volume of contamination.
For many analysts, the economic instruments provide a solution to these problems.
To reach an additional goal of reduction of vertimientos in a basin, the instruments of
market do not only have the potential to reduce the costs of fulfillment, but we encourage the
adoption of techniques that carry to a better use of the supplies, therefore reduce the flow of undone
And enlarge, at the same time, the productivity of the business. The politics that promote a greater one
flexibility, a smaller cost of fulfillment and greater competitiveness conduct to relations more
Productive among the regulator and the regular one. Additionally, of great importance for the
institutions in countries in development, the collections by contamination can generate resources
necessary financiers for an adequate environmental management, that permit greater stability
institutional and programmatic in comparison with the dependence on them yourself unstable of the
General budget of the nation.
Line of investigation of CEPAL. By its potential to harmonize the economic growth
with the protection of the environment, the regional experiences in the use of instruments
economic are of great interest for the CEPAL And the governments of Latin America and the Caribbean. This
line of investigation tries to evaluate the experiences of the region in the adoption of you said
instruments, therefore will permit to define of more adequate way the characteristics and conditions
they required for a control more cash of the contamination in the sector, to a cost that the
Economies in growth they can assume.
In the international environment, the most utilized economic instruments have been the charges
By contamination. Nevertheless, according to reports of the OCDE (1999) .they carried out for
evaluating the effectiveness of different plans that includes these last. in most cases
the charges by contamination maintain the stiff impositions and the high costs of the command and
control, and simply add a small collection on the vertimientos to supply objectives
Financial. In this manner, the essence of the economic instrument is lost, whose objective is
Minimizing the cost of reaching an environmental objective.
CEPAL – SERIES environment and development Nor 47
17
Therefore, to combine a system of command and control with financial rates is more acceptable in
countries industrialized where the availability of financial resources is greater and the cost of
Opportunity in the company is smaller. For example, the Commissariat General du Plan, the finance Office
General of France and It Monde evaluated the French system of rates by contamination of the
Agencies of the Water and they found that the total cost produced by the system is four greater times
That the necessary thing to reach the present water quality.2 This is not an acceptable result for
Countries in development.
In these countries, where the economic resources are scarce and the needs of investment
social and productive are large, the economic instruments should be developed to the light of the
Institutional, economic efficiency and of the environmental effectiveness. The challenge is how to obtain the
environmental objectives of the company al most minimum possible cost, keeping in mind so much the cost of
Fulfillment as the institutional cost. On the base of this vision, in 1997, was developed in
Colombia a model of charges by water contamination known as the vengeful rate by
Vertimientos punctual. To almost four years of its implementation and design, the CEPAL it proposed a
Initial evaluation on the impact of the application of said al industrial sector.
To support the use of economic instruments in developing countries, is necessary,
First, to evaluate its aplicabilidad in the context of our countries. Only it should not be studied its
potential to achieve the goals established, but to verify if the cost of fulfillment is smaller that
The cost faced by the mechanism of command and control. Additionally, they should be determined
The institutional requirements and necessary regulators to administer the instrument.
This document presents the results of the evaluation al system of vengeful rates of
Colombia. Said evaluation was carried out in the period understood between February and July of the 2001 and
it covers the environmental results obtained since the first semester of 1997 to the end of the year
2000. In the first section of the document the objectives of the evaluation are presented, the framework
Theoretical and the methodology utilized. In the second the impacts of the system of charges are presented
on the reduction in the contamination of the industrial sector and the impact of the incomes is evaluated
on the budget of the environmental authority; also the cost is evaluated that face the
environmental authorities al to put in operation the program, and finalizes with three studies of
Case of the characteristic industrial sectors in each one of the regions studied. The objective
of these studies is to evaluate the private answer of you said sectors al system of charges and to deduce
The cost-effectiveness of the solutions of reduction of vertimientos presented. The third section
recopila the main limitations and difficulties found during the process of
Implementation of the system of charges in Colombia. Finally, the quarter section presents the
Final conclusions of the study.
1.1 Antecedents and justification of the study
1.1.1 Preceding
The control of the contamination in Colombia went back to 1973 when the Congress of the
Republic begins to note the alarming effects of the contamination in all the country, but
Especially in the main rivers of its more important cities. A year later, arises the
first Code of the natural resources of Colombia (Law 2811 of 1974), that became the
Legal base for the environmental administration in the country. From this developed a complete one
Normative framework with a series of special decrees for water, floor, flora, mining industry, air and other.
The creation of the Environmental National System (SINA) in the 1993 it fortified the normative framework
Environmental.
2 Commissariat Général du Plan, Rapport au Gouvernement. Evaluation du dispositif of Agences of l’ Eau . Paris: The Documentation
Française, 1997.
Application of the contaminador-paying principle in Latin America
18
In 1984 the Decree is approved 1594, that regulates the Code of the natural resources in
The referring thing to the administration of the vertimientos liquid in Colombia. Said fixed decree the
norms to administer the quality of vertimientos punctual to bodies of water and systems of
alcantarillado; establishes the maximum loads permisibles by source, the types of substances and its
Concentrations permitted; the code and the regulation of the basins, among others. In
consequence, the Decree became the unique framework of control of the contamination by
Vertimientos punctual available for the environmental authorities.
