1
2
1 School of Management, Shenyang University of Technology, Shenyang, China
2 Graduate School, Shenyang University of Technology, Shenyang, China
( 1 llyywwhh@163.com, 2 hellonixin@hotmail.com)
Abstract - According to the cycling economic theory, this paper discussed the features of recycling cost and recycling benefit of the recycling economic project, and recognized the composition of recycling cost and recycling benefit, and constructed two evaluation models for the recycling economic project as recycling economic net present value and recycling benefit ratio.
Keywords - recycling economy; cost-benefit; project evaluatio
I. I NTRODUCTION economy project [3] . The cost and benefit of reducing comes from reducing the usage amount at the beginning of the production, adopting the alternate resource or reducing the pollution [4] . The cost and benefit of recycling and reusing comes from translating salvaged material to resource and recycling and reusing inside the project and among the enterprises [5] . Environmental cost and benefit of the recycling economy project means the environmental cost and benefit as developing recycling economy requirement comes from cleaner production, bio-safety disposal and the pay and relief of the tax and fees [6] .
Construction project is an important method and process to allocate and use resource, its result is direct related with the national sustainable development goals [1] . But the current project feasibility evaluation process of our country, usually evaluate the project through two methods: financial evaluation and national economic evaluation. And it lacks of recycling economy ability evaluation and the suitable method and system for the recycling economy project, therefore the recycling economy project cannot be specifically evaluated through the recycling cost and benefit and the recycling economic internalization process does not have basic approach and assessment criteria to follow which radically impedes implementation and enforcement of
Chinese recycling economy goals in construction project previous management process. The result is recycling economy project invests cannot be distinguished with other projects in the evaluation process. Therefore, this paper has study the composition of recycling cost and recycling benefit, and constructed basic evaluation models and indexes for the construction project under recycling economy, contribute d the recycling cost and benefit of construction project to the project value evaluation system, and to control the admission of the large investment construction project which damages the environment at the beginning of approving and decision [2] .
II.
F EATURES OF R ECYCLING C OST AND B ENEFIT
Recycling costs and benefits of the developing recycling economy project come mainly from three sources: the cost and benefit of reducing, the cost and benefit of recycling and reusing, environmental cost and benefit of the recycling
A. Features of Recycling Cost
1) Upfront Costs.
Recycling economy project requires large amount costs to input in advance, the cost even occurs at the design stage before the project actual operation. According to recycling economy’s requiring, experts need to be invited to plan and demonstrate the project, requisite machines and equipments need to be bought, technicians need to be employed and the former workers need to be retrained. Consequently, recycling cost will occurred in quantity at the earlier of the project.
2)Marginal Diminishing Costs
With the increasing of the product output, recycling cost has a tendency of marginal diminishing. The upfront recycling cost every production shares decrease by the increase of the output while the resource and energy costs and the pollutant charge increase under the traditional mode of production, for the reason that the technological superiority of recycling economy will manifest through mass production.
B.Features of Recycling Benefit
1)Long-term Benefits.
Recycling economy project inputs large amount at the beginning of the operation. So the marginal cost of the production is high and the recycling benefit is low. But with the operation lasting, marginal cost diminishing and recycling benefit increase. The competitiveness of the project and the production also increase because of the advancement of recycling economy. Because of above reason, the recycling benefits have a long-term feature.

