In today’s world the tremendous requirement of energy in needed in every sector like automobile, civil, power plant etc. in the view of this point, we need to recover the waste heat for various applications. This type of heat recovery will ultimately increase the productivity and efficiency of factories. This waste heat can reuse as input by various methods, out of this we take the case study of the domestic refrigerator. There is an economic reason to extend the useful life of the landfill because once the old landfill is filled, the new one can be found only at the greater distance, and this increases remarkably the transportation cost. Therefore, waste has to be recovered as much as possible. To do this, in developing countries context, small-scale composting promotion is widely accepted and the contribution of informal recycling is also widely recognized. The question remains to what extent composting and informal recycling contributes to the waste diversion. To create a platform for discussion and learning, a model is established. The model in this paper is based on the system dynamics (SD) approach. The simulation results with the data collected in Phnom Penh city, Cambodia, show that waste recovery through small-scale composting and informal recycling cannot contribute significantly to the waste diversion without other supporting policies.