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Item 1. Business

2023-03-01 compared with 2022-02-23 · 283 added, 282 removed, 280 unchanged (67% of the section changed)

Clean Harbors, Inc.

and its subsidiaries (collectively, "we," "Clean Harbors" or the "Company") is a leading provider of environmental and industrial services throughout North America.

and its subsidiaries (collectively, "we," "Clean Harbors" or the "Company") is a leading provider of sustainable environmental and industrial services throughout North America.

We are also the largest re-refiner and recycler of used oil in North America and the largest provider of parts cleaning and related environmental services to commercial, industrial and automotive customers in North America.

Everywhere industry meets the environment, we strive to provide eco-friendly products and services that protect and restore North America's natural environment.

One of our primary goals as a company is supporting our customers in providing environmentally responsible solutions to further their sustainability goals in today's world.

During the first quarter of 2021, we reorganized our Safety-Kleen business.

The collection services for waste oil, used oil filters, antifreeze and related items as well as bulk blended oil sales operations were combined with the Safety-Kleen Oil business to form the Safety-Kleen Sustainability Solutions business.

Under this structure, Safety-Kleen Sustainability Solutions operations focus on the life-cycle of oil, from the used oil collection services through the ultimate sale and delivery of base and blended oils so that we can more directly manage both sides of the spread in our re-refinery business.

We expect this change to continue to drive additional growth in our sustainable lubricant products and related services.

Concurrently with this change, we consolidated the Safety-Kleen branches' core service offerings, including containerized waste, parts washer and vacuum services, into the legacy Clean Harbors Environmental Services sales and service operations.

We believe this change fosters enhanced cross-selling opportunities within the environmental businesses and increases market presence with small quantity generators of hazardous waste.

In restructuring the operations of the Company in this manner, the information that the chief operating decision maker regularly reviews for purposes of allocating resources and assessing performance was changed to conform to this new operating structure of the business.

As a result, we reevaluated the identification of our operating segments and concluded that, starting in the first quarter of 2021, we now have two operating segments:

Everywhere industry meets the environment, we strive to provide eco-friendly services and products that protect and restore North America's natural environment.

One of our primary goals as a company is supporting our customers in providing environmentally responsible solutions to further their sustainability goals in today's rapidly progressing world.

We have two operating segments through which the Company conducts its operations:

(i) the Environmental Services segment and (ii) the Safety-Kleen Sustainability Solutions segment.

• Environmental Services - Environmental Services segment results are predicated upon the demand by our customers for waste services, waste volumes generated by such services and project work for which waste handling and/or disposal is required.

Environmental Services results are also impacted by the demand for planned and unplanned industrial related cleaning and maintenance services at customer sites, environmental cleanup services on a scheduled or emergency basis, including response to national events such as major chemical spills, natural disasters, or other events where immediate and specialized services are required.

As a result of the Coronavirus ("COVID-19") pandemic, the business has seen increased demand for response services relative to contagion disinfection, decontamination and disposal.

With the addition of the Safety-Kleen branches' core service offerings, including containerized waste disposal, parts washer and vacuum services, the Environmental Services results are further driven by the volumes of waste collected from these customers, the overall number of parts washers placed at customer sites and the demand for and frequency of other offered services.

In managing the business and evaluating performance, management tracks the volumes and mix of waste handled and disposed of or recycled, generally through our incinerators, treatment, storage and disposal facilities ("TSDFs") and landfills, the utilization rates of our incinerators, equipment and workforce, including billable hours, and number of parts washer services performed, among other key

• Environmental Services - Environmental Services segment results are predicated upon the demand by our customers for our wide variety of services, waste volumes managed by delivering such services and project work for which responsible waste handling and/or disposal is required.

Environmental Services results are also impacted by the demand for planned and unplanned industrial related cleaning and maintenance services at customer sites, environmental cleanup services on a scheduled or emergency basis, including response to large scale events such as major chemical spills, natural disasters, or other instances where immediate and specialized services are required.

The Environmental Services segment results include the Safety-Kleen branches' core environmental service offerings of containerized waste disposal, parts washer and vacuum services.

These results are driven by the volumes of waste collected from these customers, the overall number of parts washers placed at customer sites and the demand for and frequency of other offered services.

Levels of activity and ultimate performance associated with this segment can be impacted by several factors including overall U.S.

industrial production, economic conditions in the automotive and manufacturing markets, weather conditions, efficiency of our operations, technology, changing regulations, competition, market pricing of our services, costs incurred to deliver our services and the management of our related operating costs.

• Safety-Kleen Sustainability Solutions - Safety-Kleen Sustainability Solutions segment results are impacted by our customers' demand for high-quality, environmentally responsible recycled oil products and their demand for our related service offerings and products.

Safety-Kleen Sustainability Solutions offers high quality recycled base and blended oil products to end users including fleet customers, distributors and manufacturers of oil products.

Segment results are impacted by overall demand as well as product mix as it relates to these oil products.

industrial production, economic conditions in the chemical, manufacturing and automotive markets including efforts and economic incentives to reshore operations to the U.S., available capacity at waste disposal outlets, weather conditions, efficiency of our operations, technology, changing regulations, competition, market pricing of our services, costs incurred to deliver our services and the management of our related operating costs.

Safety-Kleen Sustainability Solutions offers high quality recycled base and blended oil products, including our KLEEN+ brand of Group II+ base oils, to end users including fleet customers, distributors and manufacturers of oil products.

Segment results are impacted by overall demand, market pricing and the mix of our oil product sales.

Segment results are also predicated on the demand for Safety-Kleen Sustainability Solutions' other product and service offerings including collection services for used oil, used oil filters and other automotive fluids.

These fluid collections are used as feedstock in our oil re-refining to make our base and blended oil products and our recycled automotive related fluid products or are integrated into the Clean Harbors' recycling and disposal network.

In operating the business and evaluating performance, management tracks the volumes and relative percentages of base and blended oil sales along with various pricing metrics associated with the commodity driven margin.

Management also tracks the volumes and pricing of used oil and automotive fluid collections.

These fluid collections are used as feedstock in our oil re-refining to produce our base and blended

oil products and our recycled automotive related fluid products or are integrated into the Clean Harbors' recycling and disposal network.

Levels of activity and ultimate performance associated with this segment can be impacted by economic conditions in the automotive services and manufacturing markets, efficiency of our operations, technology, weather conditions, changing regulations, competition and the management of our related operating costs.

Costs incurred in connection with the collection of used oil and other raw materials associated with the segment’s oil related products can also be volatile.

Costs incurred in connection with the collection of used oil and other raw materials associated with the segment’s oil related products can also be volatile and can be impacted by global events and their relative impact on commodity products and pricing.

The overall market price of oil and regulations that change the possible usage of used oil, including the International Maritime Organization's 2020 regulation ("IMO 2020") and other regulations related to the burning of used motor oil as a fuel, impact the premium the segment can charge for used oil collections.

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Should it be necessary, any waivers for such policies will also be posted on our website.

In December 2022, we published our second Clean Harbors' Sustainability Report, which is available on the website's Sustainability page.

Our website and the information contained therein or connected thereto are not incorporated by reference into this annual report on Form 10-K.

Acquisition of HydroChemPSC

On October 8, 2021, we acquired HydroChemPSC, a leading U.S.

provider of industrial cleaning, specialty maintenance and utility services, for a cash purchase price of approximately $1.23 billion.

The acquisition was financed with net proceeds from our concurrent issuance of $1.0 billion of senior secured term loans with the remaining purchase price being funded through existing cash.

The HydroChemPSC business serves customers across a broad range of markets and provides solutions to customers focused on cleaning, maintenance and environmental compliance of essential, mission critical equipment and infrastructure.

The acquired operations, including more than 4,500 employees, over 240 service locations and a fleet of specialized vehicles and equipment, expand our existing presence within the industrial services market and enhance the Environmental Services Segment.

We believe that the acquired business is a strategic acquisition for Clean Harbors.

As stated in Item 8, "Financial Statements and Supplementary Data," our consolidated results of operations for the year ended December 31, 2021 include $166.1 million of direct revenue and $166.4 million of expense attributable to the HydroChemPSC operations, including $12.3 million of incremental depreciation and amortization and $6.0 million of severance and integration costs.

Beyond expanding the size and scale of our operations, HydroChemPSC is an established leader in industrial services, with proprietary technology and a manufacturing center dedicated to fabricating tools aimed at reducing costs and increasing efficiency and safety.

We expect that the combined company will benefit from (i) enhanced technologies aimed at increasing safety, (ii) incremental waste volumes for processing through Clean Harbors' network of waste disposal facilities, (iii) long-established customer relationships that bring opportunities for cross selling of Clean Harbors' suite of services and (iv) synergistic opportunities within customer service, corporate functions, transportation, real estate, asset rentals and vehicle maintenance.

Health and Safety

Health and Safety is our #1 core value.

Employees at all levels of our Company share this philosophy, including those joining the Company from HydroChemPSC where health and safety were also a key priority.

We are all committed to ensuring our safety goals are met.

Our commitment to health and safety benefits all of our stakeholders including our employees, our customers, the community and the environment.

Health and Safety is a core value at Clean Harbors.

Employees at all levels of our Company share this belief and are all committed to ensuring our safety improvement goals are met.

Our Safety Starts with Me:

Live It 3-6-5 program is a key component in our overall safety approach.

This program, along with other targeted safety programs, have enabled us to maintain leading safety metrics.

Our key safety metrics are Total Recordable Incident Rate, or "TRIR" and Days Away, Restricted Activity and Transfer Rate, or "DART".

For the year ended December 31, 2021, our Company wide TRIR and DART were 1.12 and 0.71, respectively.

In order to protect our employees, lower our incident rates and satisfy our customers' demands to retain the best service providers with the lowest TRIR and DART rates, we are fully committed to continuously improving our health and safety performance through ongoing safety initiatives and training as well as technological solutions aimed at keeping all of our employees safe.

