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Much of the material listed on these archived web pages has been superseded, or served a particular purpose at a particular time. It may contain references to activities or policies that have no current application. Many archived documents may link to web pages that have moved or no longer exist, or may refer to other documents that are no longer available.

Plastic retail carry bag use 2002 – 2004 consumption

Final report
NOLAN-ITU Pty Ltd for the
Department of the Environment and Heritage, March 2005


Appendix B - Sensitivity analysis on estimations

Introduction

This sensitivity analysis is used to determine the sensitivity of the methodology employed in this study to changes in the principle estimated parameters (variables). If a small change in a variable results in relatively large changes in the outcome, then the outcomes are said to be highly dependent on that variable.

This may suggest either that:

In this study it is not possible to verify the accuracy of the baseline variable values provided by industry, nor the possible variability of the values, without significantly increasing the scope of this study. Similarly the methodology employed in the study is believed to be the best available, without again greatly increasing the scope of the project.

As such, the objective of the sensitivity analysis undertaken below is merely to illustrate the general degree of dependence of the calculation outcome to the industry provided estimated variables. It is clear from the calculations below that this dependence is high.

It is not the purpose of the sensitivity analysis, nor is it currently possible, to provide a probability range on the plastic bag consumption estimations.

Impact of Non-Carry Bag Imports Estimation Variation

The majority of the lightweight HDPE bags used in Australia are imported, and a significant minority of LDPE bags are also imported. Data on these imports is provided by the Australian Customs Service (ACS). Goods are classified under a series of product description codes by the ACS. However these codes are not always exactly specific to a particular product, as is the case for HDPE and LDPE shopping bags. Thus it is highly likely that some non-carry bags are imported into Australia and classified under the same ACS codes as retail carry bags.

To adjust for this inflation the total weight of HDPE and LDPE bags imported and recorded under the relevant ACS code has been reduced by 25%. This is based upon discussion with bag importers, an estimate of the likely usage of produce bags, and an estimate of the percentage of these that will be included with shopping bags under the ACS codes. However, some uncertainty does exist as to the accuracy of this important estimation and so an analysis of the impact of varying this estimation by 20% (or 20% to 30% of imports, from a baseline of 25%) is provided in Table B1 below.

Table B1: Sensitivity Analysis of Non-Carry Bags Estimation
Estimation Variation 2004 HDPE 2004 LDPE 2004 Total 2002 Total % Decrease 2002 to 2004
20% (-20%) 5.00 0.89 5.88 6.92 14.9%
25% (baseline) 4.73 0.84 5.58 6.92 19.4%
30% (+20%) 4.47 0.80 5.27 6.92 23.8%

Impact of Local Production / Imports Ratio Estimation Variation

Another major estimation used to establish local HDPE and LDPE retail carry bag numbers, and thus overall plastic retail carry bag use, is the ratio of imports of carry bags to the local production of carry bags.

Local bag manufacturers advised in 2002 that the estimated ratio of local product to imports of plastic bags was approximately 1:2. Further discussions during early 2005 indicated that this ratio was largely unchanged for 2003 and 2004, and so this value has been used to establish local production for 2002, 2003 and 2004. However, uncertainty does exist as to the accuracy of this important estimation and so an analysis of the impact of varying this estimation by 20% (or 40% to 60% of imports, from a baseline of 50%) is provided in Table B2 below.

Table B2: Sensitivity Analysis of Local Production to Imports Ratio Estimation
Estimation Variation 2004 HDPE 2004 LDPE 2004 Total 2002 Total % Decrease 2002 to 2004
40% (-20%) 4.42 0.79 5.21 6.92 24.8%
50% (baseline) 4.73 0.84 5.58 6.92 19.4%
60% (+20%) 5.05 0.90 5.95 6.92 14.0%