C and n t ro tondin or p to r to the and c or n or m went and n



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Economic instruments and

Environment



C AND N T RO TO N D I N OR P TO R TO THE AND C OR N OR M WENT AND N

And L M AND D I OR TO M B I AND N T AND

October of 2001

Volume 1, nº 4

¿ The Economic Instruments Function in Countries in Development?

Direction: Cra. 3 Not. 11-55 Of. 213

Bogota D.C., Colombia

Telephone: +(571) 337 6553

Fax: +(571) 337 6616

E-mail: caema@andeancenter.com

Web: http: //www.andeancenter.com

C AND N T R OR TO N D I N OR P TO R TO L TO

And C OR N OR M Í TO AND N AND L M AND D I OR

To M B I AND N T AND

Editorial 1

CEPAL Evaluated the Vengeful Rate:

Results

2-4

The President Pastrana

it does Recognition al

It programs of Rates

4

The TR Was Analyzed in the

Defensoría of the Town

5

Triple TO Arranges and Pays

Debt by TR to DADIMA

5

Training: CAEMA in

Centroamérica

6

Contained:

In our page

Web:

Presentation of the CAEMA

Presentation of the Directions

of the Center

Synthesis of the development of the



courses of training

Forms of inscription to the



courses

Programming of next



courses

Links related to Rates



Vengeful and Climatic Change

New evidence about the environmental effectiveness exists and economic efficiency of the program

of vengeful rate in Colombia: the recent evaluation presented by the Economic Commission

for Latin America and the Caribbean (CEPAL) reports important reductions in the

levels of contamination of the industrial sectors and agroindustrial, in relation to the line

Base of 1997. Still in an environment of fiscal crisis and budgetary cuts, the management of the

regional environmental authorities is more effective cost: the administrative cost by ton

it reduced of SST and DBO5 has fallen to a fifth part of its previous value to the implementation

Of the rate. Additionally, the evaluation found that the program of rates is producing

greater incomes for the environmental national system that them received by means of

Contribute of the nation. Of greater importance, the marginal costs of fulfillment assumed

By the industry are falling, by the combination of economic pressures and flexibility.

The system induces to reductions in the levels of contamination by means of the investment

in cleaner processes of production, in comparison with systems that impose solutions

Costly al final of the pipe. The World Bank, in its book Greening Industry , it identified the

potential of the program to induce al increment in the productivity and the studies of case

Of the CEPAL corroborate this fact. Problems? Two thirds of the municipalities have

they placed resistance al programs, insist that neither they will reduce their discharges neither they will pay the

Rate by their contamination. ( to see p. 2, “CEPAL Evaluated the Vengeful Rate: Results)”

The environmental effectiveness of the program was also recognized by the President Andrés

Pastrana the past 3 of September, in the ceremony for the delivery of the National Distinction

Environmental. The President qualified

the program of Vengeful Rates

as a national success and delivered it

a Distinction to the National Corporation

of the East Antioqueño by

its sectorial leadership in the implementation

of the program of rates and

by the important reductions achieved

In its discharges. ( seeing p. 4, “The



President Pastrana does Recognition

al Programs of Rates)”

Additionally, the Defensoría of the Town organized a public audience on the program

of rates to analyze the alternatives with the ones that can improve the levels of fulfillment

On the part of the municipalities, the which have remained behind with regard to the industry.

International conservation, the Department of the Environment, the Association of Corporations

Autonomous Regional and Fundepúblico presented the merits of the program. The

National association of Industrialists, in turn, agreed that the system of

charges functions although exist inequities in their implementation: while the industrialists

they pay the rate and descontaminan, in good part of the large contaminadores –the municipalities

– Itself rehúsan to control its vertimientos or to pay for its contamination. ( to see p. 5, The Rate



Vengeful it Was Analyzed in the Defensoría of the Town)

The President Pastrana offers the Environmental National Distinction.