All employees recognize the importance of protecting themselves, their fellow employees, their customers and all those around them from harm.

Our commitment is supported by the Safety Starts with Me:

Live It 3-6-5 program, which includes three Safety Philosophies, six Golden Rules of Safety and each employee’s five personal reasons why they choose to be safe at work, on the road and at home.

We regard compliance with applicable regulations as a critical component of our overall operations.

We strive to maintain the highest professional standards in our compliance activities.

Live It 3-6-5 mindset, is the foundation to our overall safety approach, and is organized around three Safety Philosophies, six Golden Rules of Safety and each employee’s five personal reasons why they choose to be safe at work, while operating a vehicle or at home.

This overall approach, along with other targeted safety programs, have enabled us to achieve continued improvement across our Company.

For the year ended December 31, 2022, our safety metrics of Total Recordable Incident Rate ("TRIR") and Days Away, Restricted Activity and Transfer Rate ("DART"), were 0.73 and 0.41, respectively.

TRIR is a measure of accidents and injuries relative to hours worked and the 2022 TRIR and DART levels are the best in the Company's history to date which further highlights the commitment to safety and continuous improvement across the Company.

Moving forward, we remain focused on the health and safety of our teams, our customers and the communities in which we work, live and drive.

We will be relentless in our pursuit to improve how we work through effective partnering and collaboration, as well as innovation and technological solutions which deliver on our promise to ourselves, our customers and our neighbors.

It starts with us, and we will live it 3-6-5.

We regard compliance with applicable regulations as a critical component of our overall operations and we maintain a compliance organization that is independent of the operations of the business to monitor and provide oversight at the highest levels of our organization.

We strive to maintain strict professional standards in our compliance activities.

Our compliance staff is responsible for the facilities' permitting and regulatory compliance, compliance training, transportation compliance and related record keeping.

To ensure the effectiveness of our regulatory compliance program, our facilities operations are monitored by our compliance staff.

Our facilities are frequently inspected and audited by regulatory agencies, as well as by customers.

Our facilities are also frequently inspected and audited by regulatory agencies, as well as by customers.

Although our facilities have been cited on occasion for regulatory violations, we believe that each of our facilities is currently in substantial compliance with applicable permit requirements.

Our strategy is to develop and maintain ongoing relationships with a diversified group of customers that have recurring needs for our products and services.

We seek to expand market awareness of the breadth of our service offerings to current and future customers through targeted marketing opportunities.

We strive to be recognized as the premier supplier of a broad range of value-added environmental services based upon quality, responsiveness, customer service, information technologies and cost effectiveness.

We aim to be a resource for our customers everywhere that industry meets the environment.

The principal elements of our business strategy in no particular order are:

• Cross-Sell Across Businesses - We believe the breadth of our service offerings allows us to provide additional services to existing and new customers in order to continually satisfy our customers' environmental and sustainability objectives.

We believe we can provide industrial and field services to customers that traditionally have only used our technical services and provide technical services to customers that use our industrial services, including our expanded customer base from the HydroChemPSC acquisition.

At the same time, there are a variety of cross-selling opportunities between our Safety-Kleen branches' core service customers and our traditional Environmental Services waste disposal customers which we hope to expand via our reorganization in the first quarter of 2021.

We believe leveraging our ability to cross-sell among and across our segments will drive additional revenue for our Company.

• Expand Network through Growth and Technology - We operate and continue to make substantial investments and technological upgrades in an extensive network of hazardous waste management facilities and oil re-refineries, which provide us with significant operating leverage as volumes increase.

We also look for opportunities to expand waste handling capacity or waste oil processing at these facilities by modifying the terms of the existing permits, improving technology or, in certain instances, significantly expanding our facilities.

For example, in 2021, we began the process of building a new incinerator at our Kimball, Nebraska facility.

This incinerator is expected to increase our annual practical capacity by approximately 70,000 tons and is designed using the same world-class air emissions control technology as our El Dorado incinerator.

Through selected permit modifications, we can expand the range of treatment services offered to our customers without the significant capital investment necessary to acquire or build new waste management facilities.

• Execute Strategic Acquisitions and Divestitures - We actively pursue selective acquisitions with certain services or market sectors where we believe the acquisitions can enhance and expand our business, such as our acquisition of

HydroChemPSC in late 2021.

We believe that we can expand existing services through strategic acquisitions in order to generate incremental revenues from existing and new customers and to obtain greater market share.

In order to maximize synergies, we rapidly integrate our acquisitions into our existing processes.

To complement our acquisition strategy, we regularly review and evaluate our existing operations to determine whether our business model should change through the divestiture of certain businesses.

Accordingly, from time to time, we divest certain non-core businesses and reallocate our resources to businesses that we believe better align with our long-term strategic direction.

For additional information on our acquisitions and divestitures, see "Acquisitions and Divestitures" below.

• Focus on Cost, Pricing and Productivity Initiatives - We continually seek to increase efficiency, reduce costs through enhanced technology, process improvements and strategic expense management and price our goods and services competitively.

Additionally, we seek to identify areas in our business where strategic investments in automation, process improvements, tools and employees can serve to increase productivity, efficiency and safety compliance.

• Expand Geographic Coverage of Service Offerings - We believe our Environmental Services and Safety-Kleen Sustainability Solutions segments have a competitive advantage due to their vast network of locations across North America, particularly in areas where we maintain service locations at or near a TSDF and our expansive truck and rail transportation network.

By opening additional service locations in strategic locations, we believe that we can increase our market share within these segments, which will drive additional waste into our network of facilities and increase overall profitability.

Our centrally managed transportation network allows us to provide cost effective transportation throughout our customer base.

In addition, our management team continues to assess the competitive landscape in order to identify new business opportunities.

• Capture Large-Scale Projects - We monitor for opportunities to quickly respond to the ever changing needs of the marketplace, whether they be from external factors, like the recent need for our decontamination services, changing regulations or customers' needs for large-scale environmental remediation services.

We believe we are a national leader in emergency response services.

We provide turnkey offsite transportation and landfill or incineration disposal services for soil and other contaminated materials generated from remediation activities.

We also assist remediation contractors and project managers with support services including groundwater disposal, waste disposal, roll-off container management and many other related services.

We believe this will drive revenue growth as well as incremental waste volume to our existing facilities, thereby increasing utilization and enhancing overall profitability.

Acquisitions and Divestitures

Acquisitions are an element of our business strategy that involve expansion through the purchase of businesses that complement our existing Company and create opportunities for profitable growth.

In 2021, in addition to the acquisition of HydroChemPSC discussed above, we also acquired a privately-owned business for a purchase price of $22.8 million.

The acquisition expands the Safety-Kleen Sustainability Solutions segment's network within the south central United States.

On June 29, 2021, we signed a definitive agreement with Vertex Energy, Inc.

("Vertex") to acquire certain assets related to Vertex's used motor oil collection and re-refinery business.

On January 25, 2022, the parties mutually agreed to terminate the planned acquisition.

In connection with the early termination, Vertex paid us a breakup fee of $3.0 million in 2022.

In 2020, we acquired a privately-owned business for a purchase price of $8.8 million.

The acquisition expands the Safety-Kleen Sustainability Solutions segment's oil re-refining operations to the northeast United States.

In 2019, we acquired two privately-owned businesses for a combined purchase price of $25.2 million.

One acquisition expands the environmental services and hazardous materials management services of the Environmental Services segment while the second has components included in both the Environmental Services and Safety-Kleen Sustainability Solutions segments.

For additional information relating to our acquisition activities during 2021, 2020 and 2019, see Note 4, "Business Combinations," to our consolidated financial statements included in Item 8 of this report.

Other business transactions include divestitures based on our ongoing review of portfolio assets to determine the extent to which they are contributing to our objectives and growth strategy.

Protecting the Environment and Sustainability

Clean Harbors recognizes that sustainability stewardship is a core aspect of our brand and an important part of our responsibility in protecting generations to come through balancing environmental, economic and social concerns.

Sustainability

is not only about doing less to harm the earth or consuming less resources, it is also about doing more good and minimizing the cumulative impact of other companies.

Our core business is to provide industry, government and the public a wide range of sustainable solutions that protect and restore North America's natural environment.

We communicate our sustainability activities and progress across various channels.

In February 2021, we issued our inaugural Sustainability Report aligned to the Sustainability Accounting Standards Board framework.

A copy of this report can be found at our website.

We also have requirements for periodic regulatory reporting to the Environmental Protection Agency ("EPA") and other agencies that are available to the public.

We voluntarily provide data to various sustainability reporting organizations, many of which provide subscribers and the public with their rankings or scorecards of companies based on a combination of public and private information.

We utilize these formal reporting platforms to inform customers and other stakeholders of our sustainability efforts and we have been pleased to see our efforts to improve the reporting of our sustainable business practices reflected in improved scores from various rating organizations.

The improvement in our scores/ranking has been significant over the past few years.

For example, in 2021 we received a bronze rating from EcoVadis, a rating agency specialized in assessing environmental performance and corporate social responsibility.

We have also improved each of the Environmental, Social and Governance scores that the Institutional Shareholder Services Inc.

("ISS") publishes.

As of the end of 2021, our ISS Social score has improved eight points since 2018, with the ISS Governance and ISS Environmental scores improving two and three points, respectively.

While we are proud of the improvements in third-party scoring and rankings, the focus of our program is on tangible improvements that positively impact the environment, our community and our employees.

Our overall sustainability program expands our commitment beyond our services and products to include our operations, employees and community.

The program focuses on the following key elements:

Health and Safety

As noted above, Health and Safety is our #1 core value and as such is at the forefront of our sustainability program.

Safety is not just the hallmark of our Company but is also at the heart of what we provide to customers.

