Industry Trends: Recycling/Landfills/Transfer Stations

Bob Wallace of WIH Resource Group and a Strategic Business Partner collaborated in discussing current and upcoming trends presented in this Q&A.

Describe the relationship between landfills, transfer stations and recycling. How do they complement each other?

Landfills and transfer stations are physical assets. Historically, transfer stations came about to allow for greater efficiencies and economies of scale as transportation became more expensive and landfills were located farther out from the core collection areas. Municipal Recycling Facilities (MRFs) were a response to the desire for recovery due to regulatory mandates and the perception that landfill space was diminishing (the mad rush when Sub-title D forced the sequential closure of unlined or unsafe facilities) and the cost associated with disposal (e.g. cost avoidance). Today, and in the future, transfer stations and MRFs serve as local waste handling sites where recovery of commodities and (presumably) energy can be derived from the waste feedstock.

What type of recycling process do you believe will become most used as it becomes more dominant in the industry?

The trend is definitely moving towards the processing of MSW where commodities such as wood, metals, plastic and paper can be pulled out of the MSW stream with a more sophisticated front-end sorting system and the organic fraction would move to anaerobic digestion and then to compost on the back-end. Inerts would also be segregated through a more complex sorting system with industrial by-products being the end result. Even with the very best curbside programs, most MSW streams today still contain 35 to 40 percent by volume (paper, plastic, wood and metals) and another more than 40 percent of organics—meaning 80 percent of what goes into most landfills today after accounting for curbside recycling programs—is still recoverable. The reason for this new emphasis is that curbside programs alone cannot maximize recovery. There are a few early adopters, like San Jose, who are working on some very innovative projects to maximize recovery and capture energy value. There are at least two dozen governmental agencies in North America with Statement of Qualifications (SOQs) or RFPs out right now that are following suit.

What type of waste-to-energy process do you believe will become will become most dominant as they are used by more organizations?

Dry fermentation anaerobic digestion (AD) is getting the most play right now and for good reason. The technology is simple, relatively inexpensive and costs less per kWh to produce energy than any other technology. Small-scale gasification has great potential but is not ready yet for commercial use. When it is, it could be combined with AD where it would process the dry materials and AD would handle the high moisture content materials to produce a very efficient low cost power source. The biogas from AD can be converted into electrical power or upgraded to CNG for transportation fuel, giving it a very high value when you consider the end product in combination with the carbon credits it produces—both of which are virtually certain to increase in value over time. Legacy LFG installations can be combined with AD programs to make use of the combined biogas stream, even though the methane content of the two is different. If a landfill gas (LFG) project is producing enough methane, the trend is to go to CNG conversion rather than electricity at least on the West Coast where electricity values are lower. The case is just the opposite on the East Coast and in Ontario for instance where the kWh prices exceed $0.15. Clearly, however, the trend is moving away from LFG projects, except in the case of very large methane generating landfills, as more waste is processed locally and the volume of methane diminishes. Ten years down the road the methane that remains from landfills may not justify the long-term investment in LFG collection systems.

How will the roles of transfer stations change as more companies/organization use waste-to-energy methods?

Transfer stations will take the place of landfills as the final resting (or processing) place. Transfer stations will house sorting technology and renewable energy technology and be mini power plants. Only the residual, which may account for 10 to 15 percent of the input will move to the landfill and not be recovered. Public and private sector owners of transfer stations are holding valuable assets that will continue to gain value in the future, but must be thinking now about becoming early adopters in the renewable energy market, getting flow control agreements and power purchase agreements in place before someone else does.

What type of R/T/L equipment do you see gaining popularity currently? What about in the future?

The equipment and needs are much the same. In the future, the number of compactors necessary will diminish as more waste is recovered and less taken to landfills. More small and mid-size wheeled loaders to handle transfer station movement are likely. Obviously, significantly more automated sorting and segregation equipment to segment the waste stream further as commodities and feedstock rather than waste. There may also be a move to begin excavating high value landfills for residual space. This is particularly true as we see fuel prices escalating and close-in airspace becomes more valuable, but more importantly, there may be an opportunity to recover plastic in cells that were active from the late 1970s on. This plastic may be converted into crude oil through innovative technology that is already available and used for high-grade fuels. This combined with the value of opening more airspace may create some viable economics.

Where do you see each element (R/T/L) at in several years? How will each change within the industry?

There will still be (probably more) residential and commercial recycling efforts so MRFs will continue to exist, but I see them moving to more sophisticated and expensive sorting equipment to provide segregation of more true MSW streams. Clean MRFs will have a tough time and dirty MRFs could thrive as more advanced recovery efforts become common. There will be a blurry line between a dirty MRF and a transfer station. Both MRFs and transfer stations will also be focused on Construction Demolition and Land clearing (CDL and C&D) waste streams. Transfer stations will take the lead in transitioning to pre-sort for renewable energy technologies ranging from anaerobic digestion (AD) to pyrolysis for waste plastics to biomass and Refuse Derived Fuels (RDF). Owners and operators will begin to focus on the value of the waste coming in and it will be treated as a commodity. Transfer stations will be the key and have the most value if they can successfully transition to highest and best use and see the value created by avoiding disposal costs, producing biogas with an electricity of transportation fuel end-product and the carbon credit and Renewable Energy Certificates/Low Carbon Fuel Standard (REC/LCF) credit value. Landfills will still be needed to take care of the residuals, although they will likely be less than 20 percent. They may have some value while the methane content of the gas is still above 50 percent, but that value will diminish over time until the LFG projects no longer justify the investment. Landfills owners and operators will save a great deal of money by not operating or building new cells as frequently, and can transfer the same funds into renewable energy projects that generate a higher return.

Bob Wallace, Principal & VP of Client Solutions of WIH Resource Group, Inc., has more than 25 years of experience in solid waste and recycling management, transportation/logistical management, sales, marketing, operations, 3PL (Third Party Logistics), WastebyRail program management, as well as recycling/integrated waste management program planning and development. WIH Resource Group, and its strategic business partners, provide solutions to clients in both the public and private sectors in the areas of alternative fuels, waste management operational improvement, collection vehicle routing, landfill alternatives analysis, financial analysis and rate modeling, renewable energy, waste shed studies, M&A services and strategic business planning. Bob also serves on the Editorial Advisory Board for Waste Advantage Magazine and can be reached at [email protected] or visit www.wihrg.com.