Material Valuation in Waste Management

[akash_agrawal5]

Hi Fellas,

Have a query, could anyone advice on the below scenario please?

In waste management we do not valuate waste materials. However in current requirement there are couple of cases.

1 - Those Hazardous wastes which have to be sold (would generate revenue to the company), how to make that cost accountable if material is not valuated?

2- Hazardous wastes which have to be scrapped using business partner service (would be a cost to the company), how to map it in service procurement as there are physical materials involved?Any other workaround?

Any input would be extremely appreciated.

Thanks,

Akash

[Former Member · Accepted solution]

Hi Akash,

In order to valuate hazardous waste materials , there are two options 1. calorifc value of the hazardous waste - generally the hazardous waste disposal options associated with its characterstics like moisture, ash, organic contents and level of inrganics. these parameters are used to define its calorific value too. If hazardous waste is rich with organic content, it will be having higher calorific value and it must be incinerated with sound technologies. alternatively, now a days, these incinerable hazardous wastes are found useful to burn as co-fuel in the rotary kilns specially in cement plants and steel industry. The calorific value is key determinant to estimate the value of the hazardous waste. e.g. if the coal is having calofic value of about 3,300 k.cal/kg. The calorific value of the hazardous waste is about 3,000 k.cal/kg. then the value of the haz. waste may be estimated as =3,000/3,300 X weight of the coal. once u arrived the weight of the hazardous waste equivalent to the coal, the price of the coal be used to cost of the hazardous waste.

2. some of the hazardous waste streams of specific industry may be alternatively useful raw material for anotehr kind of the industry, mostly, sodium sulfates (inorganic salts) from dye & dye intermediate units is useful for paper industry. the procurement cost of the sodium sulphate may be used for the valuation of the hazardous wste in this specific case.

As u rightly said the the H.waste to be scrapped using business partner services, may be incuur cost to the company, due to legislations and mode of transporation and other handling expenses. However, the valuation of the waste is differnt from the profit to the company, due to its end user application, if not sent for landfill or incineration at dedicated facilitator.

thank u,

mahesh.

[Former Member]

Hello,

In Brief.......

1. If you could able to sell a product......it is no more Waste. You can convert the material into Finished or semifinished

2. Cost of the waste disposal process can be mapped though a cost center with appropriate Account assignment group

Best Regards

Srinivas

[Former Member]

Hi Akash

If we declare that material as a by product instead of hazardous waste in SAP. Then we can sell that product through standard SAP business process in SAP MM and SD modules.

Only thing, we may have to generate MSDS for that hazardous material as we selling is involved. You may have to use Product Safety Module.

Regards

Vikram

[akash_agrawal5]

@ Mahesh,

Thanks for your reply. As you have mentioned that valuation of waste is different from the profit to the company. It would be great if you could elaborate it a bit.

@ Niraj,

As per Business process few hazardous wastes could be sold. For example - catalyst solvents. Appreciate your given workaround.

@ Vikram,

Thanks for your reply mate. MSDS is not required in current process.

Thanks,

Akash

[Former Member]

Hi Akash,

As i briefed earlier, any hazardous waste must be disposed off to a secured landfill/ incineration as per its characterstics. usally these waste will be disposed off directly to the facilitator or thru business partners. In any case, it will be charged by the facilitator to receive, treatment (if necesary) and disposal of the haz. waste that was received from the generator/ trader.

If the haz. waste from a parent company is given to other industry either to use partly/ completely, the cost incuured for transporting, treatment and disposal at the facilitator of common facility is nothing but saving money/ profit to the parent company, as the buiseness partner will be using it as one of the raw material. i.e. the treatment & disposal cost for the parent company is avoided directly. This option may not be exists for all kinds of wastes. Cutting the disposal cost of specific waste may be converted into profit to the company that generates hazardous waste at source and not incurring the disposal cost. In the case of business partner, most of the waste will be used as raw material and still some quantity of processed waste has to go to common facilitator for final disposal. The differentail quantity and converting into monetary terms can also be taken into profit account, instead of sending large quantity of waste. This applies in both landfill and incinerable categories of hazardous waste streams.

thanks & regards,

mahesh

Edited by: mahesh vr on Aug 31, 2009 5:23 PM

[nirajsikligar]

Hi Akash,

Practically, as per Business process hazardous waste can not be sold. It has to be disposed only and ther will be no revenue generated out of it.

For mapping service procurement, once the purchase order is generateed from Waste management work bench (Wae02), you can modify the the PO by removing material code from PO and assign Item category as D( Serive) to that PO and process further.

Hope this will be helpful to you.

Regards,

Niraj Sikligar.

[Former Member]

Hi Akash,

In order to valuate hazardous waste materials , there are two options 1. calorifc value of the hazardous waste - generally the hazardous waste disposal options associated with its characterstics like moisture, ash, organic contents and level of inorganics. These parameters are used to define its calorific value too. If hazardous waste is rich with organic content, it will be having higher calorific value and it must be incinerated with sound technologies. Alternatively, now a days, these incinerable hazardous wastes are found useful to burn as co-fuel in the rotary kilns specially in cement plants and steel industry. The calorific value is key determinant to estimate the value of the hazardous waste. e.g. if the coal is having calofic value of about 3,300 k.cal/kg. The calorific value of the hazardous waste is about 3,000 k.cal/kg. then the value of the haz. waste may be estimated as =3,000/3,300 X weight of the coal. Once the weight of the hazardous waste equivalent to the coal is arrived, the price of the coal be used to cost of the hazardous waste.

2. some of the hazardous waste streams of specific industry may be alternatively useful raw material for another kind of the industry. e.g. sodium sulfates (inorganic salts) one of the hazardous waste generates from dye & dye intermediate units is being used by paper industry. The procurement cost of the sodium sulphate in a paper mill may be used for the valuation of the hazardous wste in this specific case.

As u rightly said the the H.waste to be scrapped using business partner services, may be incuur cost to the company, due to legislations and mode of transporation and other handling expenses. However, the valuation of the waste is differnt from the profit to the company, due to its end user application, if not sent for landfill or incineration at dedicated facilitator.

thank u,

mahesh.