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RECYCLING FOOD WASTE TO ENERGY – FIRST HBP No. NTU075

MOVER PITFALLS: IUT GLOBAL PTE LTD Publication No. : ABCC-2015-006
Print Copy Version: 24 Aug 2015

Wee Beng Geok, Priya Subramanian, Thiruneeran

Murugavel & Stephanie Tan

This case discusses the trajectory taken by a Singapore-based entrepreneur who embarked on a multi-
million business venture to turn food waste into energy. The brainchild of Edwin Khew, a veteran in
the waste management business, IUT Global was formed in 2005 to set up and operate Singapore’s
first organic waste treatment plant.

IUT’s bio-methanisation plant was an ambitious project. Budgeted at $60 million, the plant was
designed to process 800 tonnes of food waste and produce 10 megawatts of electricity most of which
would be sold to Singapore’s national electricity grid. Investors were optimistic that with their state
of the art process technology and a ready customer, the plant would generate a steady income stream
once it was set up and running.

However, from the start of production although less than 10% of food waste in Singapore was being
recycled, IUT encountered problems in the collection of food waste needed to feed its plant. It was
unable to collect enough food waste and those collected contained a higher percentage of contaminants
than projected. Furthermore, food operators resisted the need to separate food waste from solid
waste. Unable to meet its production targets, and after three years of losses, in 2011, IUT entered
into liquidation, and with it the closure of Singapore’s first large scale food waste-to-energy facility.

The case explores the following topics: First mover pitfalls in a sustainable energy venture; Analysis
of new venture business plans; Implementation challenges for start-ups; Assumption testing/sensitivity
analysis in costing of new ventures.

Dr Wee Beng Geok, Priya Subramanian,Thiruneeran Murugavel & Stephanie Tan prepared this case based on public
sources and interviews with key personnel of IUT Global Pte Ltd. As the case is not intended to illustrate either effective or
ineffective practices or policies, the information presented reflects the authors’ interpretation of events and serves merely
to provide opportunities for classroom discussions.

COPYRIGHT © 2015 Nanyang Technological University, Singapore. All rights reserved. No part of this publication may be
copied, stored, transmitted, altered, reproduced or distributed in any form or medium whatsoever without the written consent
of Nanyang Technological University.

For copies, please write to The Asian Business Case Centre, Nanyang Business School, Nanyang Technological University,
Nanyang Avenue, Singapore 639798
Phone: +65-6790-4864/5706, Fax: +65-6791-6207, E-mail: asiacasecentre@ntu.edu.sg

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EDWIN KHEW’S ENTREPRENEURIAL JOURNEY
Edwin Khew could be regarded as an engineer, a
manager as well as a serial entrepreneur.
In early 2000s, he launched the rst ever large-scale
food waste-to-energy project in Singapore driven
by his belief in waste-to-resource technologies and
sustainable energy. In this undertaking, he made use
of his training as a chemical engineer, as well as his
expertise from his years of experience in the business
of waste management.
the guest-of-honour, then Singapore’s Minister for
Environment and Water Resources Minister Yaacob
Ibrahim, noted that the plant marked an important
milestone in the development of Singapore’s waste
management and recycling industry.2 He emphasized
in his speech that now that we have a backend plant
to treat food waste we will push for segregation and
recycling.
THE WASTE RECYCLING SCENE IN SINGAPORE
IN 2005

He looked around him at the growing mountain of
food waste that was being sent to the incinerators for
disposal, with only a very small amount-being recycled
and saw a new business opportunity. By applying
improved anaerobic digestion (AD) technology which
he led and patented, he could convert food waste
into energy at higher rates of efciency compared to
available AD technologies which could then be sold
as electricity to the power grid. The outcome was a
$30 million rst-phase project to build a food-waste
recycling plant in Singapore that was then the largest
in Asia.1 It was the intention of Edwin to later expand
the plant in its second phase to 800 tons per day. At
IUT’s ground breaking ceremony in September 2005,
In 2005, the year when IUT announced its plans to
set up its food waste-to-energy plant, only 7% of food
waste was recycled. Overall recycling rate in Singapore
was reported to be 49% which was mostly due to the
recycling of industrial waste and construction and
demolition debris.3 Food waste accounted for more than
one-tenth the total waste output in Singapore and nearly
20% of total waste disposed (See Table 1).
In 2005, almost 2.6 million tonnes of waste were
disposed and there was growing concerns that given
this disposal rate, Singapore’s only offshore landll –
Semakau – would only last till 2035.4 (See Appendix
1 – Waste Situation in Singapore.)

Table 1
Waste Statistics and Recycling Rates for 2005

Source: National Environment Agency. Environmental Protection Division Report 2005.

1 Basu, R. (2005, September 16). Leftover food to power 10,000 homes; Plant to convert waste from hotel kitchens and food courts
into energy. The Straits Times.
2 ibid.
3 National Environment Agency. Environmental Protection Division Report 2005.
4 Ministry of the Environment and Water Resources. (2014, October 1). Retrieved on February 9, 2015, from http://app.mewr.gov.
sg/web/contents/contents.aspx?contid=1538

