Waste business to top $60 billion by 2010

According to the U.S.-based Waste Business Journal’s recent Waste Market Report, the waste management industry in the US is a $52 billion per year business and is conservatively on track to exceed $60 billion by 2010. More than half of those revenues will be contributed by just the top five companies which are, not surprisingly, publicly traded.

“The increasing role of the private sector has been a trend ever since more stringent federal and state regulations implemented in the early 1990’s created huge economies-of-scale in the waste business, particularly on the disposal side,” according to the study’s principal author, James Thompson. The publicly traded companies collectively represent almost 60 per cent of the industry today up from 47 per cent as recently as 2001.

Comprising the $52 billon industry in 2006, waste collection represents 54% or $28 billion, while disposal in landfills and waste-to-energy plants represents 33% or $18 billion, and processing and materials recovery efforts account for 12 per cent or $6 billion in annual revenues.

In 2006 the US generated about 517 million tons of municipal solid waste including some construction and demolition (C&D) wastes entering municipal waste landfills and waste-to-energy plants. Of the total, 154 million tons or 30 per cent was diverted by way of recycling and composting programs. About 10 million tons of waste was imported from outside the US, primarily Canada. 93 per cent of the waste available for disposal or 348 million tons was buried in landfills while the remaining 32 million tons was burned in waste-to-energy plants.

A continually growing population and economy have contributed to steadily increasing waste generation in this country. 517 million tons generated last year are up from 458 million generated in 2001. Even per capita discards, now 9.5 lbs per person per day, are still increasing each year and seem to evidence our ever more consumer product-driven throwaway culture.

The number of landfills however is steadily decreasing. Smaller landfills are closing due to a lack of space and because of cost disadvantages with their larger cousins. That means that the annual volume of waste handled by the average operating landfill is increasing. More so for landfills owned by the private sector; the average private landfill accepts 256 thousand tons per year while the average government landfill accepts just 60 thousand tons per year.

As landfills close, waste moves over ever greater distances in search of disposal, which means that it is more likely to cross a state border or two. This is evidenced by sharply higher rates of waste imports and exports which now stand at nearly 90 million tons per year versus 20 million tons moving between states in 1991.

The consequence of closing landfills, albeit smaller ones, has been to begin to shrink available landfill disposal capacity. And while large landfills had been added in the early and mid 1990’s, few have been added since.

According to Thompson, “We are finally at a point where we have begun to spend down excess capacity to a more reasonable run rate. The effect of which will be to put increased pressure on pricing especially when you add in the increased transportation costs of moving waste from region to region.” Landfill tipping fees have risen nearly 5 per cent since 2005.

Ultimately higher prices will in turn lead to increased recycling as the avoided cost of disposal drives the incentive to be more creative with our ever more voluminous waste stream.

If you are more interested in receiving more information about the study or would like to order a copy, contact James Thompson at 619-793-5190 or thompson@wastebusinessjournal.com

You may also visit www.wastebusinessjournal.com/overview.htm.

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