By its potential to harmonize the

economic growth with the protection

of the environment, the experiences

regional in the use of instruments

economic are of great interest for the

Economic commission for Latin America

and the Caribbean (CEPAL) and the governments of the

Region. To four years of the design and

implementation of the program of rates

vengeful, the CEPAL it proposed a

initial evaluation on the impact of the

application of the instrument al sector

Colombian industrialist. With the object of this, itself

it evaluated the impact, in terms of

environmental effectiveness and efficiency

economic, on said sector in

jurisdiction of three environmental authorities

regional: CVC, CORNARE and DADIMA. In

this edition of the Bulletin we present the

executive summary of this study1.

The system of vengeful rates was

developed in Colombia by the Department

of the Environment with the purpose of

controlling the water contamination in the

effective and more efficient basins of form

that the previous system, which itself

it supported in the imposition of limits

permisibles and plants of processing in

Each source of vertimiento. After more

of thirty years to utilize the politics of

command and control, the water of Colombia

they were seriously contaminated and with the

majority of the sources was of

Fulfillment. This carried to that the

economic activities I laugh down, the

sensitive tropical ecosystems and the

social welfare to suffer external costs

high and growing, product of the

Contamination. At the moment of the

implementation of the system of rates

vengeful 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 processing

Some.

The interviews to the authorities



environmental they identified various problems

With the prior regulating system. 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 were denied

to comply with the given, imposed norms

the high costs incurred in the

processing plants construction of

Residual water. Third, the system not

it provided no incentive to seek

options of mitigación in the process of

production, based on greater

Productivity and cleaner technologies.

Finally, the local community affected by

the contamination did not participate in the

process of environmental protection, 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 of

reducing, to a smaller cost, the discharges

total of demand bioquímica of oxygen

(DBO) and solid they suspended total (SST),

until achieving the goals of reduction

Preestablished for each basin. The

secondary objective was to generate sources of

complementary income to finance

investments and activities related to

The control of the water contamination.

In synthesis, the economic instrument itself

it bases on:

• The establishment of goals of

contaminant load reduction by

basin (or sections of this), that collect

the social, economic conditions and

Environmental of the zone.

• The application of a rate by unit of

it charges contaminant poured by the

different sources of contamination

Regular.

• A system of gradual adjustment of the rate,

that it serves like permanent incentive

to reduce the contamination, and that

it determines the necessary rate for

diminishing the vertimientos to the goal

It arranged of the basin.

And FECTIVIDAD ENVIRONMENTAL:

THE VENGEFUL RATE IN THE

DECREASE OF THE LOAD

CONTAMINANT

Al to implement the vengeful rate for the

control of the water contamination, itself

left from two general cases of

Fulfillment. In the first one, the community

it regulated was found in fulfillment

with the imposed norms by the system of

Traditional regulation. Low said situation,

the regular sector had invested

abundant sums of money in plants of

processing and, therefore, its costs

marginal of descontaminación were

extremely high; this is the case of the

CVC and CORNARE. In the second case, itself

it appreciated a community regulated but with

low levels of fulfillment: few

sign you had done investments in plants

Of processing. This was the situation of

parted in the industrial sector in

jurisdiction of the DADIMA.

In the first situation, the imposition of the

vengeful rate achieved reductions

significant incremental to the investment

Massive existing in plants of processing.

In the second, an important one was achieved

reduction in the vertimientos industrial to

Differentiates of 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

it indicates the Graphic 1, the collection by

Economic instruments and Environment Volume 1, nº 4

Page 2

CEPAL Evaluated the Vengeful Rate: Results

Graphic 1. Vertimientos of the industrial sector before and after the vengeful rate

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

LB = Line of Base

Sem B = Second semester 2000

contamination serves for descontaminar

a lot beyond the levels achieved with

the traditional programs based on the

Processing plants imposition.

