Responding to Environmental Issues Dominating Waste Management

March 18, 2019 by Comerica Bank

Environmental issues are becoming a guiding factor in the waste management industry. Municipal solid waste services are focusing on sustainability, trying to reduce the amount of material making its way to landfills. At the same time, proper handling, storage and disposal of solid waste is proving vital in protecting the environment.

As a result, businesses in the waste management sector are tasked with innovating or facing high fines and possibly even criminal charges for non-compliance with environmental standards. However, developing sustainable practices isn't just about avoiding negative outcomes. Instead, businesses can use a strong focus on the environment to create value opportunities.

For example, keeping valuable raw materials out of landfills can create opportunities in the commodities market and bolster the local economy through job creation. The West Michigan Sustainable Business ForumTM analyzed municipal waste management practices across Michigan and found that, based on the amount and types of waste sent to landfills annually, organizations in the state could earn upwards of $368 million per year. Throw in the jobs that would be created by more sustainable waste collection and sorting methods, and waste management businesses are looking at a total annual economic impact of $399 million.

On a national level, the EPA found that approximately 262 million tons of municipal solid waste was generated in 2015, the most recent year that has been analyzed. During that time, just 137 million tons of waste ended up in landfills. For comparison's sake, 243.5 million tons of waste was generated in the year 2000, but more than 140 million tons went in landfills. While the amount of waste generated is generally increasing, more of those materials are recycled, composted or processed through combustion with energy recovery.

Comerica Bank can help waste management businesses adapt to environmental pressure. Check out our infographic to learn more about how the industry is evolving.


Comerica ranks first nationally among the top 25 U.S. financial holding companies, based on commercial and industrial loans outstanding as a percentage of assets, as of June 30, 2018. Data provided by S&P Global Market Intelligence.

This information is provided for general awareness purposes only and is not intended to be relied upon as legal or compliance advice for your business.

This article is provided for informational purposes only. While the information contained within has been compiled from source[s] which are believed to be reliable and accurate, Comerica Bank does not guarantee its accuracy. Consequently, it should not be considered a comprehensive statement on any matter nor be relied upon as such.

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Emerging Technologies Disrupting Environmental Service Operations

November 14, 2018 by Comerica Bank

Powerful new technologies, from physical assets aided by onboard systems to data analysis algorithms, eventually transform the way businesses schedule, manage and engage in daily tasks. These emerging digital tools, platforms and processes can also have a major influence on long-term corporate planning and companywide transparency, not to mention critical metrics such as operational efficiency and profit.

Although the environmental management field has long been governed by traditional practices and workflows, disruption from emerging technologies already happens in various ways. Additionally, there's plenty of room for more changes in the future. The industry has already entered the beginning stages of a significant and widespread period of change.

Looking at areas of rapid change created by emerging technologies

There are many different parts of the environmental services industry that will soon look different due to new technology, as well as other areas where such improvements are already clear.

The Internet of Things, based on the connection of data sensors to everyday tools such as waste receptacles and vehicles, can help firms plan more effective pickup routes. Smart technology that involves machine learning helps individuals determine the proper destination for a piece of garbage, and improves recyclable sorting at first contact. Machine learning and artificial intelligence can provide information that leads to optimized, adaptable service schedules, which also boosts customer service.

The benefits of reducing the amount of time needed to sort waste or for a truck to complete its daily pickup schedule is clear, and the cost savings aren't hard to imagine. Environmental service firms that want to implement such technology and reap the benefits need a reliable source of funding to do so. Comerica Bank, the Leading Bank for Business1, offers effective loan options that make sense for modern environmental service companies and put them in a position to benefit from emerging technology throughout the industry.

1Comerica ranks first nationally among the top 25 U.S. financial holding companies, based on commercial and industrial loans outstanding as a percentage of assets, as of June 30, 2018. Data provided by S&P Global Market Intelligence.
This information is provided for general awareness purposes only and is not intended to be relied upon as legal or compliance advice for your business.


Emerging Technologies Disrupting Environmental Services Operations Infographic

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Setting a Fiscal Baseline for Regulatory Compliance

November 5, 2018 by Comerica Bank

Environmental regulatory compliance is both a challenge and opportunity for environmental services businesses. On one hand, organizations in the various segments of the waste management industry must be especially cautious about following best practices in how they handle and dispose of materials at all times or be at risk of significant negative attention. On the other hand, environmental standards also offer waste management businesses an opportunity to provide new services focused on making compliance easier for other businesses.

For example, a waste management organization operating in a region with many data centers may want to open a specialized e-waste management service to take advantage of the market opportunity. Similarly, a business in an industrial region may want to offer specialized solutions for chemical and industrial waste removal. These services can be invaluable, especially as the cost of non-compliance with environmental laws can be high.