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RATIONALE FOR IUT GLOBAL
There were some 450 companies in the waste
management and recycling industry in Singapore
in 2005. They ranged from small operators to
multinational companies. Most of the companies were
in the waste collection business and the rest carried
out sorting and recycling of industrial and commercial
waste.5 Most of these recycling firms and plants
were involved in the recycling of construction debris,
horticultural waste, ferrous and non-ferrous metals,
used slag and scrap tyres. None were in the food
waste-to-energy conversion business.
Edwin saw that food waste had good potential as
a source of renewable energy which had been
overlooked in the promotion of sustainable energy.
His research on anaerobic digestion technology
led him to specially design a commercially viable
process that could convert food waste to energy more
efciently than in the incineration plants, leading to
higher power generation.6 He led his patent in 2007
and was awarded a patent under Patent No 145387-
WO2007/114787.
Biomethane, a gas produced by the anaerobic
digestion process, would then fuel large gas engines
to generate electricity. He could then sell the electricity
generated to Singapore’s national power grid.
IUT Global’s Food Waste to Energy System
The anaerobic or biomethanisation process, a
relatively new technology, in which biodegradable
material was converted to biogas under anaerobic
conditions, required the organic waste to be separated
from non-organic waste at source before being fed
into the bio-digestor. 7 In addition, IUT employed
a unique Anaerobic Digestion of Organic Slurry
(ADOS) process (under patent no 145387) which was
positioned between wet and dry digestion processes,
as a 8-10% slurry, and was adaptable to different water
content in the organic waste collected. The heart of the
patented ADOS process was a specially designed wet
mill (ADOS mill) which performed the size reduction
of organic solids while removing the remaining in-
organics and inerts.8 The ADOS digestion system
generated 15-20% more gas then other commercially
available anaerobic digestor systems in the market
and was functioning well for the 3.5 years it was in
operation.
Steps in Food Waste-to-Energy Transformation
I. Source of Food Waste
Food waste in Singapore accounted for 531,500
tonnes in 2005, of which only 7%, or 36,500 tonnes,
was recycled.9 Total output of food waste per day was
approximately 1500 tonnes. IUT’s goal was to collect
300 tonnes of food waste per day in phase I and
another 500 tonnes of food waste in phase II.
Commercial food establishments such as hawker
centres, hotels, restaurants and food courts were to
be the company’s main supply of food waste. IUT did
not consider household waste as a viable source for
the collection of food waste. This was because at that
time (and even up to 2015) 80% of all apartment units
in Singapore were each equipped with a single rubbish
chute through which each household would dispose
of all their rubbish, both organic or otherwise. (See
Appendix 2 – Sources of Food Waste.)
II. Collection of Food Waste
Using its own eet of trucks and drivers, IUT collected
food waste from various localities around Singapore.
These included hawker centres, food courts, hotel
restaurants, and other commercial and industrial food
establishments. The Company charged these food
operators $69.30/tonne for the removal and disposal
of food waste from their premises which was lower
in cost than charged by the general waste collectors
(GWCs) and the public waste collectors (PWCs). In
most cases 10-15% lower.

5 National Environment Agency. Environmental Protection Division Report 2005.

6 By employing anaerobic digestion technology, the high moisture content of food wastes would aid efcient and higher power generation.
7 United Nations Framework Convention on Climate Change (UNFCCC). (2006, December 22). Clean Development Mechanism – MW
Food Waste Based Grid Connected Power Project implemented by IUT Singapore Pte Ltd. Retrieved on 10 October 2014, from https://
www.certipedia.com/secure_area/quality_mark_documents/7261?locale=enimplemented by IUT Singapore Pte Ltd. United Nations
Framework Convention on Climate Change.
8 ibid.
9 National Environment Agency. Environmental Protection Division Report 2005.

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III. Pre-treatment of Food Waste
Before the food waste collected was treated, the
contaminants that could be separated by manual
labour such as tableware, crockery, boxes and
containers were removed. During the mechanical
pre-treatment stage, a bag breaker shredded plastic
bags containing the food waste. The food waste was
then fed into a screener, which separated the plastics
and in-organics to be sent to the nearest incineration
plant for burning. The ADOS mill then performed size
reduction of the organics and removed the balance
in-organics and inerts efciently.
IV.Anaerobic Digestion/ Electricity Generation
The remaining food waste was then put in an
anaerobic digester. The temperature at which this
digestion and decomposition process occurred was
between 52 and 55 degrees. The biogas with 60 to
64% methane (CH4) content that was produced as
a result was drawn out and stored in a gasholder
which was then fed into a gas engine for combustion.
This was then used to generate electricity. The net
power expected to be generated annually, after
excluding the electricity consumption of the plant, was
25,056 MWh, at 300 tonnes of food waste per day with
an anticipated 11-15% of contaminants.10
V. Feed into Singapore’s Power Grid
The national power grid was a ready customer for the
electricity generated by IUT (the power grid has to take
all renewable energy generated under 10 MW – this is
required by law). The nal price of electricity was that
settled between large power generation companies and
major power purchasers in the deregulated electricity
industry and varied every half-hour throughout a typical
24-hour day. The average selling price of electricity to
the national grid on the day that IUT announced its
launch was S$121.50 MWh.11

Figure 1
IUT Global Plant Process (In Phases)

Food Waste
Electrical
energy input
Anaerobic Gas Engine
Pretreatment Generator
Digestion (AD)
Phase Phase
I II

Digestate Electricity (Output)

Composting
Phase Phase Bio-compost
I II

Source: Food Waste Conversion Options in Singapore: Environmental Impacts Based on an LCA Perspective (2009).
Science of the Total Environment, 40(2010): 1367-1373.

10 United Nations Framework Convention on Climate Change (UNFCCC). (2006, December 22). Clean Development Mechanism – MW
Food Waste Based Grid Connected Power Project implemented by IUT Singapore Pte Ltd. Retrieved on 10 October 2014, from https://
www.certipedia.com/secure_area/quality_mark_documents/7261?locale=en
11 Energy Market Company. Price Information. Energy Price in September 2005. Retrieved September 2, 2014, from https://www.emcsg.
com/marketdata/priceinformation#priceDataView

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Plant Capacity IUT expected to be protable with the major revenue

