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Contribution Details

Type Master's Thesis
Scope Discipline-based scholarship
Title Financial and Managerial Incentives to Recycle Tantalum, a Strategic Metal, from Electronic Waste: A Real Options Analysis
Organization Unit
  • Max Cejka
  • Marc Chesney
  • English
Institution University of Zurich
Faculty Faculty of Business, Economics and Informatics
Date 2022
Abstract Text Waste electrical and electronic equipment (WEEE) is a fast-growing stream of municipal solid waste. It is considered an extraordinary hazardous and harmful category of waste due to its high content of various chemical pollutants. An efficient circular economy for WEEE does still not exist on a global scale, so that no more than 20% is recycled properly and responsibly. On the other hand, WEEE is a treasure trove of expensive and scarce secondary raw materials. One of them is the metal tantalum, which is found on old circuit boards and is not yet recycled from them. This paper examines the opportunity of setting up an innovative tantalum recycling project in an existing Central European (especially Swiss) WEEE recycling company from a technical, economic and financial point of view. First, a discounted cash flow model is used to assess the profitability of the project. Then, a real options model is applied to find the optimal investment timing strategy under the prevailing uncertainties of the project, and to answer the central research questions about whether, when and how much money to invest in the project. Results indicate that it would be technically feasible to integrate this new process into the existing WEEE recycling procedure by making minor adjustments. The net present value is clearly positive under different managerial and technical scenarios, but the real options model recommends waiting until estimated revenues are twice the estimated costs. This is likely to happen in the next few years.
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