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A Note From The Editor:
In this month's issue of the Circular File, we provide some highlights and our thoughts from one of the WasteExpo educational sessions, "Solid Waste Industry Size and Statistics", presented by Bryan Staley, PhD, President of the Environmental Research and Education Foundation (EREF).
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Disparate Data
Dr. Staley noted in his presentation that primary sources of industry/business data were the Waste Business Journal (WBJ), EPA data, Waste Age magazine, Waste and Recycling News, Biocycle magazine, and various industry reports developed by market research firms like the Freedonia Group. EREF's last major industry report was 2001, but he noted plans in the works for an update in 2012. Unfortunately, there is often little consistency between the reports, with methodology limitations and data quality issues, which frankly, is a frequent complaint of industry followers.
Industry Size Estimates Vary
Frequently cited as a source for industry size, WBJ put the solid waste industry at $55.7 billion in 2009, projected to be in the low-$60 billion area in 2011/2012. Other estimates are as high as $70 billion. Based on the Waste Age 100 list, 67% of the industry's revenues are generated by the top 100 firms, while the publicly traded companies account for 85% of the revenues of the Waste Age 100. By segment, the trend toward consolidation and privatization is clear. Again, according to WBJ, in 2001, small private companies and municipalities accounted for 23% and 30%, respectively, of industry revenues, with the publicly traded companies accounting for the remaining 47%. In 2010, the private company and municipal shares had shrunk to 18% and 23%, respectively, while the publicly traded companies' share of revenues had risen to 59%. Further underscoring the consolidation in the industry, the very large companies, with revenues over $1 billion, comprise 52% of the total market versus 48% in 2001. In an interesting sidebar, based on US Department of Labor Statistics and the Waste Age 100, although the top 100 firms account for 67% of the revenue, they employ only 47% of the workforce. Besides being more efficient, another factor is that the larger companies, particularly the publicly traded companies, utilize more contract workers, in order to increase their ability to flex down variable costs.
Waste Generation Projections Vary Even More
The primary sources for municipal solid waste generation figures are the US EPA and Biocycle, but there is a wide discrepancy in the actual numbers reported, though the trend lines are similar between the two sources. The widely cited US EPA report on municipal solid waste (MSW) generation put 2009 total MSW generation at 243 million tons, down from a peak of 255 million tons in 2007. Biocycle's MSW generation figure is closer to 400 million tons. The sources use two very different methodologies. Although the absolute difference is significant and frustrating, many industry participants are more concerned with trends and forward projections. Unfortunately, there appears to be no consensus on that either. In the presentation, Dr. Staley noted that waste generation projections vary widely, depending on whether projections are based on the average MSW growth over the last ten years (‘00—‘09) or five years ('05-'09). It should be noted that these are not EREF forecasts, but projections based on historical growth rates. Based on the ten-year average, waste generation would be flattish between now and 2030, hovering near 250 million tons. Based on the five-year average, waste generation would decline much more markedly by 2030, falling to roughly 200 million tons, a 20% decline from current levels. It must be noted, however, that obviously the latter extrapolation is heavily influenced by the sharp decline from 2007 to 2009 in the midst of the Great Recession. A much more optimistic forecast comes out of the Freedonia Group. MSW is forecast to reach 295 million tons by 2020, versus 254 million tons in 2010, with a slight uptick in pounds per person per day, from 4.5 in 2010 to 4.75 in 2020. According to EPA data, per capita generation drifted down from 4.72 pounds per person per day in 2000 to 4.63 in 2007, before slipping to 4.34 in 2009. According to the Freedonia Group, even landfill disposal is expected to rise,
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Industry Resources
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from 136 million tons in 2010 to 151 million tons in 2020, though recycling tonnages will rise faster, from 65 million tons in 2010 to 83.5 million in 2020. According to US EPA data, from 2000 to 2007, landfill tonnages were flattish, bouncing around 140 million tons annually, before falling to 132 million tons in 2009. On a dollar basis, the Freedonia Group is forecasting annual waste collection growth of 4.1% from 2010 to 2015, waste treatment and disposal growth of 3% in the same timeframe, and much higher material recovery annual growth of 7.3%. Freedonia's annual percentage growth projection for gross domestic product from 2010 to 2015 is 4.7%.
Future Focus on Plastics and Organics
As both corporations and government entities eye (and put into place) increased recycling goals and sustainability/zero waste initiatives, organics and plastics are increasingly under focus, as potentially the greatest source of further recovery potential. Looking at solid waste composition, organics comprise roughly 70% of the total, and packaging 25%, based on EPA and state studies. For packaging wastes, 52% is recycled, and 48% either landfilled or sent to waste-to-energy plants. The majority of packaging that is recovered is comprised of paper, while over 80% of plastics are going to landfills. Within organics, the bulk is comprised of paper, yard and food waste, at 42%, 20% and 21% respectively. But, while paper and yard waste recovery are both around 60%, according to the EPA, food waste recovery is only 2.5%. Hence the proliferation of emerging, alternative technologies for plastics and organics recovery/energy generation being developed, and certainly seen at WasteExpo. That said, a number of hurdles remain to greater recovery of these wastes. Although composting is a straightforward use of food waste, the "yuck factor" remains high, particularly on the residential side. And, while investments in waste to energy/fuels/chemicals are growing and hold great promise, at this point they remain "next generation." |
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We Want to Hear From You
We would like your feedback, thoughts, suggestions, etc., as we create future issues of The Circular File. Please send questions or comments to rita.ugianskis@penton.com or lyoung74@comcast.net. Your input will be invaluable.
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