IUT’s total planned plant capacity was 800 tonnes of
food waste a day, which was to be launched in two
phases (see Figure 1). In phase I (2007-2009), the
plant would be able to treat 300 tonnes of food waste
to generate about 4 Megawatts12 (MW) of electricity
while in phase II (after 2009), the plant was expected
to treat another 500 tonnes of food waste to generate
a total of 10 MW of electricity. Of this, 0.5 MW would
be used to operate the IUT plant and the remaining
9.5 MW would be sold to the grid.13
Plant Outputs
Specific net energy generation per tonne of food
waste14 was estimated to be 0.2288 MWh/tonne in
phase I and 0.2443 MWh/tonne in phase II compared
to the average power generation of 0.132 MWh/tonne
for the burning of food waste in incineration plants.15
drivers expected to be sales of electricity generated
under the National Electricity Market of Singapore
waste collection fees from food establishments, bio-
compost sold to farms and horticultural/ landscape
firms and carbon credits (this was priced at
US$13-15/tonne of CO2 equivalent at the point when
IUT was liquidated).
Sole Customer for Electricity Output
The Energy Market Company (EMC), which was
licensed by the government to operate the wholesale
market for electricity in Singapore was IUT’s sole
customer.
The use of renewable energy sources was supported
by the Singapore government and IUT’s expected
installed capacity of 1 MW to 10 MW would not impact
the total supply of electricity to the national grid.

Compost was another output from the digested food The nal price of electricity was that settled between
waste process and this could be sold as an organic large power generation companies and major power
fertilizer for farming and horticulture. Another by- purchasers in the deregulated electricity industry.16
product was heat (see Figure 2). Electricity prices varied every half-hour as large power
generators competed to supply the forecast power
demand for every half-hour trading period throughout
Figure 2
Flow Chart of Biomethanisation Process in IUT Global’s Plant

Screening & Biological Composition &

Organic Shredding Digestion Maturation
Waste

Inorganic Renewable Energy Compost

Outputs Recyclables (Electricity & Heat) (Organic Growth Media)

Source: United Nations Framework Convention on Climate Change (UNFCCC). (2006, December 22). Clean Development Mechanism –
MW Food Waste-Based Grid Connected Power Project implemented by IUT Singapore Pte Ltd.

12 1 Megawatt = 1,000 Kilowatts = 1,000,000 Watts.

13 Mulchand, A. (2007, June 13). Coming soon: Electricity from food scraps; Singapore’s rst food-waste recycling plant opens next
month. The Straits Times.
14 The amount of electricity generated for every tonne of food waste.
15 United Nations Framework Convention on Climate Change (UNFCCC). (2006, December 22). Clean Development Mechanism –
MW Food Waste Based Grid Connected Power Project implemented by IUT Singapore Pte Ltd. Retrieved on 10 October 2014,
from https://www.certipedia.com/secure_area/quality_mark_documents/7261?locale=en
16 ibid.

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a typical 24-hour day. The Uniform Singapore Energy Based on projections, the company expected to be
Price (USEP)17 when IUT came up with its business protable at 300 tonnes of food waste treated per
plan in September 2005 was approximately S$180 day.23 The net electricity generated after taking into
MWh.18 consideration the energy used by the plant, was
projected to be 25,056 MWh per year. In phase
IUT Global’s Business Plan II, expected to launch between 2009 and 2010, it
planned to recycle another 500 tonnes of food waste
Financing the project to generate an additional 44,580MWh of net electricity
per year (see Table 2).
The major sources of funds were from shareholders,
bank borrowings and trade credit. However, IUT also Waste collection Fees: As a licensed waste collector,
tapped on some small government grants as well as IUT collected waste from the food establishments and
some tax deductions offered for local R&D.19 charged a collection fee for this service. The standard
rate charged by major refuse disposal service providers
Major sources of revenue was $77/ tonne.24 This was a major source of revenue
for IUT (See section on Revenue Estimates).
Electricity sold to the power grid and waste collection
fees for the waste collected were expected to be the Another source of revenue
main sources of revenue for IUT.
Carbon Credits: In 2007, another source of income
Electricity Generated: Electricity generation depended was sale of carbon credits. Carbon credit projects were
on the amount of methane content in the biogas regulated by the United Nations (UN) under a Clean
resulting from the anaerobic process.20 The power Development Mechanism (CDM), which was part of
generated also depended on the percentage of the Kyoto Protocol. Under the global agreement to cut
contaminants in the organic waste collected. greenhouse gas emissions – regarded by scientists
as responsible for global warming – companies
IUT expected to ramp up operations to collect 300 could convert emission reductions in their business
tonnes of food waste daily within one to two years.21 operations and sell them to polluting nations. If certied
The plant designed was expected to handle food waste by the UN, IUT could have been one of the first
with up to 15% of inorganic contaminants in it. With Singapore-based facilities to earn the right to sell such
an anticipated inorganic content of 11% and moisture credits.25 One credit, or Certied Emissions Reduction,
content of 84%, biogas with 60 – 64% methane was is equal to one less tonne of carbon dioxide emitted.
expected to be produced and stored in a gasholder from In 2008, this was priced at around 22 Euros (S$46).26
where it could be continuously fed into the gas engine
for combustion which then generates electricity.22 IUT, eligible for the Clean Development Mechanism
grant27, calculated the amount of carbon emission
17 Weighted average of nodal price of electricity supplied to the national power grid (taken at half hour intervals).
18 Energy Market Company. Price Information| Energy Price in September 2005. Retrieved September 2, 2014, https://www.emcsg.com/
marketdata/priceinformation#priceDataView
19 Chua, G. (2010, October 18). Food recycling rm wins govt funding; Effort to boost bio-gas production among ve green projects
picked. The Straits Times.
20 Energypedia. Retrieved December 22, 2014, from https://energypedia.info/wiki/Electricity_Generation_from_Biogas
21 United Nations Framework Convention on Climate Change (UNFCCC). (2006, December 22). Clean Development Mechanism – MW
Food Waste-Based Grid Connected Power Project implemented by IUT Singapore Pte Ltd. Retrieved on 10 October 2014, from https://
www.certipedia.com/secure_area/quality_mark_documents/7261?locale=en
22 ibid.
23 Ng, K. & Lim, R. (2011, March 22). Recycling rm IUT Global being wound up; This follows three straight years of losses since start
up. The Business Times.
24 National Environment Agency. (2013). Retrieved September 2, 2014, from http://app2.nea.gov.sg/energy-waste/waste-management/
refuse-disposal-facility
25 Mulchand, A. (2007, June 13). Coming soon: Electricity from food scraps; Singapore’s rst food-waste recycling plant opens next
month. The Straits Times.
26 Cheam, J. (2008, August 15). $500k funding for carbon credit projects. The Straits Times.
27 Clean development mechanism grant was offered by the National Environment Agency and absorbed 50% of the cost of engaging a
carbon consultant capped at $100,000.

