Economic analysis of removing PBDE and PFOS under Stockholm convention on persistent organic pollutants in Vietnam

On the way to international integration, Vietnam has ratified many international conventions in the field of environment including Stockholm Convention on Persistent Organic Pollutants (POPs). POPs are persistent in the environment and have negative impacts on the environment and human health. POPs listed in the Stockholm Convention needs to be minimized, replaced or removed. This paper analyses the social cost and benefit of removing PBDE and PFOS, which are among the newly listed POPs since 2013. The health and economic benefit of PBDE and PFOS removal in Vietnam is estimated at USD 58 million per year, which is greater than the cost estimated at USD 4 million. Thus removing PBDE and PFOS is beneficial from the social perspective.

ECONOMIC ANALYSIS OF REMOVING PBDE AND PFOS UNDER STOCKHOLM CONVENTION ON PERSISTENT ORGANIC POLLUTANTS IN VIETNAM MSc, PhD Candidate Nguyen Dieu Hang ngdieuhang@gmail.com MSc PhD Candidate Vu Duc Dzung ducdungkhcn1965@gmail.com Associate Professor Le Ha Thanh lehathanhneu@gmail.com Faculty of Urban & Environmental Economics and Management, National Economics University, Hanoi, Vietnam Abstract On the way to international integration, Vietnam has ratified many international conventions in the field of environment including Stockholm Convention on Persistent Organic Pollutants (POPs) POPs are persistent in the environment and have negative impacts on the environment and human health POPs listed in the Stockholm Convention needs to be minimized, replaced or removed This paper analyses the social cost and benefit of removing PBDE and PFOS, which are among the newly listed POPs since 2013 The health and economic benefit of PBDE and PFOS removal in Vietnam is estimated at USD 58 million per year, which is greater than the cost estimated at USD million Thus removing PBDE and PFOS is beneficial from the social perspective Keywords: economic analysis, persistent organic pollutants, Stockholm Convention Introduction On the way to international integration, Vietnam has ratified many international conventions in the field of environment Vietnam ratified the Stockholm Convention on Persistent Organic Pollutants (POPs) on 22 July 2002, becoming the 14th Party of the Convention The Stockholm Convention on POPs (hereinafter referred to as Stockholm Convention) is a global treaty to protect human health and the environment from persistent organic pollutant The Stockholm Convention regulates to reduce or eliminate producing, using and/or releasing of 12 POPs including Aldrin, Chlordane, Dieldrin, Endrin, Heptachlor, Mirex, Toxaphene Polychlorinated Biphenyls (PCB); DDT [1,l,l-trichloro-2,2bis (4-chlorophenyl) ethane]; Polychlorinated dibenzop-dioxins (PCDD), Furans (Polychlorinated dibenzofurans) and Hexachlorobenzene (HCB) From 2009 to 2013, Conference of the Parties (COPs) of the Stockholm Convention has approved to add 11 new POPs to A, B, C annexes, including: 781 - Annex A: POP pesticides (Lindane, Alpha-HCH, Beta-HCH, Chlordecone, Endosulfan); Industrial POPs: (Hexabromobiphenyl, Pentachlorobenzene, TetraBDE, PentaBDE, Hepta and OctaBDE, Hexabromocyclododecane1); - Annex B: Perfluorooctane sulfonic acid, its salts and perfluorooctane sulfonyl fluoride (PFOS) - Annex C: Pentachlorobenzene The Prime Minister of Vietnam signed Decision No.184/2006/QD-TTg dated 10th August 2006 approving the Vietnam‘s National Implementation Plan for the Stockholm Convention on Persistent Organic Pollutants (NIP) and submitted to the Conference of the Parties of the Stockholm Convention in 2007 Vietnam has implemented many activities listed in NIP 2006, including implementation of obligations related to the development of policies and regulations on POPs management, capacity building in POPs management, Best Available Techniques (BAT)/Best Environmental Practices (BEP) for reduction of unintentional POPs, safe treatment of POPs stockpiles etc Adding new POPs in Stockholm Convention requires Vietnam to review and update the NIP Vietnam has regulations forbidding 13 POP chemicals including Alpha hexachlorocyclohexane, Beta hexachlorocyclohexane, Lindane, Endosulfan which are new POPs For PFOS which is a new listed POP, at present, Vietnam has no particular regulation on the management of its production and use This is a challenge for the government and the community to control and limit risks of POPs and to implement the commitment towards Stockholm Convention New policies are being developed and it is an urgent need for the government to have more information the economic aspects of new regulation This paper focused on economic