An Optimization Approach for the Subsidy Mechanism Determination of Food Waste Treatment

As a result of sustained population growth and significant improvement in living standards, the amount of generated food waste is huge and continues to increase. Resource-based treatment of food waste using anaerobic digestion has become the most practice in China. However, the current application of anaerobic digestion is facing problems such as low efficiency and poor reaction stability, which results in hindering the progress of the food waste treatment industry. Therefore, this study proposed a bi-level optimization model to equilibrium the decisions of the local government and the food waste treatment plant, which helps the local government to use the subsidy mechanism to encourage the operation of the food waste treatment plants and improve the effectiveness of food waste treatment. The impact of the feed-in tariffs for food waste cogeneration on the model results is analyzed. It was found that the local authority should subsidise the feed-in tariff and that food waste treatment plants should consider the selection of anaerobic co-digestion substrates in conjunction with costs.