Economies of scale and strategic planning for municipal waste treatment plants in Greece

More than 300 municipal waste treatment plants are expected to be built in Greece over the next 15 years at a running cost of US$360 million. From a strategic planning point of view, and considering that (1) a major portion of the cost corresponds to imported technology/equipment and (2) the financing of these plants will place a heavy burden on an already strained government budget, the following questions arise: How is the demand for various sizes of such plants expected to evolve? Are there economies of scale? Are there equity questions regarding government grants for such plants? This paper presents the findings of a research project (1987-88) whose objectives were to answer the above questions. It was found that the cost of a plant as a function of inflow is given by a simple multiplicative model with economies of scale up to 8000 m3 per day. On the basis of logical assumptions regarding the rate of increase in population and water consumption in Greece, the expected growth in demand for such plants and, consequently, funds is determined.