The system imposed the processing plants construction and systems al final of the pipe,
it defined the parameters and conditions of its operation, based on studies of characterization
of vertimientos punctual, and determined the substances, concentrations and maximum loads
permisibles with which the processing of them should be conditioned poured of an establishment
Industrial. The Decree defines limits permisibles according to the transience of the existence of
the industry: those that they existed before June of 1984 they were classified as existing and it was set them
limits permisibles more extensive in relation to those that were installed after that date,
they called new users . The existing sources had the obligation to build plants of
processing with removal of the 50% of SST and DBO, and they had a time limit of two years to enlarge the
Removal al 80%.3
For more than 25 years and according to this normative framework, the control was directed of the
Water contamination in Colombia. This it was supported in the respective state sancionatorio, and
depended in great part of other variables as the institutional capacity, the political will, the
Initiative and creativity of the administrations of shift, the continuity of the politics and others. Without
embargo, poor results in the control of the discharges contaminants were obtained; according to the
data of the IDEAM, the water contamination has enlarged in parallel form with the growth of the
Population and the economy during the epoch of the postwar period.4
In 1991 a new National Constitution is adopted, of which various elements are emphasized
key that they mark theoretically the difference with the previous Constitution: their profile extensively
environmentalist, the decentralization and autonomy of the environmental authorities and the participation
Citizen regulated through a lot more prompt mechanisms.
In 1993, the Law 99 dissolves the INDERENA and it creates the Environmental National System and the
Department of the Environment (MMA). The Law decentralizes the system and fortifies the
institucionalidad and the regional autonomy, al to create more than fifteen new environmental authorities
regional and al to transfer them responsibilities and resources more troops to establish programs of
Control of the contamination.
An it contribute of great importance of the Law 99 respect al use of economic instruments himself
relates to the operating and financial autonomy of the AAR. In this sense, the Law introduces
articles that permit, for the first time, that these institutions implement instruments
Economic whose recaudos are constituted in own incomes. Said incomes were destined to
Investing and to administer in the descontaminación of the water resource. In this way, the article 42 of the
Law 99 creates the vengeful rate, which was regulated by the principle “contaminador paying”
Of the Decree 901 of April of 1997.
The process of adoption of the system of rates on the part of the environmental authorities has been
Gradual. The implementation of this plan needed regulating and institutional changes, that to
Its time demand adequate processes of training. The Department of the Environment
annually it has directed programs of courses, shops and seminars with this end, and offers support
direct technician when the AAR They request it. According to data of the Department, currently has themselves
3 Source: Decree 1594 of 1984, chapter IV on the criteria of quality for the destination of the resource.
4 IDEAM, Institute of Hidrología, Meteorología and Environmental Studies of the Environmental National System. The environment in
Colombia , Pp. 486-490, Bogota, 1998.
CEPAL – SERIES environment and development Nor 47
19
it initiated the program in 24 of the 33 AAR of the country, and are charging itself and collecting rates in
Fourteen of these.5
1.1.2 Justification
The economic instruments are only for the countries industrialized? There is that
perfecting the environmental regulation based on command and control before being able to utilize the
Economic instruments? More important still, ¿the environmental institutions of Latin America and
the Caribbean are it sufficiently consolidated and are efficient to handle a collection by
Contamination that achieve economically efficient results and environmentally troops? The line
of investigation of the CEPAL it seeks answers in situ To these questions. The present evaluation of the
it programs of vengeful rates in Colombia is inserted inside the second phase of the project
it called Implementation more cash of economic instruments in the environmental management of
Latin America and the Caribbean .
In this occasion, the CEPAL it seeks to evaluate the design, implementation and management of a system
Of charges by vertimientos water in the region. By a part, the results of this study owe
serving for retroalimentar the national experience .structuring a referring one in terms of
investment, fulfillment and specific achievements associates with the environmental performance of the sector
industrial regular. And thus to contribute al perfeccionamiento of the program of rates in Colombia. By
another part, is sought to establish a base for the future formulation and administration of instruments
Similar in the countries of Latin America and of the Caribbean.
1.2 Objectives and reach
1.2.1 Objective general
Evaluating the program of vengeful rates by vertimientos water, in terms of
Environmental effectiveness and economic efficiency.
1.2.2 Reach
The CEPAL it selected the industrial sector for this evaluation, given the importance of
developing models of compatible environmental regulation with the politics of quickly growth of
Said sector in Latin America and the Caribbean. The study tries to analyze the impact of the rates
vengeful on the businesses located in the jurisdiction of environmental authorities in basins
Where develops extensive industrial activity. By they said motive, three sections were chosen of
Basins in different parts of the country. The analysis understands the industries located on the basin
of the river Cauca in the jurisdiction of the Regional Autonomous Corporation of the Valley of the Cauca (CVC),
the basin of the Black river in jurisdiction of the Regional Autonomous Corporation of the Basins of the
Black rivers and Nare (CORNARE) and the section of the river Mary magdalene in jurisdiction of the Department
Administrative Local of the Environment of Barraquilla (DADIMA).
1.2.3 Objective specific
_ Determining the impact of the vengeful rate on the flow of the loads
total suspended solids contaminants (SST) and demand bioquímica of
oxygen (DBO) They contributed to the basins included in the study.6
5 Department of the Environment, Office of Economic Analysis, Report of the Program of Horizontal Cooperation, Bogota, 2001.
6 This objective search to determine the environmental effectiveness of the program.
Application of the contaminador-paying principle in Latin America
20
_ Determining the impact of the recaudos by concept of vengeful rates on
The operating budgets of the environmental authorities.7
_ Evaluating the answer of three representative businesses of the program of rates
vengeful according to its:
or Environmental effectiveness, evaluated in terms of the achievements reached in the
Reduction vertimientos, in comparison with the previous regulating system.
or Economic efficiency in terms of the costs of fulfillment, in
Comparison al previous regulating system.
