Construction and Operation Costs of Wastewater Treatment and Implications for the Paper Industry in China

This paper aims to develop a construction and operation cost model of wastewater treatment for the paper industry in China and explores the main factors that determine these costs. Previous models mainly involved factors relating to the treatment scale and efficiency of treatment facilities for deriving the cost function. We considered the factors more comprehensively by adding a regional variable to represent the economic development level, a corporate ownership factor to represent the plant characteristics, a subsector variable to capture pollutant characteristics, and a detailed-classification technology variable. We applied a unique data set from a national pollution source census for the model simulation. The major findings include the following: (1) Wastewater treatment costs in the paper industry are determined by scale, technology, degree of treatment, ownership, and regional factors; (2) Wastewater treatment costs show a large decreasing scale effect; (3) The current level of pollutant discharge fees is far lower than the marginal treatment costs for meeting the wastewater discharge standard. Key implications are as follows: (1) Cost characteristics and impact factors should be fully recognized when planning or making policies relating to wastewater treatment projects or technology development; (2) There is potential to reduce treatment costs by centralizing wastewater treatment via industrial parks; (3) Wastewater discharge fee rates should be increased; (4) Energy efficient technology should become the future focus of wastewater treatment