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Table 2
Technical Parameters of IUT Global’s Plant
Parameter Unit Values^
Phase I Phase II

(2008) (2009 – 2010)

Waste
Type of Waste Organic Waste
Volume Tonnes/day 300 500
Inorganic Content % 11 11
Moisture Content % 84 84
Volatile Solids % 4-6 4-6
Caloric Value KJ/kg 3115 3115
Biogas
Biogas Yield M3/kg VS day 3 3
Biogas Generation m3/day 45,000 75,000
Methane content % 60 - 64 60 - 64
Power Generation
Installed Capacity MW 3.5 6
Power generation per year MWh 28,560 48,960
Captive Consumption per year* MWh 3,504 4,380
Net Power supplied to grid per year MWh 25,056 44,580
Compost Plant
Capacity Tonnes/day 200 340
Operating Days days 330 330
Compost Maturation period days 28 28

Source: United Nations Framework Convention on Climate Change (UNFCCC). (2006, December 22). Clean
Development Mechanism – MW Food Waste Based Grid Connected Power Project implemented by IUT Singapore Pte
Ltd.
^Values bolded had been used to calculate revenue estimates in Table 3
*Electricity consumption of the plant per year

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reduction achieved by this project in the Clean collection fees charged and electricity supplied to the
Development Mechanism Project Design Document power grid, which were expected to bring in revenues
Form submitted to the United Nations Framework of approximately $7 million and $3 million respectively
Convention on Climate Change (UNFCCC). in Phase I. At optimum capacity of 800 tonnes of
food waste per day, when phase II operations begin,
Revenue Estimates28 the plant was projected to generate total revenue of
approximately $27 million (see Table 3).
When the plant commenced operations, its two
main sources of revenue were projected to be waste
Table 3
IUT Global - Annual Revenue Estimatesa
Potential Revenue Generating Sources Unit Phase I Phase I + Phase II b
(2008) (2009 - 2010)
Waste Collected Tonnes/year1 99,000 99,000 + 165,000
2
Waste Collection fees S$/Tonne 69.30 69.30
Revenue from Waste Collection S$ 6,860,700 18,295,200

Net Power supplied to the grid per year MWh 25,056 25,056 + 44,580
3
Average Uniform Singapore Energy S$/MWh 121.5 121.5
Price
Revenue from electricity supplied to S$ 3,044,304 8,460,774
grid

Carbon Emission Reduction tonnesCO2eq 5088 5088 + 9837

4
Carbon Credits Pricing Euros/Tonne 22 22
Carbon Credits Pricing S$/Tonne 44 44

(Apply conversion rate of 1

Euro = S$2.00 in 2008)
Revenue from Carbon Credits S$ 223,872 656,700

Total Revenue S$ 10,128,876 27,412,674

a Assuming plant operates at capacity

b The combined capacities of phase I and phase II could recycle 800 tonnes of organic waste per day
1 One year had 330 operational days
2 Value of $69.30 calculated based on a 10% discount given on the $77/ tonne waste collection fees
3 Value obtained from the average of Uniform Singapore Energy Price in the energy market on 16 September 2005 (day
IUT Global Plant was announced) Retrieved from, https://www.emcsg.com/marketdata/priceinformation#priceDataView
4 The actual price of carbon credits uctuates based on the carbon exchange market. In 2008, this was 22 Euros/tonne.

Source: Adaptation from United Nations Framework Convention on Climate Change (UNFCCC). (2006, December
22). Clean Development Mechanism – MW Food Waste Based Grid Connected Power Project implemented by IUT
Singapore Pte Ltd.

28 Estimates were derived by the authors from the Clean Development Mechanism Project Design Document Form submitted to UNFCCC.

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Operational Challenges b) Commercial food waste

Sourcing for food waste
There were three main sources of food waste that
IUT could tap on: Domestic food waste disposed by
households and Commercial and Industrial food waste
disposed by food establishments including hotels,
restaurants, food courts/hawker centres, hospitals,
army camps, prisons, and food manufacturing
facilities.29
a) Domestic food waste
Waste disposed by households, mainly from HDB
apartment blocks30 where more than 80% of the
Singapore population resided31, included food waste.
These waste were unseparated and were collected
by licensed Public Waste Collectors (PWCs) from
the collection bins on the ground floor of these
high-rise residential buildings which were vertically
connected to the refuse chutes built on every level or
in every household to minimise nuisance to residents
and neighbouring premises, and no pollution to the
environment.32
In 2005, three PWCs contracted by NEA, namely,
Alvater Jakob, Sembwaste and FME Onyx had
been appointed to collect refuse from residential
and trade premises throughout Singapore.33 These
large transnational companies, specialising in waste
management, then transported the waste collected
to material recovery facilities to sort the waste for
recycling – waste that could not be recycled was sent
to the incineration plants. These PWCs were paid by
the town councils for waste collection and had to bid
for their licences once every few years. Their revenue
source was also from the sale of recyclables.
IUT decided to collect food waste directly from
commercial establishments and obtained the General
Waste Collector (GWC) licence from NEA. GWCs
were a larger pool of companies (including PWCs)
contracted by NEA to collect waste from industrial and
commercial premises.
Granted the class B licence to collect organic
waste, IUT was paid by the building managers of
the commercial establishments such as hotels and
shopping malls as well as by NEA which managed
110 food courts and hawker centres to collect their
food waste.
Collection of Food Waste
IUT’s list of potential food waste suppliers ranged
from large chain hotels to restaurants, shopping malls
and universities, to hawker centres and food courts.
With the assistance of National Environment Agency
(NEA), Edwin reached out to 110 hawker centres and
food courts across the island managed by the Agency.
The aim was to encourage the food operators in these
centres to separate their food waste for collection and
disposal. As a pilot project, NEA and IUT worked with
Chinatown market centre in late 2007. Other NEA-
administered food premises including Tekka Temporary
Market, Bukit Timah Market & Food Centre, Taman
Jurong Market & Food Centre and Yuhua Village
Market & Food Centre, were also in the pilot project.34
Some major hotel chains with restaurants also
participated, as well as some shopping malls which
had restaurants and food courts as tenants. Another
source of food supply was the food halls and canteens
at a local university.