1.3 Theoretical Framework
The employment of a system of charges by contamination represents al less three advantages:8 a
smaller global cost of fight against the contamination (economic advantage), an incitación effective and
permanent to the reduction of vertimientos (environmental advantage) and, finally, a source of resources
Economically more efficient than the national budget (financial advantage). Thus, an instrument
economic to control the contamination should be evaluated taking into account criteria as the
Economic efficiency and the effectiveness in protection of the environment.9 It can be added a third
parameter: the efficiency in the administration and utilization of the incomes generated by the I collect
Of the rate.
1.3.1 The economic efficiency
The economic efficiency is related to the obtaining of a goal of reduction of
Vertimientos, al most minimum possible cost for the economic sector and for the company. This implies that
an environmental goal should be established against which the performance of the instrument is evaluated in
Terms of total costs incurred to reach happiness goal. The application of a charge on the
contamination generated by each source will do that this compare the value of the rate with its cost
Marginal of reduction of contamination. Assuming that all the contaminadores have a
rational behavior and that minimize its costs of production, the total reduction of the
Contamination thus obtained will be reached al smaller possible cost.
Thus, in the case in which already a processing plants regulation exists and is desired
imposing a goal of additional reduction to it achieved previously, the to implement a system of
Collections by contamination will permit to obtain the results to a most minimum social cost. Nevertheless,
The economic efficiency requires greater flexibility on the part of the environmental authority. Has
being willing to accept that the business reduce its vertimientos by changes in process, instead of
Obliging to build and to handle plants of processing in all the cases.
1.3.2 The environmental effectiveness
The environmental effectiveness is related to the capacity of an instrument to reach
the environmental objectives of the company through the effect incitativo that exercises on the agents
Regular. In this manner, does not only depend on the establishment of an environmental goal, but of the
I encourage economic generated by the charge so that you said agents reduce its contamination and
They reach the environmental goal.
In other countries systems of charges on the contamination have been established that do not have
as objective to exercise an effect incitativo on the contaminadores, but give priority to a
Financial objective. In this case, treats more than one financial instrument for the investment and
7 A critical part of the economic efficiency is the efficiency in the assignment and administration of the resources on the part of the
Institutions of environmental regulation.
8 Barde, J.F., Economie et Politique of l’ Environnement . Presses Universitaires of France, 1991.
9 OCDE, 1999.
CEPAL – SERIES environment and development Nor 47
21
Environmental management, that of an economic instrument to reduce the contamination. The goals that
They are set for the operation of the system are financial and not environmental. Thus, in this case in
private, the environmental effectiveness of the instrument can be evaluated, not since the point of view
of its action on the behavior of the contaminadores, but on its capacity to generate
the necessary resources for it to comply the objectives of investment and management for the ones that was
It presented.
With a financial instrument, the responsibility of the assignment of resources in the
Reduction of vertimientos passes from hands of the contaminadores by hand of the institutions. Without
embargo, the most profitable characteristic of a charge is lost as economic instrument .the
reduction of the contamination al most minimum cost., it given that the environmental authorities do not count
with complete information about internal conditions, available technologies and the costs that
It faces each one of the sources by means of the cleanest production. By that lack of information,
the solutions that assigns the State they have turned out more costly than those in which there was
it invested a contaminador individual that acts rationally set against an economic incentive,
It had minimized its costs by complete information.
The collective solutions al final of the pipe, administered with a financial instrument by
the institutions .as the plants of municipal processing., can cost too much by
three reasons: i) the solution focuses the investment al final of the pipe and not in industrial investments of
greater productivity, ii) the high costs of transaction, and iii) the interests of economic agents
That they seek incomes in the construction of megaproyectos municipal. Although this type of
instrument can be acceptable in countries developed, where a great availability exists of
resources, its utility in countries in development is enough questioned by the high costs of
Opportunity of the resources.
The charge by Colombian contamination was designed like economic instrument, that is to say,
with the objective to generate an incentive to change the behavior of the contaminadores and
Reducing the contamination al most minimum cost. Thus, the evaluation on the environmental effectiveness of the
model it will be carried out only since the point of view of her capacity for I encourage to the
Sources to reduce her contamination to the goals predeterminadas for the basin.
1.3.3 The efficient generation of resources for the investment and
environmental management
In general, a system of charges by contamination constitutes an additional source of
Resources for the institutions. For the company, to utilize recaudos generated by tasar activities
that they reduce the welfare of the company .as the contamination, the cigarettes and the alcohol. is
more efficient than utilizing resources generated by taxes that are encumbered on the activities that
they increase the welfare of the company .As the work and the savings. In this way, the companies
they can reduce the tax load to the beneficial activities and to increase the load to the activities
Negative.
A system of charges designed with an environmental objective can also collect resources
Sufficient to finance the management of the institutions and to carry out environmental investments.10 The
magnitude of the incomes is going to be narrowly related to the indices of contamination
Present in the basin, the collection and the capacity of I collect of the company. Applying the charge on
all the contamination generated by each source, in basins where the loads contaminants
Poured are significant, the recaudos will be also relatively greater. Nevertheless, if the
system produces the effect desired to reduce the quantity of contamination, the financial flows
Also they will diminish in similar form in the time. This effect fights for beginning the system of
10 At least in the short one to medium time limit. In the long time limit, if the system functions, so much the flow of vertimientos as the quantity
Of the I collect should be reduced.
