United StatesThere is arguably no more effective way to slow climate change than stemming methane emissions.
The gas, which is responsible for almost one-third of the rise in global temperatures since the Industrial Revolution, is around 80 times more potent as a greenhouse gas (GHG) than carbon dioxide (C02) over a 20-year period.1 Aggressive cuts in methane emissions could therefore yield material reductions in atmospheric concentrations of GHGs – especially since methane breaks down within around 12 years.
When the UN Secretary-General made this point at London Climate Action Week this June, he singled out the waste sector as one of three where action on methane is most needed.2 While the latter emits less than either agriculture or energy, technologies exist to capture landfill gas (LFG).
As regulations tighten in many jurisdictions, the waste industry is also recognising that capturing LFG can reduce risks – and represents a high-margin financial opportunity. Adoption is far from universal, though.
For investors, meanwhile, corporate disclosure of landfill methane management is patchy and inconsistent, making it hard to compare capture rates and approaches to risk management.
We have sought to address this through direct engagement with five of the largest listed operators in the US and Europe, using the data obtained to evaluate how well each manages the challenge.3 As well as allowing us to better understand whether companies are capitalising on any financial opportunities, we believe methane serves as a useful indicator of operational skill and efficiency, as well as management quality within the waste sector.
Source: US Environmental Protection Agency, 2022
Subhead: US human-related methane emissions in 2022, by source (%)
Overview: This area chart shows the breakdown of US human-related methane emissions, by source, in 2022.
Overall, this chart illustrates how landfill gas accounts for 17% of US methane emissions. Only the energy and agricultural sectors contribute more, each accounting for 36% of total US methane emissions.
Regulatory risks are inescapable
For operators of landfill sites, including decommissioned ones, methane emissions are an inevitable by-product of the decomposition of organic material under anaerobic (oxygen-free) conditions.
They therefore need to be managed – either by flaring the methane (converting it into CO₂) or collecting it. Fugitive emissions from landfills account for 17% of total methane pollution in the US.4 The figure is proportionally slightly higher (24%) in the EU given the bloc’s methane-producing energy sector is much smaller.5
The US Environmental Protection Agency (EPA) requires landfills above a specific size or emission threshold to install and operate gas collection and control systems. In the EU, all landfills receiving biodegradable waste must be equipped with these systems and can only flare the gas collected where it cannot be used to produce energy.
With penalties for non-compliance, operators have financial and reputational imperatives to manage methane effectively, especially with third-party satellite monitoring of emissions (by the likes of Climate Trace and Carbon Mapper) increasingly able to identify any discrepancy between reported and real-world emissions. The state of Colorado, for example, has adopted a rule allowing third parties to submit remote-sensing observations of landfill emissions.6
Many landfill operators are themselves leveraging advanced monitoring systems to identify methane levels and identify any leaks. On the surface, automated wellheads that continuously monitor gas levels are often complemented by mobile data collection systems. Above ground, satellite monitoring can combine with emerging drone technologies to provide more precise, real-time information that can inform action.
Risks can also manifest below the surface. Pressure can build up within landfill sites and potentially lead to so-called ‘toxic geyser’ eruptions of hazardous gases and liquid waste. Sound management and monitoring should avoid such catastrophic events and the financial and reputational risks they carry for landfill operators.
Commercial opportunities are rising
There are also significant (albeit secondary) commercial opportunities with capturing LFG for energy use. Renewable natural gas (RNG) – or biomethane – derived from LFG can be used to generate electricity, heat homes or fuel vehicles.
So long as gas pipeline infrastructure is within reach to plug into, captured LFG should be able to offer operators additional high-margin revenue streams, leveraging a fixed, operational asset base.
The policy backdrop is supportive, too, although is not destined to be one-directional. In April 2026, the EPA finalised its ‘Set 2’ rule, raising renewable volume obligations and lifting the targets that underpin the landfill gas RNG market. The EPA now projects RNG volumes to grow by 24% year-on-year, which should continue to support LFG monetisation.7
Limited disclosures make it challenging to value the size of the current market. Reporting indicates that LFG sales currently constitute only around 1% to 2% of landfill operator revenues, though.8 This is reflective of the fact that relatively few landfills – even among those that capture LFG – have the facilities to convert it into RNG. Given that the incremental economics are logically highly attractive, the industry is potentially only at the very early stages of exploring this commercial opportunity.
Industry disclosure is inconsistent
Methane capture rates and chosen technologies, monitoring methods, target credibility and the economics of landfill gas are each disclosed inconsistently – and sometimes not at all – by the industry. Even where they are reported, it is typically hard to make like-for-like comparisons between operators.
To overcome the challenge of incompatible data, and to build a better picture of how well companies are managing risks and opportunities, we have directly engaged with these companies to understand how each landfill operator monitors and captures methane – and to separate credible strategies from narrative.