analysis of removing two of the new POPs namely Poly-BDE (PBDE) and Perfluorooctane sulfonic acid, its salts and perfluorooctane sulfonyl fluoride (PFOS) in Vietnam These two compounds are popularly presented in daily life as they exist in electronic products, garments and vehicles PBDE and PFOS in Vietnam POPs (i) are persistent the environment, (ii) become widely distributed geographically, (iii) accumulate in the fatty tissue of humans and wildlife, and (iv) have negative impacts on human health and/or on the environment Exposure to POPs can lead to adverse effects on human health, biodiversity and the environment PBDE and PFOS are among the new POPs that Vietnam should eliminate according to the Stockholm Convention since 2013 2.1 PBDE and its impacts In the 20th century, manufacturers started to replace the traditional materials such as wood, metal, cloth, etc by oil-based products such as plastics and Polyurethane foam (PU foam) The new materials are more combustible Therefore, it was necessary to control the flammability for these products PBDE is a substance mixture that functions as fire In May 2015 three POPs (polychlorinated naphtalene, hexachlorobutadiene, pentachlorophenol) were added 782 retardant and is used broadly in electronic equipment, car seat, carpet, etc There are three types of commercial PBDE including commercial Pentabromodiphenyl ether (cPentaBDE), commercial Octabromodiphenyl ether (c-OctaBDE) and commercial Decabromodiphenyl ether (c-DecaBDE) According to user‘s manuals, c-Octa BDE is mainly used in acrylonitrile-butadiene-styrene (ABS) polymer ABS is mainly used in cover of electrical and electronic equipment, specially CRT monitor, household and office appliances such as photocopier, printer 90% of c-PentaPDB is to treat PU foam The first PBDE inventory in Vietnam was carried out in 2006 It appeared that the residual PBDE in the environment was rather high The inventory of PBDE was based on the widely used electrical and electronic equipment and waste such as television, computer, laptop, mobile phone and fixed telephone, printer, photocopier, radio, audio frame, refrigerator, air conditioner, washing machine, etc PBDE mainly concentrated in the stage of use/storage and production From 2002 to 2006, PBDE in the production stage tended to decrease and PBDE in the export stage tended to increase along with time However, the quantity of PBDE in all stages of the life cycle tends to increase During the period of 2002 to 2006, the total amount of POP-PBDE in electronic equipment in Vietnam was 276.4 tones including 260.1 tones from domestic activities and 16.3 tones from exported equipment; the average amount of POP-PBDEs from domestic activities in Vietnam in the inventory stage was 52 tones per year and the annual disposed volume was tones (Tu Binh Minh et al, 2015) Figure 1: POP-PBDEs cycle in electronic equipment in Vietnam from 2002 to 2006 Source: Tu Binh Minh et al (2015) In 2015, MONRE did a survey on PBDE content in dust, plastic, sediment and fish samples in some locations of Trieu Khuc village in Hanoi and Bui Dau village in Hung Yen province The results showed a high content of PBDEs in waste storage and recycling areas The content of PBDE in sediment samples from waste-contained rivers was similar Meanwhile, the contents of PBDEs in dust, deposit and fish samples differed across the 783 locations For example, PBDEs in dust sample at Trieu Khuc - a plastic recycling village was 1.050 - 33.840 ng/g; and the content at Bui Dau - an electronic solid waste recycling village was 1.560 - 19.590 ng/g Therefore, the risk of PBDE emission and surplus in recycling areas is rather high that should be controlled tightly (MONRE, 2015) In Ho Chi Minh City, the total residual PBDE was found in sediment at a significant level The concentration of total PBDEs in the sediment taken from areas inside and outside the city and Saigon - Dong Nai estuarine was respectively 54.5 - 119.0 ng/g, < 0.02 - 10.63 ng/g and < 0.02 - 0.065 ng/g PBDE had accumulated in the sediment in Ho Chi Minh City for a long time (MONRE, 2015) There has not been an assessment on negative impacts of PBDE in Vietnam The following impacts are from international studies/researches: Human health: PBDE is found in human body cells all over the world including blood, fat and breast milk When the mother is exposed to PBDE, her breast milk will contain PBDE A research in Sweden shows that the PBDE content in the breast milk doubles after each years from 1972 to 1997 Until the 1990s, after removing PBDE, the PBDE content decreases from 3.7 ng/g of milk to 2.62 ng/g of milk (Washington State Department of Health, 2006) Therefore, the infants are seriously affected by