Application of the contaminador-paying principle in Latin America
22
collections with one or two main contaminants, to control them and to extend gradually, with the
Time, the system to other contaminants of the water, air and floor.
1.3.4 The charges by contamination as complement al
command and control for the obtaining of the goals
environmental they desired by the community
Before the vengeful rates were implemented, the legal and institutional reality
it related al control of the water contamination in Colombia was supported in the plan of
limits permisibles by source, which obliged to build and to put in operation plants of
Processing al final of the pipe. Changing this framework so hardly taken root in the plan of
command and control was not a realistic option in the short time limit, because the institutions, laws,
regulations and the Colombian regulating culture have been developed on the base of this
Framework of reference. Nevertheless, so much for the economic sectors as for the institutions
environmental, is each more apparent day than the cost of fulfillment with the traditional norms is
So high, that it limits the competitiveness of the businesses and the sectors in the international markets.
The high cost creates antagonisms toward the environmental institutions and involves to the evasion and the
legal clash, that dilates the fulfillment and rises the institutional costs of way
Unnecessary.
It figures 1.1
HIGH COSTS OF REDUCTION IN COLOMBIA BY THE DECREE 1594 OF 1984
To
B
C
Vertimiento
0
To
B
C
100 50 20
Costs of reduction,
in $/kg
Phase I
Phase II
Source : Own Elaboration.
_ An alternative for the problem of the foci of contamination (hot commercials)
During the last four decades, the flow of contamination in the hydrographic basins of the
Country has enlarged with the population and the economic growth. It advanced concentration of the
industrial activity and the fast development of the main populations of the country have carried to a
Unsustainable increase of the contamination and their impacts in certain zones. Even in places where
the environmental authorities (AAR) they have maintained good conditions of individual fulfillment,
as the cases of the rivers Cauca and Black, the capacity of asimilación of the basins is not the
Sufficient to cover the growing vertimientos residual permitted of industrial sectors.
To attend the foci of contamination, the environmental authorities had the alternative of
Enlarging the efficiency of the plants of industrial processing. The Decree 1594 imposes a high cost
of fulfillment on the sector regulated, still in its second phase; consequently, to require a
Still greater reduction of concentrations in each source would impose costs inaguantables.11 Itself
11 The cost to increase the efficiency of the processing al tertiary level is extremely high.
The Decree 1594 imposed two phases of
construction and management of plants of
processing to the industrial businesses
Existing. The first phase was the removal of
50% of the vertimientos that enter to the plant
Of processing. The second phase obliged the
businesses to enlarge the quantity of removal
To the 80%. The graphic shows the variation
in costs by kilogram reduced among the
Businesses TO, B and C in each phase. In terms
economic, the politics carries to two problems:
high costs of fulfillment and inequity
among the businesses (as is appreciated, the
business C has costs very superficially of
The businesses TO and B).
CEPAL – SERIES environment and development Nor 47
23
it required, therefore, an a lot of politics less costly than manage to reduce the contamination
Additional to it it achieved with the plan of command and control.
For Colombia is clear the control politics need to develop of the contamination
that they be more flexible, less costly and more compatible with the needs of growth
economic and international competitiveness that faces the country; if intends to reduce the impacts
social of the contamination and to obtain the environmental quality desired by the settlements
human, the introduction of the vengeful rate offers an alternative to attend these challenges, given its
potential to achieve the environmental objectives to a fraction of the costs of fulfillment
Related to the plan of command and control.
Nevertheless, at this time is not realist to rule out the traditional paradigm for
Simply substitute one new. In practical terms, the challenge situates in harmonizing the two models
Inside the present economic and institutional context.
By its potential of minimización of costs of fulfillment, the introduction of the collection by
vertimientos permits to the communities to set goals of reduction for its basins; this goes beyond
Of the present results that has produced the traditional model of command and control. To effects
to achieve this reduction in the margin, the economic instrument imposes a price by kilogram
of load poured for I encourage collective and individual reductions, based on the alternative of the
Cleaner production.
An economic instrument that control the contamination tries to rationalize the decisions
Of assignment of resources of the industrialists, al leaving each business. This flexibility is essential
to minimize the cost to comply the environmental goal of the basin, al to permit that the sources
they change of solutions al final of the pipe to the cleanest production, where the exits are based
In increments of the productivity of the use of the commodities. That is to say, the instrument
economic I encourage al industrial to optimize its decisions of investment toward the production more
Clean.
Additionally, al to charge for each unit of contaminant poured to the basin, the charge by
contamination obliges the business to include, inside its budget, the social cost of
Contaminating. It given that this affects the operating costs of the business and reduces, therefore, the
utilities, the business is obliges to modify its productive processes so that generate less
Residues and seek the options less costly for this effect. Thus, each business will seek
controlling its efluentes in the measure in which this turn out to be more economic it than the alternative of
Simply contaminate and to pay for its vertimientos.
Nevertheless, this transformation requires greater flexibility of the environmental authority: owes
permitting him al industrial other options of reduction that be not necessarily the construction of
plants of processing, whenever there be collective and individual decreases toward the
Put total of reduction in the basin.
