Financing waste management and resource efficiency in the green bond market

This briefing by the Climate Bonds Initiative examines the role of green bonds and labelled loans in financing waste management and the circular economy. It highlights a significant investment gap, particularly in plastic waste management in Southeast Asia, and analyzes the market activity of corporate and municipal issuers globally, with a detailed focus on Japan's leadership in resource efficiency.

• Waste management is a critical but underutilized sector in the green bond market, ranking as the fourth largest category for use of proceeds globally. As of December 2019, USD 6.8bn had been allocated to waste management assets and projects, representing approximately 4% of total issuance volumes.
• There is a substantial capital requirement for waste infrastructure, exemplified by an estimated annual investment gap of USD 5bn for managing plastic waste in five high-polluting countries: China, Indonesia, the Philippines, Thailand, and Vietnam.
• Non-financial corporate issuers lead the waste management green bond market, allocating USD 2.6bn (38% of the total). France is the most dominant country in this segment, with the company Paprec alone contributing USD 1.8bn, or 71% of the total raised by waste management companies across six countries.
• US municipal issuers are highly active in the sector, having allocated approximately USD 1.1bn to waste management. Projects include a USD 12m composting facility in Napa, California, and a USD 20m bond from the City and County of Honolulu to refinance the H-Power waste-to-energy facility.
• Japan is a regional leader in resource efficiency, recycling about 44% of all generated waste. The Japanese green bond market for waste management is valued at approximately USD 800m (5% of its total USD 17bn green bond market), with non-financial corporates like Hitachi Zosen and Daio Paper Corporation as primary issuers.
• The circular economy (CE) presents a global business opportunity estimated at USD 4.5 trillion by McKinsey & Co. and Accenture, though the world is currently only 8.6% circular. Financing for CE is expanding through specialized equity funds from BlackRock and RobecoSAM, and indices from ECPI, Solactive, and MSCI.
• Key barriers to scaling green finance in this sector include a lack of common standards and definitions, as well as high transaction costs for debut issuers. To address this, the European Commission's Technical Expert Group published a draft EU Taxonomy on Sustainable Finance in June 2019 to provide a common classification system.

APA

Tukiainen, K. (2020). Financing waste management and resource efficiency in the green bond market. Climate Bonds Initiative. https://www.climatebonds.net/files/documents/publications/Financing-waste-management-resource-efficiency-and-circular-economy-in-the-green-bond-market.pdf

Chicago

Tukiainen, Krista. Financing waste management and resource efficiency in the green bond market. Climate Bonds Initiative, 2020. https://www.climatebonds.net/files/documents/publications/Financing-waste-management-resource-efficiency-and-circular-economy-in-the-green-bond-market.pdf.

Wikipedia

{{cite report |last1=Tukiainen |first1=Krista |title=Financing waste management and resource efficiency in the green bond market |publisher=Climate Bonds Initiative |date=March 2020 |url=https://www.climatebonds.net/files/documents/publications/Financing-waste-management-resource-efficiency-and-circular-economy-in-the-green-bond-market.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{tukiainen2020financing, author = {Tukiainen, Krista}, title = {{Financing waste management and resource efficiency in the green bond market}}, institution = {Climate Bonds Initiative}, year = {2020}, month = mar, url = {https://www.climatebonds.net/files/documents/publications/Financing-waste-management-resource-efficiency-and-circular-economy-in-the-green-bond-market.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }