EagleTribune.com, North Andover, MA

New Hampshire

August 7, 2008

Waste haulers raise fuel surcharge as prices rise

When diesel cost $2.40 a gallon last year, waste transportation companies charged customers half as much as they do today to cover their fuel expenses.

Fuel surcharges — a percentage assessed on top of the regular bill to cover the added costs of gasoline or diesel — are a common practice in the waste disposal industry.

When the nationwide average for diesel was $2.40 a gallon in January 2007, Waste Management Inc., the state's biggest waste transportation company, imposed a fuel surcharge of 7.25 percent on private customers' weekly bills.

With last week's average for diesel at $4.50 a gallon, WMI's fuel surcharge added 17.75 percent to all nonmunicipal customers' bills.

The initial cost to rent a Waste Management 30-yard, open-top container in Rockingham County is $485 a month for the first month and $435 per month thereafter. The fuel surcharge, and an environmental surcharge — a flat rate of 4.2 percent — are added to that. The surcharges would total $106.45, or 21.95 percent, for the first month's bill.

The fee, first put in place in 2005, is used to cover fuel costs and nothing more, said Lynn Brown, a Waste Management spokeswoman. Some of the company's trucks receive as little as three miles per gallon, making fuel a major expense, Brown said.

She added that the company has predetermined percentages for the surcharge, depending on the price of diesel fuel.

"The good news is when gas prices go down, the percentage goes down," Brown said.

When diesel prices were at their highest in June — at $4.75 a gallon — the company's fuel surcharge was almost 2 percent higher than it is today.

Casella Waste Systems has a similar structure for its surcharges, according to Joe Fusco, company vice president. Casella adjusts its fuel charge on a monthly basis, depending on the national average cost of diesel fuel, Fusco said.

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