In order to evaluate the cost of fulfillment

in the regular businesses, they developed

three studies of case: two of businesses

individual (Monómeros Colombo

Venezuelan INC. and Quarries Yarumal) and

one of economic subsector (Association of

Cultivators of Cane of Colombia –

ASOCAÑA). These studies showed three

Results of importance. In the first place,

the load contaminant was 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 water processing

residual in full operation in the

Moment to be implemented the rate. In

second place, the incentive presented by

the vengeful rates did that the businesses

they implemented solutions of production

Cleaner. Third, al to seek greater

efficiency in the productive process, the

businesses did not only manage to reduce their

vertimientos but at the same time, in some

Cases, they enlarged their productivity.



THE INCOMES BY THE RATE

They FORTIFIED THE MANAGEMENT

ENVIRONMENTAL , 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

national budget for the entrance of

economic resources, which has them

it generated sharp financial crisis in

epochs of economic recession and cut

Fiscal. In this sense, the vengeful rate has

it fortified its management al to generate the

necessary resources for the investment in

you improve environmental and to finance the

you program of administration, control and

Caution of the water resource.

The results of the study indicate that the

vengeful rate: i) is an effective source of

financing of the authorities

environmental, so much for the execution of its

you program toward the community as for the

maintenance of its plant of personnel; ii)

it permits to achieve economic stability for

the environmental authorities in spite of the

you trim budgetary of the government

central; iii) guarantees greater continuity to

the programs of administration, control and

caution of the water resource; and iv) itself

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 services

Socially desirable. Tasar the

contamination has the triple dividend of

reducing the harmful impacts of the

vertimientos, to generate incomes for the

environmental management and to reduce the load

tax to the positive activities of a

Company.

THE PROGRAM OF RATES

VENGEFUL it INCREASED THE

COST - EFFECTIVENESS

INSTITUTIONAL IN THE CONTROL OF

THE WATER CONTAMINATION

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

you program is similar al previous -the expenses

related to the design, construction and

processing plants operation have

it been smaller, while have been assigned

greater resources to the measurement of

vertimientos and monitoring of the basin- the

reductions of vertimientos have been

a lot greater as result of the

descontaminación originating from the sector

Industrial. Thus, the administrative cost by

kilogram of DBO it reduced diminished a

79%, of 165 pesos with the previous system to

35 pesos with the program of rates

Vengeful (to see Graphic 2).

And L PROGRAMS OF RATES

It RATIONALIZED THE INVESTMENTS

TO REDUCE VERTIMIENTOS IN

THE INDUSTRIAL SECTOR

The studies of case mentioned

previously also they permitted to evaluate

the economic efficiency of the system of

rates, with respect to the assignment of resources

On the part of the industrial sector. Itself

it shows, in this manner, that under a

framework of economic regulation where itself

it has flexibility in the form to face

the goals of descontaminación, exists a

series of rational answers on the part of the

Sector regulated. The studies of case

they show how the economic sign is able

bring as a result, assignments

rational of so much investment in situations

where fulfillment with the norm existed

previous as in those where there was not

Fulfillment. Additionally, it is observed

that each business optimizes its options of

reduction in answer to the economic sign

and to its own priorities of production,

while it seeks to minimize its costs of

Fulfillment. Finally, it is observed that

al to combine the economic sign with the

Economic instruments and Environment Volume 1, nº 4

Page 3


CEPAL Evaluated the Vengeful Rate: Results (continued)

0

20



40

60

80



100

120


140

160


180

Command and control vengeful Rates

Administrative cost by kg reduced

in Colombian pesos



Graphic 2. The institutional cost of the management by kilogram of DBO reduced descended 79% with

the introduction of the program of vengeful rates in C ORNARE

flexibility to utilize the production more

clean as alternative of reduction, itself

they can obtain reductions beyond than

The prior limits of the command and control.

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 rate was implemented

vengeful, reductions were achieved

additional of 24% in DBO and 65% in SST

by means of the implementation of alternatives

Of cleaner production.

Also massive reductions are observed

of load contaminant in businesses where

the system of command and control there was not

It generated fulfillment. Before of

implementing the program of rates, the series

of closings and imposed fines to Monómeros

Colombo Venezuelan in Barranquilla and

Quarries Yarumal in Antioquia there was not

turned out in the reduction of vertimientos

It expected. Nevertheless, the turnover of

rates on the part of the environmental authority

it generated important obligations

economic to the businesses, for which they

they responded implementing solutions of

Reduction during the first year of collection.