Our programs and procedures focus on delivering services with unparalleled safety to our employees, our customers, local communities and other key stakeholders.

Seven of our U.S.

sites have been recognized by the U.S.

Occupational Safety & Health Administration’s Voluntary Protection Program ("VPP") for their effective safety management systems and low injury and illness rates.

To put this accomplishment in context, less than 0.1% of the eight million U.S.

workplaces have earned this elite VPP recognition.

We are committed to fundamental human rights principles and we have a comprehensive Humans Rights Policy to formalize the standards to which we hold ourselves and others accountable.

Respect for human rights is essential to our interactions with employees, customers, shareholders and the public at large.

Operations/ Customer Solutions

Technologies and operational improvements have allowed Clean Harbors to develop initiatives that focus on minimizing the Company’s and our customers’ impact on the environment.

As a leading provider of environmental and industrial services throughout North America, we help our customers prevent the release of chemicals and hazardous waste streams into the environment.

We also are the leading service provider in the recovery and decontamination of pollutants that have been released.

This includes the safe destruction or disposal of hazardous materials in a manner that ensures these materials are no longer a danger to the environment.

As an example, to provide an efficient and safe alternative for hazardous waste disposal, Clean Harbors developed and built an incinerator at our El Dorado facility which uses world-class air emissions control technology that meets the most stringent emissions standards under the U.S.

Clean Air Act.

In 2021, we commenced the permitting and planning for a new hazardous waste incinerator at our Kimball, Nebraska facility, which will also be built to these high standards.

When providing these services, we are committed to the recycling, reuse and reclamation of these waste streams whenever possible using a variety of methods more fully explained below in the sections describing our general operations.

Many of our branded services exemplify our commitment to sustainability and providing environmental solutions to the marketplace.

Where possible, liquids such as solvents, chemicals and used oil are continuously recycled to industry standards and made into useful products.

Tolling programs provide a closed-loop process in which the customer’s spent solvents are recycled to precise specifications and returned directly to the customer.

Our Safety-Kleen OilPlus ® Program, unique to the oil industry, is designed to help companies manage their oil needs in a more sustainable way.

By collecting used motor oil from customers and delivering new re-refined oil products, customers are implementing a closed-loop process for sustainability in the oil industry.

Environmental regulations prohibit the disposal of oil in sewers or landfills as improper disposal can lead to widespread environmental problems.

Our re-refining process extends the life of crude oil resources, reduces the likelihood of improper oil disposal and is energy efficient as, per the Department of Energy, it can take less energy to recycle used oil than to create new lubricating oil from virgin crude oil.

As our customers

respond to the consumer and investor focus on environmental and socially responsible practices, we expect that the use of our re-refined oil products will be one component of their ESG story.

We deploy our fleet of trucks, tankers, rail-cars and barges to collect used oil.

In 2021, we gathered more than 226 million gallons of used oil in North America and our state-of-the-art processes enable us to fully realize oils' remarkable capacity to be recycled, re-refined and reused.

Our plants have re-refined more than 4.1 billion gallons of used oil since their opening, allowing such oils to have a second life as high quality recycled lubricants and avoiding an estimated 32.1 million metric tons of greenhouse gases.

This closed loop process, for oil and other sustainable lubricant products, is the main focus of our new Safety-Kleen Sustainability Solutions segment.

Clean Harbors instills sustainability within its operations through continuous improvements and well-defined strategic initiatives that show the highest positive impact on the environment, the communities and the economy in which we work and live.

Our assets represent one of our largest opportunities to apply environmentally sustainable business practices.

Our Asset Refurbishment Program is a comprehensive effort to rebuild key vehicles to "like new" quality while reusing or recycling as much of the material as possible.

Our goal every year is to refurbish approximately 100 highly technical vehicles used in our operations, like vacuum trucks, industrial air movers and waste oil trucks.

We also have a field repair/refurbishment program for our parts washers.

In 2021, we repaired or refurbished approximately 8,500 parts washers in the field, saving transportation to our refurbishment facility.

Parts washers that required repairs or refurbishment beyond what could be accomplished in the field were returned to our refurbishment facility.

We were able to recondition the majority of these machines and salvaged the components from any machines that were beyond reconditioning.

These operations at our refurbishment facility avoid disposing of about 500 tons of metals and plastics annually.

Environmental Commitment

One of the Company’s sustainability goals is to contribute to a cleaner environment by maximizing energy and water conservation across our organization.

Energy usage at our facilities is the focus of our Facility Energy Conservation program, which provides ongoing oversight and recommendations to our facilities to help support their electricity management efforts.

We continue to evaluate solar energy as a viable option for our facilities and have built solar arrays at select sites for their ongoing energy needs.

Clean Harbors makes fleet energy management a key focus, beginning with ongoing routing reviews by our logistics team to reduce total miles driven.

We also evaluate options for reducing fuel costs including routine use of rail and barge transportation, implementation of alternative fuel vehicles and using our Performance Plus ® and EcoPower ® re-refined engine oils throughout our fleet.

Clean Harbors is constantly upgrading our truck fleet with the most fuel-efficient systems and parts and has also designed custom, multi-compartment trucks that can be used to collect and deliver oil at the same time, decreasing fuel consumption.

As part of our commitment to protecting the environment, we have made the conscious decision to reduce our water usage.

In 2022, we will improve our water usage as part of our commitment to baseline key environmental metrics while planning for quantifiable reductions in the future.

All of these items above exemplify how we, as a company, are working to minimize our footprint on the environment;

however, our environmental commitment extends beyond our internal focus to how we can help other companies minimize their environmental footprint and achieve their sustainability goals.

The core of our operations is to provide our customers with environmentally responsible solutions, whether they be our commitment to environmentally conscious services and waste disposal or our re-refined oil offerings.

We believe in holding ourselves to high standards for sustainability and human rights practices and have taken efforts to drive sustainable practices through rigorous supply chain oversight.

We monitor for practices that are not in line with our corporate vision and work to drive change.

Our Vendor Code of Conduct establishes the minimum standards that must be met by all vendors regarding treatment of workers, safety, environmental impact and ethical business practices.

Community Engagement

Clean Harbors believes that by staying engaged with our customers, communities and other stakeholders, we can contribute to the long-term health of the environment, society and the economy.

We are dedicated to being a good neighbor in the communities in which we work.

We develop partnerships with key environmental programs to build awareness, while fostering more sustainable business practices.

One of our most highly visible public programs for various government and community entities is known as our Household Hazardous Waste service line.

Communities trust us to collect paints, solvents,

batteries, fluorescent lamps, pesticides, cleaners and other hazardous materials that otherwise might be improperly disposed of or become dangerous to the communities where they are stored.

Our commitment and our business go hand in hand as we work to provide services and products that complement our customers' sustainability plans and hold ourselves and others accountable to environmental, social and corporate governance standards and best practices.

Competitive Strengths

• Leading Provider of Environmental and Industrial Services - We are a leading provider of environmental and industrial services which provide solutions that help our customers protect the environment.

Health and safety is our underlying core value and we believe our long standing commitment to safety results is an important competitive strength of Clean Harbors.

We have obtained leading positions across our business lines despite facing robust competition from local, regional and national firms.

We believe the following are our core competitive strengths developed over our 40+ years of operations which have and will continue to facilitate our leadership position in the marketplace:

• Leading Provider of Environmental and Industrial Services - We are a leading provider of environmental and industrial services which provide sustainable solutions that help our customers protect the environment.

We own nine commercial hazardous waste incinerators, making us the largest operator of such facilities in North America.

We are also one of the few industrial services companies with national footprints in both the U.S.

We have a highly skilled workforce that is trained to safely respond to customer needs across a variety of service lines.

We provide multi-faceted, high-quality services to a broad mix of customers.

Our vast capabilities, valuable and unique assets, skilled workforce, safety profile and breadth of services as well as our overall size, scale and geographic locations help us attract customers and provide environmentally responsible solutions for our customers.

• Integrated Network of Assets - We believe we operate, in the aggregate, the largest number of commercial hazardous waste incinerators, landfills, treatment facilities and TSDFs in North America.

We also have a significant fleet across a vast transportation network throughout the U.S.

Our broad service network enables us to effectively handle a waste stream from its origin through disposal and to efficiently internalize our waste streams and transportation to reduce costs.

Our size allows us to leverage our network and increase our profit margins as we can internalize a greater volume of waste in our incinerators, landfills and other disposal facilities.

Furthermore, these assets are very difficult to duplicate because, in addition to sizable required capital investments, significant permitting and regulatory approvals would need to be obtained in order for new commercial waste disposal sites to come on-line.

As such, these high barriers of entry provide increased value to our network.

We are also one of the few industrial services companies with footprints in both the U.S.

Our highly trained workforce safely responds to customer needs across a variety of service lines, including emergency response services.

We provide multi-faceted, high-quality services to a broad mix of customers and our vast capabilities, valuable and unique assets, skilled workforce, safety profile and breadth of services as well as our overall size, scale and geographic locations help us attract customers and provide them with environmentally responsible solutions.

• Integrated Network of Assets - We believe, in the aggregate, we operate the largest number of commercial hazardous waste incinerators, landfills, treatment facilities and TSDFs in North America.

We also operate our significant fleet across a transportation network spanning the U.S.

Our broad service network enables us to effectively handle a hazardous waste stream from its origin through disposal while internalizing transportation to reduce costs.

Our breadth of waste disposal outlets allows us to efficiently internalize a greater volume of waste in our incinerators, landfills and other disposal facilities.

These assets are very difficult to duplicate and maintain because, in addition to sizable required capital investments, there are significant permitting, regulatory approvals and ongoing compliance regulations necessary in order for new commercial waste disposal sites to come on-line.

In addition, operating expertise gained through years of experience is paramount to safely operating such facilities.