IUT gave the commercial establishments for disposal

of their food waste a 10% discount on the $77 per
tonne tipping fees35 that would have to be otherwise

29 Hawker Centres are open-air eating spaces with food stalls selling a variety of inexpensive food and beverages.
30 HDB apartment blocks are high-rise residential buildings with a lease holding of 99 years managed by the Singapore government.
31 The percentage of Singapore residents residing in HDB ats has uctuated very little and remained at over 80% from 2005 – 2014.
– From HDB. Key Statistics.
32 Building Construction Authority. (2011). Chapter Four: Precast Refuse Chutes, Reference Guide on Standard Prefabricated Building
Components.
33 National Environment Agency. Environmental Protection Division Report 2005.
34 Oh, B.P. (2008, October 21). Improving the taste of waste. The Business Times.
35 National Environment Agency. (2013). Retrieved September 2, 2014, from http://app2.nea.gov.sg/energy-waste/waste-management/
refuse-disposal-facility.

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paid to Public Waste Collectors (PWCs) for refuse
disposal. The management of these establishments
also considered the move to be a good Corporate
Social Responsibility (CSR) initiative as they were
participating in a sustainable energy initiative.
Getting the buy-in from restaurant and other food
operators
Although the idea of converting food waste to energy
was novel and innovative, the challenge was in
persuading food operators to separate organic waste
from inorganic waste. Although the management
of these establishments supported the recycling
initiative inherent in IUT’s collection of food waste,
workers found the separation process a hassle and
inconvenient especially during peak working hours.
(See Box.) At Yuhua Village Market and Food Centre,
a pneumatic food-waste collection system went unused
because stallholders worried it could slow down
service especially during peak periods, and that it
could increase the cost of maintenance and electricity.
Others complained that space constraints in the food
stalls made it difcult to separate food waste.36
A spokesperson for a privately operated food court
operator who did not sign up for the initiative noted
that it was easier to implement measures right from the
start at new outlets than to expect tenants at existing
food courts to adopt the practice.37
Even in the kitchens of hotels and restaurants in
shopping malls, the effort to persuade kitchen staff
to separate food waste from waste products was an
uphill struggle.
Food Waste Collection Challenges
Initially, IUT had planned to outsource collection to
one of the NEA-appointed PWCs. However, after a
review of the collection fees quoted by the PWCs, the
company decided to undertake food waste collection
internally.
As the food waste collected from suppliers had very
high water content, it was not possible to throw the
contents into the usual refuse collection truck. While
looking for specially designed trucks that could allow
this, the company decided to use 660-litre collection
bins and to collect these bins on a daily basis. Because
of the weight of food waste, bins could only be partially
lled otherwise it would be too heavy for workers to
move and place into the truck. This meant that the
space in the truck was not fully used as it was difcult
to manually pile the bins on top of each other. Also
replacement bins had to be provided as the lled bins
were transported to the plant. At the plant, after the
contents in the bins were discharged, they had to be
washed, sanitised and deodorised before reuse.
IUT obtained a grant from the government for the
purchase of specially designed trucks with loaders to

Challenges in Recycling Food Waste in Singapore

The practice of segregation of food waste from other waste was not common in Singapore. The waste
minimisation and recycling strategies employed by the government was mainly for inorganic waste. (See
Appendix 3 – Waste Management Strategies.) Food waste disposed was very often mixed with inorganic
waste, especially with the packaging material that the food came in. Uncooked food preparation waste was
also discarded together with their plastic packaging.

Possible Reasons for Lack of Food Waste Recycling Culture

 Lack of awareness of organic recycling and need for segregation of food waste from packaging materials
and other waste
 No regulations or legislation for food waste recycling
 Rubbish chutes were conveniently available in every household unit (older blocks) or in the common area
of every level (newer blocks) to ensure hygiene and safety.
 Recycling bins provided for every HDB apartment block were only for inorganic materials such as paper,
plastics and glass.

