Michael Feniger: Perfect. Okay. Thanks everyone.
Operator: Thank you. Our next question comes from Stephanie Moore with Jefferies. You may proceed.
Stephanie Moore: Hi. Thank you. We’ll keep it brief. And, kind of, just a continuation of the last question. Just wanted to talk about what you’re seeing from a pricing standpoint in your renewable energy business. I know that does include RINs, but it does include some other factors as well within your business. And then longer term, I know near-term, Devina, you just kind of discussed with the EPA standards and RIN pricing. But is there any kind of risk of maybe a supply-demand in balance with more supply at some point as more and more of certainly you guys but also your competitors also bring these renewable natural gas facilities online, just what that can mean for pricing, not necessarily this year or next, but longer term? Thanks.
Devina Rankin: Sure. I’ll speak to the price side, and this is a footnote in our press release, but we did see pricing come down in the three categories, slight decline on the power side. And as you can imagine, we saw some record power prices related to some of the dynamics in 2022 related to weather and whatnot. So that’s reflected on the power side. On the natural gas side, natural gas pricing has come down. We were north of $5 in 2022 and now coming in and around 360, that’s what we’re guiding to. And then on RIN prices, again, 230 is what we have in our guidance. And I think I just went over a little bit of the dynamics there. As far as the supply and demand dynamic, I think what’s really important to note on the renewable natural gas side is there are two markets, and they’re quite robust.
The first is on the transportation side, which is where we generate D3 RINs. And for us, we’re in a unique position. Jim has mentioned this before, where we own our own fleet, so we’re able to capture more of the value, and we have robust discussions with obligated parties. So we’re able to trade those RINs and have a long history with that. At the same time, you have this voluntary market that exists where many, many public utilities have come out with announcement where they need to decarbonize their own portfolios and the fastest way for them to do that is to buy renewable natural gas and buy renewable natural gas at a price premium. And again, we’ll give you more information on this in April, but we feel really positive about the options that we have for each of those.
Stephanie Moore: Understood. Thanks so much.
Operator: Thank you. Our next question comes from Stephanie Yee with JPMorgan. You may proceed.
Stephanie Yee: Hi. Thank you for taking my question. I just wanted to come back to the 2023 guidance overall, and just ask whether you’re assuming a recession in the guide or maybe just a slowing economic environment. And I guess you could probably see this most reflected in the volume guidance range. So is the low end of the range at kind of negative 1.5%, embed some conservatism on the economic environment.
Jim Fish: I wouldn’t say that any of us are macroeconomists. So whether we’re projecting a recession or not is hard to say. But we are projecting some softness for sure. We saw some softness in our volume numbers, as I mentioned, probably particularly in roll-off for Q4, and that’s continued a bit in January, albeit — our numbers were a little stronger volume-wise in January. I think if we try and read those tea leaves ourselves, and we’re all reading as much information as we can, it feels like there could be some type of slowdown, especially as the consumer eats through all of their savings. But I am — the last thing I am as a macro economist. So I can’t sit here and tell you, yes, we’re going to see a recession next year.
We’re just having to manage our business to €“ to our own best abilities. And that’s why we have taken cost control on very seriously. That’s why pricing is still an important aspect of this. And then at the same time, for the long-term, these renewable natural gas facilities and automation of a number of these positions makes a lot of sense. So that really is affected by €“ by any downturn in the economy.
Stephanie Yee: Okay. Okay. Great. Thank you.
Operator: Thank you. Our next question comes from Devin Dodge with BMO Capital Markets. You may proceed.
Devin Dodge: Thanks. Good morning. I suspect we’ll get more color on April 5, but could you provide a framework for how meaningful Erin could be from a WM perspective?
Tara Hemmer: So, the important thing to remember is it’s a proposed rule and EPA will be coming out with our final framework sometime over the summer. I think from our perspective though, you got to look at the 66 landfill gas to electricity plants that we have, that we own. And this, we believe, will be a significant revenue stream for us long term. It’s a great example of our ability, where we have owned these facilities and invested in them and retained the value. Now, we’re in a position to optimize the value with this pathway. So, really waiting for a bit more color from EPA on what their final framework is going to look like, but really optimistic. Again, no incremental CapEx on that potential revenue stream.
Devin Dodge: Good color. Okay. So maybe on the same thread, do you think, Erin’s even could impact the development pipeline for landfill RNG projects, or do you still expect RNG to be the most desirable landfill gas project, assuming the site is suitable for it?
Tara Hemmer: Yes, great question. I think we’re — first and foremost, we’re really confident on the path that we’re on with the 20 projects that we have in the deck. And we’re actively looking at our portfolio. We’re going to make the best economic decision, the best environmental decision. And the good news is, we have a lot of options here. I mean, that’s something that Jim said earlier on, good, really good or great. We view these frameworks as great for WM. So we’re going to evaluate what makes the most sense for us long term.
