Fuel and Environmental Charge

Waste Management is committed to providing customers with safe and reliable quality waste services at a reasonable price. Waste Management has made investments in cleaner technologies, such as LNG or CNG trucks, reducing our overall impact on the environment, but fuel prices and environmental compliance-related costs are something we cannot fully control. Our standard Fuel/Environmental Charge is meant to help our WM operating companies cover these costs and achieve an acceptable operating margin. The Fuel/Environmental Charge is one line item on customer invoices that contains two separate components: a Fuel Surcharge and an Environmental Charge.

Fuel Surcharges

The Fuel Surcharge allows our WM operating companies to recover the cost of diesel, natural gas and other hydrocarbon based fuels and products that Waste Management on an enterprise-wide basis (through its WM operating companies) uses in its overall business, above a baseline cost. That baseline cost is measured in diesel cost @$.95/gallon. This charge allows our WM operating companies to keep up with the changing costs of diesel, natural gas and other hydrocarbon based fuels and products, and allows them to achieve the operating margin they need to maintain the high level of service that customers expect. Our standard Fuel Surcharge calculation is tied directly to the national average price of diesel fuel as reported weekly by the Energy Information Administration of the U.S. Department of Energy ("EIA/DOE") in its Weekly Retail On-Highway Diesel Prices Index. This index is objective, publicly available and widely recognized in the trucking and transportation industries. Tying our standard Fuel Surcharge to this index ensures customers are assessed a fuel surcharge that is currently adjusted and easy to calculate.

The EIA/DOE average is published each Monday and will be used for invoices created during that week. The WM Collection Fuel Surcharge Table or WM Disposal Fuel Surcharge Table shows what the Fuel Surcharge, as a percentage of a customer’s monthly or other periodic invoice charges, before taxes, would be based upon the last reported EIA/DOE national diesel price prior to a customer’s invoice date.

The amount or percentage of the Fuel Surcharge is not specifically tied to the direct or indirect costs to service a specific customer account. By contract or at a WM operating company’s discretion, some customers pay a nonstandard fuel surcharge or are exempt from any fuel surcharge. Through fuel surcharges, WM operating companies attempt to collectively recover all Waste Management enterprise-wide costs for diesel, natural gas and other hydrocarbon based fuels and products used by WM operating companies above the $.95/gallon diesel cost baseline, from only those customers subject to a fuel surcharge, excluding any exempt or non-paying customers.

Environmental Charge 

The Environmental Charge is 16.0% of all invoice charges, including the Fuel Surcharge, but excluding the Regulatory Cost Recovery Charge and taxes. (Some disposal customers are charged a flat rate per load or other rate or amount in accordance with their service or contract terms. Contact your local Technical Service Center through www.wmsolutions.com for more details.)

The Environmental Charge allows our WM operating companies to cover Waste Management’s enterprise-wide costs and expenses for its WM operating companies to operate collection, transfer, landfill, and recycling operations in a safe and environmentally responsible manner, and to achieve an acceptable operating margin. The amount or percentage of the Environmental Charge is not specifically tied to the direct or indirect costs to service a specific customer account. By contract or at a WM operating company’s discretion, some customers pay a nonstandard environmental charge or are exempt from any environmental charge. Through environmental charges, WM operating companies attempt to collectively recover all applicable Waste Management enterprise-wide environmentally related costs of its WM operating companies from only those customers subject to an environmental charge, excluding any exempt or non-paying customers.

Historical WM Fuel/Environmental Charge Values

The Fuel/Environmental Charge included on a customer's invoice is determined by first applying the Fuel Surcharge percentage from the WM Collection Fuel Surcharge Table or WM Disposal Fuel Surcharge Table to the total invoice charges (excluding the Environmental Charge, Regulatory Cost Recovery Charge and taxes). Then the environmental percentage is applied to the total invoice charges, including the Fuel Surcharge calculation. For example, a bill totaling $25.00 for services, with a $3.00 Fuel Surcharge, would see an additional $4.48 applied for the Environmental Charge (16.0% of $28). For ease of reference, the Historical Table shows each Fuel/Environmental Charge applied by our WM operating companies for the previous 52 weeks. This table also references the corresponding EIA/DOE value for each week. Contact your local WM office if you require more information.

Not a Governmental Tax; Future Changes

The Fuel/Environmental Charge is not a tax or surcharge imposed by or remitted to any governmental or regulatory agency; it is our WM operating companies’ charge. The Fuel Surcharge calculation or Environmental Charge percentage may be changed in the future at the company’s discretion. Any such changes shall be subject to an existing customer’s applicable service terms. 

Fuel and Environmental Charge — Frequently Asked Questions

Q: Why do you charge a fuel surcharge?
A: This charge helps us keep up with the changing costs of diesel, natural gas and other hydrocarbon based fuels and products that we use on an enterprise-wide basis (Waste Management and its WM operating companies). Fuel surcharges are common in the transportation industry and are charged by other waste haulers, trucking companies and airline carriers.

Q: If the price of fuel goes down, will my fuel surcharge go down too?
A: Yes, if the EIA/DOE's national average diesel price falls, your fuel surcharge will come down as well (unless your service terms provide for a fixed percentage or nonstandard fuel surcharge). Tying the charge to this publicly reported price allows us to be responsive to fuel cost changes.

