Economics of fly ash utilisation: formation of an efficient link between the source and the sink
Student name: Ms Deeksha Soni
Guide: Prof Kanchan Chopra
Year of completion: 2012
Host Organisation: TERI University
Abstract: The Theory of Environmental Economics delineates a clear distinction between an economic
good and an economic bad. Generally, Fly Ash has been considered to be an economic bad
since its discharge into air may result in air or water pollution. Even the government policies
for that matter have been shaped in this view only. This general view does not take into
consideration the copious benefits that accrue to the users of Fly Ash. Thus the problems
strongly lies in the fact that fly ash is regarded as a negative externality and it is time now
that we broaden our horizons and move away from the „Polluter Pays Principle‟ and reexamine
how should the problem of Fly Ash use and disposal be tackled. This study
primarily endeavours to examine the significant factors having an impact on the fly ash
utilisation in the context of India. Keeping in close view MoEF‟s mandate on 100 per cent
utilisation of Fly Ash, this study aims to establish an efficient link between the potential users
and generators of Fly Ash. The econometric analysis leads us to conclude that indeed huge
cost is saved post fly ash substitution and hence Cost Saving is a significant variable in this
analysis. Long distance transfer of fly ash is the key impediment in fly ash use; this
hypothesis is supported by the negative explanatory power of the maximum distance variable.
Keeping at close quarters with this finding, the study successfully shows that the cement units
can cover long distances and still remain profitable.
KEY WORDS: Environment, Fly Ash, PPC, Limestone, Cost Saving, TPPs