1.3.5 Charges by contamination as complement al command
and control: application in the cases of fulfillment and not
fulfillment
The cost of fulfillment with command and control is high even in normal conditions. The
control of the contamination in the hot commercials it should reach goals of reduction of vertimientos still
More restrictive than the at present established by the system of command and control. A
alternative is the subsidiary severity , which it obliges that it be greater with the system of regulation
traditional, therefore it requires an increment in the percentage of removal of the plants of processing of the
80 al 90%. In this case, the marginal cost would be excessive for the individual businesses. In the sector
economic, the great fulfillment costs variation among the sources would carry to inequities
Inside the industry. Additionally, this politics would focus the additional investment al final of the
Application of the contaminador-paying principle in Latin America
24
To
B
C
To TR
Vertimientos
0
To
B
C
100 50 20
TR
Costs of Reduction,
In $ / Kg.
B TR C TR
Phase I
Phase II
Phase III
Pipe, which does not modernize the productive processes and does not increase the productivity. The result
it would be then a cost of extremely high fulfillment that, with time, would impoverish the
productivity of the business and would reduce its competitiveness in the national environments and
International. The following figure sample the increment in the marginal cost to impose
Additional reductions of load in 10% for the individual businesses and for the sector.
It figures 1.2
THE ADDITIONAL REDUCTIONS LOW C&C ARE EXTREMELY COSTLY
And INEQUITATIVAS
Source : Own Elaboration.
Another alternative is to introduce an economic instrument with flexibility in the way of
Complying. Al to incorporate the cleanest option of production, will be permitted them to the businesses to present
A rank of a lot more cost-effective options to control its contamination. Thus, the producer
it will choose the solutions that carry to a smaller cost that to continue contaminating and paying for the total
of its vertimientos; in this manner, reducing notably the cost by business and by sector, itself
It will reach the new environmental goal for the basin. As it is observed in the Figure 1.3, the so much cost
for the individual businesses as for the sector, al to implement the economic instrument, is
A lot smaller in comparison with the system of command and control.
It figures 1.3
THE ADDITIONAL REDUCTIONS BY COLLECTIONS BY
CONTAMINATION REDUCE THE COST AND THE INEQUITY
Source: Own elaboration.
The problem of the hot commercials of
water contamination requires politics
More cost-effective. The reductions
additional (third phase) to it achieved
by the previous norm, with solutions al
end of the pipe, create very high costs
By each kilogram reduced in the margin. The
third phase of reduction for the three
businesses TO, B and C rises hardly the
cost per kilogram reduced of the second
phase, and rise it still more with relation to
The first phase. Additionally, the
inequity by costs among businesses
It increases. The total cost of the sector, the
adds of (pqvw + pruw + pstw), will be able
affecting the competitiveness of the sector.
To
B
C
To
B
Vertimientos
Costs of Reduction
In $ / Kg.
0
To
B
C
C
100 50 20
p
q
r
s t
or
v
w
Phase I
Phase II
Phase III
CEPAL – SERIES environment and development Nor 47
25
If all the sources have the flexibility to respond in this way, each one will take the
internal options of reduction of vertimientos to the point where the cost by kilogram
it reduced is equal al collection (TR) By kilogram poured. This is the point of economic equilibrium that
It minimizes the costs of production. If each source complies with this, the marginal costs to achieve
the goal of additional reduction are equalized among all the agents, producing the most minimum cost
Possible of descontaminación for the company. Besides, the result is economically fair,
it given that the cost by kilogram reduced in each business himself retainer, as opposed to the plan of
Command and control.
It figures 1.4
APPLICATION IN CASES OF BREACH OF THE NORM OF COMMAND AND CONTROL
It figures 1.4.1
It figures 1.4.2
It figures 1.4.3
Source : Own Elaboration.
Al to be initiated the collection of rates by contamination,
it was found that a great number of businesses
they did not control their vertimientos; they were
breaking with the norm of command and
Control. The environmental authority had the option of
penalizing them for breach or to incorporate them
to a cost-effective process of production more
Clean, it supported by the collection of the rate. Some
companies argued that it there was that to use the
penalties and closings to force the
first processing plants construction,
and that the rate only could charge himself on the
vertimientos permitted (the residual flows)
Since the norm of command and control.
The Department of Environment decided then
utilizing the modality of the plans of fulfillment
To relax the limits permisibles individual.
Al to agree al plan, the authority expands them to the
present indices, being basing on a cronograma of
activities of five years to reduce you said
Vertimientos. In this way, the rate charges himself on
All the vertimientos of the regular sector.
The first picture sample the marginal costs of
reduction with cleaner production for three
businesses, D, AND and F, that they had not reduced their
Vertimientos with the previous framework of control.
The second picture sample the answer to the
Application of the most minimum rate of the vengeful rate.
The businesses invest in options of production
cleaner than they reduce the vertimientos to the
point where the cost per kilogram reduced is equal to the
rate per kilogram (TR1). The cost per kilogram reduced is
equal among the sources, and the total reductions
(QAnd + QF + QG) they contribute significantly to the
Collective decrease in the basin.
If the collective reduction is not sufficient for
reaching the goal of the basin, the authority
environmental regional it should increase the rate
gradually until reaching a that assigns the
Necessary reduction to obtain the goal. The
third picture sample the collective reduction
it achieved by the index of the rate TR2. In this
case, all the sources are in fulfillment and
the most cost-effective options of the basin
They have been executed. As turned out, the goal
it is reached al most minimum possible cost, with equity
Economic among the regular businesses.
