Date: June 27, 2007
Source: Waste Management, Inc.
Waste Management, Inc. Announces Major Waste-Based Alternative Energy Initiative
Nation's Largest Owner and Operator of Landfills to Generate Renewable Electricity At 60 Additional Landfills Over Next 5 Years Using Landfill Gas
Waste Management, Inc. (NYSE: WMI) today announced a major initiative to expand its roster of landfill gas to energy (LFGTE) facilities. The program will result in the creation of an additional 60 renewable energy facilities over the next five years and together with its existing LFGTE facilities, WM will generate more than 700 megawatts of clean renewable energy -- enough to power 700,000 homes or replace over eight million barrels of oil.
Throughout the remainder of 2007, Waste Management plans to bring 10 LFGTE facilities on line and begin development on an additional 10 new sites.
"This initiative is a major step in Waste Management's ongoing efforts to implement sustainable business practices across the company," said Paul Pabor, vice president of renewable energy. "Landfill gas to energy projects provide an important contribution to the country's renewable energy portfolio. We're setting an ambitious goal to greatly expand our current roster of these plants, which will help us responsibly allocate the company's resources while providing renewable power to the businesses, communities and regions in which we operate."
The LFGTE initiative, which will add 230 megawatts of electricity generation to the grid, enough to power approximately 230,000 homes, will position the company to serve the growing market for renewable energy. In recent years, consumer awareness of environmental issues and ambitious state Renewable Portfolio Standards have quickly increased demand for new sources of renewable energy. LFGTE projects are especially valuable to utilities because they provide dependable base load power, in contrast to the intermittent nature of other renewable energy sources.
A pioneer in LFGTE projects, Waste Management designed and operated its first such facility in the United States over 20 years ago. With 281 landfills, Waste Management is the country's largest landfill operator and is in a unique position to expand waste-based renewable power generation across the country. The company is also exploring partnerships to expand its landfill gas to energy technology to other private and municipal landfills.
Landfill gas, produced when microorganisms break down organic material in the landfill, is comprised of approximately 50-60 percent methane and 40-50 percent carbon dioxide. At most landfills in the United States, these greenhouse gases are simply burned off, or "flared." However, Waste Management sites that have LFGTE facilities collect the methane and use it to fuel onsite engines or turbines, generating electricity to power surrounding homes and neighborhoods while creating a new revenue stream for the landfills. By building LFGTE facilities, Waste Management reduces greenhouse gases by offsetting the use of fossil fuel at the utility power plants.
As part of its initiative, in 2007 Waste Management plans to commission LFGTE projects at landfills in Texas, Virginia, New York, Colorado, Massachusetts, Illinois, and Wisconsin.
About Waste Management
Waste Management, based in Houston, Texas, is the leading provider of comprehensive waste management services in North America. Our subsidiaries provide collection, transfer, recycling and resource recovery, and disposal services. We are also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the United States. Our customers include residential, commercial, industrial, and municipal customers throughout North America. More information about how Waste Management Thinks Green(r) can be found at www.wm.com/wm/thinkgreen.
The Company, from time to time, provides estimates of financial and other data, comments on expectations relating to future periods and makes statements of opinion, view or belief about current and future events. Statements relating to future events and performance are "forward-looking statements." The forward-looking statements that the Company makes are the Company's expectations, opinion, view or belief at the point in time of issuance but may change at some future point in time. By issuing estimates or making statements based on current expectations, opinions, views or beliefs, the Company has no obligation, and is not undertaking any obligation, to update such estimates or statements or to provide any other information relating to such estimates or statements. Outlined below are some of the risks that the Company faces and that could affect our financial statements for 2007 and beyond and that could cause actual results to be materially different from those that may be set forthin forward-looking statements made by the Company. However, they are not the only risks that the Company faces. There may be additional risks that we do not presently know or that we currently believe are immaterial which could also impair our business. We caution you not to place undue reliance on any forward-looking statements, which speak only as of their dates. The following are some of the risks that we face:
competition may negatively affect our profitability or cash flows, our price increases may have negative effects on volumes and price roll-backs and lower than average pricing to retain and attract customers may negatively affect our yield on base business;
we may be unable to maintain or expand margins if we are unable to control costs;
we may not be able to successfully execute or continue our operational or other margin improvement plans and programs, including pricing increases; passing on increased costs to our customers; reducing costs due to our operational improvement programs; and divesting under-performing assets and purchasing accretive businesses, any of which could negatively affect our revenues and margins;
weather conditions cause our quarter-to-quarter results to fluctuate, and extremely harsh weather or natural disasters may cause us to temporarily shut down operations;
inflation and resulting higher interest rates as well as other general and local economic conditions may negatively affect the volumes of waste generated, our financing costs and other expenses;
possible changes in our estimates of site remediation requirements, final capping, closure and post-closure obligations, compliance and regulatory developments may increase our expenses;
regulations, including regulations to limit greenhouse gas emissions, may negatively impact our business by, among other things, restricting our operations, increasing costs of operations or requiring additional capital expenditures;
if we are unable to obtain and maintain permits needed to open, operate, and/or expand our facilities, our results of operations will be negatively impacted;
limitations or bans on disposal or transportation of out-of-state or cross-border waste or certain categories of waste can increase our expenses and reduce our revenues;
fuel price increases or fuel supply shortages may increase our expenses, including our tax expense if Section 45K credits are phased out due to continued high crude oil prices, or restrict our ability to operate;
increased costs to obtain financial assurance or the inadequacy of our insurance coverages could negatively impact our liquidity and increase our liabilities;
possible charges as a result of shut-down operations, uncompleted development or expansion projects or other events may negatively affect earnings;
fluctuating commodity prices may have negative effects on our operating revenues and expenses;
trends requiring recycling, waste reduction at the source and prohibiting the disposal of certain types of wastes could have negative effects on volumes of waste going to landfills and waste- to-energy facilities;
efforts by labor unions to organize our employees may increase operating expenses and we may be unable to negotiate acceptable collective bargaining agreements with those who have been chosen to be represented by unions, which could lead to union-initiated work stoppages, including strikes, which could adversely affect our results of operations and cash flows;
negative outcomes of litigation or threatened litigation or governmental proceedings may increase our costs, limit our ability to conduct or expand our operations, or limit our ability to execute our business plans and strategies; problems with the operation of our current information technology or the development and deployment of new information systems may decrease our efficiencies and increase our costs to operate;
the adoption of new accounting standards or interpretations may cause fluctuations in reported quarterly results of operations or adversely impact our reported results of operations; and
we may reduce or eliminate our dividend or share repurchase program or we may need to raise additional capital if cash flows are less than we expect or capital expenditures are more than we expect, and we may not be able to obtain any needed capital on acceptable terms.
Additional information regarding these and/or other factors that could materially affect results and the accuracy of the forward-looking statements contained herein may be found in Part I, Item 1 of the Company's Annual Report on Form 10-K for the year ended December 31, 2006.
For more information, contact:
Waste Management, Inc.
Analysts: Greg Nikkel (713) 265-1358
Media: Wes Muir (713) 328-7053