With landfill taxes reaching new highs and landfill space expected to reach its full capacity by the end of the decade, the industry is under growing pressure to reduce waste and find cost-effective ways of dealing with disposal.

The good news is that by using technologies such as anaerobic digestion (AD), waste streams can be transformed into a valuable resource that can be harnessed to generate clean and renewable heat and power.

The government has already identified AD as the best option currently available to deal with separately collected food waste. Now, an increasing number of businesses are also seeking to build, run and own AD facilities because of the potential operational and commercial benefits.

The argument for doing so is two-fold: the cost of waste management can be reduced and an organisation can self-generate electricity and heating and earn income from government schemes such as Feed-in Tariffs, Renewable Obligation Certificates or Renewable Heat Incentive.

The biggest hurdle is raising investment capital. However, this can be overcome with the support of manufacturer-financiers, who often exhibit a greater appetite to finance such projects than their generalist counterparts.

Specialist financiers tend to be better placed to evaluate the assets, validate a robust business plan and assess lifecycle costs and payback models.

Emerging financing options align investment costs with power savings, so one subsidises or even pays for the other - and specialists are now offering solutions that cover the design, installation and commissioning of plants as well as the plant components.

For manufacturers and retailers, food waste management should be regarded as both an economic and an environmental issue. By converting waste into energy, businesses can play a key role in helping the UK meet its renewable energy targets by 2020.

With flexible finance solutions making AD investment increasingly affordable, waste management is more of an opportunity than a challenge.

Julian Hobbs is sales director at Siemens Financial Services

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