Europe is largest waste-to-energy market, but economy heralds change

Europe is the largest waste-to-energy plants market in the world with a very well developed infrastructure and over 429 installed plants in 2008. New analysis from Frost & Sullivan, European Waste to Energy Plants Market, finds that the market earned revenues of $4.4 billion in 2008.

The stress from the European Union to shift away from landfills towards better alternatives has indirectly helped the waste-to-energy business. This diversion of waste from landfills has resulted in the planning and commissioning of many waste to energy plants in the last five years.

“The most important driver for the waste to energy plants market in Europe has been the Landfill Directive and its waste diversion targets,” confirmed Frost & Sullivan research associate Karthikeyan Ravikumar. “This has resulted in the diversion of waste from landfills to waste-to-energy plants.”

Countries such as France and Germany have the largest number of waste to energy plants. Such plants have facilitated the effective treatment of waste diverted from landfills, enabling these countries to reach successfully their landfill diversion targets.

In addition to the Landfill Directive, the growing demand for power, paralleled by volatile oil prices, has made waste to energy plants a viable alternative for the disposal of waste.

However, the delay in obtaining environmental and other permits has restrained the growth of this market considerably.

“The process of obtaining an environmental permit for the construction of a waste-to-energy plant is quite tedious and a substantial amount of time is spent on it,” cautioned Ravikumar. “The delay affects the price of raw materials and, thereby, the overall revenues.”

Furthermore, the current economic slowdown will influence the prospects for market expansion. The slowdown will restrict the amount of investment flowing into the waste-to-energy plants business.

The drop in investments will undoubtedly affect plants that are in the planning stage and that are on the lookout for finance. This could result in projects getting delayed or postponed by a year or two.