PBDE pollution PBDE is considered as a factor reducing IQ in the children, thus pregnant women should be protected from PBDE exposure (Chen et al, 2014) PBDE is discovered in food chain, indoor dust and air Food chain is the main channel through which people exposed to PBDE Food containing PBDE includes pork, beef, poultry, fishes and dairy products Some recent studies show that indoor dust/air contributes the biggest part in PBDE exposure, especially for small children and the infants who are exclusively formula-fed (Washington State Department of Health, 2006) Research works in many countries show that workers of companies in manufacturing and recycling PBDE-contained products can be exposed to PBDE at the workplace Electronic waste recycling areas have the highest PBDE content in the air, especially the places for disassembling wastes like computer, printer, TV, microwave and plastic parts which are taken separately In Sweden, workers disassembling electronic items have high content of PBDE in blood (Sjodin et al, 1999) Their blood contains Penta, Octa- and Deca-BDE Hospital cleaner, computer staff, and firefighter are also exposed to PBDE due to contact with furniture, electronic equipments and fire fighting foam during the working process (Shaw et al 2012) Women participating in waste recycling and children living in the recycling areas have high risk of PBDE exposure Environment: There are many studies showing that PBDE accumulates in the natural environment, causing environment degradation and affecting human health PBDE is found in air sample in city, rural area and remote area of Great Lakes (USA), in areas far away from industrial parks in Sweden or coastal area in Korea (UNEP, 2007b) Even the air in Indian Ocean also contains PBDE (2.5 pg/m3) For water environment, Ontario Lake in Canada has the total PBDE content of pg/m3 (UNEP, 2007b) Sediment samples in this 784 lake contain hexa and hepta-BDE with the content from 0.5 to µg/kg Soil samples in the Europe have the total PBDE content from 0.61 to 2.5 µg/kg (UNEP, 2007b) C-OctaBDE is found in many aquatic species in Great Britain and Japan HeptaBDE is contained in eggs of falcon in Sweden Carps and perches in Detroit River in USA are infected from PBDE (UNEP, 2007b) 2.2 PFOS and its impacts PFOS is present in imported products such as fire fighting foam, insecticide and other products such as carpet, textile and garment and toy Although Vietnam does not produce PFOS, materials containing PFOS for production are imported Thus some products containing PFOS are considered as Vietnamese goods For example, according to Greenpeace organization (2013), Mamnut gloves made in Vietnam and exported to Europe have PFOS concentration of 9.5 μg/m2, μg/m2 higher than the regulated level Jackets made in Vietnam under the brand of Jack Wolfskin and Schöffel have PFOA content at 6.3 μg/m2 and 6.2 μg/m2, respectively PFOA is a substance that is not yet included in the list of POPs but currently evaluated in the POP Reviewing Committee Using PFOS in firefighting foam and surface treatment (e.g synthetic carpets, textiles furniture), furnishings etc in Vietnam is common The inventory of PFOS is preliminarily assessed in Vietnam with samples of surface water and fish collected from recycling areas, reproduction areas, canals, waste water reservoirs, etc in Hanoi, Bac Ninh and Da Nang The result shows a relatively high concentration of PFOS at the locations near production and recycling areas (MONRE, 2015) PFOS can negatively affect the human health and the environment Human health: Young men and women who expose to PFOS and related substances are likely to have problems with their reproductive health (UNEP, 2007a) A research in Denmark indicates that PFOS (and PFOA) content reduces sperm quality in men (UNEP, 2007a) When a pregnant woman is exposed to PFOS, this substance may be transmitted to her fetus and further to her breast milk after she gives birth (UNEP, 2007a), which exerts negative influence on the development of the infants PFOS is present in paper package/hard cover, interior furniture, medical equipment, insecticide, electrical and electronic equipments, fire fighting foam, paint, cleansing agent, rubber and plastic, etc (UNEP, 2007a) Therefore, their users may have their health affected badly Workers on metal plating lines, assembly lines or semiconductor production lines face the similar risks because PFOS is used in the industrial process of these fields Environment: PFOS and related substances accumulate and cause pollution to underground water and surface water, which impacts salt water, fresh water and terrestrial ecosystems through food chain PFOS in fire fighting foam is important