Waste-to-Energy Market

Market Overview

The global waste-to-energy (WtE) market was USD 37.1 billion in 2022. It is expected to reach an estimated value of USD 68.78 billion by 2031 at a CAGR of 7.10% during the forecast period (2023-2031). 

Waste is any substance or unwanted material resulting from human activity or process. Economic development, the degree of industrialization, societal customs, and regional climate all impact the production rate of municipal solid waste. As a general rule, the amount of municipal solid waste produced increases with economic development. Waste-to-energy (WtE) plants turn solid waste, which may otherwise go to the landfill, into energy, by burning the waste and leaving behind a small amount of ash that can be reused as road or construction aggregate, with the remainder (such as toxic waste) being disposed of in a landfill. Therefore, WtE plants reduce the burden on the existing landfills and help properly dispose of waste. However, the market studied has witnessed significant growth in recent times due to the fear of increasing pollution, the impact of climate change, and the increasing focus on non-fossil fuel sources of energy.

Market Dynamics

Global Waste-to-Energy Market Drivers

• Supportive Government Policies and Schemes 

Supportive government policies have been the key driving factor for the waste-to-energy market in the past. Governments across several countries have taken policy-level initiatives to develop the waste-to-energy market. Municipal solid waste landfills in the US are required by regulations under the Clean Air Act to install and run a landfill gas collection and control system. Thus, in 2020, about 256 billion cubic feet (Bcf) of landfill gas was collected at 327 landfills in the United States and burned to generate about 10 billion kilowatt-hours (kWh) of electricity or about 0.3% of the total utility-scale electricity generation in the United States.

Moreover, India's government has incentivized WtE projects through capital subsidies and feed-in tariffs. To recover energy from municipal and industrial trash, the Ministry of New and Renewable Energy (MNRE) aggressively supports all available technology solutions. By offering financial support for R&D initiatives on a cost-sharing basis and according to the MNRE's R&D policy, MNRE is also advancing waste-to-energy research. For instance, the Ministry of New and Renewable Energy (MNRE) updated the rules for its waste-to-energy program in March 2020. The new guidelines may supersede the Waste to Energy Program's existing guidelines published on July 30, 2018. One new addition to the guidelines is the inclusion of municipal solid waste (MSW)-based projects based on the Department of Expenditure clarification. Such guideline additions will likely drive the waste-to-energy market during the forecast period.

• Hydrothermal Carbonization (HTC) And Dendro Liquid Energy (DLE) 

The new WtE technologies like Hydrothermal Carbonisation (HTC) that can speed up the slow process of geothermal conversion of wet waste with an acid catalyst at high pressure and heat to stimulate the production of ‘hydro-char’ that has properties similar to fossil fuels can provide the opportunity for the growth of the market. The main advantages of this to AD are the lower processing time and similar operating conditions needed to generate the same amount of energy. The essential characteristics of HTC include the following:

• Processes such as HTC have high feedstock flexibility in form, composition, and moisture content, so these do not require an energy-intensive drying step before processing. The reactions are autogenous, with no additional pressure added.

• Hydrochars can be used in various applications, such as fuel, functionalized carbonaceous materials (activated carbon), or as a soil amendment to increase soil fertility while providing a long-term carbon sink.

• In addition to acting as a carbon sink, the production of MSW char may result in the displacement of significant amounts of GHG arising from the production of other soil amendments, such as fertilizers, and prove to be a simpler, more energy-efficient, and better approach than current CCS technologies. One ton of charcoal obtained by HTC avoids 2.2 tons of CO2 in the atmosphere.

Moreover, another technology Dendro Liquid Energy (DLE), is a nearly ‘zero-waste’ WtE innovation. World Energy Council claims that DLE technology is up to four times more efficient than AD in terms of electricity generation and costs less. Additionally, zero-emission discharge makes the plant more favorable compared to current technologies. DLE can potentially convert a mix of different waste fractions, such as plastic waste and wood logs, into energy. Depending on the waste mix, DLE technology can reach over 80% efficiency. A typical 30.000 metric ton/year installation needs an investment of EUR 14.5 million and annual operating costs of about EUR 1,750,000. The zero-waste technology innovation is, thus, likely to be considerably used for market growth in the coming years.

