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The global solid recovered fuel market size was valued at USD 4.63 billion in 2021. The market is projected to grow from USD 4.75 billion in 2022 to USD 6.00 billion by 2029, exhibiting a CAGR of 3.4% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with solid recovered fuel experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the global market exhibited a decline of -3.1% in 2020 as compared to 2019.
Solid Recovered Fuels (SRF) are a subset of the more prominent family of Refuse-derived Powers (RDFs) that are produced from non-hazardous waste streams and differ from a generic RDF in that it is a fuel that meets the requirements (classification and specification) of national or international standard. SRF is produced from residual waste left behind once all commodities and contaminants have been removed. These fibers and fragments of paper, plastics, wood, and textiles have high calorific value, low moisture, and low chlorine content, which is a great alternative to fossil fuels such as pet coke and coal and offers an excellent environment-friendly solution.
SRF is potentially used to power heat-treating facilities such as cement plants, heating plants, industrial boilers, and so on. It acts as low ash, low sulfur alternative fuel, and is eligible for Renewable Energy Credits (REC) in various countries.
Closure of Production Units and Disruptions in Supply Chain to Slow Down Growth Amid Pandemic
In 2020, the impact of COVID-19 resulted in lower waste generation and recycling rates from the commercial and industrial sectors owing to closure of workplaces. The pickup in economic activity and resumption of business and social movements in 2021 have led to almost 5% in waste disposal, and around 20% of waste was recycled.
Subsequently, during this pandemic, it has been possible for the amount and type of waste generation to increase or decrease depending on the location. The reasons are twofold; on the one hand, significant businesses and schools, which usually generate large volumes of waste, have remained closed for a certain period. On the other hand, household, medical, and agricultural waste generation was not reduced during the COVID-19 pandemic for open businesses.
Furthermore, lower demand/activities in the construction industry and export industry produce inert waste generation, especially for waste streams, such as construction and demolition, wood, and non-ferrous metal, which experienced a decline in 2020 owing to the shutting down of activities. Subsequently, the production of most waste streams, such as paper, cardboard, plastic, and food waste, which majorly fall under the recycling waste stream, was also lower than the 2019 period due to interrupted recycling services to prevent cross-contamination.
Other key factors, such as supply chain disruptions and reductions in manufacturing and commercial activities, have also resulted in lowered waste generation and processing of waste in terms of volumes, logistics, transport, and varying market mechanisms.
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Adoption of Waste Recycling to Spur Market Opportunities Owing to Increasing Range of Secondary Fuel
Managing waste properly is essential for building sustainable and livable cities, but it remains challenging for many developing countries and cities. Effective waste management is expensive and often comprises 20%–50% of municipal budgets. Recycling waste is one of the most effective ways of reducing waste. Recycling prevents the debris of potentially useful materials and reduces the consumption of fresh raw materials, thereby reducing energy, air, and water pollution. Attributed to this, the recycling of waste material is becoming increasingly popular.
Furthermore, waste recycling maximizes a broad range of secondary fuels for various industrial applications, resulting in significant cost benefits for end-users. Unlike other green energy sources, such as solar and wind, recycling waste to energy plants can be operated 24/7.
Additionally, with increasing plastic waste consumption, government agencies are focusing on plastic recycling/reuse. For instance, the European Commission has adopted the first-ever Europe-wide strategy on plastics as part of the transition toward a more circular economy. Under the new plans, all plastic packaging on the EU market will be recyclable by 2030, the consumption of single-use plastic will be reduced, and the intentional use of micro plastics will be restricted.
Ongoing Intensive Growth of Incineration Industry to Drive Market Growth
SRF is produced mainly from commercial waste, including paper, cards, wood, textiles, and plastics. It acts as a supplement or replacement to thermal coal and can be used by production facilities with little or no modification in their solid fuel systems.
