Waste To Energy Project

Waste To Energy Project

Close to 97% of food waste in North America ends up in landfills. That’s trash that could be cost-effectively turned into renewable fuel using waste to energy technology, says Paul Sellew, chief executive of waste to energy firm Harvest Power. The Waltham, Mass. company announced Wednesday that it raised a $51.7 billion Series B round of funding, which will help it ramp up the pace at which it is building facilities to turn yard and food waste into methane, the principal component of natural gas using its waste to energy technology. The new funding brings the total equity financing raised by Harvest Power to roughly $70 million, Sellew said.




Harvest Power is currently in the process of building two large anaerobic digestion facilities, one in Richmond, outside Vancouver, Canada and the other in London, Ontario. There it plans to take food and yard waste and turn them into methane, which can be sold as a fuel. Harvest Power also operates large composting facilities in California and the northeastern U.S. In Tullytown, Penn., it runs Waste Management’s Warner North Composting Facility. Waste Management is an investor in Harvest Power, as is venture capital firm Kleiner Perkins (home to billionaire venture capitalist John Doerr) and Munich Venture Partners. New investors in the latest round include former vice president Al Gore’s Generation Investment Management. (For more on Sellew’s entrepreneurial background, read Meet The Renewable Entrepreneur, written by my colleague Maureen Farrell last August.)



What was surprising: Sellew didn’t boast about any special technological advantage that Harvest Power has. He admits that anaerobic digesters and composting are well understood technologies. “We have created a novel approach…and we have gained a cost advantage,” Sellew said in a phone interview. “It’s the efficiency, it’s the capital cost, operating cost, productivity and yield we get out of our technologies.” So couldn’t some other large operator of composting facilities do the same? Sellew says the market is fragmented and the company really doesn’t have large competitors.



Harvest Power’s model is to design, build, own and operate its own facilities. Sellew wouldn’t give me a sense of how profitable these facilities can be, but he said he expects the company to be profitable this year, on a run rate of $100 million revenues. By the end of next year, it expects to expand operations from its five current facilities to 20, just in north America. “We view this as similar to next generation solar. We’re taking a waste material and extracting the energy out of it. We can produce energy 24/7, 365 days a year,” says Sellew. Of course, methane has a bigger carbon footprint than solar energy does.



A handful of cities, including San Francisco, require residents to separate food waste from other garbage. San Francisco currently has a large compost facility that turns food waste into fertilizer. Sellew expects more cities to adopt such policies, a move that could create more business for his company.