WM Fuel/Environmental Charge Information

Overview

Waste Management is committed to controlling costs so we can continue to provide you with the best overall value in waste related services. Other than investments Waste Management is purposefully making towards cleaner technologies and towards reducing our overall impact on the environment, rising fuel prices and environmental compliance-related costs are something we cannot fully control. Our standard fuel/environmental charge is meant to help us cover these increased costs and achieve an acceptable operating margin. This fuel/environmental charge is one line item on customer invoices that contains two separate components — a fuel charge component and an environmental charge component.

Fuel Component

The fuel charge is a Waste Management charge that allows us to recover the increase in the cost of diesel fuel over a base price per litre ($.55/litre). This charge helps Waste Management keep up with the fluctuating costs of diesel fuel on a company-wide basis throughout North America and provides the stability we need to continue to maintain the high level of service you expect. The fuel charge calculation is tied directly to the Canadian National average of diesel fuel as reported weekly by Bloomberg, a leading global provider of data, news and analytics. Tying our fuel charge to this weekly reported diesel price ensures you are assessed a fuel charge that is currently adjusted, easy to calculate and equitable to you and the company. Our collection and disposal fuel charge table shows what the fuel charge, as a percentage of your monthly invoice charges, before taxes, would be based upon the last reported Bloomberg Canadian National diesel price prior to your invoice date.

Beginning January 1, 2011, we changed our fuel charge percentage from .15% to .165% for collection services, and .09% to .099% for disposal services, for every 1 cent in fuel cost increase or decrease.

Environmental Component

The environmental component of this fuel/environmental charge is current 10% of invoice charges, excluding tax.  (Some disposal customers are charged a flat per load rate or a variation not described herein. Please contact your local Technical Service Center through www.wmsolutions.com for more details.) The environmental component of this fuel/environmental charge was implemented by the company to cover our increasing costs and expenses to operate our collection, transfer, landfill and waste-to-energy operations, on a company-wide basis, in a safe and environmentally responsible manner, and to achieve an acceptable operating margin.  The amount or percentage of the environmental component is not specifically tied to the direct or indirect costs to service your account, but to Waste Management's overall costs on a company-wide, North American basis.

Historical WM Fuel/Environmental Charge values

The fuel/environmental charge that is included on a customer’s invoice is determined by combining the percentage from the WM collection fuel charge and/or disposal fuel charge and the environmental fee component and applying that percentage to the invoice charges. For easy reference, the historical collection fuel charge and historical disposal fuel charge shows each fuel/environmental charge issued by Waste Management. Contact your local WM office if you require more information. .

Not a Governmental Tax; Future Changes

Our fuel/environmental charge is not a tax or surcharge imposed by or remitted to any governmental or regulatory agency; it is our charge. The fuel/environmental charge percentages may be changed at the discretion of Waste Management. To the extent required by your applicable service terms, your consent to the assessment of the fuel/environmental Charge, and any changes to such charge, is effective upon your payment.

Frequently Asked Questions

Q: Why do you charge a fuel charge?
A: This charge helps us keep up with the changing costs of diesel fuel on a company-wide basis throughout North America and provides the stability we need to continue to maintain the high level of service you expect. Fuel charges are common in the transportation industry and are charged by other waste haulers, trucking companies and national airline carriers.

Q: If the price of fuel goes down, will my fuel charge go down too?
A: Yes, if Bloomberg's Canadian national monthly average price for diesel goes down, your fuel charge will come down as well. Tying the charge to this publicly reported price allows us to be more responsive to fuel cost changes.

Q: What does the environmental component cover and will it fluctuate each month?
A:  The environmental component is our charge that we attribute to our overall company-wide costs to operate our business in a safe and environmentally responsible manner and to achieve an acceptable operating margin. This environmental charge is not tied to any specific environmental compliance or other costs to service a specific customer account, but to the overall environmentally related costs to service all Waste Management customers. Our environmentally related costs include, among other things, landfill cover material, engineering, testing and maintenance in our landfills and waste-to-energy facilities.  In our collection operations these costs include such things as the disposal of tires, batteries, oils and fluids and the monitoring and management of vehicle emissions. The environmental charge will not fluctuate each month; however, the percentage may be changed periodically if there is a business determination that warrants a change.

Q: Did the environmental charge component recently increase?
A: Like most companies, we are constantly looking at various cost components of our business, including our environmentally related costs, to ensure we continue to operate in a profitable and sustainable manner. An increase in the environmental component occurred for most of our customers in September 2011. We reviewed our environmentally related costs for 2010 and projected costs for 2011 for those customers paying the charge and determined that increases to such costs (as measured on the volume of waste that we collect and dispose) coupled with maintaining an acceptable operating margin, warranted a change in the environmental component to 10%.