Both firms achieved reductions

upper al 90% in its load

Contaminant.

The businesses have managed to reduce its

vertimientos even in periods of

growth of the production, by means of the

introduction of efficiencies in the processes

Productive. This is the case of the industry

sugar whose production grew 5,6%

between 1998 and 1999 by means 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

it given rise to new products for

Commercialization. Quarries Yarumal, by its

it splits, obtains sand washed of its solution

of reduction, what enlarges the volume of

Sands sold.

In this manner, the not alone businesses

they obtained benefits by the increment in

their production, but they managed to diminish

their payment by vengeful rates -their

Main motivation. In this sense, the

reductions of load achieved by

Monómeros Colombo Venezuelan INC.

they permitted savings for more than 400

millions of pesos al year by concept of

Payment of the rate. Quarries Yarumal by its

it splits, saved 22,6 million pesos

Annual al to reduce its vertimientos.

For greater information, to contact al

coordinator of the project of CEPAL , Jean

Acquatella: jacquatella@eclac.cl.

CEPAL Evaluated the Vengeful Rate: Results (continued)

Economic instruments and Environment Volume 1, nº 4

Page 4

The President Pastrana does Recognition al Programs of Rates

By its leadership in the implementation of the

it programs of vengeful rates, the past 3 of

September the Business Corporation of the

East Antioqueño received of hands of the

President of the Republic Andrés Pastrana the

Environmental National distinction in the category

of Institutional Project for the Defense and

Protection of the Environment1. The prize it

it was offered al guild antioqueño under a

framework of recognition to the adoption of

vengeful rates and processes of production

Cleaner in the country. Subsequently

we present passages of the speech of the

President Pastrana:

The Business Corporation of the East



Antioqueño is done merecedora of this

Distinction by its leadership in the

implementation of the economic instrument of

the Vengeful Rate, in the framework of actions

Technological environmental. The efforts of

this industrial sector, comprising 67

businesses of the alimentary sectors,

metalmecánico and chemical, are reflected in the

improvement of the water quality of the

region from the reduction of load

Organic in its vertimientos.

It is worth while to mention that the Bank

World, in its evaluation on this

economic instrument, emphasized the results

that it presented this Corporation from the

cost-effective reduction of the contamination,

improving the competitiveness of the businesses

by environmental factors, as one of the

Better examples to world level. ()L...L

“() L...Lit is good to emphasize the enormous reception



it reached by the institutional work in

cleaner matter of production as a group

with sectors of the small, medium and great one

industry, which advance in the framework

of the Environmental Collective Project, as

component of the National Plan of Development

Change to Build the Peace.

The Cleanest politics of Production has himself

it translated in the permanent application of a

preventive environmental strategy and integrated in

the productive processes, the products and the

services, to reduce the prominent risks

on the human being and the environment, which

it involves to the private and public sectors of

the production in the construction of the

Sustainable development. This year have itself

it recognized in the category of Project

Institutional for the Defense and Protection of the

Environment two important initiatives.”

Thus same, in its speech the President

it underlined the most important results of its

administration in themes of environmental management

among the which did it emphasize the program of rates:

The management to diminish the levels of



contamination of the superficial water itself

it translated in the successful application of

economic instruments for the

improvement of the environmental quality of

our bodies of water by virtue of the

Contaminants substances reduction. In

this sense, continued with the

implementation of the Program of Rates

Vengeful. To the date, 27 departments of the

country have advanced in the implementation of

this measure and in 13 of them already applies the

collection of the rate through the authorities

Environmental respective.

1 CEPAL: Application of the contaminador-paying principle in



Latin America: evaluation of the environmental effectiveness and

economic efficiency of the rate by water contamination in

the Colombian industrial sector, 2001.

