Cost Benefit Analysis of Lead Waste Site Interventions in Indonesia by Using Exposure, DALY & VSL Estimates: A Case Study of Cinangka, Indonesia

Abstract

Toxicity of lead to various human organs and tissues, including, the heart, bones, GI tract, reproductive and nervous system have been well documented. In particular, the neurotoxic effects of lead exposures on young children have been examined well and quantified based on studies conducted mostly in high income countries. Consequently, high income countries have taken various precautionary actions in order to prevent dangerous exposures to lead by the most vulnerable groups, including children, occupational workers and the elderly. In contrast to this, studies on exposures and mitigation actions to avoid lead exposures in low and middle income countries (LMIC) have been quite limited, mostly due to budgetary constraints. This thesis aims to assess children’s potential exposures, risks and mitigation costs in Indonesia using cost-benefit analysis techniques. The exposure and health focus was restricted to toxic lead contamination in soil, resulting in mild mental retardation (MMR) in children.

Specifically, two research questions were investigated: 1) Is Indonesia underestimating the health costs caused by water and soil pollution from lead toxic waste sites? and 2) Does a cost benefit analysis show that the benefits will outweigh the costs of remediation?

The non-profit research organization Pure Earth in New York City provided the data on measured lead contamination in soil samples they have taken from different parts of the Cinangka village in Indonesia. The soil contamination in Cinangka was caused by past and present small-scale lead acid battery recycling operations in the village. For data analysis purposes, the village was divided into six separate sample areas, based on the type of use of each area (e.g. residential, areas with infrastructure or in which lead recycling is performed). Calculated geometric mean of the soil lead measurements in each of the sample areas were first used using as inputs into EPA’s Integrated Exposure Uptake Biokinetic Model (IEUBK model) to predict blood lead level (BLL) values and then subsequently using these BLL values for estimating the MMR incidence rates and finally for predicting the number of disability adjusted life years lost (DALYs). Using the previously developed approaches by the World Health Organization (WHO), the estimated number of DALYs in turn were converted into a predicted monetary amount by employing a benefit transfer (BT) approach based on three separate value of statistical life (VSL) studies done in the Asia. This monetary value is an estimation of the monetary benefits gained by cleaning up lead contaminated waste sites. For an indication of the cost of remediating lead contaminated waste sites, an average cost was calculated based on the cost of six remediation’s done in LMIC by Pure Earth.

The cost benefit analysis (CBA) performed in this research showed that from a financial perspective, it is beneficial to remediate the more contaminated and populated sample areas four, one and two. However, a break-even point was identified when 37.7 DALY’s due to lead exposures expected to cause MMR in children can be avoided. Despite numerous information limitations in this thesis, we conclude that there is good evidence to confirm the validity of the research questions posed, especially considering the fact that the calculated benefits were based on avoiding only the incidence of MMR in children, among many of the other health impacts that have also been associated with chronic lead exposures.