As such, these longstanding capabilities exhibited by us create a competitive advantage and provide substantial value for our network.

• Comprehensive Service Capabilities Complementing our Customers' Sustainability Goals - Our comprehensive service offerings and product catalog allow us to act as a full service provider of sustainable options for our customers' needs.

Not only can our customers rely on Clean Harbors to be part of their sustainability plan, but they can minimize the number of outside vendors utilized and rely on us as "one stop shop" service provider.

Our breadth of service offerings creates incremental revenue growth with no one competitor having the portfolio of services that we can provide to our customers.

Our workforce is trained to swiftly pivot to fulfill customer needs should markets change or demand shift and our complementary lines of business help keep us steady in turbulent times.

• Largest Collector and Recycler of Used Motor Oil - As the largest re-refiner and recycler of used oil in North America, during 2021 and 2020, we returned approximately 196 million and 166 million gallons, respectively, of new re-refined oil, lubricants and byproducts back into the marketplace.

In 2021 and 2020, our re-refining process eliminated more than an estimated 2.1 million and 1.7 million metric tons, respectively, of greenhouse gas ("GHG").

For 2021 alone, the estimated GHG's eliminated as a result of our re-refining process has the net carbon benefit equivalent to growing approximately 35 million trees for 10 years or taking over 457,000 passenger cars off the road for one year.

• Effective Cost Management - In these times of cost increases due to significant inflationary pressures, we have focused our cost management in order to maintain our overall margins.

Not only can our customers rely on Clean Harbors to be a sustainability partner, but they can minimize the number of outside vendors utilized and rely on us as a "one-stop-shop" service provider.

Our breadth of service offerings creates incremental revenue growth with no single competitor offering the portfolio of services that we can provide to our customers.

Our workforce is trained to fulfill a multitude of customer needs and our complementary lines of business help keep us steady in times of market uncertainty.

In addition, our proprietary and integrated technology platform utilized to deliver our services provides a competitive advantage for us and continuous investments provides incremental value to our customers' experience.

• Used Motor Oil Collection and Re-refining Capabilities - As the largest re-refiner and recycler of used oil in North America, during 2022, we collected and processed 232 million gallons of used motor oil and returned approximately 196 million gallons of new re-refined oil, lubricants and byproducts back into the marketplace.

Our ability to collect used lubricants from customers and have the capability to then re-refine and produce high-quality recycled products sets us apart from many competitors in the space.

In 2022, our re-refining process eliminated more than an estimated 1.9 million metric tons of greenhouse gas ("GHG").

The estimated GHG eliminated as a result of our re-refining process in 2022 has the net carbon benefit equivalent to growing approximately 33 million trees for 10 years or taking over 428,000 passenger cars off the road for one year.

• Effective Cost Management - We have effective cost management programs in place in order to maintain our overall margins, even in times of higher inflation.

Our significant scale allows us to maintain low costs through standardized compliance procedures and significant purchasing power.

Leveraging our investment in technology and our ability to efficiently utilize logistics and transportation, we can economically direct waste streams to the most efficient facility.

We also have the ability to use internal resources to transport and process the substantial majority of all hazardous waste that we manage for our customers.

We also use internal resources to transport and process the substantial majority of all hazardous waste that we manage for our customers.

In addition, our Safety-Kleen Sustainability Solutions segment results are significantly impacted by the overall market pricing and product mix associated with base and blended oil products.

We manage the pricing on our used oil collection services which allow us to effectively manage the profit spreads inherent in our Safety-Kleen Sustainability Solutions business.

We manage the pricing on our used oil collection services which allows us to effectively manage the re-refinery spreads inherent in our Safety-Kleen Sustainability Solutions business.

Our support functions are also highly leverageable and have resulted in improved operating margins.

• Large and Diversified Customer Base - Our customer portfolio ranges from small companies to Fortune 500 companies and include public and private entities that span multiple industries and business types, including some government entities.

This diversification opens opportunities for cross-selling our large portfolio of services and limits our credit exposure to any one customer and potential cyclicality in any one industry.

As a percentage of our 2021 revenues, the top ten industries we serviced totaled approximately 79% of revenues and included chemical (16%), general manufacturing (16%), base and blended oils (9%), refineries (9%), automotive (8%), government (6%), utilities (5%), transportation (4%), retail (3%) and construction (3%).

• Stable and Recurring Revenue Base - We have long-standing relationships with our large customers, many of whom have worked with our Company for decades.

We will also benefit from the long-standing customer relationships that HydroChemPSC will bring to our business, including many instances where HydroChemPSC operations are embedded in a customer facility (insite locations).

Our diversified customer base provides stable and recurring revenues, as a significant portion of our revenues are derived from previously served customers with recurring needs for our services.

This diversification opens opportunities for cross-selling our large portfolio of services and limits

our credit exposure to any single customer and potential cyclicality in any one industry.

As a percentage of our 2022 revenues, the top ten industries we serviced totaled approximately 80% of revenues and included chemical (17%), general manufacturing (15%), refineries (13%), base and blended oils (8%), automotive (8%), utilities (6%), government (4%), oil and gas (3%), transportation (3%), and retail (3%).

• Stable and Recurring Revenue Base - We have long-standing relationships with our large customers, many of whom have worked with our Company for decades, and certain of our operations are embedded in customer facilities, entrenching Clean Harbors in their day-to-day operations.

A significant portion of our revenues are derived from previously served customers with recurring needs for our services.

In addition, there can be a financial burden that accompanies switching hazardous waste disposal providers due to customers' desire to audit disposal facilities prior to their qualification as approved sites and to limit the number of facilities to which their hazardous waste is shipped in order to reduce potential liability under United States and Canadian environmental laws and regulations.

We have been selected as an approved vendor by large and small generators of waste because we possess comprehensive collection, recycling, treatment, transportation, disposal and hazardous waste tracking capabilities and have the expertise necessary to comply with applicable environmental laws and regulations.

We have been selected as an approved vendor by large and small generators of waste because, in addition to our strong safety performance, we possess comprehensive collection, recycling, treatment, transportation, disposal and hazardous waste tracking capabilities and have the expertise necessary to comply with applicable environmental laws and regulations.

Those customers that have selected us as an approved vendor typically continue to use our services on a recurring basis.

In our Safety-Kleen Sustainability Solutions segment, oil collections are the feed-stock into our oil product sales.

Though our collection services customer base may fluctuate, we consistently collect over 200 million gallons of used motor oil annually.

• Regulatory Compliance - We continue to make capital investments in our facilities to ensure that they are in compliance with current federal, state, provincial and local regulations.

Companies that rely on in-house disposal may find the current regulatory requirements to be too capital intensive or complicated, and may choose to outsource many of their hazardous waste disposal needs.

• Proven and Experienced Management Team - Our executive management team provides depth and continuity.

Our executive officers collectively have over 200 years of experience and expertise in the environmental and industrial services industries.

Our Chief Executive Officer founded our Company in 1980 and, since the Company's formation, has served as both the Chief Executive Officer and Chairman of the Board.

This team has the depth of knowledge of both the industry and our operations to be able to quickly pivot in times of change and identify and respond to new market demands.

We have an independent compliance group outfitted to monitor and adhere to these compliance standards.

Companies relying on in-house disposal may find the current regulatory requirements to be too capital intensive or complex, and may choose to outsource many of their hazardous waste disposal needs.

• Proven and Experienced Management Team - Our executive management team provides extensive depth of knowledge and continuity with years of experience and expertise in the environmental and industrial services industries.

McKim founded our Company in 1980 and has continuously served as our Chairman of the Board and Chief Executive Officer.

Pursuant to an orderly succession process approved by our Board of Directors, effective March 31, 2023, Michael L.

Battles, our current EVP and Chief Financial Officer, and Eric W.

Gerstenberg, our current Chief Operating Officer, will become our Co-Chief Executive Officers.

Battles and Gerstenberg have each served in their current roles for more than five years and collectively have over 40 years of experience and expertise in the environmental and industrial industries.

McKim will continue as the Executive Chairman of the Board, while also taking on the duties of Chief Technology Officer.

We believe that the separation of the Chairman and CEO roles will strengthen the overall governance of Clean Harbors.

Eric Dugas, our current SVP and Chief Accounting Officer will succeed Mr.

Battles as our EVP and Chief Financial Officer.

Eric has been a key member of the management team since he joined the Company in 2014.

Our experienced management team has the depth of knowledge of both the industry and our operations to be able to quickly pivot in times of change and identify and respond to new market demands.

Our strategy involves leveraging our core competitive strengths to develop and maintain ongoing relationships with a diversified group of customers having recurring needs for our services and products while continuing to grow our service lines ensuring that we can meet our customers' changing environmental and sustainability needs.

Targeted marketing opportunities allow us to expand market awareness of the breadth of our service offerings to current and future customers.

Everywhere industry meets the environment, we aim to be a primary resource for our customers.

The principal elements of our business strategy are:

• Cross-Sell Our Solutions - The breadth of our service offerings allows us the opportunity to provide various services and products to meet our customers' environmental and sustainability objectives.

We look for opportunities to be a one-stop-shop service provider, expanding the range of services we traditionally provide to a customer.

Our team is committed to identifying opportunities to cross-sell among and across our segments which we expect will drive additional revenue for our Company.

• Expand Our Network and Suite of Offerings - We operate an extensive network of hazardous waste management facilities and oil re-refineries, which provides us with significant operating leverage as volumes increase.

opportunities to expand waste handling capacity or oil processing at these facilities by modifying the terms of the existing permits, improving technology or, in certain instances, significantly expanding our facilities.

Through selected permit modifications within our network of facilities, we can expand the range of treatment services offered to our customers without the significant capital investment necessary to acquire or build new waste management facilities.

We also look for opportunities to grow through opening new locations in strategic geographies, expanding to new waste streams and being responsive to shifting product and service needs in the marketplace.