since it is largely released to the environment when fire fighting foam is used Methodology Due to the lack of data in Vietnam, the costs of using, producing and removing PBDE and PFOS in this analysis are estimated by the transfer method Reference to case 785 studies in some countries where POP inventory and solutions for moving and/or replacing PBDE and PFOS are available is used The environmental benefits are identified while the health benefits and economic benefits are estimated Because the time of removing PBDE and PFOS has not been decided, the actual annual costs and the benefits were calculated with no discount factors Economic analysis of removing some new POPs 4.1 Estimating the cost 4.1.1 Polybrominated Diphenyl Ethers (PBDE) To minimize and remove PBDE, the government intends to: a) Control the import and export of chemicals in PBDE group in Vietnam by focusing on electrical and electronic products, fire-resistant materials, vehicles and household appliances b) Assess the production and the inventory of chemicals in PBDE group; periodically report as requested under Stockholm Convention c) Safely manage and minimize the use of chemicals in PBDE group in production and business, apply BAT/BEP in safely classifying, collecting, transporting, recycling and treating materials and wastes containing PBDE; control the safe recycle and treatment of chemicals in PBDE group and assure not to recover PBDE for reuse; assess and review exemption registration and purposeful use of products, materials containing PBDE in Vietnam d) Monitor the PBDE content in the environment, products, materials, wastes and polluted areas in order to assess the associated risks and implement methods for environmental health management 4.1.2 Social costs for minimizing and removing PBDE Cost for establishing technical standards: Technical standards are required to control PBDE The actual cost for establishing one standard in Vietnam is million VND There are two groups of technical standards, one for imported products and the other for waste and waste treatment The number of standards needed is not decided yet but it can be seen that the total cost for establishing the standards is rather small for the whole society Cost for measuring, monitoring PBDEs: Two tasks which are (a) to assess the production and the inventory of chemicals in PBDE group; periodically report as required under Stockholm Convention and (d) monitor PBDE in the environment, products, materials, waste and polluted areas in order to assess risks and implement methods for environmental health management require periodical sampling, testing and reporting The cost for testing PBDE in water is VND million for one sample This cost includes costs of materials, wages and administration cost It is supposed to have reports on PBDE in a year with 500 samples needed for each report Then the annual cost for measurement and monitoring of PBDE is VND 3,000 million Cost for treatment of wastes containing PBDE The emission source of PBDE is waste from disposed products Hence the important solution to minimize PBDE is sludge treatment There are different methods for 786 treatment from filling, using in production of soil for agriculture and forestation to incineration in hazardous waste incinerator The incineration plan is applied if a separate incinerator is available for this purpose; this can only be applied when the volume of waste to be incinerated is large enough or will be incinerated with other hazardous wastes Wastes containing PBDE have not been treated separately in Vietnam Some of them are hazardous wastes which are treated in some capable stations So here the cost of hazardous wastes treatment is used In Holcim Vietnam, the cost of treatment of wastes containing PCB is from VND 40 to 300 million per tone This paper assumes the lowest price, which is VND 40 million per tone The main types of plastic in electronic waste are PS, ABS, PP, PVC and PC, all of which can be recycled except PVC The estimated volume of PVC in electronic wastes in 2014 is 2,100 tones Therefore, the annual cost for treatment will be VND 84 billion or USD 3,733,333.33 4.2 Perfluorooctane sulfonic acid, its salt and Perfluorooctane sulfonyl fluoride (PFOS) To minimize and remove PFOS, it is expected to take the following measures: a) Assessing and strictly controlling the import and export of PFOS products, materials and equipments in Vietnam; assessing the actual use, storage, disposal and taking comprehensive inventory of PFOS b) Monitoring PFOS in products, materials, waste and environmental components to assess and control environmental and health risks c) Further controlling PFOS use and disposal; assessing and considering