The end of garbage (cont.)

By Marc Gunther, Fortune senior writer

Dell collected about 79 million pounds of e-waste in 2005, up 72% over 2004. HP collected more - 164 million pounds - but experts say Dell has leapfrogged its rival in greenness. "It's been a tremendous turnaround for Dell," says Barbara Kyle, coordinator of the Computer Take-Back Campaign, an advocacy group. In part because they now take back their products, Dell and HP have redesigned them to make them easier to disassemble and recycle.

The e-waste problem is huge. The Computer Take-Back Campaign says the U.S. spewed 2.6 million tons of e-waste in 2005, and only 12.5% was recycled. (Even HP and Dell figure they get back at most 20% of the gear they sell.) Four states - California, Washington, Maine, and Maryland - have passed e-waste laws, and another 22 have legislation pending.

In 1975, Casella Waste Systems began with a single truck in Rutland, Vt. Thirty-two years later it is a $550-million-a-year company that collects, transfers, processes, and disposes of garbage. Most of the waste is trucked to 11 landfills in the Northeast that are big enough to hold about another 30 years' worth of trash. "The foundation of the business is disposal capacity," says chief executive John Casella. "It's such a finite resource."

Lately, though, Casella has taken the company in new directions. In 2003, Casella Waste entered into a partnership with Ontario County, N.Y., to operate a $29 million facility that recycles, generates power from landfill gas, and will eventually use waste heat to grow hydroponic tomatoes. U.S. GreenFiber, a joint venture with Louisiana Pacific, uses old newspapers to make insulation and lawn products.

Golfing in New England? You may tee off on a course fertilized with Casella's Earthlife compost. You don't want to know what's in it, but we'll tell you: biosolids, which are what remain after everything that's flushed down the toilet is treated at a sewage plant.

Casella generates nearly 20% of its revenues from recycling. That hasn't impressed Wall Street. The stock is around $12, below the $18 price when Goldman Sachs took the company public in 1997. The company's profitable, but investors haven't bought into recycling. John Casella says there's no turning back. "The economic model continues to get stronger and stronger," he says. "We are just starting to grow the industry of the future."

"When you look at a dumpster, you see trash," David Redfield says. "When I look at it, I see materials and money." Redfield, a Bentonville, Ark., native who has put in 15 years at Wal-Mart, is the man in charge of getting the world's biggest retailer closer to its zero-waste goal. It's good for the planet, he says, and for the company's bottom line. As Wal-Mart CEO Lee Scott has explained, "If we had to throw it away, we had to buy it first. So we pay twice: once to get it, once to take it away."

Fortunately Redfield is getting help. This month Wal-Mart will bring 3,000 people to a trade show in Bentonville with the goal of reducing the packaging in its stores. Most are suppliers, which will meet with vendors from about 150 packaging companies. Wal-Mart has begun to measure how much packaging its suppliers use; they get a scorecard based on nine factors, including CO2 emissions, the product-to-package ratio, and the use of recycled content. (Possible targets: toothpaste, which comes in a tube and a box, and small electronics wrapped in bulky plastic.) Wal-Mart wants to reduce packaging by 5%, which it estimates will save the company and its suppliers about $11 billion. About 30% of municipal waste comes from packaging, the EPA says.

Redfield's efforts to reduce Wal-Mart's waste are already bearing fruit - in part by recycling it. The company's experimental green stores collect food waste, which is made into compost and resold by Wal-Mart. More significant is a curious innovation called a super sandwich bale that Wal-Mart is now rolling out nationally. Machines in every store will crush plastics, paper, and cans into layers of a big "sandwich," which is then taken apart at recycling facilities.

Wal-Mart has been using the sandwich bales in Oklahoma, where Redfield led me on a tour of a "closed loop." We watched the bales being crushed in a Tulsa superstore. We visited a local recycler where the junk is sorted, mostly by hand. At a huge Georgia Pacific mill, we saw wastepaper turn into pulp and then into toilet paper, paper towels, and napkins.

"Two things shocked us about the sandwich bale," Redfield says. "There was less paper than we thought there would be. And there were more hangers. Oh, my goodness, the hangers. It was amazing."

Hangers? Amazing? Until recently Wal-Mart paid a trash company to haul them away from its 3,900 U.S. stores. Now it sells them for about 15 to 25 cents a pound to Mountain Valley Recycling, a Tennessee company that turns them into pellets of resin, which can be molded into virtually anything made with commodity plastics. Twenty-five cents per pound doesn't sound like much until you realize that Wal-Mart goes through more than one billion hangers a year. The money adds up in a hurry. "Trash," Redfield says, smiling, "is cash."


Dell gets on the environmental bandwagon: Michael Dell and his company will now recycle your computer hardware for free -- even if you're not buying anything new from Dell. Top of page