The World's #1 Renewable Energy Network for News, Information, and Companies.
Untitled Document

Will Higher Heat Content in Trash Help Waste-to-Energy Stocks?

The US Energy Information Administration (EIA) recently published an article describing an increase in the energy content of municipal solid waste (MSW). The reason for this increase is an increase in the percentage of waste from "non-biogenic" sources (i.e. plastics) as compared to biogenic sources (paper, cardboard, wood, food and yard waste, etc.) Biogenic waste has an average heat content of 11 MMBtu/ton, as compared to 23 MMBtu/ton for non-biogenic waste.

The EIA attributes the relative decrease in the amount of (biogenic) food containers and packaging (heat content 16.6 MMBtu/ton) and an increase in waste polypropylene (PP, 38 MMBtu/ton.)  PP is the relatively hard-to-recycle plastic #5, found in yogurt cups and other wide-necked containers, and has a much higher heat content that relatively easy-to-recycle plastics #1 and #2 (PETE at 20.5 MMBTu/ton and HDPE at 19.5 MMBtu.)

The higher heat content of MSW should make generating electricity from MSW more efficient, and give a slight boost to margins of waste-to-energy companies like  MSW electricity generators like Covanta (NYSE:CVA) and Algonquin Power and Utilities (OTC:AQUNF, TSX:AQN), which generates thermal energy from MSW in addition to a large renewable energy business.

However, if increasing energy content of waste is to make a difference in the stock prices of MSW-to-energy firms, it will have to be sustained over the long term.  I doubt the trend will continue for long.   First of all, total MSW volumes are flat in the US, and falling on a per-capita basis, even while recycling rates are rising (EIA data.)

I expect increased recycling to begin to reduce the energy content of the remaining waste as less-recycled, higher energy-content materials are increasingly recycled.  Currently, only 13.5% of plastic containers  in the waste stream are recovered, as opposed to 71% of paper and 33% of glass.   Further, high-energy PP is becoming increasingly easy to recycle; I was recently pleased to find that it and LDPE (plastic #4, also with a relatively heat content of 24.1 MMBtu) are now accepted at my local transfer station.

While waste-to-energy companies may be getting a small margin boost from higher MSW heat content today, investors should not count on any such boost being permanent.  That’s a large part of the reason why my preferred investments in MSW are integrated companies like Waste Management (NYSE:WM), which can profit from both increased recycling and waste-to-energy opportunities.

Disclosure: Long AQN, MW

This article was first published on the author's blog, Green Stocks on September 6th and AltEnergy Stocks and was republished with permission. 

DISCLAIMER: Past performance is not a guarantee or a reliable indicator of future results.  This article contains the current opinions of the author and such opinions are subject to change without notice.  This article has been distributed for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product.  Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.

Lead image: Trash via Shutterstock

Untitled Document

Get All the Renewable Energy World News Delivered to Your Inbox - FREE!

Subscribe to Renewable Energy World Magazine and our award-winning e-Newsletter to stay up to date on current news and industry trends.

 Subscribe Now



DOE Releases Final Programmatic Environmental Impact Statement for Hawaii

Jennifer Delony DOE released a final programmatic environmental impact statement for Hawaii to provide federal, state and county gove...

The 800 Ways Taxpayer Money Supports Fossil Fuel Industries

Reed Landberg, Bloomberg As world leaders converge on New York for a United Nations gathering that’s expected to have a strong emphasis on cli...

Makers of Fuel From Plants Feel Forsaken in Obama’s Climate Push

Mario Parker, Bloomberg Producers of motor fuels from plant waste say they have been left behind in President Barack Obama’s push to fight cl...
clean energy

Report: Vermont Clean Energy Sector Jobs Increased 9.8 Percent Since 2013

Jennifer Delony Vermont saw a 9.8 percent increase in clean energy sector jobs since 2013, and jobs in the sector are expected to gro...


US Solar Institute Chosen for Military Solar Training at Patrick Air Force Base

In August 2015, the Air Force chose The US Solar Institute (USSI) for a specialized sol...

Solar Power World Ranks Florida Solar One a Top 400 Solar Installer

Florida Solar One, a Miami Fort Lauderdale solar contractor is ranked among the top sol...

NC State University Installs Student-Funded Spotlight Solar Structure to Drive Awareness and Adoption of Clean Energy

North Carolina State University (NC State) will today showcase its commitment to clean ...

Canadian Solar Signs Agreement with Mashiki Town and Kumamoto Prefecture to Build 47 MW Solar Plant in Japan

Canadian Solar Signs Agreement for 47 MW Solar Plant



Geothermal Visual: GEA, Clean Energy Organizations Tell Congress: We Need Tax Extenders 'As Soon As Possible'

In a letter dated Oct. 5, over 580 signatories representing clean energy industries, including Geothermal Energy Asso...

Why the Solar PV Industry Should Love Geothermal Heat Pumps Part 3

It’s a marriage made in heaven: Solar PV and Geothermal Heat Pumps Part 3 of a 6-Part Series Geothermal Heat ...

Beyond Utility 2.0: Part 4 “Next Steps”

Principles, Structure, and Policies of Energy Democracy Energy democracy can best be described as an electricity sy...


Tom Konrad is a private money manager and freelance writer focused on Peak Oil and Climate Change as investment themes. He manages portfolios for individual clients and is Head of Research for the JPS Green Economy Fund (http://jpsgreeneconomyfund...


Volume 18, Issue 4


To register for our free
e-Newsletters, subscribe today:


Tweet the Editors! @jennrunyon



Biogas 3: free online trainings on sustainable small-scale biogas f...

The main objective of BIOGAS3 (Sustainable Small-scale biogas production...

International Energy and Sustainability Conference 2015

The fourth International Energy and Sustainability Conference will be he...

2015 AREDAY Summit

The 12th Annual AREDAY Summit, August 8-13th in Snowmass Colorado. Engag...


New coating extends cylinder life 8 times longer than traditional c...

Hydroelectric turbine systems operate in extremely harsh conditions. The...

Clean Energy Patents Maintain High Levels in First Quarter, Solar L...

U.S. patents for Clean Energy technologies from the first quarter of 201...

SAP for Utilities Blog

The Eventful Group produces the annual SAP for Utilites Conference ...


Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now