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Fuel and Environmental Charge

Fuel and Environmental Charge

 

SBC Waste Solutions is dedicated to providing customers with safe and dependable waste management at an affordable cost. SBC Waste Solutions has invested heavily in green technology, such as LNG or CNG trucks. We strive to consistently lower our overall impact on the environment. However, prices related to environmental compliance and fuel are not something that we can completely control. The standard to fuel/environment charge is designed to help our cover these costs and attain a reasonable operating margin. The fuel and environmental charge appears on customer invoices as a one line item that contains two distinct components: a fuel surcharge and an environmental charge.

 

Fuel Surcharge

 

The fuel surcharge lets SBC Waste Solutions recover the cost of diesel, natural gas, and any other

hydrocarbon-based fuels that we use to operate our company and perform our services, above a baseline cost. The baseline cost is measured in diesel cost at $.95 per gallon. This charge lets our company to keep up with the frequently changing price of diesel, natural gas, and other  fuels. It also allows us attain the operating margin we need to keep up the high-quality service customers expect from us. Our standard fuel surcharge calculation stems directly from the national average price of diesel fuel, which the Energy Information Administration of the U.S. Department of Energy (“EIA/DOE”) reports weekly in their Retail On-Highway Diesel Prices Index. This index is available to the public and highly reputable within the trucking and transportation industries as an objective source. Basing our standard fuel surcharge to this index makes sure customers are assessed a fuel surcharge that is correctly adjusted and easy to calculate.

 

The EIA/DOE average is published every Monday. We then use the data for our invoices for that week. The SBC Waste Collection Fuel Surcharge Table or the SBC  Waste Disposal Fuel Surcharge Table details what the fuel surcharge as a percentage of a customer’s monthly charge (or other incremental invoice charges) before taxes would be based on the most recently reported EIA/DOE national diesel price that came before the customer’s invoice date.

 

The amount or percentage of the surcharge is not directly linked or indirectly linked to the cost to service a specific client’s account. By contract or at the SBC Waste’s discretion, some customers pay a nonstandard fuel surcharge and some customers are exempt from any fuel surcharge. SBC  Waste Solutions uses the surcharges to try to recover the all company-wide costs for diesel, natural gas, and other hydrocarbon-based fuels and products used by SBC Waste Solutions above the $.95/gallon diesel cost baseline, only from those customers subject to a fuel surcharge, this this exclude anyone who is exempt from the surcharge, as well as non-paying customers.

 

Environmental Charge

 

The environmental charge is 16.0% of all invoice charges, including the fuel surcharge. However, it excludes the Regulatory Cost Recovery Charge and taxes. (Some customers are charged a flat rate per load or other rates, which are terms in their contract or service. For more details, contact the Technical Service Center.)

 

The environmental charge lets SBC Waste Solutions cover enterprise-wide costs and expenses for its operating companies, which include the operating costs for collection, transfer, landfill, and recycling. The charge allows us to perform these operations in a safe and an environmentally responsible fashion, while also allowing us to attain a reasonable operating margin. The amount or percentage of the charge is not specifically linked to the direct or indirect costs to service specific customer accounts. Either by contract or at the discretion of SBC Waste Solutions, some customers pay a nonstandard environmental charge and some are exempt from the environmental charge. Through the environmental charge, SBC Waste Solutions tries to recover all applicable company-wide environmentally relevant costs to its operations, but only from the customers who are subject to an environmental charge. This excludes those who are exempt, as well as non-paying customers.

 

Historical SBC Waste Fuel/Environmental Charge Values

 

The fuel/environmental charges included on a customer’s invoice is determined by applying the fuel surcharge percentage from the Collection Fuel Surcharge Table or Disposal Fuel Surcharge Table to the total invoice charges (this excludes the environmental charge, Regulatory Cost Recovery Charge, and taxes). After that, we apply the environmental percentage to the total invoice, which includes the fuel surcharge. For example, if your invoice totals

$25.00 for services and a $3.00 fuel surcharge, an environmental charge of $4.48 would be added (16% of $28.00). As a reference, you can check the Historical Table. This table shows each fuel and environmental charge that has been applied for the past 52 weeks. The table also references the EIA/DOE value for each week. Contact SBC Waste Solutions for more information.

 

Fuel and Environmental Charge — Frequently Asked Questions

Q: Why do you charge a fuel surcharge?

 

A: This surcharge allows us to keep up with the cost of diesel, natural gas, and other fuels. These prices change constantly, so a surcharge helps offset this volatility. Fuel charges are very common in the transportation industry and are used by most 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 comes down as well (unless your service terms provide for a fixed percentage or a nonstandard fuel surcharge). We tie the charge to this publicly reported price because it allows us to objectively respond 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. The index is updated Monday evenings.

 

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 at $.95/gallon), irrespective of when a customer’s contract begins or is renewed. We believe using a fuel surcharge that uses a common baseline rate for all customers is the best approach, as it results in a uniform fuel surcharge that can be easily calculated by customers. They just have to refer to the Collection Fuel Surcharge Table or Disposal Fuel Surcharge Table.

 

Q: What does the Environmental Charge cover?

A: The Environmental Charge covers SBC Waste Solutions overall operational costs so the company can operate in a safe and environmentally responsible manner and achieve an acceptable operating margin. The Environmental Charge is not directly tied to the environmental compliance or other costs to service each individual customer account. These environmental costs include landfill cover material, engineering, testing and maintenance at landfills and other disposal facilities, the disposal of tires, batteries, oils and fluids and the monitoring, management of vehicle emissions, and other environmental costs.  The Environmental Charge percentage does not change from one month to the next. 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

 

Every year, our company incurs thousands of dollars in host community fees and waste disposal taxes. For this reason, we apply a Regulatory Cost Recovery Charge on customer invoices. This charge applies to the environmental and fuel charges but not to taxes. The current charge is 3.6%.

 

This charge lets our company recover a part of the costs we incur from host community fees, waste disposal taxes, and other charges we pay to municipal and governmental agencies in order to participate in the waste collection, transfer, processing, disposal, treatment and/or recycling business. It also helps us reach an acceptable operating margin. The amount of the charge is not directly or indirectly linked to the cost to service a given customer’s account. It is based on what SBC Waste Solutions has to pay in host community fees and other regulatory costs. By contract or by the discretion of our company, some customers pay a nonstandard regulatory cost recovery charge and some are exempt from such a charge.

 

Not a Governmental Tax; Future Changes

The Regulatory Cost Recovery Charge is our operating companies’ charge; it is not linked to any specific fees, taxes or charges applicable to your local service area that our SBC Waste Solutions 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 SBC Waste Solutions standard charge meant to cover a portion of the enterprise-wide costs associated with host community fees, waste disposal taxes and similar charges that we pay to municipal or other governmental authorities or agencies to participate 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 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 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 we assess based on overall regulatory costs, which is meant to cover a portion of SBC Waste Solutions’s overall enterprise-wide costs for host community fees and disposal taxes that we pay across all of our service areas. We 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 connected to any specific  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 of our customers in all our locations, and to attain 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 go up and down periodically, at our discretion, if there is a business determination that warrants a change in the charge, but these fluctuations do not happen regularly.