Weekly News Bulletin: Jan. 25-31, 2011


Casella Sells Non-integrated Recycling Operations for $130.4M to Pegasus Capital

Casella Waste Systems Inc. (Rutland, VT) announced its intention to sell some of its noncore and "non-integrated recycling assets" for $130.4 million to a new company formed Pegasus Capital Advisors LP and Intersection LLC. Proceeds of the sale are expected to net the company $117 million which it will apply entirely to the retirement of debt. The assets include 17 FCR material recovery facilities, a transfer station, and some intellectual property, all of which produce roughly $70 million in revenue and $14 million in annual adjusted EBITDA, according to estimates from the management team. "With this important transaction, we will have made substantial progress towards our objective to deliver the balance sheet," CEO John W. Casella said. Jim Bohlig, chief development officer and a board member at Casella Waste, will join the newly created acquiring entity CE Holdings as its CEO...Read More »



EPA Given Only One Month to Issue Boiler MACT Rules

The US EPA has only one month, by decree of the U.S. District Court for the District of Columbia, to issue final Maximum Achievable Control Technology (MACT) rules, regulating emissions from industrial boilers. The news comes as a disappointment to the agency that had requested a six to 15-month extension, and to industry which had been fighting the potentially job-killing rules and wanted more time to present its case. EPA asked the court for the extra time in December, citing an overwhelming number of public comments on the proposed rules, released in April. The MACT rules include standards for area source and major source polluters, as well as commercial and institutional solid waste incinerators. It would recategorize a number of multifuel boilers as incinerators, subject to more stringent limits on emissions of five hazardous air pollutants -- mercury, hydrogen chloride, particulate matter, carbon monoxide and dioxin. EPA is obligated under the Clean Air Act (CAA) to regulate hazardous air pollutants from those sources and promulgated a rule in 2004 that was later vacated by the U.S. Court of Appeals. In re-issuing the rules, the agency has been under intensifying pressure from numerous industries, stalled energy projects and Congress, including 23 Republicans and 18 Democrats in the Senate. Among them is Sen. James Inhofe (R-OK), ranking member of the Senate Committee on Environment and Public Works, who calls the MACT rule "a massive regulatory failure," and accuses the agency of following a "rule-by-consent-decree approach."...Read More »



Obama Administration Gives More Than $600M in Loan Guarantees to 4 Biofuel Companies

The US Department of Agriculture has awarded $600 million in loan guarantees to a quartet of biofuel companies that produce fuel from wood chips, municipal waste, cooking oil and other sources. The loans are meant to help the companies get to commercial scale production amid the difficult financial markets and to help the industry meet government set mandates for how much ethanol must be blended with petroleum under national renewable fuel standards. The largest recipient was Coskata Inc., which received $250 million for a cellulosic ethanol facility it is building in Green County, Alabama that will produce 55 million gallons of ethanol annually from woody biomass. The company is backed by Khosla Ventures,, Blackstone Group and GM, among others. The second largest guarantee, $240 million, went to Diamond Green Diesel LLC, a joint venture between the refining company Valero Energy Corp. and Darling International Inc., a food waste recycling company. Based in Louisiana, Diamond Green will produce 137 million gallons of biodiesel per year from animal fats, used cooking oil and other grease wastes. Montreal-based Enerkem earned an $80 million loan guarantee for a 10 million gallon-per-year plant in Pontotoc, Miss. that will use municipal solid waste as a feedstock to turn into biofuels. The company also received a $50 million award from the Department of Energy for the same plant in 2009. Enerkem's investors include Rho Ventures, Braemar Ventures and Waste Management, Inc. Another company, INEOS New Planet BioEnergy LLC, received a $75 million loan guarantee for a biorefinery in Vero Beach, Fla. capable of producing 8 million gallons per year of cellulosic ethanol, using vegetative waste like citrus, agricultural, yard, wood and municipal solid waste. Ineos is a spinoff from its parent company, chemicals player Ineos...Read More »



RockTenn Buys Smurfit-Stone to Create a $9 Billion Company

Packaging and paper recycling giant RockTenn Co. (Norcross, GA) is buying rival Smurfit-Stone Container Corp. (Creve Coeur, MO) in a $3.5 billion deal comprised of equal shares of cash and stock that will result in a $9 billion company. The combined company will be based in Norcross. RockTenn is paying $35 per share, representing a 27% premium to Smurfit-Stone's recent closing price. Smurfit-Stone, formerly Jefferson Smurfit and Stone Container, is one of the largest containerboard and corrugated packaging companies, and consequently one of the largest paper recyclers. The company had sought Chapter 11 bankruptcy protection from creditors in January 2009 and emerged this past summer. Since 2007, Smurfit-Stone has closed 53 facilities, reduced its workforce by 42 percent while investing more than $550 million in its remaining box plants. RockTenn CEO James A. Rubright said "RockTenn's fiber input ratio will be 55% virgin and 45% recycled. We believe this transaction provides the greatest possible career opportunities for our co-worker from both companies."...Read More »