2)Uncertain Benefits.
The recycling economy project risks will cause the benefits uncertainty. The risks mainly come from two resources, the operational risk and the estimation risk. One operational risk comes from technology risk for the recycling economy technology which belongs to innovative and high technology and the unanticipated conditions lead to project failure. The other is the estimation risk that the estimation of the recycling benefit may be different from the actual, for the recycling project is a new emerging thing and the relative researches and practices are lacking. These two risks lead to an uncertain recycling benefit.
III. C
B
ONSISTING OF
ENEFIT OF THE
R
R
ECYCLING
ECYCLING
C
E
OST AND
CONOMIC
R
P
ECYCLING
ROJECT
Recycling cost and recycling benefit of the recycling economic project mainly comes from three parts: resource reduction, resource recycling and reuse, and environment cost and benefit of recycling economic project.
A.
Consisting of Recycling Cost and Recycling Benefit of
Resource Reduction
There are various methods to implement resource reduction. One is simply reduce the usage amount by improving the efficiency of resource use or other technologic methods. The other is using other cleanly and efficiently resources instead of original resources to produce. So the amount of new resource exploitation and usage can be reduced. The key factor to implement resource reduction is targeted improving the production technology and process while ensuring the same production capacity and product quality.
1) Consisting of Recycling Cost of Resource Reduction
The main costs of resource reduction are as follows: a) The cost of alternative resources usage
Practically, many recycling economic projects use new kind of clean energy and materials instead of the environmental pollution and inefficient energy and materials, so they can reduce the amount of original resources and sum amount of resources. But the unit price or total price of the alternative resources may be high than the original resources.
Therefore, the cost of alternative resources usage is a important part of the cost of resource reduction.. b) The recycling cost of resource reduction technology
As the use amounts and the use types of resource both may change in the recycling economic project, the production process should be targeted designed. And buy the specialized machines and equipments and rebuild the factory.
This kind of costs like equipment investment and operating and maintenance fees are the costs of resource reduction technology. c) The cost of management and human resource
As resource reduction may cause the increase of the production processes and the total work, more workers may be needed. And as resource reduction technology is usually advanced, technicians need to be employed to assist and support to design, production and maintenance. The original workers need to be educated and new workers need to be employed. All the reasons above can cause the human cost increase. The resource reductionmakes production process more complex, and harder to operate and manage the project, so the management costs like the operation and the monitoring costs will increase.
2) Consisting of Recycling Benefit of Resource
Reduction a) Benefit of resource reduction
The resource supply becomes decreasing, and the resource price becomes bullish today. Resource reduction can cut off the production cost through improving resource using efficiency and reducing the using amount. The price of the saving resource is the benefit of resource reduction. There are two ways to cut off the cost and increase the benefit, one is the benefit of improving original resource using efficiency to reducing the resource usage mount while the other is changing the production technology, using other economical and efficient resources to reducing the original resource usage. b) Invisible benefits
For the resource reduction is an important measures to protect the environment, the production using the resource reduction technology has an environmental brand image and a social reputation, and the enterprise will advertise that to strengthen the consumers’ identification. This kind of publicity can bring about benefits by increasing the sales volume and improving the enterprise image.
B.
Consisting of Recycling Cost and Recycling Benefit of
Resource Recycling and Reuse
Resource recycling and reuse usually have two meanings in actual production. One is using the recycled resource for production and the other is recycling and reusing the underused resource in the project production process.
1) Consisting of Recycling Cost of Resource Recycling and Reuse a) The cost of recycled resource usage
Recycled resource means use the production and consumption waste, the byproduct, and the excess material as production materials through recycling and deposing. The cost of recycled resource usage contains the cost of buying the resource, recycling and sorting the resource, and transporting the resource. b) The cost of recycling and reusing technology
Most of the recycled resources have low conversion rates, low heat values and much impurity content. Therefore

they probably need to be sorted and special processed before put into production and need specialized machines or equipments. Consequently, expenditures of buying and maintaining the equipments constitute the cost of recycling and reusing technology. c) Resource recycling production cost
Resource recycling production cost means the cost of using the byproduct and excess material which come from the project production process to produce. Resource recycling production cost including the cost of recycling production equipments, deposing the byproduct for production and the relative labor and other resources. d) The cost of resource recycling and processing
It contains the costs of collection, transportation, and storing and the fees of inspection, classification, cleaning and disassembly. e) The cost of management and human resource
Similar like the resource reduction’s influence, resource recycling and reuse also can lead to this kind of costs.
2) Consisting of Recycling Benefit of Resource
Recycling and Reuse a) The benefit of recycled resource usage
Recycled resource is not only good for the environment but also low-cost for most of the recycled resources are transformed from the waste. The price spread between the new resources and the recycled resources is the benefit of recycled resource usage. b) Resource recycling product benefit
Recycling economy project uses the byproduct to produce other products. Resource recycling product benefit means sales income of these products. c) The cost of resource recycling
It contains: the income of selling the resource to the specialized recycling company after collection and sorting, the saving costs and fees of landfill and pollution discharge for the waste reduction which due to the resource recycling. d) Invisible benefits
Due to the enhancement of the social environmental awareness, the product uses the recycled and reused materials is more competitive in the market. The increase of product competitiveness and improvement of product image are the invisible benefits of resource recycling and reuse.
C.
Consisting of Environmental Cost and Benefit of the
Recycling Economy Project
1) Consisting of Environmental Cost of the Recycling
Economy Project a) Preventive environmental cost
It contains the following parts: The fees of building and operating the environmental management system [7] , the fees of environmental protection consulting and judgment, the cost of buying, using and maintaining related equipments and the fees of labor and welfare. b) Administrable environmental cost
Administrable environmental cost contains the fees of environmental protective measures, the fees of environmental protective equipments and the fees of biosafety disposing the emission. c) Losing environmental cost
Losing environmental cost mainly contains the fees of disposing the emission, pollution discharge fees, pollution cleanup fees, the fees of processing environmental pollution accident, and the fees of recovering the environment [8] .
2) Consisting of Environmental Benefit of the Recycling
Economy Project
Environmental benefit of the recycling economy project contains the following parts: the saving interest of national concessional loan in low-rate or non-rate for the recycling economic project [9] , tax preference, subsidy and bonus from government and reduced pollution discharge fees and the related penalty and reparations by clear production [10] .
IV. C OMPREHENSIVE M ODELS OF R ECYCLING C OST AND
B ENEFIT
According to the constitution of recycling cost and benefit, the following models can be built:
Total cost of recycling economy project:
Cr
1)
 C
Resource Reduction
 C
Resource Recycling and Reuse
 C
Environmen t
(
Total benefit of recycling economy project
Rr
(2)