36 Chua, G. & Goh K.S. (2011, January 28). Pushing hard for eateries to think green. The Straits Times.
37 ibid.

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improve efciency and alleviate some of its collection
problems. However, before the trucks were delivered,
IUT had gone into liquidation.
Unforeseen Operating Costs
IUT had expected the bulk of its costs to arise from
depreciation costs of plant & equipment with other
costs being labour and administrative expenses. The
total operating cost, however, was much higher than
expected.
IUT incurred significant logistics costs for waste
collection. Initially, when the company started, it did
not use trucks specially designed to handle food waste
as the purchase and running of such trucks were cost
prohibitive. The use of conventional trucks to collect
food waste led to collection inefciencies given food
waste was high in water content and as a result, heavy
in weight. IUT had tried to outsource the collection of
food waste to the PWCs but felt that the price quoted
was not cost effective and carried out its own collection.
For IUT, a vital part of the waste collection system, in
addition to the logistics of collection, is the efciency
of waste inspection and source segregation, as well as
a good working relationship with the customer. These
were all very important aspects of the collection cum
pre-treatment system.
As the proportion of inorganic contaminants in
collected food waste grew, so did labour costs as IUT
had to have workers manually separate unscheduled
non-organic waste (computers, large cane baskets,
cardboard boxes and even broken tables and chairs)
contaminants from the food waste.
While the projected cost of disposal of inorganic
contaminants was based on 11-15% impurities, the
actual costs exceeded the budgeted amount when
inorganic contaminants rose to 30-40% of food waste
collected.
Additional costs beyond what was budgeted as
operating cost were also incurred to have these
contaminants sent for disposal at incineration facilities
for which a tipping fee of $77 per tonne was charged
38 Vaughan, V. (2010, May 7). Food recycling plant going to waste. The Straits Times.
39 National Environment Agency. Environmental Protection Division Report 2007.
40 Ng, K. & Lim, R. (2011, March 22). Recycling rm IUT Global being wound up; This follows three straight years of losses since start
up. The Business Times.
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By May 2010, IUT was only able to process 120-130
tonnes of food waste daily, less than half its initial
target of 300 tonnes. At that time, Edwin had noted
that, “It has taken us longer than we expected to get
the waste volumes we need to break even. We need
to be recycling 150 to 220 tonnes a day to break even
… At 300 tonnes, we will start making money.”38
Although IUT’s target to recycle 99,000 tonnes of
food waste per year was just 17.7% of total food
waste output of 558,900 tonnes39 in Singapore for the
year 2007, the rm found it an uphill task to collect
300 tonnes of food waste daily because of the high
impurities in certain premises especially the hawker
centres. With lower than expected revenue and high
costs of disposal and manual separation of inorganic
waste , the business struggled to breakeven.
The End of the Road for a First Mover
For IUT the problem of high inorganic contamination
of its food waste supply was a major problem which
severely hampered the company’s ability to meet its
production/treatment targets. This resulted in the start-
up accumulating losses of more than $8 million and
with total liabilities exceeding total assets by more than
$7 million in 2009.40 By then the start-up had incurred
three years of consecutive losses since it started
operations in 2007.
The food waste contamination problem could be
traced to the habits and accepted behavioural patterns
regarding the disposal of food waste in Singapore,
whether in commercial places where food was
prepared and consumed, or in household kitchens. For
Edwin this was an issue which could only be addressed
through government regulations and mandates that
encouraged commercial and industrial facilities to
dispose of their rubbish appropriately.
Confronted with this seemingly intractable community-
wide behavioural issue, at the end of 2010, plans for
Phase II were suspended. The yearly losses for the
preceding three years were:
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2007: S$1.1 million In May 2011, Enviro-Hub Holdings, a Singapore

2008: S$3.1 million Stock exchange mainboard-listed waste management
2009: S$4.9 million41 company, bought IUT’s 1.7 hectare recycling plant
and property at Tuas, including part of the equipment
The consequences of food waste contamination for $15.8 million.43 Today the facility is used as a
loomed large for IUT with few prospects of being warehouse and very little recycling is happening at the
resolved in the Company’s short- or even medium- facility-once a much decorated technology company
term timespan. After careful consideration and lengthy by the Asean Energy Secretariat and the Institution of
discussions with the government and the Minister-in- Engineers, Singapore.
charge of the environment , in February 2011, IUT
announced that it had entered into voluntary liquidation
as it could not see any legislation for food waste
segregation for commercial & industrial waste in the
short or medium term and the cross-contamination of
non-organics will continue without these laws . Two
months later, it stopped collecting food waste from its
suppliers and production activities were terminated.42

41 Ng, K. & Lim, R. (2011, March 22). Recycling rm IUT Global being wound up; This follows three straight years of losses since start
up. The Business Times.
42 Chua, G. (2011, November 11). Food waste recycler folds. The Straits Times.
43 Enviro-Hub buys IUT recycling plant. (2011, May 31). The Business Times.

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APPENDIX 1

WASTE SITUATION IN SINGAPORE

Singapore is a highly urbanised city-state with a land size of about only 710 square kilometres.1 In 2014, with
a population of about 5.4 million2, it was one of the most densely populated nations in the world. About 80% of
the population lived in high-rise apartment blocks more commonly known as Housing and Development Board
(HDB) ats.3 Waste generated by the apartment blocks was mainly discarded through refuse chutes built either
into each apartment unit or in the common area of every level of the block.

This waste was then collected daily by Public Waste Collectors (PWCs) from the collection bins at the HDB
blocks. General waste that was thrown into the recycling bins situated at every apartment block was also
collected by PWCs weekly.4 To be recycled, all these materials had to be unsoiled or not ‘dirtied’ by food waste.5

Waste that was not recycled was classied as incinerable or non-incinerable waste in Singapore. Incinerable
waste, including food waste, was sent to the waste-to-energy incineration plants to be burnt to ashes where
the waste volume was reduced by about 90%. Non-incinerable waste such as construction debris, human and
animal waste, liquid and volatile waste, oil sludge, poisonous and radioactive waste as well as Polyvinyl Chloride
(PVC) were not allowed to be brought to the incineration plants.6 If not recycled, non-incinerables were dumped
directly at the Semakau landll, the only offshore landll in Singapore.

