Waste2Energy, Inc. (OTC: WTEZE.OB) designs, builds and installs waste-to-energy (W2e) plants that generate a source of clean and renewable energy by converting biomass or other solid waste that typically heads to the landfill. Click here to visit W2e’s ProActive News Room website for report / presentation downloads, videos, news feeds, and other info. This morning, W2e announced that it has received a contract from TBF + Partners AG for a Preliminary Engineering Design Study (PEDS) for a waste-to-energy plant in Italy, and the Company’s UK subsidiary will perform preliminary design work and pricing for the project.
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W2e is the process of creating energy in the form of electricity or heat from the incineration of waste source and represents a form of energy recovery. Most W2e processes produce electricity directly through combustion or produce a combustible fuel such as methane, methanol, ethanol or synthetic fuels. Once processed, the energy by product is electricity (from heat) and steam (also from heat generated during processing.
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There is a growing need on a worldwide basis to shift away from the landfill model of waste disposal due to the unsustainable growth rates (landfill creep) combined with rapidly growing populations, urbanization, and limited real estate / land availability in densely populated cities. The initial market opportunity for Waste2Energy lies in Europe, which is an estimated 2-3 years ahead of the U.S. in terms of dealing with waste disposal in an environmentally friendly manner on a local basis.
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The landfill model is limited and nearing end of life cycle with little incentive for innovation due to high tipping fees from distant cities that may send their trash via rail / truck transport for remote disposal, resulting in the waste of energy for transport, expanding landfills, and the generation of greenhouse gas emissions. W2e offers a local, community-based solution for waste with useful by-products in the form of steam to generate electricity, clean water (desalinization), and local jobs while simultaneously solving the problem of waste disposal.
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Larger players in the space such as Covanta (NYSE: CVA) and Waste Management (NYSE: WM) (Wheelabrator subsidiary) are not focused on the highly customizable, small-scale installations that W2e plans to offer, providing a large market niche on a global basis that has the potential to become very profitable for W2e once it secures funding. Covanta estimates that 14% (37 million people) of municipal solid waste in the U.S. is processed at waste-to-energy facilities, which produces enough electricity for 2.8 million homes. In addition, waste-to-energy facilities are more widespread in Europe (where W2e will focus its initial efforts) and Covanta estimates a total of 600 such facilities worldwide.
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Based on some quick calculations and estimates, a small town / region such as where I live in Western Pennsylvania presents a significant opportunity for installing and implementing a local, community-based W2e solution for trash. For example, an independent trash hauler could save nearly $1 million in tipping fees (which represent a significant operating cost) with the potential for add-on revenue by charging 50% of landfill tipping fees to accept municipal waste from other local / regional independent trash haulers.
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In addition, at a level of 200 tons per day of municipal solid waste, approximately 6 MW (megawatt) of power could be generated from municipal solid waste on a daily basis that could be put back into the electric grid. This compares to approximately 2 MW of power on a daily basis from each of the Gamesa (OTC: GCTAF.PK) windmills that line the mountaintops in Western PA.
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However, since no W2e facilities are currently in operation in the continental U.S., many independent trash haulers and communities such as mine are currently unaware that such technology exists. The challenge going forward will be to get a pilot facility up and running in the mainland U.S. that can serve as a model for hundreds of communities and independent trash haulers across the country to begin implementing.
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W2e's units are currently used at a number of locations such as the Ronald Reagan Strategic Missile Base, Kwajalein Atoll for mixed and hazmat wastes, Husavik, Iceland-mixed municipal wastes, BP/ARCO - Alaska for drilling camp wastes, Pogo Gold Mine, Philippines for mining camp wastes, Cayman Islands - hospital wastes and Conoco-Philips for use in Alaskan drilling camp waste disposal.
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In addition, W2e designed, built, and installed a cBOS system in Scotland for Scotgen, which represents a $35 million facility that will officially open after commissioning and will continuously produce 6 MW of electric grid power from both unsorted municipal and hazardous waste sources as a three acre permitted site for cBOS that processes 180 metric tons per day. W2e’s two?stage process of gasification and then oxidation is inherently cleaner than most other thermal processes for the conversion of waste to energy and the systems meet EU standards, which are more stringed than the U.S. EPA standards for air quality.
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Other commercial opportunities lie in developing countries, desalinization for clean water, islands / cruise ship waste disposal, military camps, oil / gas exploration, metals / mining sites, and hospitals (this a near-term opportunity in the U.S. market). W2e offers a scalable, community-based solution that is customizable and easier to implement from the budgetary / financing perspective for local governments since it offers the flexibility to start out on a small scale.
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Disclosure: No positions
$19.36 (01/11/10)