Q: How can I access the Department of Energy Weekly Retail On-Highway Diesel Prices Index?
A: Here is the link to the EIA/DOE. This site is updated every Monday evening.

Q: Why is there a fuel surcharge when the cost of fuel is less than what it was when my contract began or was renewed?
A: Our fuel surcharge uses a baseline cost (measured in diesel cost @ $.95/gallon), regardless of when a customer’s contract begins or renews. We believe employing a fuel surcharge that uses a common baseline rate for all WM operating companies’ customers is the best approach, as it results in a uniform fuel surcharge that can be calculated by customers by referring to the WM Collection Fuel Surcharge Table or WM Disposal Fuel Surcharge Table.

Q: What does the Environmental Charge cover?
A: The Environmental Charge is intended to cover Waste Management’s overall enterprise-wide costs for our WM operating companies to operate in a safe and environmentally responsible manner and to achieve an acceptable operating margin. The Environmental Charge is not specifically tied to the environmental compliance or other costs to service each individual customer account. Such environmental costs include, among other things, landfill cover material, engineering, testing and maintenance at landfills and other disposal facilities, the disposal of tires, batteries, oils and fluids and the monitoring and management of vehicle emissions. The Environmental Charge percentage will not fluctuate each month; however, the percentage may be changed periodically, at our discretion, if there is a business determination that warrants a change.

Q: Did the Environmental Charge recently increase?
A: The Environmental Charge increased by 1.5% of all invoice charges, including the Fuel Surcharge (but excluding the Regulatory Cost Recovery Charge and taxes) in December 2017 (to 16.0%).

Regulatory Cost Recovery Charge

Our WM operating companies incur millions of dollars in host community fees and waste disposal taxes every year. As a result, our WM operating companies assess a Regulatory Cost Recovery Charge on customer invoices, currently 3.6% of all invoice charges, including the Fuel/Environmental Charge, but excluding taxes.

This charge allows our WM operating companies to collectively recover a portion of Waste Management’s overall enterprise-wide costs associated with host community fees, waste disposal taxes and similar charges paid by our WM operating companies to municipal or other governmental authorities or agencies to engage in the waste collection, transfer, processing, disposal, treatment and/or recycling business, and to achieve an acceptable operating margin. The amount or percentage of the Regulatory Cost Recovery Charge is not specifically tied to the direct or indirect costs to service a specific customer account, but to Waste Management's overall applicable enterprise-wide host community and other regulatory costs for all customers, whether they pay this charge or not. By contract or at a WM operating company’s discretion, some customers pay a nonstandard Regulatory Cost Recovery Charge or are exempt from such charge.

Not a Governmental Tax; Future Changes

The Regulatory Cost Recovery Charge is our WM operating companies’ charge; it is not tied specifically to any fees, taxes or charges applicable to your local service area that our WM operating companies are required to collect and remit to any governmental agency. The Regulatory Cost Recovery Charge percentage may be changed in the future at the company’s discretion. Any such changes shall be subject to an existing customer’s applicable service terms.

Regulatory Cost Recovery Charge — Frequently Asked Questions

Q: What does this charge cover?
A: The Regulatory Cost Recovery Charge is a Waste Management standard charge intended to cover a portion of Waste Management’s enterprise-wide costs associated with host community fees, waste disposal taxes and similar charges that WM operating companies pay to municipal or other governmental authorities or agencies to engage in the waste collection, transfer, processing, disposal, treatment and/or recycling business.

Q: What is a “host fee”?
A: Typically, a “host fee” is a fee a WM operating company pays, either by ton or on a monthly, quarterly or annual basis, to a community (city, county, province, municipality, township, etc.) to locate, construct, operate and/or expand our waste and/or recycling facilities in the community.

Q: I do not live in a community with host fees or disposal taxes, why am I being assessed a Regulatory Cost Recovery Charge?
A: The Regulatory Cost Recovery Charge is a standard charge assessed by WM operating companies intended to cover a portion of Waste Management’s overall enterprise-wide costs for host community fees and disposal taxes paid by all its WM operating companies across the United States and Canada. WM operating companies apply this charge to a customer’s invoice whether or not the customer is serviced in a city, municipality, county, province, state or other region that charges or assesses host community fees, waste disposal taxes or similar charges.

Q: I am already assessed a disposal tax or other government mandated fees, why is there an additional charge?
A: The Regulatory Cost Recovery Charge is assessed in addition to any specific host community fee, waste disposal tax or similar charge that is directly applicable to your account or service area. This charge is not specifically tied to such costs to service your account, but instead helps us cover Waste Management’s enterprise-wide costs for host community fees, waste disposal taxes and similar charges to service all WM operating company customers in the United States and Canada, and to achieve an acceptable operating margin.

Q: Will the Regulatory Cost Recovery Charge change each month?
A: No. The regulatory cost recovery charge will not fluctuate each month. It is currently set at 3.6% of all invoice charges, including the Fuel/Environmental Charge (but excluding taxes). The percentage may be changed periodically, at our discretion, if there is a business determination that warrants a change in the charge.