Disposal of non-incinerables and ash waste in Semakau Landfill

Each year around 3 million tonnes of waste was disposed of. Most of the waste disposed were incinerated
into ashes, reducing the waste volume to 10%. The ashes amounting to about 1400 tonnes per day and non-
incinerable waste amounting to approximately 600 tonnes per day were dumped in the offshore Semakau
landll, Singapore’s only offshore landll.7

Semakau landll, located 8 km south of Singapore, was built in 1999. It was created by enclosing 350 hectares
of sea space between two offshore islands with a 7km perimeter rock bund. The bund, lined with impermeable
membrane and a layer of marine clay, ensures that leachate from the refuse is contained within the landll area.8
The landll capacity was 63 million m3. At the current rate of use, Semakau landll was expected to last till 2035.9

To protect the natural environment, the 13 hectares of mangrove that was destroyed during the construction
of the landll was replaced by the National Environment Agency which planted 400,000 mangrove saplings on
14 hectares of specially created mud-beds. The mangroves also act as biological indicator giving early warning
if toxins leak into the sea.10

1 Approximate gure as Singapore’s land size has been increasing due to land reclamation.
2 Inclusive of Singapore citizens, permanent residents and foreign non-resident population.
3 Housing Development Board. (2014, September 5). Retrieved March 19, 2015, from http://www.hdb.gov.sg/10/10320p.nsf/w/Abou
tUsPublicHousing?OpenDocument
4 National Environment Agency. Environment Protection Division Report 2013.
5 Cheam, J., Chua. G., & Yong, N. (2010, December 12). Recycling in Singapore: 10 years on - Chute, we got it wrong. The Straits
Times.
6 National Environment Agency. Code of Practice for Licensed General Waste Collectors. Appendix 2.
7 Waste Management World. (2009). Retrieved March 30, 2015, from http://www.waste-management-world.com/articles/2009/03/
semakau-landll.html
8 National Environment Agency. (2013, June 14). Semakau Landll. Retrieved March 30, 2015 from http://www.nea.gov.sg/energy-waste/
waste-management/semakau-landll
9 Ministry of the Environment and Water Resources. (2014, October 1). Retrieved February 9, 2015, from http://app.mewr.gov.sg/web/
contents/contents.aspx?contid=1538
10 National Library Board. (2010). Singapore Infopedia. Pulau Semakau. Retrieved March 30, 2015, from http://eresources.nlb.gov.sg/
infopedia/articles/SIP_1008_2010-03-22.html

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APPENDIX 1
(CONTINUED)

WASTE SITUATION IN SINGAPORE

Waste Statistics

The total amount of waste generated in 2013, was 7.85 million tonnes, an increase from the 5.60 million tonnes
in 2007 (see Table 1A). Of the 7.85 mn tonnes of waste generated, 61% was recycled and comprised mainly
industrial and construction debris recycling (see Table 1B). Domestic waste was about 1.71 million tonnes in
2013, which averaged to about 0.87kg per capita daily and domestic waste recycling rate remained low at 20%.11

Total food waste generated was 796,000 tonnes and accounted for about 10% of total waste generated. Total
food waste disposed however, was 696,000 tonnes and accounted for more than 20% of total waste disposed
(see Table 1B).

Table 1A
Total Waste Generated, Recycled, Incinerated and Landfilled: 2007 to 2013

Source: Ministry of the Environment and Water Resources, Singapore. (2014, August 19). Key Environment Statistics.

11 Ministry of the Environment and Water Resources. (2014, May 9). Media Kit – Our Waste Situation, [News Release].

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APPENDIX 1
(CONTINUED)

WASTE SITUATION IN SINGAPORE

Table 1B
Recycling Rates by Waste Type in 2013
Waste
Waste Waste
Recycled Recycling
Waste Type Generated Disposed of
Rate (%)
(tonnes) (tonnes)
(tonnes)
Construction debris 1,695,300 1,683,000 12,300 99
Used slag 353,700 344,800 8,900 97
Ferrous metals 1,416,000 1,369,200 46,800 97
Scrap tyres 21,600 19,000 2,600 88
Non-Ferrous metals 135,100 114,000 21,100 84
Wood 332,400 254,600* 77,800 77
Paper/Cardboard 1,261,100 679,400 581,700 54
Horticultural waste 252,600 120,900* 131,700 48
Glass 73,500 14,600 58,900 20
Food 796,000 100,000 696,000 13
Plastics 832,200 91,100 741,000 11
Textile/Leather 156,600 16,300 140,300 10
Ash & Sludge 190,600 14,200 176,400 7
Others (stones, ceramics, rubber, etc) 334,800 4,800 330,000 1
Total 7,851,500 4,825,900 3,025,600 61
*Includes 131,900 tonnes used as fuel in biomass plants
Source: National Environment Agency. Environmental Protection Division Report 2013.

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APPENDIX 2

SOURCES OF FOOD WASTE

The major sources of food waste in Singapore were food manufacturers, supermarkets/wet markets12, food
retailers such as food stalls and restaurants as well as households.

 In the rst quarter of 2015, the Singapore Food Manufacturing Association (SFMA) had about 350 members.13
In the food manufacturing process, food was wasted when it failed to meet manufacturing standards or
customer requirements. The retailers in Singapore had the practice of returning unsold food products (mainly
dented canned food or expired food) to manufacturers who lacked recycling options and knowledge on how
to sort waste.

 Supermarkets/ wet markets were a huge source of fresh produce waste. Fresh produce that were “ugly”
or “imperfect” were not bought by consumers leading to the wastage of a large quantity of fruits damaged
when people touched and pressed it during the process of buying and vegetables with leaves that had dried
up. Cosmetic ltering was a common practice among many supermarkets who had staff to trim ‘unpleasant
looking’ leaves from vegetables so that they can be sold.14

 Food retailers were a major source of food preparation waste such as peels, unusable portions of vegetables/
meat. In 2013, Singapore had a total of about 6750 food establishments15 of which 935 were food courts,
coffee shops and eating houses, 215 were canteens and about 110 hawker centres16 managed by the
National Environment Agency (NEA) in 2013. 6 in 10 Singapore residents ate out on a regular basis while
49.9% of Singapore residents usually had lunch at hawker centres, coffee chops or food courts in 2010.17
These safe and affordable eat-out options contributed to cooked food waste in the form of unnished meals
or unavoidable waste such as shells and bones.