We have combined insights and company data to develop a proprietary Methane Performance Matrix that seeks to enhance comparability and identify best practice across five focused areas: assets, emissions, management, targets and beneficial use. A summary is below.
Impax Methane Performance Matrix at-a-glance
| Metric | What is captured | Why it matters | Our findings |
| Assets | Number, volume and weighted-average remaining life of active landfill sites (years). | Sizes the underlying exposure, volume and maturity of the asset base. Disclosure of remaining landfill life by bracket (e.g., 0 to 10 years, 11 to 20 years) is more helpful than an aggregate average as it flags near-term capital expenditure exposure (permitting/expansion risk) and potential stranded-asset or closure-liability timing more clearly. | Reporting is uneven. One operator does not report a consolidated figure for the total number of landfill sites it operates worldwide. US firms report on the average remaining life of their active sites, and one divides them further into brackets of remaining years. |
| Emissions | Average emissions factor (tCH4 per ton of waste). | Provides a comparable metric for emissions intensity and performance over time. | Four of five disclose, though not on a consistent basis. |
| Management | Effectiveness of monitoring collection systems, capture rate, flaring versus beneficial-use split. | Describes effectiveness of monitoring, management and monetisation of sites and methane emissions, important signals of operational quality, rigour and transparency. | Reporting is uneven across monitoring, collection and capture, and not directly comparable between operators where disclosed. Three disclose capture rates, two do not disclose. |
| Targets | Gas capture targets, beneficial use targets, emissions reduction targets and progress. | Separates credible, validated commitments from narrative. Capture and beneficial-use targets are important indicators of a company’s strategy and capex spending on higher-margin future earnings that also reduce emissions and regulatory risks. | One company has company-wide and regional capture targets, but no beneficial use target. Three companies have no capture targets but have set beneficial use targets. One company has no capture or beneficial use target. Three have SBTi-validated emissions targets, one does not, and the other’s SBTi commitment appears to have lapsed.9 |
| Beneficial use | Utilisation outlets, ownership model (owned / joint venture / royalty), separate LFG revenue disclosure. | Describes commercial materiality and how capital is allocated. | Ownership models vary and almost no operator breaks out LFG revenue. |
The Methane Performance Matrix enables us to turn patchy and inconsistent disclosures into an engagement agenda. Our ongoing engagement priorities with all companies, as relevant, are as follows:
- Clearer methane capture rate definitions and methodology
- Continued improvement in methane emission monitoring approaches, including remote sensing and ground-based technologies
- Transparency on the split between flaring and beneficial use of captured LFG
- Target-setting for capture rates and beneficial-use split (as percentages of sites)
- Credible, validated emissions targets with disclosed progress
- Revenue contribution, capital expenditure intensity and the rationale behind ownership models for LFG / RNG sales
Clearer insights enhance analysis
For operators of landfill sites, exposure to methane emissions is a structural risk that tightening regulation and rising transparency are pushing up the agenda. Capturing and monetising methane emissions meanwhile offers commercial opportunities that, while modest today, could prove significant.
Limited and incomparable public disclosure makes it challenging for investors to understand who, among landfill operators, is managing these risks (and adjacent opportunities) well.
Direct engagement with companies has filled in some of the blanks for us, identifying perceived gaps in their respective approaches and reflecting, in our view, elements of management quality among some of the sector’s largest listed companies.
These insights inform our investment decision-making as well as future priorities for our ongoing engagement with a sector that has a critical role to play in reducing global methane emissions.
1 UN Environment Programme, 2024: Facts about Methane
2 UN, 23 June 2026: Secretary-General’s special address at London Climate Action Week
3 US-listed companies Waste Management, Republic Services, Waste Connections and Casella, alongside French-listed Veolia
4 US Environmental Protection Agency, 2022
5 European Environment Agency, 2025: Methane, climate change and air quality in Europe: exploring the connections
6 Greenberg Traurig, December 2025: Colorado Approves New Rules Regulating Methane Emissions from Landfills
7 American Biogas Council, March 2026
8 Impax analysis of company reports, July 2026
9 Science Based Targets Initiative (SBTi)
References to specific securities are for illustrative purposes only and should not be considered as a recommendation to buy or sell. Nothing presented herein is intended to constitute investment advice and no investment decision should be made solely based on this information. Nothing presented should be construed as a recommendation to purchase or sell a particular type of security or follow any investment technique or strategy. Information presented herein reflects Impax Asset Management’s views at a particular time. Such views are subject to change at any point and Impax Asset Management shall not be obligated to provide any notice. Any forward-looking statements or forecasts are based on assumptions and actual results are expected to vary. While Impax Asset Management has used reasonable efforts to obtain information from reliable sources, we make no representations or warranties as to the accuracy, reliability or completeness of third-party information presented herein. No guarantee of investment performance is being provided and no inference to the contrary should be made.