Covanta releases Q2 results, plans to close New Jersey EfW plant

On July 26, Covanta Holding Corp. released second quarter financial results, provided an update of its energy-from-waste (EfW) operations and announced plans to close an EfW plant in New Jersey.

During an investor call, Stephen Jones, CEO and director of Covanta, said several of the company’s largest plants are positioned to reach record waste and energy volumes this year. He noted the company’s key assets are performing well, and said Covanta is continuing to move forward on its portfolio optimization plan.

According to Jones, Covanta recently decided to close its 550 ton-per-day EfW plant in Warren County, New Jersey. “This was a difficult decision as the facility has run consistently well and the team has done a fantastic job there,” he said “However, given its size and the challenging local market conditions, we didn’t see its potential to be a significant financial contributor going forward.” The facility is expected to close early next year.

Regarding Covanta’s energy segment, Jones said Covanta saw strong year-over-year improvement in energy production, given the performance of the fleet and the Fairfax plant in particular. He also noted that Covanta has agree to a new 15-year power purchase agreement at its Marion County EfW facility in Oregon. “The new power sales will begin in the later part of 2019,” he said. “The pricing in this agreement reflects the plant’s capability as a base load renewable energy provider and we expect it to improve the plant’s overall economic proposition.

In addition, Jones said that the Virginia-based Fairfax plant entered into a new one-year power purchase agreement for a portion of its output. “This agreement includes value for the renewable aspects of the plant,” he said.

Overall, Covanta reported $454 million in revenue for the second quarter, up from $424 million for the same period of last year. Net loss was $31 million compared to a net loss of $37 million during the second quarter of 2017. Adjusted EBITDA was $103 million, up from $93 million during the first quarter of last year.