Waste disposal is growing significantly. Greenhouse gas emissions from landfills are increasing. Recycling programs are faltering. It is time we reassess the way we manage our waste. Venture Capital, Private Equity and banks should take a close look at opportunities for value creation while aligning their green vision with their green values.
LOS ANGELES – Data suggests that, in spite of the urgent need to increase recycling rates, the majority of recycling programs in the U.S. and most countries around the world have not proven to be very effective. Japan and several European countries are notable exceptions. It is not unheard of to see recycling recovery rates of 14 percent to 20 percent or lower in some jurisdictions.
A recent World Economic Forum and Ellen MacArthur Foundation report states that 72 percent of plastic packaging is not recovered at all. Many reasons abound for the lack of good results — not the least the wide variation in community policies and programs (is it better to have two or three recycling bins?). The taxpayer, who is the stakeholder and participant in the recycling effort, often suffers from a lack of clear, specific communications detailing the programs’ goal, process and expectation.
This situation is not uncommon with utility companies. For years, electric and water utility companies have been suffering from low participation in energy efficiency and water conservation programs. A key reason has been that the messaging of their communication programs was too technical for their audience. Marketing 101 —it has taken years for electric utilities to fine-tune and simplify the message in order to start making some progress. Unfortunately, from a climate point of view, that delay has resulted in excess carbon emitted that could have been avoided with a better-designed strategy at an earlier stage. We can learn from this result and do better moving forward.
But, waste is different. Waste is not like electrons. Waste is heterogeneous and varies from site to site. Managed and unmanaged landfills contribute significantly to climate change by means of the decomposition of millions of tons of waste and generation of large quantities of greenhouse gases emitted to the atmosphere on a daily basis. Unmanaged or poorly designed landfills also generate considerable amounts of leachates damaging valuable soil and water resources. The volume of waste generated in developed and emerging markets continues to increase significantly. We are not even scratching the surface when looking at ways to effectively deal with this enormous environmental issue affecting many urban communities around the world. It is time to think differently about our waste management practices.
It is Time to Reassess Waste Management
Early stage separation of recyclable materials is not fully solving our problem when we still end up burying significant volumes of waste. The consistency of the quality of the separated recyclable materials is an issue too. Separated ‘recycled’ waste contaminated by wet organic material or commingled with other ‘non recyclables’ undermines the recycling process and increases its cost. In the end, taxpayers end up paying more for a program that may not work as effectively as desired.
Current waste management practices are not a real match for what we need to do as a society to solve the waste problem and eliminate the negative contribution of waste to climate change and environmental degradation. Above all, the function of the landfill needs to be updated with modern thinking. It is time to change the way we look at the landfill and transform it from a dumping place where we go beyond selectively ‘cherry picking’ what’s good from what is not to a source of production of renewable products.
Looking at landfills with a more holistic focus, it is possible to designing process plants that will convert 95 percent of the waste received into valuable non-fossil based, renewable commodities like drop-in fuel, electricity, chemicals and other products. The design aims to have zero emissions and environmental footprint. This is not incineration or trash burning. It’s true value creation using environmentally sustainable technologies.
A modular design allows for fine-tuning of the output based on the specific composition and volume of the waste at each location. Only the remaining 5 percent of inert materials is bound for landfilling. This concept can transform any landfill from an environmental hazard to a source that continuously recycles carbon and produces clean renewable products that replace current fossil based products.
Beyond its beneficial environmental attributes, each plant aims to be of significant impact to the nearby population as a source of stable jobs.
A recent McKinsey report on managing waste in emerging markets discusses that the full potential value of waste streams is not fully captured today. It states that there is a significant societal and environmental benefit of aggregation of waste volumes as a solution to improve value recovery.
On the financial side, this concept is achievable today using commercially available technologies that minimize investor’s risk. Venture Capital, Private Equity and banks should take a serious look at these infrastructure projects where there are opportunities for process improvements and IP development as well as consistent revenue and value creation. More importantly, it will provide real opportunities to align their green speech and social impact statements with their core green values.
Time is of the essence. The stakes are high and there is a need to act more firmly now to better manage waste streams in urban areas. An effective solution is within reach. Now, it is up to us to take the leap forward to clean our environment.
Lead image: Recycleable material. Credit: Shutterstock.