Landfill legislation and limited capacity
London— Waste-to-energy markets are experiencing
enhanced political and environmental attention in Europe. An important
component of integrated waste management strategies, waste-to-energy
assists in waste incineration to relieve pressure on landfill and
dispose waste that cannot be recycled. The add-on benefit of waste-to-energy
plants is that energy generated is fed either back into the plant
itself or to the local community.
Frost & Sullivan finds that the European Waste
to Energy Plants Markets earned revenues of $1.8 billion in 2005
and estimates this to reach $2.7 billion in 2010.
“Amongst other factors, landfill legislation
and increasing waste volumes are urging countries to revisit waste
management strategies and develop more cost-effective, sustainable
solutions,” notes Frost & Sullivan’s Energy and
Environment Practice director John Raspin. “The EU Landfill
Directive, which sets targets for the reduction of land-filling
of biodegradable municipal waste (BMW) offers tremendous growth
potential. This Directive, coupled with the short supply of new
landfill void space in Europe, is driving alternative waste disposal
strategies including waste-to-energy.”
If BMW production continues to grow, increasing
quantities will need to be diverted from landfill and consequently,
waste-to-energy will be employed. In addition, increased production
of refuse derived fuel (RDF) in countries such as Germany and shortfall
in the capacity for disposing such pre-treated waste will create
greater need for new waste-to-energy plants.
Currently, over 400 waste-to-energy plants in
Europe process about 50 million tons of municipal solid waste per
annum. However, as a result of the Landfill Directive, this number
is likely to increase and over 100 plants or lines are expected
to be installed by 2012.
Despite the benefits of the waste-to-energy technology,
it has met with public opposition from environmental groups and
local communities over the safety of waste incineration. This has
hindered the implementation of new projects.
“The effects of emission on public health,
increase in traffic and pollution associated with transporting waste
for incineration are key concerns likely to hamper market expansion,”
states Mr. Raspin. “While the markets offer opportunities
through high-value capital-intensive contracts and operational revenues,
risks of project cancellation pose a significant challenge.”
In view of long waiting periods involved in project
planning and the risks of project cancellation, waste-to-energy
suppliers will need to work closely with local communities and municipalities
to promote projects.
Moreover, with the rise in competition, the markets
are witnessing an increasing number of mergers and acquisitions
and competition is set to intensify.
Significant opportunities exist for companies
that can target and explore specific areas of growth. Strengthening
product and financial positioning through consolidation, enhancing
brand name and customer services, as well as meeting environmental
demands of legislations and customers are some of the key factors
that will influence market success.