Considering the costs of failure to maintain environmental compliance

Non-compliance with environmental standards can be personally costly, not just impactful at the business level. The Environmental Protection Agency has the power to enforce regulatory standards by punishing offenders in the form of civil and/or criminal trials. In major breach incidents, a business may be fined heavily for the incident, and leaders could be either fined or face criminal charges. These aren't just nominal charges either. The EPA recently released the results of its enforcement activities for the fiscal year 2017. During that period, the agency required environmental criminals to pay out $2.98 billion. This came in the form of fines, restitution, and mitigation. Total criminal sentencing during the year amounted to more than 150 years in jail.

Investing in the equipment, staff or technology you need to maintain compliance may seem expensive, but this move may pay off. The EPA isn't just interested in recouping funds based on damages and using criminal punishment as a deterrent. Instead, the agency is also committed to creating a level fiscal playing field as businesses strive for compliance. As such, the EPA searches for situations in which organizations may be failing to comply in order to gain a financial advantage and levy penalties accordingly.

Environmental services businesses can't afford to cut regulatory corners. They can capitalize on the scrutiny facing businesses across just about every sector to offer services that solve specific pain points. For example, proper disposal of hazardous waste materials represents a growing challenge as the EPA works to monitor safe handling across a material's entire lifecycle.

Looking at hazardous waste as an example of regulatory challenges

The Resource Conservation and Recovery Act covers the majority of hazardous waste issues, and any compliance audits will usually be performed by either the EPA or a state authority that works with the EPA. Inspections can involve anything from asking for material manifests to visiting a work site and evaluating the environment for signs of contamination or malpractice. For environmental services firms, it's important to recognize that the EPA inspects processes regarding handling, transportation, storage and disposal of hazardous materials.

Preparing to ramp up regulatory compliance

Building stronger environmental regulatory compliance practices can require significant financial investments. An environmental services firm could enact a variety of strategies, including:

  • Investing in state-of-the-art trucks and waste management equipment.
  • Purchasing real estate, constructing new facilities or renovating outdated buildings to support modernized operations.
  • Deploying modern information technology systems, including internet-of-things devices, to track materials and improve documentation.

These types of investments can dramatically improve compliance, but they come with costs. Comerica Bank can help. We're the Leading Bank for Business1 and will work closely with you to help you identify the best strategies and financing opportunities for your organization.


1Comerica ranks first nationally among the top 25 U.S. financial holding companies, based on commercial and industrial loans outstanding as a percentage of assets, as of June 30, 2018. Data provided by S&P Global Market Intelligence.

This information is provided for general awareness purposes only and is not intended to be relied upon as legal or compliance advice for your business.

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Waste Management Financial Planning for Commodity Risk

October 29, 2018 by Comerica Bank

Commodity prices fluctuate frequently, making it difficult for waste management and recycling companies to accurately project revenues related to commodities and plan accordingly. The inherent risk in the commodity market can be a stumbling block to business growth and sustained innovation as a decline in a key commodity can severely reduce cash available to spend on equipment, facilities or workforce improvements. Managing risk is critical when engaging in the commodities market, and strong relationships with stakeholders, particularly public sector agencies, can be instrumental in weathering fluctuations in the sector.

The commodity risk situation

Commodity pricing is extremely dependent on supply and demand, and the rise in recycling can lead to a decline in demand for raw materials. As more environmental services firms have goods to sell to processing plants, the market value of those materials will decline. The U.S. Environmental Protection Agency performed a landmark study in 2015, covering historic costs of commodities across a variety of sectors. In general, the average cost of commodity declined substantially per ton over the research period. Significant annual fluctuations were common in the study. For example, HDPE, PET, and aluminum cans all experienced major price increases in 1995 and 2011 but then declined quickly from 1995 to 1996 and again from 2008 to 2009. These kinds of rapid changes must be accounted for in waste management and environmental services business models, especially as political decisions and similar macroeconomic issues can also have a major impact on the market.

For example, a Seeking Alpha report explained that a ban on importing 24 types of recyclables and solid waste in China led to lower commodity prices throughout 2018. The rule went into effect in January 2018 and was specifically aimed at limiting paper and plastic importation from North America, though the legislation had a global impact. This type of measure led to significant changes in commodity pricing and can be disruptive in the sector, leading businesses to rethink their export strategies, invest in local recycling facilities or otherwise adapt to the new industry dynamics.

Responding to commodity risk

Preparing for cost fluctuation is critical when it comes to commodities, and many recycling companies have stayed afloat by strengthening their position in the broad waste management landscape. According to IbisWorld, revenues in the recycling facilities market have been tepid, with revenue only increased slightly in 2018, reaching $6 billion. Declining commodity prices have been a primary limiting factor to growth. However, public interest in recycling has led to significant investment in the practice among state and local governments, creating stability at a time when commodity prices are proving problematic.

