It has been determined that the plastic waste load in the Petanu river (Bali, Indonesia) can be as high as 2015.5 kg/day in the beginning of the rainy season. To restore the ecosystem and protect human livelihood this load should be reduced drastically. The enormous pollution rate is largely due to the massive amounts of mismanaged (plastic) waste at household level. This is the part of the waste that is either burned or dumped by the households, rather than collected or brought to a recycling facility. Extensive mismanagement of waste is an indication of an inadequate functioning waste management system. In Bali, and this watershed specifically, the existing system is decentralised and its waste management strategies rely heavily upon public participation. As a result, in some areas households have limited options regarding waste handling due to a lack of a collection system and other waste services. At the same time, households need to pay for those services. In order to improve the current waste management, it is therefore important to understand the trade-off made by the households between the environmental impact of plastic waste and cost of the waste management system.

In this report, this trade-off is studied by creating a real-world, coupled economic-environmentalmodel, of the Petanu’s watershed in the Gianyar regency. The model consists of two parts: 1) a production possibility frontier (PPF) and 2) a utility curve. The PPF is an arc curve that visualises the relation between the plastic waste load originating from households and the average impact on the monthly purchasing power of a household. The purchasing power is impacted since users of the waste management system need to pay for the services. The utility curve, on its turn, visualises a households trade-off between plastic waste load and impact on monthly purchasing power. Coupling these curves gives insights in how well the current waste management system satisfies the preference of the households regarding cost versus pollution rate. If the current waste management matches perfectly with these preferences, the point of tangency of both curves would be the location on the curve representing the current plasticwaste load and impact on the purchasing power. If the point of tangency has a lower plastic waste load and hence higher impact on purchasing power, households are willing to invest more in their waste management to improve the environmental quality of the Petanu river.

To gain insight in the trade-offs people make regarding four disposal methods (Self-Service, Pick-Up, Burn and Dump), cost and time, a stated choice experiment was set up. This is done by means of a questionnaire in which respondents were asked to make choices between hypothetical choice situations. The choice sets consist of different combinations of the disposal methods with varying attribute levels for cost and time. The survey has been conducted under 300 respondents from six different villages, located in the watershed of the Petanu river. With the help of data analysing program Biogeme, an open source Python package, the stated choice data has been transformed into the utility curve. Besides a general utility curve for the whole population living in the watershed of the Petanu river, also utility curves have been established for certain segments of the population, based on age, educational level and currently used disposal method. Hence, the questionnaire contained also questions about socio-demographic characteristics, the currently used disposal method and the corresponding cost. The latter two are not only used for the segmented utility curve but also for the creation of the PPF. The PPF is built-up by defining five different scenarios, i.e. the current situation, three scenarios with an improved waste management system and a scenario without a waste management system. The scenarios with an improved system have an increasedwaste collection rate or additional locationswhere recyclables can be handed in, in exchange for money. For all scenarios, the corresponding average cost per household and the plastic waste load in the Petanu river have been calculated. The quadratic best fit to these data points gives the PPF.

By combining the PPF with the general utility curve it was found that an average household in the watershed of the Petanu is willing to pay more for the waste management system than they are currently doing in order to decrease the plastic waste load in the Petanu river. It was even found that households want to achieve very low plastic waste load values and are willing to invest 47,400 IDR per month to reduce their contribution to plastic waste load by 100 grams per day. An exact equilibrium point is however not found as the PPF entails to many uncertainties at very low plastic waste load values. Nevertheless, the model gives a good indication and it is therefore recommended to increase the current collection rate of household waste. Furthermore, it is recommended to invest in TPS3R facilities in which waste is sorted and send to recycling facilities. Moreover, the combination of the PPF with the segmented utility curves gave some very interesting
insides. First of all, the younger generation (· 31 years old) has a higher willingness to pay for the reduction of plastic waste load, than the older generation. This is likely the result of the awareness programs on waste management at schools. Hence, it is recommended to expand this educational program. Secondly, educational level is positively correlated with willingness to pay. Remarkably, income level and gender did not have a significant relation with willingness to pay. Lastly, time is a significant determinant for the choice of disposal method, which corresponds to a certain plastic waste load. Therefore, it is recommended that waste management at household level should be as time-efficient as possible. This means the collection should be as much as possible be done at the doorstep of the houses and recycling bins should be located close-by.

All in all, it has been demonstrated that the households in the watershed of the Petanu river are very willing to pay for the waste management services, however, current waste management options are too limited. It is now the task of the governmental institutions and community leaders to enable collection of waste for every household in every village.