Green Garbage

Making the Waste Stream More Sustainable

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Waste Management is the largest trash hauler in the United States and ranks 196th on the Fortune 500, generating almost all of its revenues from transporting garbage from homes and businesses to landfills. They have 273 of them throughout the country with enough capacity to last for at least the next 40 years.

So it's noteworthy that Waste Management is actively looking to cannibalize the "landfill pricing" that drives their own business. How? By taking sustainability seriously. Says CEO David Steiner:

Picking up and disposing of people's waste is not going to be the way this company survives long term. Our opportunities all arise from the sustainability movement.

The company generates the equivalent of more than 550MW of electricity by supplying landfill gas to 118 projects. Other initiatives include projects for carbon sequestration and bioreactor landfills that accelerate decomposition of buried materials. Waste Management is also making strategic investments in businesses with technology that fits their focus on sustainability: Garick, Harvest Power, Terrabon, and Enerkem. They also provide expertise to customers to reduce their waste stream, or as the animation on their home page puts it:

Ask how we can help green up your business... while greening up your bottom line

Sure, some of this may also be for public relations, but Steiner is blunt about his motivation:

This is not David Steiner on some quest to save the planet. I don't get paid to do that. I get paid to generate shareholder value.

Stock analysts, fixated as they are on generating near-term portfolio churn, don't get it.

Steiner is taking a long-term view. A cornerstone of the new strategy is his belief that energy and commodity prices will rise, driven by economic growth in China and India. Higher energy prices will pay off for Waste Management if the company and its partners devise new ways to generate electricity or transportation fuels from trash. Higher commodity prices will drive recycling because the value of materials extracted from the waste stream -- paper, plastic, aluminum, steel, and precious metals like gold and mercury -- will go up. Waste Management has estimated that about $8 billion to $10 billion worth of value lies in the waste it handles each year.

Most material still goes into landfills and probably will for some time; however, under Steiner's leadership Waste Management has decided, as their tag line puts it, to "think green" and is showing that sustainability is good business sense for the long term.