Investor Insights

Emergent Waste Solutions presents a compelling opportunity for impact investing, leveraging a disruptive technology that promises to become a profitable solution to the world’s growing waste problem.

Overview

Emergent Waste Solutions (EWS) is a Canadian company that converts waste into marketable products using its proprietary Advanced Thermolysis System (ATS). The technology uses materials like municipal solid waste, tires, plastics, biomass and livestock waste as feedstock and converts these into valuable products, such as activated carbon, carbon black, biochar, bio-coal, syngas and bio-oil.

The company’s North American facility is in Ruby Creek, British Columbia, which has entered commercial production and achieved the first sales of its biochar. The plant, which has a CaPEx of $3.5 million has attractive economics with potential revenues at full operation of over $1.6 million and net profit before tax of $721,000 (to finance its first plant, EWS sold 54 percent interest in revenue from the plant to investors.). In addition, the company has a strong pipeline of projects in excess of $100 million in CapEx. This includes three projects in Canada and international projects in Brazil, Ghana and the Philippines.

These projects will process agriculture waste, wood waste, used tires and municipal solid waste, and depending on feedstock will produce biochar, bio-oil, bunker-grade diesel, renewable natural gas and carbon black.

EWS is pursuing several global revenue models: 100 percent ownership, the sale of its ATS plants; and joint ventures, where Emergent aims to hold a minimum of 50 percent ownership of a project. Such JV arrangements will allow EWS to maintain optimal plant operating parameters, ensure maintenance and plant upgrades, have a national and international sales strategy, and execute new product development to achieve maximum profits.

The company expects significant revenue growth over the next few years, forecasting an increase in revenue. On top of this, the margins in the business are predicted to remain high and increase as the scale of the business grows and as it focuses on sales of specialty grow blends versus commodity biochar.

According to EWS, the traditional waste treatment and disposal service industry in Canada alone was valued at $5.1 billion in 2022. Even if EWS was to capture a small percentage of this market, the potential revenue numbers are large. EWS believes the Canadian market will need more than 3,500 plants to treat different waste streams. For example, waste wood biomass would need more than 1,700 plants, municipal solid waste (MSW) will need over 750 plants, and livestock manure will need more than 600 plants.

The company’s ATS technology has lucrative economics. An ATS5000 plant (processing 120 Tonnes per day for 330 days per year) using MSW as feedstock has the potential to generate nearly $55 million in annual revenues with an operating income of about $42 million.

EWS offers investors an attractive ESG investment opportunity to benefit from the growing demand for renewable natural gas, biochar, bio-coal and carbon black.