At today’s Waste Management Investor Summit, a 200 slide 4 hour presentation about all aspects of the business, I was in the minority. There were very few other women in the room, and I was the only representative of the media. Nearly every non-WM attendee was analyst or banker. And judging by their questions at the end of the report, none of them cared about green. So I was rare in that sense too. Given that setting, I was impressed by WM’s bold prioritization of sustainability. The tagline on every slide is “Think Green.” They are eagerly repositioning themselves as an environmental services provider rather than waste collector, and backing up that change with investments. Barry Caldwell, SVP of Public Affairs and Communications, candidly noted that WM used to make a wonderful profit hauling waste to the landfill and doing no more. And this shift to diversion is driven in large part by consumer demand for better solutions. And WM is still making money, so they must be doing something right. In addition to customers caring, WM is dedicated to green because they care (or at least a majority of the executive team must), and they see green as a growing trend which has already gained them trust and favor according to their brand research.
The conundrum that I kept coming back to is this – WM’s revenues are driven by price and volume of trash. So when volumes decline, so does revenue. That is to say, reducing the amount of stuff that Americans throw out is not in WM’s best interest. The recession was tough because there was less trash (among other things). An outlook with increased volumes is rosier than declining volumes. This isn’t to say WM would actually sabotage waste reduction efforts. In fact, they’re quick to point out that their Upstream teams actually advise large companies on how to achieve (or move closer towards) ZeroWaste. For WM, the focus is on extracting more and more value from the waste. For example they noticed that people bring them $8 to 10 billion worth of waste each year. What you don’t want still has value and WM does its best to capture that value in new and inventive ways.
Here are some of the things WM is doing in green. These are also all ways that WM extracts value from the “junk” we toss out, listed in the Investor Day report:
- Waste-to-energy (energy from waste): WM has 23 plants which generate power for 1 million homes and is looking to build or acquire more (including in China)
- Curbside and commercial recycling
- Landfill-gas-to-energy or -fuel: 119 WM landfills capture and utilize gas for use, with plans to triple power output by 2015 compared to 2005
- C&D recycling
- Roof shingle recycling
- Greenopolis and GreenOps: internally developed system for tracking and rewarding consumer recycling
- WM LampTracker®: Florescent light bulb recycling system
- ThinkGreenFromHome.com: Batteries and universal waste mail back recycling system
- eCycling: Electronics recycling is WM’s fastest growing revenue stream
- Harvest Power: Composting/aerobic and anaerobic digestion
New technology in organics:
- Terrabon L.L.C.: Waste-to-fuel conversion technology
- Enerkem, Inc.: Gasification and catalysis technology
- S4 Energy Solutions: Plasma gasification technology
Each of the above is worth a discussion of its own really. Look for more in later posts. In my next post however, I’m going to try to answer the questions I fielded before this event as well as any more you may have. What other questions, comments or concerns come up about WM’s investments, processes, priorities, etc? Ask away, and I’ll try to make sure they all get addressed either in comments or the next post.
Also, for those of you who want to really dive deep, you can find the entire WM Investor Day presentation online here.
Ed Note: In the interest of full disclosure, WM covered Amie’s travel expenses to the Florida summit