Vertimientos
Costs of
Reduction, $ / Kg. 0
F AND D
100 50
TR1
QD QAnd QF
20
TR2
Vertimientos
Costs of
reduction $/kg
0
F AND D
100 50
TR 1
Q D Q And Q F 20
Vertimientos
Costs of
reduction $/kg
0
F AND D
100 50
Q D, and, F 20
Application of the contaminador-paying principle in Latin America
26
1.4 The Colombian model of charges by water contamination:
efficient control beyond the command and control
Known like the vengeful rate by vertimientos punctual, the Colombian system of
charges by water contamination is a system based on:
? The coordination of total goals of contaminant load reduction by basin (or section
Of this).
? The application of a rate by poured contaminant load unit by the different
Sources of contamination.
? A system of adjustment of the rate that serves like permanent incentive for the reduction
of the contamination, which is increased gradually to the point where the
Descontaminación collective reach the total goal for the basin.
The Department of the Environment developed the system being basing on the article 42,
Title VII of the Law 99 of 1993. Its text establishes the right of the State to charge for the services
environmental that they utilize the contaminadores:12
REGULAR VII: OF THE INCOMES OF THE AUTONOMOUS CORPORATIONS
REGIONAL
ARTICLE 42. Vengeful rates and Compensatorias. The direct or indirect utilization of the
atmosphere, of the water and of the floor, to introduce or to throw waste or agricultural wastes,
mining or industrial, black water or served of any origin, smoke, vapors and
harmful substances that are turned out of activities antrópicas or favored by the
man, or economic activities or of service, be or not lucrative, will be held al payment of
Vengeful rates by the harmful consequences of the aforesaid activities.
The design of the system is bases on the model proposed by Baumol and Oates in its work The
Theory of Environmental Policy . This model is supported in a solution of second best, where itself
it establishes a system ajustable of charges (price) on the contamination, designed to reach
A specific environmental goal. This, instead of try to calculate a charge that approach al value
where the marginal social costs of reduction are equal to the marginal social benefits
Net they obtained by the descontaminación. Said projection for each basin can arrive at
Implying excessive costs.
The Colombian model establishes put five-year of descontaminación by region, basin
or section, based on a process of negotiation and coordination where participated the community
it regulated, the community that suffers the consequences of the contamination, and the authorities
Environmental competent (Department of the Environment and Autonomous Environmental Authorities).
The space of negotiation is given inside the Executive Counsel of the Environmental Authorities
Regional, where they are found represented all the groups of interest: private sector,
departments, municipalities, NGO, native communities, ethnic groups, Department of the Environment and
Presidency of the Republic.13
The development of the goal splits of a point of reference: the line base. This is the load
Total contaminant poured inside the basin by semester. The communities affected and regular
they negotiate on the total reduction, required in the basin, that are willing to accept, given the
Costs generated by the contamination and the costs that face the businesses by descontaminar.
The goal is defined like total quantity of load desired to future in the basin, measure in
12 Differentiates himself legally, institutional and economically of the services antropogénicos as the public utilities.
13 Two representatives of the industrialists of the jurisdiction, two of the NGO, four mayors, a delegate of the president, a delegate of the
Minister of the Environment, a delegate of the governing one and a representative of the ethnic groups and negritudes.
CEPAL – SERIES environment and development Nor 47
27
Kg/semester. As each basin is a different ecosystem, with impacts by contamination that
they vary among them, the system permits to arrange put individual for each basin according to
The specific conditions of each one.
Vertimientos total in the basin
Cost
C TR
C C&C
Social benefits
descontaminación
Social costs
descontaminación
Case 1. Low benefits, high costs
M Or M S
Limit C&C
Source : Own Elaboration.
As the Figures indicate it, in some circumstances the damages perceived are low and the
capacity of asimilación is high, for which the community does not feel the need to carry out
Costly efforts of descontaminación. In other occasions, the impacts are perceived as very
High and the costs of descontaminación, relatively low. In this case the community is able
Arranging an a lot more restrictive goal.
Once the goal is defined that all are willing to accept for the five-year period, is initiated the
charge on the total kilograms of load contaminant of DBO and SST poured in that sector, in
Each one of the sources contaminants. The total of the charge is initiated with the most minimum rate defined
by the Department of the Environment and is adjusted semiannually by a coefficient of adjustment
Constant of 0.5, call the regional factor.14 By law, this presents an incremental behavior
whose boss of growth is then: 1; 1.5; 2; 2.5 and so on until arriving at the rate that
It results of the collective reduction of load that achieve the goal. The possible maximum of the regional factor
Is of 5.5.
To adjust the rate, the competent environmental authority revises the vertimientos generated
During the previous semester in each sector, and compares them with the goals established. Depending
of the behavior of the vertimientos total and of its relation with the goals, the authority applies or
Not the factor to adjust the rate. This regional factor acts like a constant incentive for the
change in the behavior of the contaminador, because leaves to adjust the value of the rate of form
Gradual to that value that achieves the goal of descontaminación previously definite. The goal of
vertimientos represents an objective and quantitative measure that, al to be reached, limits the
Growth of the regional factor in final form. The combination of the goal, the most minimum rate and the
regional factor permit to reflect the own environmental, social, and economic differences of each
Region. The velocity of obtaining of the goal depends in the capacity and costs of reduction of the
Sources. In the following Figure, for example, the goal in the sixth semester is reached, but is able
Being reached with greater or smaller velocity.
14 The regional factor multiplies for the most minimum rate to obtain the regional rate, that applies fairly to all the sources
Of the basin.
