The biggest disadvantages of waste-to-energy are financial as well as environmental. Incinerators are the most expensive way to manage waste, they are frequently built with public loans and subsidies, and many come with “put-or-pay” contracts that force cities to keep supplying waste for decades — or pay for waste they never deliver.
It’s also a climate finance problem. As governments negotiate climate finance at COP31 in Antalya, incinerators are competing for the same money as proven zero waste solutions: nearly USD 4 billion has gone into waste incineration projects, capturing 94% of waste-sector methane finance, while barely 1% reaches organic waste management and food rescue. In October, GAIA and allied groups demanded an end to public financing for incineration. Our new research, The Burn Book, documents twenty incinerators and incinerator proposals around the world. Together they have racked up nearly $7 billion in investment, with a portion coming directly from taxpayers through government subsidies and municipal borrowing.
What is a put-or-pay contract?
A put-or-pay contract — sometimes called a minimum tonnage guarantee — requires a city to deliver a minimum amount of waste to an incinerator every year. If the city sends less, for example because of robust recycling and composting programs, it still pays as if it had delivered the full amount. In practice, this turns waste reduction into a financial penalty.
Under a put-or-pay contract, cities pay financial penalties for reducing waste-burning through ecological techniques like recycling or composting.
The Burn Book shows how common these clauses are:
- Hempstead, New York (USA): a long-term put-or-pay contract requires payment for at least 381,000 metric tons of waste a year through 2034.
- Surabaya, Indonesia: the Benowo plant’s operator is guaranteed payment for at least 1,000 metric tons a day even when the city delivers less, and the national utility buys its electricity at a preferential tariff of $0.1335 per kWh.
- Harare, Zimbabwe: the planned Pomona incinerator sits at the center of a $344 million, 30-year concession that requires the city to pay for minimum quantities of waste whether or not they are delivered.
- Moerdijk, Netherlands: contracts requiring 510,000 metric tons of waste a year led to financial disputes once better waste separation reduced municipal deliveries.
Who pays for incinerators?
Incinerators are often presented as private investments, but much of the money comes from the public — through development banks, national grants, municipal borrowing and guaranteed electricity prices:
- Copenhagen, Denmark: Amager Bakke (CopenHill) was financed with about $682 million in publicly backed borrowing. When local waste volumes came in lower than expected, its owner municipalities loosened restrictions on imported waste.
- Paris, France: Isséane cost about $836 million, largely through public financing.
- Kwinana, Australia: the project received $16.3 million in federal grants and up to $63.8 million in debt financing from the government-owned Clean Energy Finance Corporation, while councils signed 20-year waste-supply agreements.
- Rome, Italy: the nearly $1.12 billion Santa Palomba incinerator will bind the city to a 33-year concession, even as Rome plans to raise separate collection to 70% by 2035.
- Prachinburi, Thailand: three industrial incinerators are part of a 12-plant project backed by more than $500 million in debt financing arranged by the Asian Development Bank, with lenders including the Asian Infrastructure Investment Bank.
How development finance is pushing incineration in the Global South
The risk is greatest where cities have the fewest resources to absorb it. GAIA Asia Pacific’s Citizens’ Atlas on False Climate and Circularity Solutions assessed 59 World Bank Group projects from January 2015 to August 2026. It found that 42 of them support waste incineration — including waste-to-energy, pyrolysis and gasification — across US$35.89 billion in total approved project amounts. Only 15 of the 59 projects mention or include plans to address waste workers’ concerns.
In Africa, GAIA’s new report Africa’s Waste Crisis Is Attracting the Wrong Solution examines 15 waste-to-energy projects and proposals across 10 countries. Ethiopia’s Reppie plant shows what can go wrong. The government spent about $120 million on a facility designed to burn 1,400 metric tons a day, but it processes only around 396–650 tons. It costs about $6.09 million a year to operate, Addis Ababa pays more than $1.83 million a year in compensation for power-generation shortfalls, and waste pickers interviewed reported an average 50% drop in income after the incinerator opened.
Overcapacity: when there isn’t enough waste to burn
Big incinerators are designed around big waste volumes. When cities succeed at recycling and composting, those plants run short — and someone has to cover the gap. Europe already has around 65 million tonnes of incineration overcapacity, according to a 2026 data update from Zero Waste Europe, which calls for a moratorium on new capacity and for EU law to treat incineration as disposal, not recovery.
Oversizing is still happening. Brampton’s Emerald facility in Canada is approved to expand from about 182,000 to 912,000 metric tons a year, and the planned plant in Barueri, Brazil, has roughly three times the capacity of the residual waste the city itself generated in 2024.
7 questions to ask before your city signs an incinerator contract
- What kind of waste will the plant burn, and where will it come from — household waste, recyclables, organics, plastics, or waste imported from other cities?
- Is there a minimum tonnage or put-or-pay clause — and what happens to the bill if we recycle and compost more?
- How long is the contract, and what would it cost to exit early?
- Who carries the debt if the plant underperforms or waste volumes fall?
- Are electricity prices, tipping fees or subsidies guaranteed with public money?
- Will emissions, including dioxins and particulate matter, be continuously monitored and published?
- How will waste pickers and informal recyclers be affected, and what is the plan to protect their livelihoods?
GAIA’s Waste-Burning 101 toolkit helps communities and organizers work through these questions, challenge proposed facilities and engage in waste planning decisions. For organizing strategies, read How Communities Can Refuse Incineration and Win.
Zero waste costs less — and should get the climate finance
The alternative is cheaper, and it is where climate finance agreed at COP31 should go. In Bandung, Indonesia, decentralized community systems save the local government up to USD 1.7 million a year in avoided transport and tipping fees. Over 550 municipalities around the world are already taking steps toward zero waste. And over GAIA’s 25 years, more than 375 incinerators have been shut down — proof that communities can win against incinerators.
Frequently asked questions about the costs of waste-to-energy
What are the disadvantages of waste-to-energy?
Waste-to-energy incinerators are expensive to build and run, often rely on public money and long-term contracts that require a steady waste supply, emit greenhouse gases and toxic pollutants, and produce toxic ash. The twenty incinerators in GAIA’s Burn Book produced at least 1.7 million tons of toxic ash per year.
What is a put-or-pay contract in waste management?
A put-or-pay contract obliges a city to deliver a minimum quantity of waste to a facility or pay for the shortfall. It discourages recycling and composting, because reducing waste doesn’t reduce the bill.
Who finances waste-to-energy incinerators?
Often the public. Funding comes from development banks such as the World Bank Group, the Asian Development Bank and the European Investment Bank, as well as government grants, municipal borrowing and guaranteed electricity tariffs.
Is waste-to-energy cheaper than recycling and composting?
No. Incineration is the most expensive form of waste management. Community-based zero waste systems — separation, collection, composting and recycling — are sustained at a fraction of the cost of building an incinerator.
Can communities stop an incinerator?
Yes. More than 375 incinerators have been shut down over GAIA’s 25 years, and 2026 victories include Skalica in Slovakia, Pavlikeni in Bulgaria and Mapo-gu in South Korea.
Read the full Burn Book, download the World Bank fact sheet, and if your community is fighting an incinerator, put your campaign on the map.