• Pursue Acquisitions and Divestitures - We have history of strategic acquisitions ranging from small, "tuck-ins" to large scale operations and we continue to actively pursue selective acquisitions we believe can enhance and expand our business.

Strategic acquisitions are executed to expand existing services, generate incremental revenues from existing and new customers, obtain greater market share, broaden the markets in which we operate and expand our total waste disposal or oil re-refining capacity.

In order to maximize synergies, we rapidly integrate our acquisitions into our existing processes.

To complement our acquisition strategy, we regularly review and evaluate our operations to determine whether we should divest certain non-core businesses and reallocate our resources to businesses that we believe better align with the long-term strategic direction of the Company.

• Execute on Cost, Pricing and Productivity Initiatives - We continually seek to increase efficiency and reduce costs through enhanced technology, process improvements and strategic expense management.

We seek to identify areas in our business where strategic investments in automation, process improvements and employees can serve to increase productivity, efficiency and safety compliance.

We continuously focus on the operating leverage of our support functions, including expanding globally to achieve profitability and productivity benefits.

We aim to price our services and products competitively, understanding the inherent value of our network of assets and operations and being quick to respond to market and macroeconomic changes.

We also understand the value our customers place on our products and services in a global market continuously focusing on sustainability, environmental compliance and safety.

• Foster Innovation through Technology - Technology has always been part of our core operations, influencing our strategy from increasing throughput at our facilities to increased automation for enhancing productivity.

We aim to utilize advanced technologies in our operations while also integrating technology-based solutions for our customers to use in the management of their generated waste streams and which promote the safety, efficiency and profitability of these operations.

With technology, we are able to centrally manage our transportation network, deploying, monitoring and adjusting our transportation fleet as needs change.

Technology is enhancing our customer interactions through the use of our Customer Solutions Portal, our e-commerce initiatives and through tools providing customers with real-time data on the services we are providing.

We anticipate that as new waste streams arise or grow in prominence, we will develop new technology and/or prove the capabilities of existing technology to respond to these waste disposal needs.

We believe that by making technological investments that increase the value of our services delivered to our customers pays off in a variety of ways including growth, retention, profitability and overall customer experience.

• Capture Large-Scale Opportunities - With our national footprint and breadth of services, we can quickly and reliably respond to customer needs, including in emergency response situations.

We can assist with remediation needs, either planned or unplanned, by providing remediation contractors and project managers with support services including groundwater disposal, roll-off container management and many other related services.

We can also provide turnkey offsite transportation and landfill or incineration disposal services for soil and other contaminated materials generated from remediation activities.

We monitor for opportunities to quickly respond to the ever changing needs of the marketplace like the recent need for specialized decontamination services or strategic partnerships with customers to provide a dedicated waste disposal outlet for their operations or a one-stop-shop for their oil-related needs.

Business Overview

We operate our business in two segments:

Environmental Services and Safety-Kleen Sustainability Solutions.

Each segment utilizes our network of specialized facilities and equipment, along with our skilled workforce, to meet the needs of our customers.

Environmental Services

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Our CleanPack ® services include the collection, identification, categorization, specialized packaging, transportation and disposal of laboratory chemicals and household hazardous waste.

We perform a wide range of industrial maintenance and specialty industrial services and utilize specialty equipment and resources to perform field services at any chosen location on a planned or emergency response basis.

We also collect containerized waste and provide parts washer and vacuum services to small quantity generators of hazardous waste.

We perform a wide range of industrial maintenance and specialty industrial services and utilize specialty equipment and resources to perform services at any chosen location on a planned or emergency response basis.

We also collect containerized waste and provide parts washer and vacuum services to small quantity generators of

hazardous waste.

All of these services are designed to protect the environment and address environmental related challenges through the use of innovation and the latest technologies.

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Customers typically accumulate waste in containers, such as 55-gallon drums, bulk storage tanks or 20-cubic-yard roll-off containers.

In providing this service, we utilize a variety of specially designed and constructed tank trucks and semi-trailers as well as third-party transporters, including railroads.

We recycle, treat and dispose of hazardous and non-hazardous industrial waste.

In providing this service, we utilize a variety of specially designed and constructed tank trucks and semi-trailers as well as third-party transporters and rail.

We recycle, treat and dispose of hazardous and non-hazardous waste.

The waste handled includes substances which are classified as "hazardous" because of their corrosive, ignitable, infectious, reactive or toxic properties and other substances subject to federal, state and provincial environmental regulation.

We provide final treatment and disposal services

designed to manage waste which cannot be otherwise economically recycled or reused.

We provide final treatment and disposal services designed to manage waste which cannot be otherwise safely and/or economically recycled or reused.

The waste that we handle comes in solid, sludge, liquid and gas form.

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Our facilities in Kimball and Deer Park also have on-site landfills for the disposal of ash produced as a result of the incineration process.

Our Deer Park landfill will reach permitted capacity in early 2023, however, the Company plans to dispose of the ash from this incinerator facility in one of our other landfills going forward.

Our incinerator facility in Lambton, Ontario, is a liquid injection incinerator designed primarily for the destruction of liquid organic waste.

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Our non-hazardous landfill is located in the United States.

In addition to our seven commercial landfills, we also own and operate, as described above, two non-commercial landfills that only accept waste from our on-site incinerators.

In addition to our seven commercial landfills, we also own and operate two non-commercial landfills that only accept waste from our on-site incinerators, as described above.

As of December 31, 2022, the useful economic lives of our six commercial hazardous waste landfills included approximately 24.8 million cubic yards of remaining capacity.

We estimate the useful economic lives of landfills to include permitted airspace and unpermitted airspace that our management believes to be probable of being permitted based on our analysis of various factors.

In addition to the capacity included in the useful economic life of these landfills, there are approximately 20.9 million cubic yards of additional unpermitted airspace capacity included in the footprints of these landfills that may ultimately be permitted, although there can be no assurance that this additional capacity will be permitted.

In addition to the capacity included in the useful economic life of these landfills, there are

approximately 20.9 million cubic yards of additional unpermitted airspace capacity included in the footprints of these landfills that may ultimately be permitted, although there can be no assurance that this additional capacity will be permitted.

As of December 31, 2022, the useful economic life of our non-hazardous industrial landfill included 3.3 million cubic yards of remaining permitted capacity.

This facility is located in the United States and has been issued operating permits under Subtitle D of RCRA.

This facility is located in the United States and has been issued operating permits under Subtitle D of the Resource Conservation and Recovery Act ("RCRA").

Our non-hazardous landfill facility is permitted to accept commercial industrial waste, including waste from demolition and construction.

Another waste disposal outlet in our network of facilities are our TSDFs that collect, temporarily store and/or consolidate compatible waste streams for more efficient transportation to final recycling, treatment or disposal destinations.

These facilities hold special permits, such as Part B permits under the Resource Conservation and Recovery Act ("RCRA") in the United States, which allow them to process, transfer and dispose of waste through various technologies including recycling, incineration, landfill and wastewater treatment depending on each location's permitted and constructed capabilities.

Another waste disposal outlet in our network of facilities are our TSDFs that collect, temporarily store, process and/or consolidate compatible waste streams for more efficient processing and transportation to final recycling, treatment or disposal destinations.

These facilities hold special, hard to come by permits, such as Part B permits under the RCRA, which allow them to process, transfer and dispose of waste through various technologies including recycling, incineration, landfill and wastewater treatment depending on each location's permitted and constructed capabilities.

We operate recycling systems for the reclamation and reuse of certain waste, particularly solvent-based waste generated by industrial cleaning operations, metal finishing and other manufacturing processes.

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Our wastewater treatment facilities process hazardous and non-hazardous waste through use of physical and chemical treatment methods.

With the acquisition of HydroChemPSC, we now have ten wastewater treatment facilities that offer or employ a range of wastewater treatment technologies.

These facilities treat a broad range of industrial liquid and semi-liquid waste containing heavy metals, organics and suspended solids.

Our ten wastewater treatment facilities offer or employ a range of wastewater treatment technologies.

These facilities treat a broad range of liquid and semi-liquid waste containing heavy metals, organics and suspended solids.

We also provide total project management services in areas such as chemical packing, on-site waste management, remediation, compliance training and emergency spill response, while leveraging Clean Harbors' network of service centers and environmental capabilities.

Our household hazardous waste collection services provide municipalities with a partner for the collection and disposal of household paints, solvents, batteries, fluorescent lamps, pesticides, cleaners and other hazardous materials.

Field and Emergency Response Services

Our crews and equipment are dispatched on a planned or emergency basis and perform services such as confined space entry for tank cleaning, site disinfecting, decontamination and disposal, including such work for COVID-19 decontamination, large remediation projects, demolition, spill cleanup on land and water, railcar cleaning, hydro excavation, manhole/vault clean outs, product recovery and transfer, scarifying and media blasting, vacuum services and water treatment services.

We are also a leader in providing response services for environmental emergencies of any scale from man-made disasters such as oil spills and from natural disasters such as hurricanes.

Industrial Services

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Our industrial services crews handle services to support ongoing in-plant cleaning and maintenance services on our customers' mission critical equipment and infrastructure.

These services include liquid/dry vacuum, hydro-blasting, dewatering and materials processing, leak detection and repair, water and chemical hauling and steam cleaning.

We provide a variety of specialized industrial services including plant outage and turnaround services, specialty cleaning services including chemical cleaning and high and ultra-high pressure water cleaning, daylighting, production services and upstream energy services.

With the addition of the HydroChemPSC business into our industrial services operations, we expanded our on-site/in-plant service delivery program for industrial services and are focused on the integration of automation, technology and innovation into the industrial services operations.

These services include liquid and dry vacuum services, hydro-blasting, dewatering and materials processing, leak detection and repair, tank cleaning, specialty mechanical services, vapor control, water and chemical hauling and steam cleaning.

