Could food waste reduction goals backfire on the industry?
The fight against food waste is a battle that will take many years to combat, with a slew of obstacles along the way. As the EPA and USDA outline national food waste reduction goals, they target various stakeholders that can make 50% waste reduction goals by 2030 a reality. From consumers to food manufacturers, the actions that these groups take to reduce food waste are crucial for success.
However, there is one group of stakeholders that may feel betrayed by the food waste war: operators of anaerobic digestion facilities.
As federal organizations fight to stop food waste from ever being produced in the first place, companies are investing millions of dollars in capital intensive facilities to eventually manage the waste. In a sense, food waste reduction goals are decreasing the chances for these companies to be profitable in their business.
So how can the waste industry — which has uniform goals to save the environment and promote sustainability — be supportive of waste reduction efforts that may backfire economically?
Stopping the waste
Food waste has become the largest unmanaged component of the food waste stream, according to Anne Germain of the National Waste & Recycling Association. However there are many ways the food waste can be stopped from reaching the landfill, which the EPA has outlined in its Food Recovery Hierarchy.
Credit: Environmental Protection Agency
The EPA recently co-sponsored a Food Recovery Summit to brainstorm ways for source reduction to be jump started across the food and waste industries.
"The goal of Food Recovery Summit was to engage with representatives and experts from the American food marketplace to develop a clear picture of actions we can take to reach our national goal of cutting America’s food loss and waste in half by 2030," explained a spokeswoman from the EPA in an e-mail. "Organizations are encouraged to follow the Food Recovery Hierarchy to prioritize their actions to prevent and divert wasted food. The Hierarchy places the highest value on producing less wasted food, followed by using good wholesome food to feed hungry people and animals, using inedible food for industrial uses or to feed the soil. Finally, the least preferred option in the Hierarchy is disposing of what cannot be recovered."
But if the highest preferred value is placed on producing less wasted food, anaerobic digestion facilities will start to feel an absence of incoming material.
How anaerobic digestion facilities may take a hit
Anaerobic digestion facilities have been popping up rapidly across the country. Just this month, Green Cow Power launched two anaerobic digestersin Indiana, while Agromin opened a five-acre organics recycling site in California. In August, CR&R announced it would build a $100 million anaerobic digestion plant in California which would be up-and-running by early 2016.
These facilities are a crucial component of the food waste reduction goal. Yet each new anaerobic digestion facility that has been announced has proved a similar point: the facilities are not cheap. According to the National Renewable Energy Laboratory, the average installation and operating costs of these facilities are estimated at $561 per ton capacity and $48 per ton processed, respectively.
Germain explains that these facilities are capital-intensive, with an average 20 year payback rate. As for-profit companies, the operators of the digesters need to make money from the waste, yet food waste reduction goals do not aim to ensure that profits will exist.
"It’s intermediary. The service that the waste industry provides is an intermediate step and the sooner they can fix the problem, as far as that’s concerned, the happier they are," explains Germain. "But all of that would make anybody who’s looking to invest money into these capital-intensive projects a little more hesitant to put their money there. If there’s a big push by the EPA and the manufacturers are all on board and everyone is standing together saying how they reduce their waste and everyone is holding hands, swaying back and forth and singing Kumbaya, that’s fantastic — it’s very admirable and you can't fault that. But at the same time there goes your revenue stream and now you’re left holding the bag for all of this money that you still owe."
A similar issue was seen in Germany: When the country installed an abundance of garbage incinerators, the nation's high recycling rate drastically reduced the amount of trash available to feed the incinerators. The incineration plants were left to import piles of garbage from England, Ireland, Italy, and Switzerland in order to keep the plants operating.
As the reduction of food waste becomes so pressing, the industry would take a step backward by following Germany's lead and importing food waste for operational purposes. So what's the solution?
Accepting the issue for what it is
As an industry, it is important to support the USDA and EPA's efforts to reach the 50% food waste reduction goal. So how can anaerobic digestion facilities be supportive, while continuing to make money?
Germain lists a few solutions, including shared risk from investors or grants.
"My understanding of the anaerobic digestion facilities that have gone commercial-scale in the U.S. – I don’t think any of them have been funded without any grant money. I don’t think anybody has said. 'Oh yeah, this is a great idea and it seems like a profitable idea, let’s move forward on that.' Instead, people are saying, 'You know, this is technically reasonable. It's something that’s viable from a technical perspective, its viable from a collection and sufficiency perspective on the amount of material, and it’s viable on a generation of energy perspective...' So it’s win, win, win, win, win, but it always boils down to the cost."
The idea of banning food waste from the landfill is another measure that would ensure more food waste reaches anaerobic digestion facilities. While some municipalities have put this mandate into effect, Germain does not believe landfill bans are the answer.
"Regulators, they're all opinionated and they all would like to see these facilities being built, and I think part of what happens is their idealism leads them to be a little softer on some of these facilities that they like more, then they stop being regulators and they end up being advocates for some technologies. And by doing that, they end up allowing odor issues and other things that cause problems down the line to occur," explains Germain.
"And I think it’s going to happen. I think we’re moving in that direction, and there are several states that have instituted their own bans … I think it should continue to be promoted and it should be looked at from a very objective perspective, what’s the best thing for the environment."
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