Case Study: How to Make Municipal Waste Investable

Joi Danielson

System Change and Transformation Specialist

Making waste investable? It’s been done before. Watch Joi Danielson as she explains how she helped build a blended finance waste infrastructure fund.

Sector-Wide Essentials

Making waste investable? It’s been done before. Watch Joi Danielson as she explains how she helped build a blended finance waste infrastructure fund.

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Case Study: How to Make Municipal Waste Investable

8 mins 33 secs

Key learning objectives:

Outline steps to make waste systems investable
Identify the four components of a blended finance model
Outline strategies to align stakeholder needs
Understand key lessons for other pre-investable systems

Overview:

Transforming municipal waste into an investable system requires reliable revenue, strong operating models, and stakeholder alignment. Many essential services are “pre-investable” due to high risk and low returns. A blended finance approach combining philanthropic, concessional, and commercial capital reduces risk and enables scaling. Key strategies include treating waste like a utility, creating ring-fenced legal entities, and using revolving credit facilities to manage repayment risks. Lessons from Indonesia’s municipal waste model show how these principles can make pilots scalable and investable, offering insights applicable to other sectors like health, education, and environmental services.

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Summary

How can municipal waste systems be transformed into investable assets?

Municipal waste, often treated as an underfunded social service, can be made financially viable by professionalising revenue collection, treating it like a utility, and supplementing user fees with additional funding sources like plastic credits or national taxes. These steps create predictable revenue streams, reduce commercial risk, and lay the foundation for scalable investment.

What are the key components of a blended finance model for waste systems?

Treating waste as a utility to generate steady revenue
Creating a ring-fenced legal entity for transparency and accountability
Blending philanthropic, concessional, and commercial capital to de-risk investment and scale the system
Establishing a revolving credit facility to cover early-stage repayment gaps and protect investors

How can the needs of governments, investors, philanthropies, and operators be aligned?

Alignment requires understanding each stakeholder’s priorities: local governments need stable revenue and predictable costs, investors require clear repayment paths, philanthropies aim to leverage impact, and operators need capital with defined responsibilities. Blended finance structures, clear legal entities, and revenue models designed to minimise risk help meet these diverse needs, building confidence and enabling investment at scale.

How can lessons from municipal waste finance be applied to other pre-investable sectors?

The principles of strong operating models, predictable revenue, stakeholder alignment, and blended finance can be adapted to sectors like health, education, or environmental services. By designing credible financial structures and reducing perceived risk, even sectors with weak economics or volatile revenues can become investable, enabling national-scale transformation.

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Joi Danielson

Joi Danielson is a transformation leader with over 15 years of experience driving complex, high-stakes system change. She began her career as a consultant at McKinsey, later became a Partner at Systemiq, and now serves as Managing Partner of Vital Ocean. Joi specialises in turning ambitious ideas into practical, lasting outcomes that deliver real impact at scale, while developing the leaders and partnerships needed to sustain that change.

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