In 2022, we united all U.S-based industrial services under one brand, HPC Industrial, powered by Clean Harbors, and continued our focus on integrating automation, technology and innovation into our industrial services operations.

Field and Emergency Response Services

Our crews and equipment are dispatched on a planned or emergency basis and perform services such as confined space entry for tank cleaning, site disinfecting, decontamination and disposal, large remediation projects, demolition, spill cleanup on land and water, railcar cleaning, hydro excavation, manhole/vault clean outs, product recovery and transfer, scarifying and media blasting, vacuum services and water treatment services.

We are also a leader in providing response services for environmental emergencies of any scale from man-made disasters such as oil spills and from natural disasters such as hurricanes.

Safety-Kleen Environmental Core Services

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We provide pickup and transportation of hazardous and non-hazardous containerized waste for recycling or disposal, primarily through the Clean Harbors' network of recycling, treatment and disposal facilities.

As the largest provider of parts cleaning services in North America, we offer a complete line of specially designed parts washers to customer locations and then deliver recurring service that includes machine cleaning and maintenance and disposal and replenishment of clean solvent or aqueous fluids.

As the largest provider of parts cleaning services in North America, we offer a complete line of specially designed parts washers to customer locations and then deliver recurring service

that includes machine cleaning and maintenance and disposal and replenishment of clean solvent or aqueous fluids.

Our vacuum services remove solids, residual oily water and sludge and other fluids from customers' oil/water separators, sumps and collection tanks.

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Safety-Kleen Sustainability Solutions

Our Safety-Kleen Sustainability Solutions business offerings span the life-cycle of oil and other sustainable lubricant products.

Our Safety-Kleen Sustainability Solutions business offerings span the life-cycle of lubricants and other sustainable automotive products.

Our teams collect used oil which serves as feedstock for our oil re-refineries.

In 2022, we collected 232 million gallons of used oil.

We can process the used oil collected through our seven re-refineries located in East Chicago, Indiana;

We process the used oil collected through our eight re-refineries located in East Chicago, Indiana;

Newark, California;

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Rollinsford, New Hampshire;

Kingsland, Georgia;

and Breslau, Ontario.

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The used oil collected is processed or re-refined to convert into a variety of products, mostly base and blended lubricating oils, and much smaller quantities of asphalt-like material, glycols and fuels.

One of the primary goals of our Safety-Kleen Sustainability Solutions business is to produce and sell high-quality eco-friendly blended oils, which are created by combining our re-refined base and other base oils with performance additives in accordance with our proprietary formulations and American Petroleum Institute licenses.

Our Performance Plus ® and EcoPower ® family of products are sold to on- and off-road corporate fleets, government entities, automotive service shops and industrial plants, which are serviced through our internal distribution network, as well as an extensive United States and Canada-wide independent distributor network.

We also sell unbranded blended oils to distributors that resell them under their

private label brands.

Our OilPlus ® program consists of selling our renewable oil products directly to our end customers.

We sell the base oil that we do not blend and sell ourselves to independent blenders/packagers that use it to blend their own branded or private label oils.

With 226 million gallons of used oil processed in 2021, we were able to return approximately 196.1 million gallons of new re-refined oil, lubricants and byproducts back into the marketplace helping our customers meet the growing demand for the use of sustainable products in their operations.

One of the primary goals of our Safety-Kleen Sustainability Solutions business is to produce and sell high-quality eco-friendly base and blended oils.

In 2022, we launched our KLEEN+ brand of Group II+ base oils.

Our Performance Plus ® and EcoPower ® family of blended products are sold to on- and off-road corporate fleets, government entities, automotive service shops and industrial plants, which are serviced through our internal distribution network.

We also sell unbranded blended oils to distributors that resell them under their private label brands.

The used oil can also be processed into recycled fuel oil, or “RFO,” which is then sold to customers such as asphalt plants, industrial plants, pulp and paper companies.

The used oil is also processed into vacuum gas oil which can be further re-refined into lubricant base oils or sold directly into the marine diesel oil fuel market.

We also collect and either recycle or dispose of related automotive products including antifreeze and oil filters.

We sell automotive and industrial products including antifreeze recycled through our collections above, windshield washer fluid, degreasers, glass and floor cleaners, hand cleaners, absorbents, mats and spill kits.

The used oil is also processed into vacuum gas oil which can be further re-refined into lubricant base oils or sold directly into the marine diesel fuel market.

With 232 million gallons of used oil collected and processed in 2022, we were able to return approximately 196 million gallons of new re-refined oil, lubricants and byproducts back into the marketplace helping our customers meet the growing demand for the use of sustainable products in their operations.

We sell the base oil that we do not blend and sell ourselves to independent blenders/packagers that use it to blend their own branded or private label oils

The Safety-Kleen Sustainability Solutions operations also collect and either recycle or dispose of related automotive products including antifreeze and oil filters.

We sell automotive and industrial products including antifreeze recycled through our collections, windshield washer fluid, degreasers, glass and floor cleaners, hand cleaners, absorbents, mats and spill kits.

Our operations may be affected by seasonal fluctuations primarily due to weather and budgetary cycles influencing the timing of customers' spending for products and services.

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Customer factory closings for year-end holidays can also contribute to reduced waste volumes in our network of facilities during this time.

In 2021, for various macroeconomic reasons, the effects of seasonality were not as apparent as they have been in prior years.

That said, we do anticipate that we may see these seasonal trends again in the future.

Geographical Information

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For additional information about the geographical areas from which our revenues are derived and in which our assets are located, see Note 3, "Revenues," and Note 20, "Segment Reporting," respectively, to our consolidated financial statements included in Item 8 of this report.

Acquisitions and Divestitures

As noted above, we execute upon acquisitions as an element of our business strategy to create opportunities for profitable growth.

We also monitor our operations for opportunities to reallocate resources through the divestiture of non-core businesses.

In 2022, we acquired two privately-owned businesses for a collective purchase price of $91.3 million.

The acquisitions expanded the Safety-Kleen Sustainability Solutions segment's waste oil collection capabilities and re-refining business throughout the southern United States.

Additionally, we sold a line of business from our non-core operations for a purchase

price of $18.8 million.

The divested line of business was previously included within the Environmental Sales and Service reporting unit of the Environmental Services segment.

In 2021, we acquired HydroChemPSC for a purchase price of $1.23 billion.

The acquisition expanded the Company's Environmental Services segment.

We also acquired a privately-owned business for a purchase price of $22.8 million.

The acquisition expanded the Safety-Kleen Sustainability Solutions segment's network within the south central United States.

For additional information relating to our acquisition activities during 2022, 2021 and 2020, see Note 4, "Business Combinations," to our consolidated financial statements included in Item 8 of this report.

Protecting the Environment and Sustainability at Clean Harbors

Balancing environmental, economic and social concerns is foundational to our framework for success and is expected by our employees, customers and other stakeholders.

Sustainability is not only about doing less to harm the earth or consuming fewer essential resources, it is also about doing more good and partnering with our customers to minimize their environmental impacts.

Our core business is to provide industry, government and the public a wide range of sustainable solutions that protect and restore North America's natural environment.

Our commitment to sustainability includes a focus on continuously improving our efforts around sustainability.

We communicate our sustainability programs and progress across various channels.

In December 2022, we issued our second Sustainability Report aligned to the Sustainability Accounting Standards Board framework.

A copy of this report can be found on our website.

We also have requirements for periodic regulatory reporting to the Environmental Protection Agency ("EPA") and other agencies that are available to the public and we continue to monitor for emerging legislation which may influence sustainability-related disclosures.

We voluntarily provide data to various external sustainability reporting and assessment organizations, many of which provide subscribers and the public with their rankings or scorecards of companies based on a combination of public and private information.

The improvement in our scores/ranking has been significant over the past few years.

We maintain a bronze rating from EcoVadis, a rating agency specialized in assessing environmental performance and corporate social responsibility.

We have shown improvement in each of the Environmental, Social and Governance risk assessments that the Institutional Shareholder Services Inc.

("ISS") publishes as well as continued improvement with the S&P Global ratings system.

We continue to disclose as a voluntary participant to the Carbon Disclosure Project, MSCI Environmental Social and Governance, ("ESG") Ratings, Morning Star Sustainalytics and participate in numerous other corporate as well as customer-specific assessments and disclosures.

Our overall sustainability program expands our commitment beyond our services and products to include our operations, employees and community.

The program focuses on the following key elements:

Health and Safety

As noted above, Health and Safety is our #1 core value and as such is foundational to our sustainability program.

Safety is not just the hallmark of our Company but is also at the heart of what we provide to customers.

Our programs and procedures focus on delivering services with unparalleled safety to our employees, our customers, local communities and other key stakeholders.

In 2022, we achieved TRIR of 0.73 and DART of 0.41, the best levels in Company history and achieving our 2030 goal of TRIR less than 1.0 eight years ahead of schedule.

Seven of our U.S.

sites have been recognized by the U.S.

Occupational Safety & Health Administration’s Voluntary Protection Program ("VPP") for their effective safety management systems and low injury and illness rates.

To put this accomplishment in context, less than 0.1% of the eight million U.S.

workplaces have earned this elite VPP recognition.

Operations/ Customer Solutions

Technologies and operational improvements have allowed Clean Harbors to develop initiatives that focus on minimizing the Company’s and our customers’ impact on the environment.

As a leading provider of environmental and industrial services throughout North America, we help our customers prevent the release of chemicals and hazardous waste streams into the environment.

We also recover and decontaminate pollutants that have been released.

This includes the safe destruction or disposal of hazardous materials in a manner that ensures these materials are no longer a danger to the environment.