registration of exemption and intentional use of PFOS products and materials in Vietnam d) Promoting PFOS replacement in production and business activities; limiting and removing PFOS in consumer goods and insecticide and fungicide Social costs for minimizing and removing PBDE Cost for establishing technical standards: Actual data shows that cost for PFOS collection and analysis is VND 1.5 million per sample As such, supposed that report on PFOS with 500 samples all over the country should be conducted twice a year, then the annual survey and monitoring cost is VND 1,500 million Cost for replacing PFOS in fire fighting foam Since fire fighting foam is the most important source that releases PFOS, replacing PFOS in fire fighting foam is the most priority Costs for PFOS removal/replacement in fire fighting foam of countries are calculated differently According to the EU statistics in 2006, cost for destruction of PFOS fire fighting foam is about 1100 USD/tone and total quantity across EU was 122 tones (Sweden, 2006) In the USA, total annual cost covering replacing PFOS fire fighting foam and PFOS fire fighting foam is 24.31 million USD (in 2011) (Wray et al, 2011) In the UK, removal/replacement of PFOS fire fighting foam was supposed to take years Then, net present value of the cost for removal/replacement of PFOS fire fighting foam was estimated at USD 2,770,655 (UK Ministry of Environment, Food and Agriculture, 2004) 787 With limited background information, it is difficult to specify relevant costs in Vietnam In this context, the low estimate is used, which is the cost in EU, i.e about 134,000 USD (1,100 USD multiplied by 122 tones) This is the cost of destruction of foam 4.3 Estimating the benefits The benefits are estimated with the assumption that not only PBDE and PFOS but other POPs are also removed/ replaced 4.3.1 Health benefit Upon removing/replacing POPs, the society would reduce risk of death and diseases The community health would be improved This is regarded as one of direct social benefits from POPs removal/replacement For specific locations or sectors, it is possible to quantify health benefits in monetary term from POP removal/replacement Health benefit is estimated based on disability-adjusted life-years (DALY) and value of one life year According to the World Health Organization (WHO), DALY disease burden is a measure of the statistical years of life lost due to mortality and the years of life lived with diseases or accidents A DALY is understood as one year of statistical life lost (cumulative risk over all individuals in the population to develop a certain mortality or morbidity case) Total DALY over total population, also known as disease burden, reflects the gap between present health of the population and ideal health of the whole population when everyone can live without diseases or injuries DALY is calculated as the sum of years of life lost (YLL) due to death, diseases and accidents and years lived with disability (YLD) Table shows the DALY in Vietnam in 2012 estimated by WHO Table 1: Standardized DALY in Vietnam in 2012 (for 100,000 people) All diseases Infectious diseases Noninfectious diseases Injuries DALY 29,226 6,375 19,555 3,296 Source: http://www.who.int/ From DALY of the whole population, it is possible to calculate DALY of the location where residents are exposed to POPs by the following formula: DALY in the POP-polluted location = National DALY x Population of POP-polluted location 100,000 persons Value of a life year (VOLY), or value in monetary terms of one DALY, reflects economic cost of a year of life lost due to death, ill health or disability Value of one DALY in each country reflects its economic development, income and price In this paper, value of one DALY for Vietnam is estimated by benefit transfer method Using contingent valuation, Desaigues et al (2011) estimated the monetary value of a life year in European countries at EUR 40,000 or about USD 44,000 This value is directly transferred to Vietnam Assuming that the annual DALY in Vietnam is 1,000, then the value of health benefit is USD 44 million 788 4.3.2 Economic benefit POPs, for example, PBDE released in the environment have negative impacts on agricultural production and aquaculture Agricultural and aquatic products are important exports of Vietnam If POPs residue is found in these products, they will be returned to Vietnam, causing big economic damage not at the time of export but also in the future when the market is lost In fact, Vietnam has faced some cases in which foreign countries detected pesticide residues in agricultural products or found infected aquatic products Every year, Vietnam loses over 14 million USD when aquatic products