It’s a dirty world, but cleaning it up may be rewarding.
In Yorkshire, England there’s an old expression: “Where there’s muck, there’s brass.” Meaning if you’re willing to get dirty, you just might make a little money. In a world that just topped 7 billion people and counting, there’s plenty of muck—call it solid waste or garbage or rubbish or trash. And it’s overwhelming. But where is the brass? It appears to be coming from turning the muck into energy.
Waste-to-energy (WtE)—where solid municipal waste is either burned or gasified (thermal), or turned into a synthetic fuel (digestion)—is a growing market. Globally, WtE is expected to grow strongly, with revenues from WtE systems increasing from $3.7 billion in 2010, to nearly $13.6 billion by 2016, according to Pike Research.
Solid waste is the feedstock for WtE. Its supply continues to grow as populations, urbanization, and standards of living rise. According to World Bank data, the U.S. produces over 1,600 pounds of waste per person each year, churning out 40% of the world’s waste for only 5% of the world’s population. That’s around 220 million tons of garbage each year. Estimates suggest China will produce approximately 533 million tons of waste by 2030.
Waste could most likely be added to the short list of truly renewable sources of energy on the planet.
“WtE is compelling because there’s always going to be trash,” said MacKinnon Lawrence, senior analyst at Pike Research.
Landfills for many are no longer the solution. Waste decays and releases pollutants into the soil and ground water, and into the air, as it turns to methane and carbon dioxide.
Land is also finite. At some point, it will be needed for other uses, like housing. Thus, it tends to be in smaller countries, and in U.S. states, that have been the leaders in WtE deployment. Denmark burns 54% of its waste for heat and power, while Sweden incinerates 49%, according to EPA and Eurostat figures.
The U.K. is adopting more stringent landfill regulations, said Robert Eckard, Energy Analyst at the industrial market research firm SBI Energy, which projected in a 2011 research report that WtE could provide up to 10% of the world’s electricity. “[It] has seen an exponential growth in WtE installations, as waste managers scramble to keep up with regulations and avoid fines.”
Eckard noted that in emerging economies, especially China and India, mid-to-long-term growth in WtE will be driven more by the presence of feedstock, rather than a lack of available land. Yet, moving to WtE solutions is not an easy sell in every country. The U.S. has had a love-hate relationship with incineration since the 1970s, when hastily built plants spewed pollutants into the air. The recycling of negative data about emissions, local, state and national red-tape, and Nimbyism (Not In My Backyard), have put the brakes on new development for now.
“There were facilities built using very old technology that did not have good emissions-control equipment,” Lawrence said. “But there have been a lot of advances in improving emissions air-quality control equipment, and waste energy comes out on top.” Why? Due to stringent standards, waste energy has about a third of the emissions of burning coal, and about half that of natural gas, he added.
European markets are expected to continue to lead growth in WtE until 2020, when mandated EU targets mature. After that, continued growth in North American and Asian markets could continue to drive incinerator markets, said SBI Energy in its white paper “Waste to Energy Technology.”
“Generally speaking, an increase in solid waste means a concurrent increase in potential feedstock for waste to energy, and is expected to drive more WtE installations in the future,” Eckard noted.
From selling waste, to transporting it, and turning it into heat or power or fuel, there are entrepreneurial companies out there who can smell the opportunity. Investors can too.
One Man's Trash
Garbage is big business. So is resurrecting waste. Hauling, recycling, and alternative-energy industries will have a growing stake in cleaning up after the population boom. For a list of the “Waste & Disposal Services” heavyweights, check out "Industrials" in Sectors & Industries.