2

In CORNARE, for example, during the process of



coordination, was established that only 10% of the I collect for

rates he would be invested in operation and 90% in investment in

Works and activities oriented to descontaminar the basin.

1 The Nodo Regional of Cleaner Production of the

Department of Santander received the same distinction.

The Vengeful Rate Was Analyzed in the Defensoría of the Town

Economic instruments and Environment Volume 1, nº 4

Page 5

News

The business of Acueducto, Alcantarillado

and Neatness of Barranquilla (Triple A) has

it arranged the payment of it owed by

concept of vengeful rates al

DADIMA from September of the

Present year.

The business, since the start of the

implementation of the program of rates, itself

has opposed al collection of the rates

vengeful and it has carried out three demands

In its against.

Nevertheless, after an embargo

imposed by DADIMA, the Triple TO

it sought a conciliation for the payment of the

debt contributing its measurements as

Base of negotiation. It given the difference

among the figures of the DADIMA and of happiness

business, was decided to carry out a study

that to measure the real load poured by the

home sector to the network of

alcantarillado, and that kept in mind the

removal carried out by the gap of

Oxidation of the business.

The results of the study gave foot al

recognition on the part of the business

of its debt by concept of rates

vengeful, which it elevated to

approximately 2.500 million

Pesos. This sum will be canceled

monthly during a year and,

additionally, the business will pay

monthly by the vertimientos

home they carried out since this month

Of October.

With this action, the Triple TO joins with

Public businesses of Medellín al to assume

the social responsibility of its

Vertimientos water. EPM start the

payment of the rates last year and is

advancing in the implementation of its

Plants of processing.



For greater information to contact Alberto

School in the DADIMA:

alberto_escolar@hotmail.com.

Triple TO Arranges and Pays its Debt by Vengeful Rates al DADIMA

The past October 12 took place in the

Defensoría of the Town an audience

public whose central theme was the rate

Vengeful. The objective of the meeting was

presenting the points of view of different

actors that have intervened in the

discussion on the theme, with a focus

special on the contamination

municipal: the municipalities are the

greater contaminadores of the country with the

70%, and the majority do not have plans of

descontaminar neither pay for their

Vertimientos. The guests were the

Department of the Environment,

CORNARE, the Association of

Regional Autonomous corporations

(ASOCARS), With s and r v to c i ó n

International, the Association of Businesses

of Home public Utilities and

Ac t i v i gives of s Compl ementa r i to s

(ANDESCO), the General finance Office of

the Republic, the attorney general’s office of

the Republic, the National Association of

Industrial (ANDI) and the foundation for

the Defense of the Public Interest

(Fundepúblico).

The representatives of the Department of the

Environment they explained the model

economic of the rates and their aspects

Normative. CORNARE, ASOCARS and

International conservation they showed

the achievements obtained in reduction of the

water contamination as turned out of

The implementation of the program of rates.

Additionally, they insisted in the

simplification and endorsement of the

Forms of autodeclaración.

They stood out the difficulties that face

the authorities to carry out the

activities of monitoring and verification

of the contained information in you said

Forms.

The National Association of Industrialists



it accepted that the economic instrument

functions, but that problems exist

because the municipalities are not

reducing its vertimientos neither paying

the rate by these: the industrialists feel

inequity because they if are paying

by their vertimientos and investing in the

Descontaminación. When are together

industrial and municipalities in the same one

basin, the municipal breach

it complicates to reach the goal of

descontaminación of the basin,

resulting a gradual increment of the

Rate. Additionally, it expressed its

worry by the lack of imposition

of the rate through all the territory

National. Its application in some

regions and not in other creates inequities and

competitive disadvantages for the

businesses that if pay and reduce their

you unload, in a moment in which the

conditions of the industry are

Especially difficult.

ANDESCO exposed the problems

regulation that have the businesses of

Public utilities. Although the law 142 of

1994 it permits to include the environmental rates

in the costs of operation and to transfer the

costs to the users, they indicated that

many businesses have not assumed the payment

of said rate by the lack of a

resolution aclaratoria on the part of the

Water Regulation commission

Drinkable.

