Enabling Conditions for Scaling Up Solid Waste Management Financing: Case Studies in Indonesia and Brazil

This case study by the Climate Policy Initiative, coordinated by the Global Alliance for Incinerator Alternatives (GAIA), analyzes waste management business models in Indonesia and Brazil. It highlights a significant funding gap for organic waste management compared to waste-to-energy incinerators and argues that decentralized, community-based, and informal models offer greater cost efficiency and co-benefits, despite facing financial strain and a lack of legal certainty.

• Global financing for methane abatement in the waste sector is heavily skewed toward large-scale waste-to-energy incinerators. In 2021/22, approximately 94% (USD 4.08 billion) of this finance went to incinerators, while only 1% (USD 20 million) was allocated to organic waste management.
• Public budget allocations for waste management are low in both Indonesia and Brazil, with Brazil's municipal budgets allocating between 1.9% and 5.1% and Indonesia's allocating between 0.3% and 2.4%.
• Decentralized models, such as community groups in Indonesia and waste picker cooperatives and home composting in Brazil, demonstrate higher cost efficiency in terms of levelized cost of waste management (LCOW) compared to private and government operators. In Brazil, home composting had the lowest LCOW at USD 1.69-19.12/tonne, while private operators had the highest at USD 74.65-324.10/tonne. In Indonesia, community groups ranged from USD 28-63/tonne, compared to USD 11-92/tonne for private and USD 49-59/tonne for government operators.
• Capital expenditure on fixed assets, such as land acquisition, is a primary barrier for industrial players, accounting for 89% of total asset value in relevant Indonesian cases and 58% in Brazil. Conversely, operational expenditure is the main cost driver for most groups, with labor being the largest expense, representing 74% to 98% of costs in Indonesia and 48% to 90% in Brazil.
• Community groups face financial instability because their operational funding relies entirely on operational revenues, despite having complex capital structures involving private entities (49%), government (48%), and grants (3%). This is exacerbated by small processing volumes, high labor dependency, and a reliance on shorter-lived assets.

APA

Climate Policy Initiative (2025). Enabling Conditions for Scaling Up Solid Waste Management Financing: Case Studies in Indonesia and Brazil. https://www.climatepolicyinitiative.org/publication/enabling-conditions-for-scaling-up-solid-waste-management-financing-case-studies-in-indonesia-and-brazil/

Chicago

Climate Policy Initiative. Enabling Conditions for Scaling Up Solid Waste Management Financing: Case Studies in Indonesia and Brazil. 2025. https://www.climatepolicyinitiative.org/publication/enabling-conditions-for-scaling-up-solid-waste-management-financing-case-studies-in-indonesia-and-brazil/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Enabling Conditions for Scaling Up Solid Waste Management Financing: Case Studies in Indonesia and Brazil |date=5 June 2025 |url=https://www.climatepolicyinitiative.org/publication/enabling-conditions-for-scaling-up-solid-waste-management-financing-case-studies-in-indonesia-and-brazil/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2025enabling, author = {{Climate Policy Initiative}}, title = {{Enabling Conditions for Scaling Up Solid Waste Management Financing: Case Studies in Indonesia and Brazil}}, institution = {Climate Policy Initiative}, year = {2025}, month = jun, url = {https://www.climatepolicyinitiative.org/publication/enabling-conditions-for-scaling-up-solid-waste-management-financing-case-studies-in-indonesia-and-brazil/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }