Waste Management 2015 Annual Report Download - page 69

largest network of landfills in North America. Solid waste landfills are constructed and operated on land with
engineering safeguards that limit the possibility of water and air pollution, and are operated under procedures
prescribed by regulation. A landfill must meet federal, state or provincial, and local regulations during its design,
construction, operation and closure. The operation and closure activities of a solid waste landfill include
excavation, construction of liners, continuous spreading and compacting of waste, covering of waste with earth
or other acceptable material and constructing final capping of the landfill. These operations are carefully planned
to maintain environmentally safe conditions and to maximize the use of the airspace.
All solid waste management companies must have access to a disposal facility, such as a solid waste
landfill. The significant capital requirements of developing and operating a landfill serve as a barrier to landfill
ownership and, as a result, third-party haulers often dispose of waste at our landfills. It is usually preferable for
our collection operations to use disposal facilities that we own or operate, a practice we refer to as internalization,
rather than using third-party disposal facilities. Internalization generally allows us to realize higher consolidated
margins and stronger operating cash flows. The fees charged at disposal facilities, which are referred to as
tipping fees, are based on several factors, including competition and the type and weight or volume of solid waste
deposited.
Under environmental laws, the federal government (or states with delegated authority) must issue permits
for all hazardous waste landfills. All of our hazardous waste landfills have obtained the required permits,
although some can accept only certain types of hazardous waste. These landfills must also comply with
specialized operating standards. Only hazardous waste in a stable, solid form, which meets regulatory
requirements, can be deposited in our secure disposal cells. In some cases, hazardous waste can be treated before
disposal. Generally, these treatments involve the separation or removal of solid materials from liquids and
chemical treatments that transform waste into inert materials that are no longer hazardous. Our hazardous waste
landfills are sited, constructed and operated in a manner designed to provide long-term containment of waste. We
also operate a hazardous waste facility at which we isolate treated hazardous waste in liquid form by injection
into deep wells that have been drilled in certain acceptable geologic formations far below the base of fresh water
to a point that is safely separated by other substantial geological confining layers.
Transfer. At December 31, 2015, we owned or operated 297 transfer stations in North America. We deposit
waste at these stations, as do other waste haulers. The solid waste is then consolidated and compacted to reduce
the volume and increase the density of the waste and transported by transfer trucks or by rail to disposal sites.
Access to transfer stations is critical to haulers who collect waste in areas not in close proximity to disposal
facilities. Fees charged to third parties at transfer stations are usually based on the type and volume or weight of
the waste deposited at the transfer station, the distance to the disposal site, market rates for disposal costs and
other general market factors.
The utilization of our transfer stations by our own collection operations improves internalization by
allowing us to retain fees that we would otherwise pay to third parties for the disposal of the waste we collect. It
enables us to manage costs associated with waste disposal because (i) transfer trucks, railcars or rail containers
have larger capacities than collection trucks, allowing us to deliver more waste to the disposal facility in each
trip; (ii) waste is accumulated and compacted at transfer stations that are strategically located to increase the
efficiency of our network of operations and (iii) we can retain the volume by managing the transfer of the waste
to one of our own disposal sites.
The transfer stations that we operate but do not own generally are operated through lease agreements under
which we lease property from third parties. There are some instances where transfer stations are operated under
contract, generally for municipalities. In most cases we own the permits and will be responsible for any
regulatory requirements relating to the operation and closure of the transfer station.
Wheelabrator. On December 19, 2014, we sold our Wheelabrator business to an affiliate of Energy Capital
Partners and received cash proceeds of $1.95 billion, net of cash divested, subject to certain post-closing
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