The consequences of the increasing use of various materials such as plastics, wood, and textiles have experienced significant growth in production over time. For instance, in Europe, plastics are mostly used in packaging as a low-cost product. It was estimated that plastic packaging covers around 40% of the total amount of plastic materials yearly produced, resulting in post-consumer plastic waste. Out of the total post-plastic waste, around 27% of the plastics went into landfills, leading to land pollution.
To reduce pollution caused by such wastes, governments encourage the reduction/reuse of them by treating them through the incineration industry, where the wastes are treated with high-temperature sustained incineration processes. The demand for SRF involves facilities that fall into the waste management system, including incineration plants. Waste type used in SRF can also be recovered through incineration on municipal sites. The growing inclination toward plant activities across key regions globally will likely drive the solid recovered fuel market growth. For instance, in Germany, waste incineration is one of the main pillars of waste management, where a large share of the waste remaining after incineration is recovered through multiple treatments.
Adoption of Secondary Fuels Propels Market Growth
Waste production from various municipal, industrial, and residential sectors is a vital factor that hampers sustainable development. It is well known that the several greenhouse gases (GHGs) produced from waste are major contributors to global GHG emissions.
Moreover, with continuous urbanization, waste has become a challenge not only for developed countries but also for developing economies. However, waste production can act as a substantial opportunity through which a future for sustainable development can be achieved as waste to energy could be a potential technology to reduce these GHG emissions. Waste-to-energy conversion is one of the latest forms of waste treatment, offering several benefits as it can generate electricity using different technologies. For example, incineration and anaerobic digestion can also be used as secondary fuels for multiple end-user applications.
Secondary fuels produced from waste have substantial demand across industry verticals, which acts as a driver for this market. For instance, industrial sectors such as the cement industry and coal power plants where the use of secondary fuels substitutes fossil fuels (coal, pet-coke) generate benefits in the form of less dependence on fossil fuels and lower environmental impact. Moreover, government organizations initiate guidelines for using waste as secondary fuels to meet substantial development. For context, in the U.K., the Waste and Resource Action Program (WRAP) provides a guideline for the classification and specification of secondary fuels, generically named Waste-Derived Fuel (WDF), which also acts as a driver for the market growth.
High Cost Associated with Processing of SRF to Hinder Market Growth
SRF produced from municipal solid waste is considered one of the most promising alternative fuels. There is an estimated high potential availability with increasing waste production across various regions. However, producing SRF poses challenges such as the high capital required to establish pre-processing plants and the higher cost of collecting, separating, and transporting solid waste. For instance, the U.K. energy producer Warwick Energy administrated a six-month briquetting trial coupled with C.F. Nielsen presses. Warwick Energy's test was mainly based on small diameter SRF-generating briquettes. This resulted in higher capital and operating costs to densify the solid recovered fuel compared to other processes such as biomass.
In addition to cost, technical barriers such as poor quality of solid waste and high moisture content result in the degraded quality of SRF, further impacting its production rate. However, there is ongoing work within the international Standards Organization (ISO) to develop standards for SRF and its production process. This might be an important tool to increase the production of SRF as a secondary fuel and thus overcome some of the market barriers caused by the lack of a common denomination and methods to determine the quality comparably.
Inert Waste Accounts for Dominant Market Share due to Increase in Amount of Construction Waste
SRFs are produced from individual or mixed streams of municipal waste (MSW), commercial waste (CW), industrial waste (IW), and construction and demolition waste (CDW). These streams include different shares of waste fractions and also show a different elemental composition.
Based on waste type, the market is segmented into biodegradable material, recyclable type material, composite waste, and inert waste. The inert waste segment is likely to hold a dominant market share owing to the large consumption of construction and demolition waste, dirt, rocks, and debris. With increasing waste generation from the construction and demolition industry, the inert waste type will likely maintain its dominating share during the solid recovered fuel market forecast period.
Subsequently, composite waste, which generally includes waste from composite materials produced from the end-user industry, such as automotive, wind, and aerospace, also holds a significant market share owing to the increase in the production of composite materials.