are returned from Europe, the USA, Japan and Australia (Saigon Times Newspaper, 2013) Consumers have not known much about the presence of POPs in daily life If this information is spread among the community, consumption will reduce sharply For example, non-stick pan, a popular product often contains PFOA or PFOS If consumers know about it, the market of non-stick pans will be lost, causing big damages to the importers and the manufacturers 4.3.3 Environment benefit Apart from health improvement, the removal/replacement of POPs also helps to improve environmental quality Value of environmental quality is improved through total economic value brought about by environmental quality to the society - Direct benefit: Increasing landscape value, surrounding environmental quality to meet economic, entertainment and aesthetic demands of the community - Indirect benefit: Improving ecological service and biodiversity - Nonuse benefit: Increasing existence value, option value and bequest value of environmental quality These benefits can be measured by the society‘s willingness to pay to conserve the environment The environment benefit is not estimated in this paper, but previous researches show that the total economic value of the environment is often very high Besides, removing PBDE from electronic wastes helps to reduce pollution caused by other pollutants Electronic wastes often contain heavy metals like lead, nickel, chrome and mercury which can be harmful for human health Freon is present in control boards in refrigerators and air conditioners, which can affect the ozone layer When the electronic waste containing PBDE is treated, these dangers are also eliminated 4.3.4 Summary of cost and benefit of removing PBDE and PFOS Table shows the summary of cost and benefit of removing PBDE and PFOS It can be seen from the table that although social benefit gained from removing PBDE and PFOS has not been estimated sufficiently, it is a large number Such benefit is always larger than the cost of policy development and enforcement plus the cost of environmental treatment The treatment cost will decrease overtime as the POPs inventory decreases Therefore, from socio-economic aspect, removing PBDE and PFOS as well as other new POPs are necessary to protect public health, ensure environmental quality, and increase social welfare 789 Table 2: Cost vs benefit of removing PBDE and PFOS Item Value Cost - Technical standard 133 USD/standard1 - Environmental monitoring 200,000 USD/year2 - Waste treatment 3,867,333 USD/year Benefit - Health - Economy 44,000,000 USD/year > 14,000,000 USD/year - Environment -3 : This cost occurs only at the year of issuing the standard : Total estimate cost of PBDE and PFOS monitoring is 4,500,000,000 VND/year : Benefit is not valued in monetary term (Reference exchange rate: USD = 22,500 VND) Source: Authors‟ calculation Conclusion Being a party in Stockholm Convention, Vietnam has the responsibility to eliminate, remove and replace the listed POPs Nation Implementation Plan was developed in 2006 but now it is necessary to update it since new POPs are being added in the Convention PBDE and PFOS are among the new POPs listed in 2013, which requires Vietnam to carry out the inventory, to control the using and producing and to remove them from the products This paper analyzed the social cost and benefit of removing PBDE and PFOS Due to the lack of data, benefit transfer method was employed and the cost and benefit were compared directly The cost of removing PBDE includes cost of establishing technical standards, cost of sampling, testing and reporting and cost of treatment The cost of removing PFOS includes cost of establishing of technical standards, cost of sampling, testing and reporting and cost of destructing the firefighting foam The health and economic benefit of PBDE and PFOS removal is estimated at USD 58 million per year, which is greater than the cost estimated at about USD million Thus removing PBDE and PFOS is beneficial from the social perspective References Chen A, Yolton K, Rauch SA, Webster GM, Hornung R, Sjödin A, Dietrich KN, Lanphear BP (2014), 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registration of exemption and intentional use of PFOS products and materials in Vietnam d) Promoting PFOS replacement in production and. .. standards, cost of sampling, testing and reporting and cost of treatment The cost of removing PFOS includes cost of establishing of technical standards, cost of sampling, testing and reporting... Vietnam? ??s National Implementation Plan for the Stockholm Convention on Persistent Organic Pollutants (NIP) and submitted to the Conference of the Parties of the Stockholm Convention in 2007 Vietnam