As an example, to provide an efficient and safe alternative for hazardous waste disposal, Clean Harbors developed and built an incinerator at our El Dorado facility which uses world-class air emissions control technology that meets or exceeds the most stringent emissions standards under the U.S.

Clean Air Act.

Our new hazardous waste incinerator that we are building in Kimball, Nebraska is being built to these high standards as well.

Additionally, during 2022, we concluded a comprehensive third-party study demonstrating that the Company's commercial incinerators can safely and thoroughly destroy per- and poly-fluorinated alkyl substances ("PFAS") in multiple forms.

Specifically the study demonstrated that the use of high-temperature

combustion destroyed greater than 99.9999% of PFAS compounds, a level that meets the strict chemical destruction standards for many of the most dangerous and difficult to destroy hazardous wastes.

As the prevalence of PFAS and the necessity to mitigate future harm from these "forever chemicals" becomes more widely understood and likely demand for services to properly handle and dispose of these materials increases, we believe this capability will become a differentiating factor for us.

When providing environmental services, we are committed to the recycling, reuse and reclamation of handled waste streams whenever practical using a variety of methods more fully explained in the sections describing our general operations.

Many of our branded services exemplify our commitment to sustainability and providing environmental solutions to the marketplace.

Where possible, liquids such as solvents, chemicals and used oil are continuously recycled to industry standards and made into useful and sustainable products.

Tolling programs provide a closed-loop process in which the customer’s spent solvents are recycled to precise specifications and returned directly to the customer.

Our Safety-Kleen OilPlus ® Program is designed to help companies manage their oil related disposal and consumption needs in a more sustainable way.

Environmental regulations prohibit the disposal of oil in sewers or landfills as improper disposal can lead to widespread environmental problems.

To avoid the improper disposal of oil, we deploy our fleet of trucks, tankers, rail-cars and barges to collect used oil.

In 2022, we gathered more than 232 million gallons of used oil in North America.

This used oil is feedstock into our re-refining process which extends the life of crude oil resources, reduces the likelihood of improper oil disposal and decreases overall energy usage as, per the Department of Energy, it can take less energy to recycle used oil than to create new lubricating oil from virgin crude oil.

Our state of the art processes enable us to fully realize oil's remarkable capacity to be recycled, re-refined and reused.

Our plants have re-refined more than 4.4 billion gallons of used oil allowing such oils to have a new life as high-quality recycled lubricants and avoided an estimated 33.4 million metric tons of greenhouse gases.

In 2022, in conjunction with World Environment Day, we unveiled KLEEN+, a new family of re-refined base oil products designed to help companies manage their oil needs in a more sustainable way with less reliance on virgin crude oil production.

KLEEN+ base oil also earned a spot on the 2022 list of top sustainable products from Sustainability Environmental Achievement and Leadership Awards.

As our customers respond to the consumer and investor focus on environmental and socially responsible practices, including less reliance on foreign oil products, we expect that the use of KLEEN+ re-refined oil products will contribute to our customers' ESG efforts.

We continue to seek to improve efficiency and sustainability within our operations through continuous improvements and well-defined strategic initiatives that show the highest positive impact on the environment, the communities and the economy in which we work and live.

Our assets represent one of our largest opportunities to apply environmentally sustainable business practices.

Our Asset Refurbishment Program is a comprehensive effort to rebuild key vehicles to "like new" quality while reusing or recycling as much of the material as possible.

Our goal is to refurbish over 200 highly technical vehicles used in our operations, like vacuum trucks, industrial air movers and waste oil trucks.

We also have a field repair/refurbishment program for our parts washers.

In 2022, we repaired or refurbished over 7,000 parts washers in the field, saving transportation to our refurbishment facility.

Parts washers that required repairs or refurbishment beyond what could be accomplished in the field were returned to our refurbishment facility.

We were able to recondition the majority of these machines and salvaged the components from any machines that were beyond reconditioning.

These operations at our facility refurbished over 9,000 machines in 2022 and avoided disposal of over 400 tons of metals and plastics.

Environmental Commitment

One of the Company’s sustainability goals is to contribute to a cleaner environment by maximizing energy and water efficiency and conservation across our organization.

We continue to evaluate and incorporate solar energy as a viable option for our facilities where possible and have built solar arrays at select sites for their ongoing energy needs.

We also continuously seek to better understand the contribution of renewable energies to our collective energy consumption.

We estimate that about 23% of our U.S.

electricity consumption is generated by renewable energy sources, including hydroelectric, biomass, wind, solar and geothermal energy.

Clean Harbors makes fleet energy management a key focus, beginning with ongoing routing reviews by our logistics team to reduce total miles driven.

We also evaluate options for reducing fuel costs including routine use of rail and barge transportation, implementation of alternative fuel vehicles and using our Kleen+ and Performance Plus ® re-refined engine oils throughout our fleet.

All of these items above exemplify how we, as a company, are working to minimize our footprint on the environment;

however, our environmental commitment extends beyond our internal focus to how we can help other companies minimize their environmental footprint and achieve their sustainability goals.

The core of our operations is to provide our customers with

environmentally responsible solutions, whether they be our commitment to environmentally conscious services and waste disposal or our re-refined oil offerings.

We believe in holding ourselves to high standards for sustainability and human rights practices and have taken efforts to drive sustainable practices through rigorous supply chain oversight.

We monitor for practices that are not in line with our corporate vision and work to drive change.

Our Vendor Code of Business Conduct and Ethics establishes the minimum standards that must be met by any vendor that does business with Clean Harbors regarding treatment of workers, supply chain practices, workplace safety, environmental impact and ethical business practices.

Community Engagement

Clean Harbors believes that by staying engaged with our customers, communities and other stakeholders, we can contribute to the long-term health of the environment, society and the economy.

We are dedicated to being a good neighbor in the communities in which we work.

We develop partnerships with key environmental programs to build awareness, while fostering more sustainable business practices.

One of our most highly visible public programs for various government and community entities is known as our Household Hazardous Waste service line.

Communities trust us to collect paints, solvents, batteries, fluorescent lamps, pesticides, cleaners and other hazardous materials that otherwise might be improperly disposed of or become dangerous to the communities where they are stored.

Competitive Markets

Due to the variety of services and products offered, the Company faces competition from companies in various industries, though no one competitor directly competes with our full suite of offerings.

Due to the variety of services and products offered, the Company faces significant competition from companies in various industries across all lines of business.

The Company's breadth of service offerings however has resulted in no one competitor directly competing with our full suite of offerings.

Sources of competition vary by locality and by type of service rendered, with competition coming from national and regional industrial and automotive waste services companies and hundreds of privately-owned firms.

Veolia North America, US Ecology, Inc., Harsco Corporation, Stericycle, Inc.

Veolia North America, Harsco Corporation, Republic Services, Waste Management, Stericycle, Inc.

and Heritage-Crystal Clean are the principal national firms with which we compete.

Each of these competitors is able to provide one or more of the environmental services we offer.

Under federal and state environmental laws in the United States, generators of hazardous waste remain liable for improper disposal of such waste.

Under federal and state environmental laws in the United States, generators of hazardous waste remain liable and responsible for the proper disposal of such waste.

Although generators may hire various companies that have the proper permits and licenses, because of the generators' potential liability, they are very interested in the reputation and financial strength of the companies they use for the management of their hazardous waste.

We believe that our technical proficiency, safety record, customer service oriented culture and overall reputation are important considerations to our customers in selecting and continuing to utilize our services.

We also believe that the depth of our recycling, treatment and disposal capabilities, our ability to collect and transport waste materials efficiently and our pricing are additional significant differentiating factors which create an advantage for us in the market for treatment and disposal services.

We also believe that the depth of our recycling, treatment and disposal capabilities, and our ability to collect and transport waste materials efficiently are additional significant differentiating factors that create an advantage for us in the market for treatment and disposal services.

Competition within our Environmental Services segment varies by locality and type of service rendered.

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For our industrial, field, emergency response and Safety-Kleen branches' core services, competitors vary by locality and by type of service rendered, with competition coming from national and regional service providers and hundreds of privately-owned firms that offer similar services.

Envirosystems and Heritage-Crystal Clean in the United States, and CEDA International Corporation and Secure Energy Services in Canada, are the principal national firms with which we compete for this work.

Heritage-Crystal Clean in the United States, and CEDA International Corporation and Secure Energy Services in Canada, are the principal national firms with which we compete for this work.

There are also several regional and local firms with which we compete.

Each of these

competitors is able to provide one or more of the industrial and field services we offer.

Each of these competitors is able to provide one or more of the services offered by our industrial, field, emergency response or Safety-Kleen branches' operations.

We believe the availability of specialized equipment and latest technologies, skilled, technical, and professional personnel, quality of performance, diversity of services, safety record and price are the key competitive factors in this industry.

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With our Safety-Kleen Oil Plus ® closed loop offering, we are competing in certain markets with other North American lubricant distributors.

The principal methods of competition for all of our services and products are quality, price, reliability of service rendered or products sold and technical proficiency.

We believe that we offer a more comprehensive range of environmental and industrial services than our competitors in major portions of the United States and Canada.

With our KLEEN+ base oil

produced at our re-refineries, we compete against base oil produced at traditional oil refineries such as Motiva Enterprises LLC, Chevron Corporation and Phillips 66.

The principal methods of competition for all of our services and products are quality, price, service reliability or products sold and technical proficiency.

We believe that we offer a more comprehensive range of services and products than our competitors in major portions of the United States and Canada.

Human Capital

As of December 31, 2021, we employed approximately 18,300 active full-time employees, of which 1,460 in the United States and 558 in Canada were represented by labor unions.

As of December 31, 2022, we employed 19,775 active full-time employees, of which approximately 1,630 in the United States and 590 in Canada were represented by labor unions.

In response to the needs of our business, we also employ temporary and part-time employees.

As of December 31, 2021, the total of all active employees was approximately 19,100, including over 3,600 previous HydroChemPSC employees.