Europe and North America are two major markets for biodegradable plastics, but the demand for biodegradable plastics is growing rapidly in Asia, especially in China and India, due to plastic restriction policies, further improving the market landscape for solid recovered fuel from biodegradable material.
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Cement Industry is Among the Leading Energy Consuming Industries, Resulting in High Demand for Secondary Fuel
The demand for solid recovered fuel across the globe falls under energy-intensive industries, such as cement and thermal power plants, which make the use of secondary fuels as substitutes for fossil ones, which means a benefit in terms of both less dependence on fossil fuels and lower environmental impact.
The demand for solid recovered fuels is generally high across the cement kiln industry as cement is one of the most energy-intensive industries with high energy consumption owing to multiple production processes.
Primarily coal was used as a primary fuel source. However, using secondary fuels, such as SRFs, generates benefits in the form of less dependence on fossil fuels and lower environmental impact. The cement industry's focus on reducing Carbon Dioxide (CO2) and Nitrogen Oxide (NOx) is likely to contribute to the growth of solid recovered fuel in cement kiln applications.
Asia Pacific Solid Recovered Fuel Market Size, 2021 (USD Billion)
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The market has been studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
The Asia Pacific region is likely to hold the dominating solid recovered fuel market share owing to increasing construction activities, surging the demand for the cement industry, which is the major consumer for SRFs. Furthermore, construction and demolition activities are also most likely to result in waste production from construction and demolition, a major waste source for SRFs.
Followed by Asia Pacific, Europe holds the leading market share. Factors such as the presence of key SRF manufacturers and the increasing shift toward secondary fuel sources for energy generation have resulted in trades between key countries such as Germany, the U.K., France, and other neighboring countries.
Furthermore, municipal solid waste has experienced significant growth in North America in the past three years. Due to this, governments are focusing on adopting significant technologies to maintain waste production and make sustainable use of it.
In addition, in Latin America and the Middle East regions, the increasing market trends in improving their economy have aroused the need for maintaining waste generation, resulting in the adoption of recycling and reuse techniques of waste management.
Key SRF Producers are Concentrating on Enhancing their Business Capacities Due to Increasing Demand for Secondary Fuels from Cement Industry
The global market is dominated by several key players operating across the globe. However, the market also has various small and medium-sized players who deal in manufacturing, processing, and distribution of solid recovered and hold a good regional/local presence.
Major players also include Veolia, Geminor, Enva, Bepurac Group, and Renelux Group, which constitute around one-fourth of the market, and the remaining market is dominated by a large number of regional and local players. Veolia is the frontrunner in the market, and in November 2021, it increased its new industrial collaborations and advocated new circular economy regulations. By participating in several industrial alliances and platforms, the company ensures that its products are designed to minimize waste and reintegrate the maximum amount of recycled materials into the production cycle.
Numerous other key players operating in the market focus on enhancing their regional foothold through acquisition or badging contracts. For example, in January 2022, Geminor opened a stream of sustainable SRF to Finland by signing a three-year agreement with Finnsementti. The cooperation includes the supply of SRF, handling, and transport of waste fuels to the cement plant in Parainen.
An Infographic Representation of Solid Recovered Fuel Market
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The market research report comprehensively assesses the global market of solid recovered fuel by offering valuable insights, industry-related information, and historical data. Several methodologies and approaches are adopted to make meaningful assumptions and views. Furthermore, the research report offers a detailed analysis and information of the market segments, helping our readers get a comprehensive global industry overview.
Value (USD Billion)
By Waste Type, Application, and Region
By Waste Type
The Fortune Business Insights study shows that the global market was USD 4.63 billion in 2021.
The global market is projected to grow at a CAGR of 3.4% in the forecast period.
The market size of Asia Pacific stood at USD 1.93 billion in 2021.
Based on waste type, inert waste holds the dominating share in the global market.
The global market size is expected to reach USD 6.00 billion by 2029.
The key market drivers are the adoption of secondary fuel and increasing incineration industry growth.
The top players in the market are Veolia, Renelux Group, BMH Technology, and Beauparc Group.
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