Macquarie and Orange County, CA to Build 32.5MW Landfill Gas Project

Broadrock Renewables LLC, in partnership with Orange County, CA, has started building a new landfill gas-to-energy plant at the County's Olinda Alpha Landfill. The new expanded facility, which is expected to be online by the end of next year, will supplement the existing 5 megawatt facility and have a renewable energy generating capacity of 32.5 megawatts. The project which was formerly owned by Ridgewood Renewable Power affiliates was rebranded under Broadrock Renewables following its acquisition last November by Macquarie Infrastructure Partners II. "Landfill gas-to-energy technology is at the forefront of efforts to reduce greenhouse gas emissions. We are excited to be here today, standing alongside our various partners and under new ownership and backing by Macquarie Infrastructure Partners, to announce commencement of construction," said Randy Holmes, CEO, Broadrock Renewables LLC. Power from the new facility will be purchased by the City of Anaheim Public Utilities, which already purchases power from the existing facility at the site. The US Department of Energy (DOE) will fund $10 million to the project under the American Recovery and Reinvestment Act...Read More »



Waste Management Issues Sustainability Report

Waste Management, Inc. (Houston, TX) recently released its sustainability report for 2010 touting some successes and noting work that needs to be done. Among the former, the company said it has met its wildlife habitat goal ten years ahead of schedule having received Wildlife Habitat Council certification at 100 landfills while expanding the number of acres set aside for wildlife to 25,000. The company conceded that while it has not met its goal of zero violations, it has recorded the lowest level of violations in three years, down 28 percent from last year. "The goal of our environmental management system is to correct conditions that could lead to a violation before the violation happens," the report said.

The company boasts of being North America's largest recycler, in 2009 moving more than 8.5 million tons of material towards recycling or reuse. It aims to triple the amount of recyclable materials it manages, from a 2007 baseline, to more than 20 million tons a year by 2020. The task has been made much more difficult in the last couple of years covered in the report as the economic downturn has depressed commodity material pricing. "Fortunately, commodity markets steadily recovered through 2009 and into 2010 such that those markets are at or near their pre-October 2008 levels," the report said...Read More »



Fortistar Constructing 11.5 MW Gas-to-Energy Plant in North Carolina

Fortistar said it has begun constructing a new 11.5 megawatt state-of-the-art landfill gas-to-energy plant at Republic Services' Charlotte Motor Speedway landfill in Concord, NC. Output from the Concord Energy LLC facility will be sold to Duke Energy Carolinas under a long term 20-year power purchase agreement. The plant will utilize two Solar Taurus combustion gas turbines each driving a 5.75 MW generator, along with associated landfill gas clean-up and compression equipment, and a new interconnection to Duke's local distribution system...Read More »



Food Waste Recycler to Sell Shares of Stock

Darling International Inc. (Irving, TX), which recycles and recovers food industry waste products, announced its intention to offer 24.2 million shares in a public offering. The company plans to use proceeds to repay a portion of its debt and for general corporate purposes. Last year Darling acquired Griffin Industries Inc., also engaged in the rendering, bakery byproduct and used cooking oil recycling business, in a transaction that included 10 million shares of Darling stock. Therefore, the company will not receive any proceeds from the sale of stock held by former stockholders of Griffin who may grant underwriters a 30-day option to purchase from them up to 3.6 million additional shares of Darling common stock. Goldman, Sachs & Co. and BMO Capital Markets are joint managers for the offering...Read More »



Firm Wins SC State Approval to Build $12M Organic Waste-to-Energy Plant

A Columbia, SC-based firm has received a permit to proceed with construction of a planned $12 million biowaste-to-energy facility in the city. The company, called W2E, is headed by Daniel Rickenmann, a Columbia City Councilman and a former restaurateur said his plant will process organic waste such as food, grease, produce and yard clippings into natural gas for electric power production. The plant will also produce a soil additive and compost as a byproduct. Rickenmann said his company has commitments from a variety of commercial waste streams including Wal-Mart, BlueCross and BlueShield of South Carolina, Palmetto Health and the State Farmers Market. He expects the plant to be operational next year and that it will serve as a prototype for similar digesters in six other cities such as Gastonia, NC and Baton Rouge, LA. W2E is partnering with the German firm EISENMANN, which will build the plant...Read More »



Missouri DNR Touts Cleanup of 16 Million Tires Since 1990

The Missouri Department of Natural Resources said that 16 million scrap tires have been removed and 983 sites cleaned up since 1990, when efforts began. However, they estimate that more than 231,000 tires at 185 sites across the state remain and perhaps as many as 500,000 tires in unknown dumps. In 2009, 1.75 million tires were used as tire-derived-fuel in power plants and cement kilns. The department is also working with the Missouri Department of Transportation to promote the use of scrap tires in asphalt for Missouri's roadways. The cleanup program is funded by a 50-cent-per-tire fee charged on all tires purchased in the state...Read More »



DTE Energy Strikes Landfill Methane Deal

DTE Energy and DTE Biomass, operating under the name Blue Water Renewables said that the Michigan Public Service Commission has approved its plan to construct a 3.2 megawatt landfill gas-to-energy plant at the 44-year-old Smiths Creek Landfill in St. Clair County, MI. Once constructed, Blue Water Renewables will purchase the power, enough to power about 2,500 homes, under a long term power purchase agreement with the county...Read More »


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