Fostering stronger relationships with key stakeholders can go a long way in dealing with commodity risk. To illustrate this, a Let's Recycle report detailed how a workshop held by industry leader SUEZ addressed commodity risk. The workshop was held largely in response to the new policies out of China. While the waste management firm itself was prepared to deal with the change in prices, it realized that its public sector partners wouldn't necessarily handle the situation as smoothly and held the small conference specifically to inform agencies it works with on how to tackle the commodity situation effectively.

While SUEZ was tackling this issue from a UK-focused perspective, its activities serve as a key example of how to handle commodities risk. With the public sector embracing recycling in response to consumer demand, service advances aimed at municipal markets can go a long way in fostering value creation.

Enacting new strategies to withstand commodity risk requires capital, and that's where Comerica Bank can help. We offer specialized lending options aimed at environmental services and can support organizations as they work to adapt to the ever-changing market while sustaining innovation.


Comerica ranks first nationally among the top 25 U.S. financial holding companies, based on commercial and industrial loans outstanding as a percentage of assets, as of June 30, 2018. Data provided by S&P Global Market Intelligence.

This information is provided for general awareness purposes only and is not intended to be relied upon as legal or compliance advice for your business.


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Environmental Service Innovation: Equipment Leasing and Financing

October 23, 2018 by Comerica Bank

Environmental services businesses are facing a period of tumultuous growth as emerging technologies and a widespread move to sustainability create demand for innovation. Waste management and recycling organizations trying to adapt to emerging requirements often find themselves in a difficult position as significant changes require new equipment, vehicles, and even facility investments. Mid-sized businesses hoping to keep up with larger competitors have an opportunity to use innovative equipment to stand apart, and strategic funding can go a long way in making that possible.

While spending heavily on new equipment can seem daunting, organizations can't afford to miss out on the opportunity to advance their capabilities as the industry goes through a period of rapid change.

Innovation ahead in environmental services

Change is afoot for environmental services firms, as even public sector groups are prioritizing spending in the sector to drive progress. According to an Onvia study on state and local government procurement, year-over-year spending increased 5.5 percent during the fourth quarter of 2017. While a variety of operational areas benefited from this increase, the environmental services segment experienced some of the fastest spending growth.
Investing in waste management and environmental services is occurring at a time when many organizations are facing demand to become more sustainable and efficient in how they operate. With commercial, industrial and consumer groups embracing green practices, waste management companies have an opportunity to expand their service offerings. In practical terms, this puts pressure on environmental services businesses to:

  • Become more efficient and sustainable in their own practices.
  • Expand services to incorporate handling a wider range of waste types.
  • Deploy equipment designed to process varied materials and support emerging operational strategies.

Smart solutions, dubbed as intelligent because of their ability to connect to networks, allow environmental services businesses to modernize their operations around data-driven processes. As such, organizations increasingly find themselves blending equipment investments that promote sustainability with those that allow for smart solution use, bringing about rapid change. In fact, the market for smart equipment is gaining momentum quickly.

Smart equipment in environmental services

A Technavio study found that the global smart waste management market will expand quickly, achieving a compound annual growth rate of 18 percent for the 2018 to 2022 period. Key factors shaping the industry include:

  • Rapid innovation in waste collection, which took 62 percent of the smart equipment market share in 2017.
  • A move into waste processing, as investments in this segment will outpace those in landfills.
  • A growing emphasis on operational efficiency across the entire waste management life cycle.

Key technologies emerging as firms embrace smart equipment include driver-assistance solutions and autonomous vehicles, embedded systems focused on real-time data delivery, artificial intelligence and the industrial internet of things.
Environmental services firms are embracing new technologies and equipment, and funding can help mid-sized firms advance their initiatives and fuel industry progress.

Using financing to bolster equipment innovation

Smart equipment is designed to fuel efficiency and sustainability gains, creating opportunities to drive return on investment from strategic spending. As such, finding initial capital to support equipment purchases can go a long way toward creating consistent profitability. Comerica can position organizations to take advantage of this opportunity through financing that emphasizes lending for equipment leasing and specialized options for environmental services firms.

With change happening quickly in the sector, organizations can't afford to sit back and wait to see how the market unfolds. At Comerica Bank, we work closely with our clients to understand their business needs and become a key part in their growth. Our loan options can help you position your business for the future, and it’s a big reason why we're considered the Leading Bank for Business1.


1Comerica ranks first nationally among the top 25 U.S. financial holding companies, based on commercial and industrial loans outstanding as a percentage of assets, as of June 30, 2018. Data provided by S&P Global Market Intelligence.

This information is provided for general awareness purposes only and is not intended to be relied upon as legal or compliance advice for your business.

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