Finance Solutions for Sustainable Waste Collection Fleets

The global waste management market was valued at €1.20 trillion in 2022 with an estimated compound annual growth rate (CAGR) of 5.4%, this is expected to reach €1.81 trillion by 2030. Within this context, a sustainable waste management strategy is essential for industry stakeholders if they are to meet global targets (according to the Paris Agreement) on reduced greenhouse gas emissions and transition to a low-carbon economy.

While waste materials can be hazardous items or electronics, industrial waste accounts for the largest segment with food waste being a major issue. According to The World Bank, global populations currently create 2.01 billion tons of municipal waste per year, of which 33% is not disposed of in an environmentally safe way. By 2050, this figure is expected to increase to 3.40 billion tons, with high income countries the main perpetrators.

The EU regularly updates waste management rules to encourage sustainable practices with a view to eventually achieve a fully circular economy for waste disposal through reuse or recycling, for example. Similarly, the US Environment Protection Agency has developed national strategies to promote sustainable practices to reduce food and plastic waste and increase recycling.

As the global waste heap grows, the waste management industry is under increasing pressure to find sustainable solutions for the collection, transportation, disposal, and recycling of these huge volumes. Industry stakeholders are already making progress with investment in electric vehicles (EVs), as they work towards improving sustainability and increasing efficiency.

However, when it comes to asset purchases, the inherent costs can be prohibitive for many, so before making any decisions about EV investment, it’s important to understand how the market works and the potential challenges as you transition.

Impact of EV waste management fleet

The usage of battery operated vehicles significantly improves waste management sustainability. Data shows that battery electric vehicles (BEVs) correspond to 66-69% lower emissions in Europe and 60-68% in the US, compared to combustion engines.

EV batteries are also durable and may be critical to scaling equipment reuse and recycling. The International Council on Clean Transportation (ICCT) believes the importance of battery reuse and recycling will grow as EVs reach end of life - and will eventually become the main source of battery recycling.

However, while battery EVs (BEVs) reduce GHG emissions and air pollution, they also present a logistical challenge. For example, as mileage eats up battery power, vehicles will need to be recharged and operators need to factor this in to maintain efficient operations.

Optimize waste collection fleet charging infrastructure

Although the market for heavy duty EVs is still in its early stage, sales more than doubled across the EU in 2023, compared to 2022, from 5,000 to 11,000 units. This upward trend is expected to continue as more models become available and production capacity increases.

Efficient use of EVs for waste collection is dependent on a robust charging infrastructure that should be developed early enough to avoid disruption to normal operations. Thorough planning is key to managing electricity demand in a timely and cost-efficient way. Wired stationary charging is the dominant technology now (for overnight charging at private depots or public motorway stops), but novel alternatives, such as battery swapping and overhead catenary charging, are emerging to increase charging flexibility in the long-term.

These technologies could help reduce EV truck charging downtime, as well as truck cost and overall weight due to reduced battery sizes. Moreover, harmonization of battery and charging infrastructure would reduce development costs and ensure interoperability. In the meantime, strategic route planning is the main answer to optimize efficiency of EV waste collection fleets.

Integration of telematics in waste collection fleets

Global EV telematics was valued at €7.85 bn in 2022, with demand driven by national government initiatives to support businesses as they transition to sustainable transport solutions, and analysts predict this trend will continue in coming years.

Current innovation is focused on interoperability and standardization through development of common data exchange protocols and seamless integration of different EV telematics, as well as on improving the user experience of EV telematics, using intuitive interfaces, real-time data visualization, and mobile connectivity.

Advanced telematics in EVs monitor and transmit real-time vehicle data to improve waste fleet performance. The technology allows drivers and fleet managers to track battery status, range, and enhance efficiency, while remote detection of potential issues means operators can predict when maintenance is needed, saving both time and money.

Waste fleet finance solutions

Legal requirements for zero emission transport in cities are driving adoption of EVs. Europe accounted for 0.9% of all new zero emissions heavy-duty trucks sold last year, while sales of light and medium trucks grew by 28% the previous year, which demonstrates significant prospects for EVs in the region. However, prohibitive costs and infrastructure challenges mean that the transition to EV can take time.

Explore how DLL can help you navigate the EV landscape in our blog post!

Tailored finance solutions with built-in flexibility can support a staggered approach for waste management companies, allowing them to invest in waste management fleets without having to incur heavy upfront costs.

Subsidized incentives for waste fleet acquisitions

Depending on whether the waste management company is privately or municipally run, there are different finance solutions and financial support from national governments. As a result, total cost of ownership (TCO) parity with diesel trucks is not far off, according to EV market research. For example, 16 European countries (including the UK) offer subsidies that can cover up to 80% of the cost difference, compared to diesel trucks. Meanwhile, US manufacturers can benefit from tax credits on purchases of new and used EVs, as well as financial support for the installation of commercial and municipal EV charging infrastructure.

The availability of such schemes is a win-win for waste management fleet acquisitions, but the system can be difficult to negotiate and often incredibly time-consuming. DLL can manage the finance solutions process from start to finish and therefore facilitate the timely introduction of sustainable electric waste collection fleets.

A finance partner for your sustainable transition

By exploring various finance options, subsidy incentives and cost-saving strategies, DLL enables businesses like yours to make informed decisions on fleet electrification while driving positive environmental impact and operation efficiency.

DLL consultants are happy to discuss your requirements and offer realistic solutions. Waste fleet finance with DLL can be adapted to fit your specific needs and support both short and long-term expansion.

Get in touch now or alternatively get in touch with our team members during IFAT in Munich or Waste Expo in Las Vegas for guidance on commercial tailored finance or pay-per-use solutions to improve sustainability and efficiency at your business.