- Covanta CEO Stephen Jones talked to The Street this week about climbing the ranks as a waste-to-energy supplier; about holding on through low energy prices that have hurt commodities' value; and about how big corporations are driving business.
- Some key takeaways of the interview were that revenue from Covanta’s zero-landfill private sector services are on the rise; the company found its niche in green investors, namely big corporations; and its metal reclamation sector is under more pressure than the waste side of business because of the poor market performance of scrap metal.
- Jones explained that the company generates energy from over one million tons of trash a year; two-thirds of its revenue is from its waste services; and its business in catering to companies with zero-landfill sustainability goals grew by 24% in FY 2015.
Covanta, traditionally recognized as an energy company, has lately found its sweet spot in waste—specifically waste-to-energy—and finds the market to be healthy. "You are starting to see more green funds realize [the value of] renewable power, and unlike wind and solar, we don't rely on the weather in order to produce the power since we use waste as the input," Jones told The Street.
While he admitted being under pressure due to how poorly scrap metal is doing, he said, "We are in a good place from a waste standpoint ... because of the strong nature of our revenues which are under long-term contract."
The business model is working out because of the company's focus on huge corporations with the desire to be sustainable. "In the US ... Ford, GM, Subaru ...and pharmaceutical [companies] have zero-landfill policies as a sustainability goal, and they are driving our business," he told The Street.
Moving forward, the company will focus on safety and health performance, aiming for reduced emissions levels that surpass regulatory requirements, and pushing to reduce greenhouse gases.