Vertimientos total in the basin
M Or
Social benefits
descontaminación
Social costs
descontaminación
Case 2. High benefits, low costs
Limit C&C
Cost
C TR
C C&C
Application of the contaminador-paying principle in Latin America
28
It figures 1.5
In this way, a specific rate for each basin is established, based on a goal
predeterminada that keeps in mind the capacity of asimilación of each basin, the impacts by
contamination that perceives the regular community and the costs of demolition that faces the
Community regulated.
The efficiency in the costs of fulfillment is promoted since the system of rates
vengeful, therefore it introduces flexibility in the alternatives of descontaminación: the contaminadores
They should be free to seek the option that minimize its costs by ton reduced.
Specifically, the system is designed to promote cleaner processes of production. Al
prompting efficiencies in the use of supplies through the process of production, a smaller one is achieved
Generation of waste through the time. This at the same time reduces the quantity of supplies and energy
Necessary to produce each unit of final product, al to diminish thus the costs of production.
The productivity enlarges while fall so much the flows of waste as the costs
Marginal.
When it is induced to the sources contaminants to reduce beyond the normal thing and with costs
Low, the system permits to capture additional efficiencies in the process of descontaminación.
Also it permits to offer flexibility to the sources with high costs so that these they reduce their
Vertimientos in a smaller proportion. It is keep in mind that in this process are utilized the
Standards of command and control as guides, and not as a stiff imposition. The redistribution
of the activities of descontaminación .it based on costs of descontaminación individual.
eventually it carries al system to minimize costs when are equalized the marginal costs of
descontaminación among the regular sources, whenever that the total discharges of DBO and
SST they be handled under the limit permisible and the specific location of the reductions be
It holds to flexibility.
The following two Figures illustrate this result. We look at the case for three firms, each one
with marginal curves of descontaminación (CMD) different:
Semesters
0 1 2 3 4 5 6 7 8
Level of rate
$
T6
CEPAL – SERIES environment and development Nor 47
29
It figures 1.6
In the first Figure the strict implementation of a system of command and control creates
economic inequities among firms: the firm 1 faces costs four higher times than the
Signs 3.
In the second figures, the economic instrument induces to activities of descontaminación
where each firm reduces their vertimientos to the point in which its incremental costs are
equivalent to pay the rate: the marginal costs are equalized among the three firms, promoting
The economic equity and minimizing the total costs of fulfillment. Again, if the
you unload total of DBO and SST are down of the limits permisibles, the model is indifferent
About the quantity of descontaminación that is carries out in each punctual source.
It figures 1.7
The incomes generated by the system of loads by contamination are of property of the
Been, in this case, of the regional environmental authority. In legal terms, is recovering the
value of the social damages that the contaminadores caused al quite public (superficial water) and,
At the same time, the costs are assumed. For the regional authorities, the right to obtain these incomes
to cover expenses of operation and to carry out environmental investments is a great incentive for
Measuring the vertimientos, to charge the rates with regularity and to collect the incomes of effective form.
The Department of Environment of Colombia considers this institutional incentive as a
determinant factor in order to motivate an effective environmental regulation on the part of the authority
Regional.
Descontaminación
Cost by kg reduced
$
CMD 1
CMD 2
CMD 3
Descontaminación
Cost by kg reduced
$ CMD 1
CMD 2
CMD 3
Application of the contaminador-paying principle in Latin America
30
1.5 Methodology of evaluation
The study evaluates three main aspects of the program of collections by contamination: i) the
environmental effectiveness, ii) the economic efficiency and iii) the institutional efficiency of the authorities
Environmental that they administer the program. For complying with the objectives presented, was done a
analysis retrospectivo of the management of the water resource before the instrument (only command and
Control), and an analysis of this in the first years of implementation of the vengeful rate. The
team evaluator revised the official documentation and pertinent technical literature, visited to the
environmental authorities and to some regular businesses, interviewed officials related to the
It fear and collected the information and necessary data of the environmental authorities.
For the evaluation three basins in the jurisdictions of three authorities were selected
Environmental: DADIMA, CORNARE and CVC. These were chosen by having an extensive activity
industrial, by the difference in capacity, by the resources of the three institutions and by the
Diversity among the regions and cultures where function. These authorities come analyzing
semiannually the advances of the instrument and the behavior of the regional goal that has been
It arranged in its respective jurisdictions. In each one of them the section was selected or basin
with greater industrial presence: the section of the river Cauca in jurisdiction of the CVC, the section of the river
Mary magdalene in jurisdiction of the DADIMA and the basin of the Black river in CORNARE. In the three cases
the evaluation is carried out since the phase of preimplementación to date in which have himself approved
The last semiannual report of evaluation on the part of the respective executive counsel.15
The group evaluator revised the existing regulating framework in order to control the contamination
water and its different instruments, before establishing the program of vengeful rates: Code
national of the natural resources(Law 2811 of 1974) and Decree 1594 of 1984. Also it was done
a revision of the documents and norms that support the system of charges and its process of design
and establishment in the environmental authorities: Law 99 of 1993, Decree 901 of 1997 and
Resolution 273 of 1997. Additionally, it was revised the Manual of implementation of the rates
vengeful , which it includes the critical route of respected implementation as the referring basic one
to measure the institutional efficiency of the environmental authorities in the process of
Implementation.16
The evaluators visited the authorities and they revised the bases of available data by the
environmental authorities on loads contaminants, values to pay, full values by the
Users and administrative costs of the program of rates for the authorities. Likewise, it was collected
the information registered semiannually, presented by the environmental authorities al Department
Of the Environment, expedients of users, and legal information of the agreements of each company.