Our human capital objectives focus on the health and safety of our employees, employee development and training and compensation and benefits.

As of December 31, 2022, the total of all active employees, inclusive of the temporary and part time workforce, was approximately 20,260.

Our human capital objectives focus on the health and safety of our employees, employee development and training, fair and competitive compensation and benefits and business and hiring practices that support diversity and inclusion.

Key metrics that management uses to measure these objectives include TRIR, voluntary turnover rates and time to job ready, all of which are monitored at all levels of the organization.

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We also provide competitive compensation and benefit programs, including matching employee contributions towards retirement savings plans and covering annual healthcare cost increases.

We are committed to fundamental human rights principles and we have a comprehensive Human Rights Policy to formalize the standards to which we hold ourselves accountable.

Respect is essential to our interactions with employees, customers, shareholders and the public at large.

In recognition of our Human Rights Policy and our intrinsic values of diversity and inclusion, we promote equal opportunity and respect in our workplaces.

Our seven employee resource groups were developed to encourage belonging, inclusion and collaboration among our employees at Clean Harbors.

We have invested significantly in the development of proprietary technologies and also to establish and maintain an extensive knowledge of leading technologies.

The acquisition of HydroChemPSC increased this portfolio of leading technologies and innovation, specifically in the industrial services business.

We incorporate these technologies into the services we offer and provide to our customers to enhance the service, reduce the time and/or increase the safety of such services.

We incorporate these technologies into the services we offer and provide to our customers to enhance the service and value received by our customers, reduce the time and/or increase the safety of such services.

For example, our internally developed proprietary software system, Waste Information Network, electronically tracks each step taken by any particular load of waste in our business, allowing customers assurance and transparency into their waste disposal.

As of December 31, 2022, we held a total of 49 U.S.

and 18 foreign issued or granted patents (which will expire between 2022 and 2031), one foreign and three U.S.

and 15 foreign issued or granted patents (which will expire between 2023 and 2038), six foreign and four U.S.

pending patent applications and 94 U.S.

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We believe that we hold adequate rights to all intellectual property used in our business and that we do not infringe upon any intellectual property rights held by other parties.

We must obtain and maintain permits and licenses for transportation and industrial needs in both Environmental Services and Safety-Kleen Sustainability Solutions.

We must obtain and maintain permits and licenses for transportation and industrial needs throughout our business.

We are required to obtain federal, state, provincial and local permits or approvals for each of our hazardous waste facilities.

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direct physical damage and third-party liability.

We maintain a casualty insurance program providing coverage for vehicles, employer's liability and commercial general liability in the aggregate amount of $105.0 million, $102.0 million and $102.0 million, respectively, per year, subject to retentions of $1.0 million for employers' liability in the United States and $2.0 million (CAD) in Canada and $2.0 million per occurrence for auto and commercial general liability.

Our auto and commercial general liability umbrella policy includes a $5.0 million annual aggregate self-insured corridor retention as well.

We maintain a casualty insurance program which provides coverage for vehicles, employer's liability and commercial general liability in the aggregate amount of $105.0 million, $102.0 million and $102.0 million, respectively, per year, subject to retentions of $1.0 million for employers' liability in the United States, $2.0 million per occurrence for auto and commercial general liability in the United States and $2.0 million (CAD) per occurrence for employer's liability, auto and commercial general liability in Canada.

We also have workers' compensation insurance with limits established by state statutes.

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In addition, we have a global foreign liability policy that will provide excess and difference in condition coverage in international countries.

Under our insurance programs, coverage is obtained for catastrophic exposures, cyber security as well as those risks required to be insured by law or contract.

It is our policy to retain a significant portion of certain expected losses related primarily to employee benefits, workers' compensation, commercial general and vehicle liability.

It is our practice to retain a significant portion of certain expected losses related primarily to employee benefits, workers' compensation, commercial general and vehicle liability.

Provisions for losses expected under these programs are recorded based upon our estimates of the actuarially determined value of the aggregate liability for claims.

We believe that policy cancellation terms are similar to those of companies in other industries.

Operators of hazardous waste handling and certain other permitted facilities are required by federal, state, provincial and local regulations to provide financial assurance for closure and post-closure care of those facilities should the facilities cease operation.

Closure would include the cost of removing the waste stored at a facility which ceased operating and sending the material to another facility for disposal and the cost of performing certain procedures for decontamination of the facility.

As of December 31, 2021, our total estimated closure and post-closure costs requiring financial assurance by regulators were $502.4 million for our U.S.

facilities and $57.4 million for our Canadian facilities.

We have obtained all of the required financial assurance for our facilities through a combination of surety bonds and insurance from qualified insurance companies.

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We are constantly monitoring the regulatory environment which is often influenced by changes in leadership at the federal, state, provincial and local levels.

We make a continuing effort to anticipate regulatory, political and legal developments

that might affect operations, but are not always able to do so.

We make a continuing effort to anticipate regulatory, political and legal developments that might affect operations, but are not always able to do so.

We cannot predict the extent to which any legislation or regulation that may be enacted or enforced in the future may affect our operations.

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We operate a network of collection, treatment and field services (remediation) facilities throughout North America whose activities are regulated under provisions of TSCA.

TSCA established a national program for the management of substances classified as polychlorinated biphenyls ("PCBs") which include waste PCBs as well as RCRA waste contaminated with PCBs.

TSCA established a national program for the management of substances classified as PCBs which include waste PCBs as well as RCRA waste contaminated with PCBs.

The rules set minimum design and operating requirements for storage, treatment and disposal of PCB waste.

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Federal Regulations.

In addition to regulations specifically directed at our transportation, storage and disposal facilities, there are a number of regulations that may "pass-through" to the facilities based on the acceptance of regulated waste from

affected customer facilities.

Each facility that accepts affected waste must comply with the regulations for that waste, facility or industry.

Examples of this type of regulation are National Emission Standards for Benzene Waste Operations and National Emissions Standards for Pharmaceuticals Production.

Examples of this type of regulation are National Emission Standards for Benzene Waste Operations and National

Emissions Standards for Pharmaceuticals Production.

Each of our facilities addresses these regulations on a case-by-case basis determined by its requirement to comply with the pass-through regulations.

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However, there can be no assurance that regulations governing future licensing will remain static, or that we will be able to comply with such requirements.

Regulations by the International Maritime Organization ("IMO") primarily impact shipping businesses, and we continue to monitor the impact of the new IMO regulation for a 0.50% global sulphur cap for marine fuels which began on January 1, 2020 (known as "IMO 2020").

Regulations by the International Maritime Organization ("IMO") primarily impact shipping businesses.

Under the new global cap, ships that traverse the oceans are required to use marine fuels with a sulphur content of no more than 0.50% sulphur, versus the previous cap of 3.50%, in an effort to reduce the amount of sulphur oxide and decrease pollution and greenhouse gas emissions from the global shipping fleet.

The shipping industry is the last major transportation sector to utilize fuel with high levels of sulfur, which is the reason the IMO pushed the industry to more closely align with other transport sectors for pollution reduction.

Given the disruption to global economies and supply chains, the marine shipping industry, and oil related commodity prices stemming from the COVID-19 pandemic, there are several variables around this regulatory change whereby the impacts of such changes still remain unclear.

In particular this lack of clarity applies to our expectation of a significant increase in demand for a broad range of low sulfur distillates including diesel, marine gas oil, marine diesel oil and vacuum gas oil.

However, it does seem clear that IMO 2020 has shifted the supply/demand balance for used motor oil, creating a surplus in the market that has materially reduced its value, although the exact amount remains unclear due to other factors affecting used oil markets.

We will continue to monitor the impact of IMO 2020 on our business as markets return to more ‘normal’ conditions.

This regulation indirectly impacts our Safety-Kleen Sustainability Solutions segment as it has reduced the end market of used oil.

Canadian Hazardous Waste Regulation

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These pieces of legislation were developed by the provinces independently and, among other things, generally control the generation, characterization, transport, treatment and disposal of hazardous waste.

Regulations developed by the provinces under the relevant legislation are also developed independently, but are often quite similar in effect and sometimes in application.

Regulations developed by the provinces

under the relevant legislation are also developed independently, but are often quite similar in effect and sometimes in application.

For example, there is some uniformity in manifest document design and utilization.

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The environmental regulations discussed above require that we remediate contaminated sites, operate our facilities in accordance with enacted regulations, obtain required financial assurance for closure and post-closure care of our facilities should such facilities cease operations and make capital investments in order to keep our facilities in compliance with environmental regulations.

As further discussed in Note 9, "Closure and Post-Closure Liabilities," and Note 10, "Remedial Liabilities," to our consolidated financial statements included in Item 8 of this report, we have accrued environmental liabilities as of

December 31, 2021, of $211.0 million.

As further discussed in Note 10, "Closure and Post-Closure Liabilities," and Note 11, "Remedial Liabilities," to our consolidated financial statements included in Item 8 of this report, as of December 31, 2022 we have recognized environmental liabilities of $235.1 million.

For the years ended December 31, 2022, 2021 and 2020, we spent $13.9 million, $15.5 million and $12.4 million, respectively, to address environmental liabilities.

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In addition, such government entities, as well as surrounding landowners, may claim that we are liable for environmental damages.

Citizens groups have become increasingly active in challenging the grant or renewal of permits and licenses for hazardous waste facilities, and responding to such challenges has further increased the costs associated with establishing new facilities or expanding current facilities.

Citizens groups have become increasingly active in challenging the grant or renewal of

permits and licenses for hazardous waste facilities, and responding to such challenges has further increased the costs associated with establishing new facilities or expanding current facilities.

A significant judgment against us, the loss of a significant permit or license or the imposition of a significant fine could have a material effect on our business and future prospects.

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What changed 10-K

Item 1. Business