Environmental & Waste

Waste-to-energy

The plants that burn the rubbish recycling cannot take, energy-from-waste (EfW). Capital-heavy, long-life and long-contracted, an EfW plant earns two streams: a contracted gate fee for every tonne of residual waste it accepts (the stable core, under long municipal supply agreements), and revenue from selling the power it generates (the merchant swing). Pick a real plant below and follow it through the development, the model and a working returns model.

In focus ·
Example

Drag the sliders to see what earns the money, the capacity of waste burned, the contracted gate fee on each tonne, and how hard the plant runs, plus the power it sells.

600 kt/yr
Capacity
Throughput
Gate + power
recurring revenue p.a.
EBITDA p.a.

01

What it is & how it works

02

How it earns

Model A · gate fee + power

A contracted processing asset

An energy-from-waste plant is a contracted processing asset, it burns residual waste (the non-recyclable rubbish left after recycling) and earns two streams. The stable core is the gate fee, a charge per tonne of waste accepted, usually under long, contracted municipal supply agreements with take-or-pay protection, so the revenue holds even when the gate-fee price softens. On top sits a more merchant stream: selling the power (and sometimes heat) the plant generates. The asset is capital-heavy and long-life (a 600kt plant runs to hundreds of millions, ~£0.7–1.1k per annual-tonne) on long contracts. The engine is therefore throughput × (contracted gate fee + merchant power), less O&M, ash disposal and reagents, a contracted core with a power kicker.

03

What it costs, and how it's financed

Revenue → operating costs → EBITDAMargin

The capital, net of contributions
Who funds the buildallocation

    History & framework · key milestones
      04

      Cash flows & returns

      Build & contributions

      m
      m
      %
      %

      Revenue regime & tax

      m
      m
      %
      ×

      Financing & hold

      ×
      %
      %
      y
      Unlevered IRR
      asset / project return
      Levered IRR
      return to equity
      Equity multiple
      MOIC over hold
      Payback
      project, undiscounted
      Cash-flow profile, equity invested   returned
      Show the year-by-year schedule
      05

      What drives the return

        See also the Waste-to-energy plant simulator, build and run an EfW plant interactively, and the Cash-flow & DCF model.