Global Waste-to-Energy Market Restraint

• Negative Impacts of Incineration-Based Waste-to-Energy Technology

Despite being an attractive technological option for waste management, combustion-based processes for municipal solid waste (MSW) treatment are a subject of intense debate worldwide (i.e., under environmental, social, and political circles). Nevertheless, depending on the waste's composition, incinerators discharge a wide range of chemicals that negatively impact the environment and human health. Biomedical wastes, which are dangerous to humans and the environment and call for specialized treatment and management, make up 10% to 25% of the total waste produced by healthcare companies. Along with the emission of countless compounds whose toxicity is unknown, incinerators also produce substantial pollutants like particulate matter, metals, acid gases, nitrogen oxides, and sulfur. Public health and ecology are seriously endangered by this trash incineration method.

Cancer incidence and respiratory symptoms have a substantial impact on health. Other possible impacts include hormonal imbalances, increased sex ratio, and congenital anomalies. On the other hand, the impact on the environment has been demonstrated through eutrophication, smog creation, acidification, ozone or photochemical smog formation, global warming, and animal and human toxicity. Moreover, incinerating waste causes problems, as plastics produce toxic substances, such as dioxins, when burnt. Gases from incineration cause air pollution and further contribute to acid rain. At the same time, the ash from incinerators may contain heavy metals and other toxins. Due to these problems, several campaigns are being active against waste incineration. Therefore, based on the above factors, incineration-based waste-to-energy technology is expected to hinder the global waste-to-energy (WtE) market during the forecast period.

Global Waste-to-Energy Market Opportunities

• Growing Waste Collection And Energy Demand

The growing global population is piling up trash. As per the United Nations projection, the global population is expected to increase to around 9.7 billion in 2050 from 7.7 billion in 2020. Out of the total population growth, nearly 90% is expected to occur in Africa and Asia's urban demand. With the existing population, the world generates nearly 2.01 billion of municipal solid waste daily, with at least 33% not managed in an environmentally safe manner. Hence, with a growing population and money to spend, the waste generation volume will likely expand tremendously in the upcoming years.

Further, with growing middle-class families in countries like China, India, South Africa, Russia, and Brazil, waste generation is likely to pile up with the consumption of packaged foods at a considerable rate. Additionally, the growing urban population in developing countries, leading to lifestyle changes, is likely to drive waste generation globally. Moreover, the demand for power or electricity is another significant factor that needs to be addressed with growing pollution. As per the World Energy Council, the global electricity demand is expected to increase to around 53000 terawatt-hours in 2050 from 12.9 terawatt-hours in 2020. Hence, to reduce the demand-supply gap, waste-to-energy could be an option for most countries to reduce waste and generate electricity.

Regional Analysis

By region, the global waste-to-energy (WtE) market is segmented into North America, Asia-Pacific, Europe, Middle East & Africa, and South America. 

Europe accounted for the largest market share during the forecast period. Currently, incineration is Germany's most well-known waste-to-energy (WtE) technology for MSW processing. The gasification and pyrolysis processes produce a combustible synthetic gas (syngas) that can either generate electricity or further be refined and upgraded for direct generation in a gas turbine or engine. The electrical efficiency rate from incineration is usually higher than gasification due to lower operating temperatures, steam pressure, and the overall energy required to run the plant. Further, in Germany, the constant volume of total municipal solid waste (including all recyclable material, such as glass and paper) is around 50.61 million tons per year (2019), while the proportionate volume of domestic waste (exclusively thermally recyclable) has risen sharply in the country. 