R
Resource Reduction

R
Resource Recycling and Reuse

R
Environmen t
Among the total cost of recycling economy project, the cost of resource reduction:
C
Resource Reduction

C
Alternativ e Resources

C
Reduction Technology

C
Management
 i n 

1
C i
* Q i
 j n 

1
C j
* Q j

C
Management
(3)
In this equation, C i
represents the unit price of alternate resource numbered i, Q i
represents the amount of alternate resource numbered i, C j
represents the unit price of the technology or equipment numbered j, Q j
represents the amount of the technology or equipment numbered j.
The cost of resource recycling and reuse:

C
Resource Recycling and Reuse
 C
Recycling P roduction
 C
 C
Recycling Resource

Recycling and P rocessing

C
Recycling Technology
C
Management
 k n 

1
C k
* Q k
 l n 

1
C l
* Q l
 n  m

1
C m
* Q m

(4) n n 

1
C n
* Q n

C
Management
In this equation, C k
represents the unit price of the recycling resource numbered k, Q k
represents the amount of the recycling resource numbered k, C l
represents the unit price of the technology or equipment numbered l, Q l represents the amount of the technology or equipment numbered l. C m
represents the unit production cost of the product numbered m, Q m
represents the production amount of the product numbered m. C n
represents the unit recycling cost of the resource numbered n, Q n
represents the recycling amount of the resource numbered m.
The environmental cost of the recycling economy project:
C
Environmen tal
(5)

C
P reventive

C
Administrb le

C
Losing
Among the total benefit of recycling economy project, the benefit of resource reduction:
R
Resource Reduction

R
Reduction

R
Invisible
 i n 

1
R i
* Q i
 n  j

1
R j
* Q j
(6)
In this equation, R i
represents the unit price of resource numbered i, Q i
represents the reduction amount of resource numbered i, R j
represents the unit price of product numbered j, Q j
represents the additional sales amount of the product numbered j as the resource reduction.
The benefit of resource recycling and reuse:
R
Resource Recycling and Reuse

R
Resource Recycling P roduct


R
Recyclied Resource Usage
R
Resource Recycling

R
Invisible

(7) k n 

1
R k
* Q k
 l n 

1
R l
* Q l
 n  m

1
R m
* Q m
 n  n

1
R n
* Q n
In this equation, R k
represents the unit saving cost of the recycling resource numbered k, Q k
represents the usage amount of the recycling resource numbered k, R l
represents the unit price of the recycling product numbered l, Q l represents the sale amount of the recycling product numbered l. R m
represents the unit price of the recycling resource numbered m, Q m
represents amount of the amount of the recycling resource m. R n
represents the unit price of the product numbered n, Q n
represents the addition sale amount of the product numbered m as resource recycling and reuse.
The environmental benefit of the recycling economy project:
R
Environmen tal
(8)

R
Interest

R
Subsidy

R
Reduced Fees
In conclusion, the recycling economy cost and benefit can be shown as the following equation:
Cr
 i n 

1
C i
* Q i
 j n 

1
C j
* Q j
 k n 

1
C k
* Q k
 l n 

1
C l
* Q l
 m n 

1
C m
* Q m
 n n 

1
C n
* Q n

C
Rr
Management
 i n 

1
R i

*
C
P reventive

Q i
 n  j

1
R j
C
Administra ble

*
Q j
 k n 

1
R k
C
Losing
*
Q k

(9) l n 

1
R l
* Q l

R
Interest
(10)

 m n 

1
R m
R
Subsidy

* Q m
R
 n n 

1
Reduced Fees
R n
* Q n
V. E VALUATIONS AND S UGGESTION OF THE R ECYCLING
E CONOMY C OST AND B ENEFIT M ODELS
Recycling economy project feasibility has two methods to evaluate, recycling cost-effectiveness and recycling economic net present value.
A. Recycling cost-effectiveness
The formula of recycling cost-effectiveness is:
RNPV
 i n 

1
( CI

CO

E
1

E
2

Rr

Cr ) i
( 1
 r )
 i
(
11)
In this equation, Rr i
represents the recycling benefits in the year i, Cr i
represents the recycling cost in the year i, r represents the rate, i represents the time (in the measure of years).
B.
Recycling economic net present value
The formula of recycling economic net present value is:
RNPV
 i n 

1
CI

CO

E
1

E
2

Rr

Cr
i
 r
 i
(1
2)
In this equation, Rr i
represents the recycling benefits in the year i, Cr i
represents the recycling cost in the year i, r represents the rate, i represents the time (in the measure of years).
When the recycling cost-effectiveness of the project
RPVB<1 or the recycling economic net present value
RNPV>0, the return level of the resource which the project put into the recycling economy can be accept. The project is recycling feasible, and can be invested. If not, which means the benefit of recycling economy is less than the cost, the

project is recycling infeasible, and need to be adjusted to be feasible or abandon the project.
A CKNOWLEDGMENT
The authors would like to extend the sincere thanks to
Prof. Wang’s advising to this paper.
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