The evaluators visited businesses and guilds of the sector regulated and they revised the registrations of
Environmental management. Additionally, information of the bases of data of the Department was utilized of the
Environment on incomes and transfers of the nation to the environmental authorities and the
Reports of advance of the program of Horizontal Cooperation.17
Besides the revision of the data of operation in each authority, the work itself
it supported in great part in interviews to officials responsible for the program of rates
vengeful in the environmental authorities and to executives responsible for the environmental management in the
Businesses and guilds visited. To carry out these interviews developed various formats
of registration of information, whose purpose was to verify and to complement it obtained in the registrations
And bases of data of the three environmental authorities.
15 CORNARE initiates the process of turnover in 1997, the CVC, in 1998, and the DADIMA, in 1999.
16 This document was elaborated by the Department of Environment and adopted like official guide by the environmental authorities.
17 The program of Horizontal Cooperation heads it the Department of the Environment since the promulgation of the Decree 901 in 1997.
Its objective is to assess to the environmental authorities in the implementation and operation of the program of vengeful rates.
CEPAL – SERIES environment and development Nor 47
31
In order to differentiate the data cuantificables of those that conduct to an analysis more
it qualified, several complementary headquarters were done, which have served to consign and
handling referring data to:
? Registration of users and loads contaminants (see I Enclose 2). Itself order there the totality
of industrial users with its respective loads punctual contaminants of SST and
DBO5, by each semester.
? Registrations of contamination in the sources of water (see I Enclose 3). Formats where itself
they consign the data of contamination and historic registrations raised by the authorities
in the bodies of water for the control of some indicators and substances: OD, DBO, SST,
Greases, total solids, pH, temperature, substances of sanitary interest and other.
? Evaluation of the costs in the environmental authorities (see I Enclose 4). It was designed a
special format to register the information on the costs related to
Administration, control, caution and monitoring of the water resources. This information
it is necessary to do a comparative analysis among the related costs to the
Implementation and operation of the program of vengeful rates.
? Control of programming and costs of laboratory (see Anexos 5 and 7). The programs of
administration, control and caution of the water resources of the authorities
environmental they are characterized for having the major associated cost to the expenses of personnel and
Laboratory. Nevertheless, it is difficult to find this information discriminated in the
Reports of budget and in the reports of management. With this format, is possible to do
A work of calculation of these costs.
? Uses of the resources of the program of control of the water contamination (see
I enclose 6). This format permits to handle data related to the destination of the
areas that finance the programs of administration, control and caution of the resources
Water in the environmental authorities.
? Control of incomes by concept of vengeful rates (see I Enclose 8). It has been designed a
format for recopilar the data, that permit to know the recaudos periodic of the
Environmental authorities by concept of vengeful rates. This information is utilized
To evaluate the turnover and the capacity of I collect of the competent authorities.
? Industrial investment in projects and actions of descontaminación water (see I Enclose
9). For complying with one of the most important objectives of the study, that of identifying the
impact of the vengeful rates in the performance of the industries encumbered with the rate, itself
requirió a tool that to permit to consign the information related to the
investment that the businesses do in minimizing the water contamination, whether in the
Source or al final of the process.
The revision of the normative framework and of the conditions to which respond the instruments
of command and control, as well as other regulating instruments, carried to the elaboration of a picture
comparative to confront you said mechanisms with the economic instruments (see I Enclose 1:
Regulating instruments set against economic instruments). In this case, a summary was done of
the regulating instruments that more have worked themselves in Colombia to administer the resources
water; these they were grouped in two modalities: of formulation and execution of politics, as well as
Of administration, control, caution and environmental management.
The information recopilada by each one of the environmental authorities was consolidated in three
bases of data (a by each authority) organized according to year, type of business, load of each one
Of the substances poured, value invoiced and full value. Additionally, they were calculated, in the
cases in which was necessary, the annual and semiannual averages of the loads of the businesses
Present in each one of the basins; of equal form proceeded in each industrial sector. With the
Application of the contaminador-paying principle in Latin America
32
end to obtain information of the pertinent businesses al period before the start of the collection of the
vengeful rates, the businesses were identified that had registrations of vertimiento of years
Previous. Semiannual averages were taken of vertimiento of those companies for which
there was not sufficient information in the files of the company and was consulted with the professionals
Environmental responsible for verifying the information. The responsible for the program they supplied the
costs of the programs of administration, control and caution of the water resource and of rates
Vengeful.
The work also includes three studies of case to evaluate the application and utility of the
Instrument in the control of the industrial loads. Monómeros Colombo Venezuelan S.TO,
business located in the urban helmet of Barranquilla, is characterized not only by its great size,
But by its considerable volume of liquid residues contributed historically al I laugh Mary magdalene.
Quarries Yarumal, located in the basin of the Black and identifying river as the industrial source with
greater vertimientos of SST In the zone, product of the exploitation and the washed of sands. The third
study of case was that of the Sugar Cane Cultivators Association of Colombia (Asocaña),
Guild that shelters the cultivations of cane located in the jurisdiction of the CVC. In this case itself
it considered the global action carried out by the cultivations of cane agremiados there, in the reduction of its
you charge contaminants of DBO5 and SST, Before and after it implemented the instrument.
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