Waste Management Solid

The growing energy from waste management market continues to scale with an influx of capital and rapidly growing interest from several market areas, - offering diverse economic opportunities.

By Les Blevins

October 02, 1990

For incorporated towns, cities and counties, it’s an ideal time to be in the commercial and industrial waste market, says Les Blevins President at ADVANCED ALTERNATIVE ENERGY in Lawrence Kansas.

“We could be converting area available urban and agricultural biomass and municipal wastes to power and both fuel gases and to liquid fuels,” explains Blevins of Advanced Alternative Energy. “We should aim to process all the above and more to energy without damaging the environment.

In the next five to 10 years, Blevins predicts, the waste sector can expect to see residential as well as municipal industrial waste businesses as well as larger waste management firms moving from pursuing existing waste and solid waste strategies. He says he also expects to see an evolution in the waste-to-energy model as technology to process many diverse waste streams into alternative energy sources.

“When you think about sustainability, think about the regulatory environment and you think about the fragmented nature of the waste management industry, the commercial and industrial waste market sector is ripe for capital to build more scalable businesses here and it is ripe for the strategics that have already built platforms to scale and add value to their clients,” he says.

Key players

The municipal and industrial waste sectors alone will account for an approximate $175 billion of total addressable markets, and in the approximate $225 billion environmental services and waste resource management industry, Blevins says. The combined municipal and industrial waste stream encompasses hazardous and nonhazardous streams, Blevins explains, including liquids and solids coming primarily from the municipal industrial complex.

Industrial and municipal waste can be viewed as a solid waste business, only with slight differences in waste processing, disposal and customer contracting dynamics. Otherwise, the two are very similar in terms of vertical integration of the businesses from a collection, processing and disposal or utilization capability. “It’s a massively more fragmented market, but very equal in terms of size—and growth potential,” Blevins says.

In five to 10 years, look for a more consolidated market, Blevins says. He predicts that the market will become more subscale but will include respectable-sized waste platforms.

“I think you’ll see more advancements in technology designed to process waste streams into alternative energy sources compared to purely disposal,” he says. “It means that the waste-to-value business model will evolve as technology gets more advanced to process all those various waste streams properly.”

Capital markets

For companies in the waste sector, the private capital market offers significant opportunity for potential expansion. Large pools of capital have been raised to pursue initiatives ranging from climate to resource conservation to sustainability, he says.

The capital markets see opportunity in environmental services that stretch beyond disposal, Blevins says, whether that’s processing waste streams, collecting waste streams or sending waste streams for alternative uses.

“The disposal model will likely be there for a very long time, but capital is going to monetize those waste streams as a usable source into some process,” he says. “You see capital being raised in the form of climate funds, sustainability funds, waste-to-value, decarbonization and energy transition, and so things will change.”

“Similar to solid waste, eventually scale will also dominate because scale is critical,” he says. “Facility network and population density are important, so you can expect regional players taking advantage as the market consolidates. There’s ample opportunity for capital to do that and for regional players to do that, but you can eventually see them being acquired by some of the larger winners.”

" This time, like all times, is a very good one, if we but know what to do with it." ~ Ralph Waldo Emerson, 1803-1882

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