Canadian Waste Industry Compares to U.S.

Kim A. O'Connell Contributing Editor Arlington, Va.

Canada is much more than our neighbor to the north. It also is a mirror of the United States in many ways, including waste management practices. According to a new report issued by Statistics Canada, a government agency in Ottawa, Ontario, Canada's waste industry is similar to the U.S. waste industry, especially concerning privatization and the composition of private waste firms.

The data in this biennial report comes from two 1998 waste management industry surveys that covered both the government and business sectors. The surveys collected information on the amount of waste disposed of in landfills and incinerators managed both publicly and privately, as well as recycling and composting data. In addition, the report tracks financial and employment information, comparing it to surveys conducted in 1994 and 1996.

Similar to the United States, in Canada, local governments enter into contracts with private firms to provide waste management services such as curbside collection and recyclables collection. The survey's results indicate that a shift has occurred away from public management of waste services toward increasing privatization.

In 1994, according to the report, the split between in-house services and contractors was rather even. By 1996, however, only 39 percent of waste management expenditures were spent on in-house activities, with 61 percent spent on contracted services. By 1998, the private sector was the recipient of 69 percent of these expenditures.

Despite this shift, public bodies are retaining the ownership and operation of recycling facilities. One reason for this could be recycling facilities' ability to generate significant income through feedstock sales, according to the report.

Many of what were previously public services now are services that a municipality makes a provision for rather than provides directly, says John A. Marshall, analyst for Statistics Canada's Environment Accounts and Statistics Division. Generally, economically, Canada has been growing at a very good clip. The waste management industry is reflecting that.

Also similar to the United States, the Canadian waste management industry is characterized by a small number of large firms at the top. The largest 59 companies, in terms of employment, account for only 4 percent of firms but account for 65 percent of total revenues.

Canadian waste management business revenues totaled $2.9 billion (Canadian) or approximately $1.9 billion (U.S.) in 1998, while operating expenditures reached $2.5 billion (Canadian) or approximately $1.65 billion (U.S.).

In addition, these firms invested more than $319 million (Canadian) or approximately $210 million (U.S.) in capital expenditures. These revenue figures translate into an 8 percent increase over 1996 levels.

Employment levels also are on the rise in Canada. More than 20,000 people were employed by the waste industry across Canada in 1998, representing a 6 percent increase from 1996.

According to Marshall, Many of our markets [in the U.S. and Canada] are shared in a lot of ways, and we have many companies that are the same. The mergers and acquisitions that have happened in other industries are happening here, too. The increase in privatization and the increase in revenue go hand in hand.

Overall, Canadians are recycling 30 percent of the total waste stream, a national recycling rate that is slightly higher than it is in the United States (which is about 27 percent) however, differences in how these figures are assessed in the two countries may make direct comparisons difficult.

In 1998, governments and businesses disposed of 21 million tonnes (metric tons) of municipal and construction and demolition (C&D) waste. The 1998 total was equivalent to 690 kilograms of waste for each Canadian, unchanged from the 1996 level.

More than 8.8 million tonnes of nonhazardous waste materials were diverted through recycling or reuse programs, according to the report. Combined with materials disposed, more than 29 million tonnes of waste materials were generated and disposed of or recycled. Approximately 604,000 tonnes of hazardous waste were treated and disposed of as well.

Overall, Canadians are recycling 30 percent of the total waste stream, a national recycling rate that is slightly higher than it is in the United States (which is about 27 percent). Marshall cautions, however, that differences in how these figures are assessed in the two countries may make direct comparisons difficult.

Furthermore, the report does not include waste or recyclable materials managed and disposed of directly by the generator, such as a pulp and paper mill or a smelter. Used clothing that is donated to a retailer and resold is excluded from these findings, as is the agricultural sector, which tends to manage farm waste onsite.

As is the case with individual states in the United States, Canada's provinces wildly differ. British Columbia had the highest diversion rate at 41 percent, with Nova Scotia following closely behind at 39 percent.

Overall, 67 percent of all materials collected and transported for recycling and reuse originated from nonresidential sources. Nova Scotia saw the highest percentage, 58 percent, come from residential sources, while Quebec had the largest nonresidential proportion at 87 percent.

Since the mid-1990s, there has been a large emphasis on recycling and an increase in the infrastructure to recycle, Marshall says. It has been government practice for a number of years to encourage 50 percent diversion.

Nova Scotia, British Columbia and Ontario have been aggressive in recycling, he continues. But we're a very large country, and 80 percent live in urban areas. We have very many rural areas where there are a lot of different costs involved in recycling.

The report compiles statistics based on general waste type (municipal, solid or hazardous waste), generator (residential, industrial, commercial or C&D) and specific material (glass, metal, plastic, etc.).

Of the materials recycled, paper products comprise 33 percent of the national total, with ferrous metals such as iron and steel making up 18 percent. C&D materials comprise 18 percent.

This report marks the first time that composting data was collected. In 1998, more than 1.1 million tonnes of organic materials were composted in offsite facilities. The 2000 report will study composting even more closely, Marshall says.

We're taking a closer look at composting because wet garbage or organic waste weighs a lot, and it costs a lot more to put into a landfill, he says. It's also a case where many people view organic waste as a resource as opposed to waste.

Surveys for the 2000 report already have begun. Preliminary findings of the 2000 report will be released later this year, with the final report issued in spring 2002.

For more information, or for a free, downloadable copy of the 1998 report, visit the Statistics Canada website at www.statcan.ca.