The General finance Office of the Republic

it spoke of the problems in the collection of the

vengeful rates and of the deficiencies by

splits of the environmental authorities in

causing to comply to the municipalities with the

limits permisibles imposed by the

Decree 1594 of 1984.

Finally, Fundepúblico emphasized the

effectiveness of the vengeful rates in the

Descontaminación water. Has not been

responsibility of the instrument the

difficulty in its implementation, but of

the difficult conditions that cross

The environmental institutions of the country.

Economic instruments and Environment Volume 1, nº 4

Page 6


The CAEMA in Centroamérica

Among the 10 and last October 12 was

it carried out in Tegucigalpa, Honduras, the

Regional “course of Training



for Potential Leaders of the Program

of Collections by Contamination in

America Central” , it organized by the

Central american commission of Environment

and Development (CCAD), with the sponsorship

of the Pan-american Bank of Development

(BID), the government of the Low Countries and

the Office of the secretary of Natural Resources and

Environment of Honduras (SERNA).

The course, prepared and dictated by the

professionals of the CAEMA, was carried out in

the framework of the Program of Modernization

of the Systems of Environmental Management

(CONTINUE), project of Support to the

Harmonization of Regulatory Frameworks

Amb i and n t to l and s in the Re g i ó n

Central american. In it they participated,

besides the president protémpore of the

CCAD, the Minister Xiomara Gómez, and the

director of the CCAD, mister Mauricio

I neuter, professionals of diverse

institutions of the environmental sector of six

countries of Centroamérica interested in

designing and to implement instruments

economic for the control of the

Contamination in its region.

During the three days of session the

CAEMA present the conceptual bases,

institutional requirements and of

participacion common, and experiences

in the implementation of the systems of

Collections by contamination. They participated

besides as expositores the lady

Alejandra Sobenes, President of the

Institute of Environmental Right and

Sustainable development in Guatemala,

who it presented the legal framework for the

charges systems implementation in

Centroamérica; the mister Raúl López,

Coordinator of the Area of Management

Environmental of the CCAD, who carried out a

presentation on the institutional framework

present in the region; the lady María

Guzmán, Organizer of the Commission of

the Basin of the Large River of Tárcoles in

Costa Rica and the mister Mario López,

Director of the Authority of Management

Sustainable of the Basin of the Lake of

Amatitlán in Guatemala, who

they presented proposals for the

charges systems implementation in

These two central american basins.



COVENANT ASOCARS - CAEMA

The past 18 from September the Association of Regional Autonomous Corporations of Sustainable development and Environmental Authorities

of Large Urban Centers (ASOCARS) and the Andean Center for the Economy in the Environment (CAEMA), they signed the

first Covenant of Cooperation to work jointly in the formulation and implementation of activities in the areas of training

and technical advising for the use of the economic instruments in the control of the contamination inside the environmental management

Colombian.

With the covenant, the regional environmental authorities will have access to the services of advising and training that offers the CAEMA

More agile, less costly, and it eliminates the need of individual contracts among the authorities and the Center. Among the services

that it facilitates the covenant are:

Advising in vengeful rates:

• preparation of semiannual reports with recommendations for the management of the regional rate,

• coordination of goals of vertimientos by basin, and

• Design and monitoring plans operation of vertimientos by basin.



Courses of professional training:

• updating in the operation of the vengeful rates,

• opportunities for the application of the Mechanism of Clean Development,

• designs of projects for the Mechanism of Clean Development,



Training

For greater information on the Covenant , to contact al

doctor Francisco Channel, Executive Director of ASOCARS:

Asocars@asocars.org.co

Telephones (1) 317 0164 / 317 2655 / 317 2888.

For greater information on the services and courses , to contact

al CAEMA in:

Caema@andeancenter.com, tel. 337 6616/6553

Association of Corporations

Autonomous Regional of

Sustainable development and

Environmental authorities of

Large Urban Centers
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