 Household food waste was similar to the food wasted by food retailers. Singaporeans also had the practice
of ‘taking away’ or ‘tapau-ing’ food from hawker centres, food courts or coffee shops back home to eat. This
practice meant that unnished meals and other cooked food waste was disposed of with packaging materials
which were usually Styrofoam boxes made of polysterene together with plastic bags used to carry them
home. In addition, households also threw away expired manufactured food products such as canned food
items.

12 A wet market sells unpackaged fresh produce and meat.

13 Singapore Food Manufacturers’ Association. (2015). Retrieved March 30, 2015, from http://www.sfma.org.sg/sfma/member
14 Tackling food waste: More measures needed, say experts. (2014, November 2). Channel NewsAsia.
15 Department of Statistics, Ministry of Trade & Industry, Singapore. (2014, December). Services Survey Series: Food & Beverage Services
2013.
16 Hawker centres are open-air eating spaces with separate food stalls selling a wide variety of inexpensive food & beverages.
17 Health Promotion Board. (2011, November). National Nutrition Survey 2010.

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APPENDIX 3

WASTE MANAGEMENT STRATEGIES

The management of waste in Singapore was motivated by two guiding principles of maintaining high levels of
public health and optimizing resource utilization in the waste disposal system.18 The main aims of the waste
management system were to19:

a) Minimise waste generation: In 2007, the NEA spearheaded an initiative to reduce packaging waste in Singapore
to cut down domestic waste generation. This was done through the signing of the Singapore Packaging
Agreement (SPA) by industry associations, individual companies, non-governmental organisations, the Waste
Management & Recycling Association of Singapore (WMRAS) and public waste collectors. The SPA aimed
to also raise awareness and educate Singapore consumers on the need to reduce waste. Initially covering
only food and beverages packaging, in 2009, the agreement was extended to include all types of packaging.

Packaging waste was reduced by 20,250 tonnes by signatories to the agreement between 2007 and 2013,
and the companies involved saved more than S$44 million as a result of this.20 A second SPA was launched
in 2012, after the rst had expired and as at early 2015, 160 signatories had signed the SPA.21

b) Maximise waste recycling: In 2001, the government introduced the National Recycling Programme where
PWCs collected recyclables segregated by residents such as paper, plastics and glass fortnightly. To
complement these collections, NEA placed a huge recycling bin at every ve HDB apartment blocks in 2007.
From mid-2014 onwards it was planned for every apartment block to have a recycling bin. The collected
recyclables were then sent to material recovery facilities for sorting and baling before being sent to recycling
facilities. Perishable waste such as food waste was not covered under this recycling programme.22

The recyclables were sometimes contaminated with organic waste. Many of the public recycling bins contained
up to 20% of materials that could not be recycled and some bins were soiled or contaminated by food waste,
which meant that none of the materials in the bin could be recycled and these then had to be sent to the
incineration plants.23

Waste-To-Energy (WTE)/ Incineration plants were an efcient way in reducing waste volume to conserve landll
space, in land-scarce Singapore. In 2015, there were four WTE plants and a Tuas Marine Transfer Station which
served as an intermediate collection point for incineration ash from WTE plants and non-incinerable waste to
be transported to the Semakau landll. In 2013, NEA announced plans to build a fth WTE plant to handle the
increasing amount of waste disposed and this plant was expected to be completed in 2018.24 However, energy
generated by incineration of food waste in WTE plants was less efcient compared to anaerobic digesters.25
(The incineration ashes, together with non-incinerable waste, were disposed at Semakau landll.)

18 Ministry of Environment and Water Resources. (2014, May). Our Waste Situation. Media Kit.
19 National Environment Agency. Environmental Protection Division Report 2013.
20 National Environment Agency. (2014). Factsheet on the Singapore Packaging Agreement and the 3R Packaging Awards, [Press
Release].
21 National Environment Agency. (2015). Singapore Packaging Agreement. Retrieved February 11, 2015, from http://www.nea.gov.sg/
energy-waste/waste-management/singapore-packaging-agreement
22 National Environment Agency. Environmental Protection Division Report 2013.
23 Cheam, J., Chua. G., & Yong, N. (2010, December 12). Chute, we got it wrong. The Straits Times.
24 Plans for 5th incineration plant for solid waste. (2013, September 11). The Straits Times.
25 Hsien H. Khoo , Teik Z. Lim, Reginald B.H. Tan. Food waste conversion options in Singapore: Environmental impacts based on an
LCA perspective. Science of the Total Environment, 408 (2010): 1367–1373.

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APPENDIX 3
(CONTINUED)

WASTE MANAGEMENT STRATEGIES

The 3Rs (reduce, reuse, and recycle) also played a complementary role by reducing waste sent to the disposal
sites by reducing waste generated at source.

Mandatory Waste Reporting

On 1 April 2014, the Environmental Public Health Act was amended to effect the mandatory reporting of waste
data and waste reduction plan by large commercial premises, starting with large hotels and shopping malls.
The mandatory reporting requirement was aimed at drawing and sustaining management attention on the
amount of waste produced by the premises and to help build greater awareness of the potential for improving
their waste management systems.

Commercial premises such as hotels with more than 200 rooms and shopping malls with net lettable area of
more than 50,000 square feet would be the rst to be governed under these new requirement structures.26
These establishments had to submit a report by March 2015, on their waste data for waste generated, reused
and recycled (Classied by different material types) for the period between July 2014 and December 2014
as well as waste reduction plans. From 2016 onwards, the reports had to include progress updates as well.27

26 National Environment Agency. (2013). Mandatory Waste Reporting. Retrieved February 11, 2015, from http://www.nea.gov.sg/energy-
waste/waste-management/mandatory-waste-reporting
27 National Environment Agency. (2014). Sample Notice to owner/ occupier/ lesse of premises under section 30A of the Environmental
Public Health (Amendment) Act 2014.

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