Asia Pacific is the second largest region. As of 2019, Asia-Pacific is one of the largest global waste-to-energy (WTE) markets. China, Japan, India, and a few other countries dominate the WTE market in the region. Factors such as increasing waste generation, supportive government policies, initiatives to dispose of waste generated in the region sustainably and efficiently, increasing investments, and technological advancements in the WTE landscape are expected to drive the market in Asia-Pacific during the forecast period. China is one of the most populous nations globally, with a population of approximately 1.44 billion (as of 2020). Due to economic development and rapid urbanization, municipal solid waste (MSW) generation has increased rapidly. Therefore, the effective disposal of municipal solid waste has become a serious environmental challenge in China. Most of the generated waste winds up in landfills around major cities in China, meaning citizens are exposed to soil and groundwater contamination and severe air pollution. The uncontrolled decomposition of these wastes triggers the release of the potent greenhouse gas methane. Most of those landfills in the country are at or near-total capacity, spawning illegal waste dumping and burning.

Moreover, many cities in China have no suitable places for landfills. The country addresses the problem of garbage siege, which leads to severe environmental, underground water, soil contamination, and health issues. By 2025, China’s solid waste generation is expected to double to more than 500 million tons annually. This, in turn, is expected to create a massive demand for waste treatment facilities in the country during the forecast period.

North America is the third largest region. Waste-to-energy (WTE) meets the criteria for a renewable energy resource. The WtE plant fuel source (trash) is sustainable and indigenous and generates clean, renewable energy. Due to its renewable nature, various states in the United States have declared the WtE renewable. The WtE plants recognized under the renewable portfolio offer them lower disposal fees and, in turn, can help foster the market's growth. One of the significant factors contributing to the decline in WtE plants is the enormous amount of capital required for plant construction.

Additionally, the return on the investment is low, which has hindered the investment in the market. In 2018, Canada generated about 25.6 million metric tons of waste. The residential sector accounted for 42.15% of waste generated (10.84 million tons, while the industrial, commercial, and institutional (IC&I) sector generated 14.88 million metric tons, accounting for 57.85%. During 2014-2018, the IC&I waste generation dropped slightly, but the residential waste during the same period increased. Though most waste disposal in the country is done by the landfill method. The provincial and central governments have developed initiatives to promote waste recycling and the waste-to-energy industry. As a result, waste recycling and the waste-to-energy sector are expected to grow during the forecast period. 

Segmental Analysis

The global waste-to-energy (WtE) market is segmented by technology and region. 

By Technology

The global waste-to-energy (WtE) market is segmented into physical, thermal, and biological. The thermal segment accounted for the largest market share during the forecast period. In the thermal process, waste is treated to generate heat, which is used for generating energy or producing fuel oil or syngas from organic and inorganic wastes. Further, the thermal process may involve combustion, pyrolysis, thermal gasification, or plasma arc gasification. The thermal-based waste-to-energy conversion is expected to lead the market, especially in Asia-Pacific's growing economies. The rising urban population is forecasted to be the key contributing factor to increasing municipal solid waste (MSW). Other factors, such as industrialization and economic development, contribute toward MSW generation, which is anticipated to influence waste-to-energy market growth positively.

Recent Developments

• November 2022 - A deal has been reached between Mitsubishi Heavy Industries, Ltd. (MHI) and Taiwan Power Company (TPC) for MHI to study the possibility of implementing ammonia co-firing at the Linkou Thermal Power Plant in Linkou District, New Taipei, Taiwan. On November 16, representatives from TPC and other companies signed an MOU with the company. In response to the global trend toward reducing CO2 emissions and a change in Taiwan's energy policy, the goal is to reduce coal consumption in line with TPC's project to achieve its energy supply composition targets.
• November 2022 - A Memorandum of Understanding (MoU) was signed yesterday by Mitsubishi Heavy Industries, Ltd. and PT. PLN Indonesia Power, a subsidiary of Indonesia's state-owned electricity provider PT. PLN (Persero) (PLN), to launch three feasibility studies on co-firing less carbon-intensive fuels at Indonesia Power power plants. The three studies, which will be carried out jointly by Indonesia Power and MHI with assistance from its power solutions brand, Mitsubishi Power, will advance strategies to hasten the decarbonization of Indonesia's energy systems.