Small Scale Computer Reuse and Recycling: Optimal
Environmental and Economic Solution to the E-Scrap Dilemma

Presented to the R'07 Conference
Recovery of Materials and Energy for Resource Efficiency
Davos, Switzerland, September 2007

By Neil N Seldman, PhD
Institute for Local Self-Reliance
Washington, DC

1. Abstract

The recent paradigm shift in computer discard from disposal to recovery and recycling has been the result of grass roots organizing in the US. Refurbishing of computers has not been emphasized in new government policies, despite the overwhelming evidence that reuse is far superior in environmental, economic and social impacts.

A new emphasis on refurbishing and reuse is essential for a sound e-scrap policy.

2. E-Scrap Recycling

The US Government Accounting Office estimates that over 100 million computers, monitors, and televisions become obsolete each year in the US. The US National Safety Council estimates that there may be 500 million obsolete computers in the US waiting to be discarded. Only 11% of computer discards in the US are recycled. The US EPA concludes that the disposal of these discards accounts for a significant amount of the heavy metals found in landfills, and is a threat to the environment and public health. [1]

Up until three years ago, no one in US industry of government was paying attention to this building problem. Thanks to grass roots organizing and cooperation with international NGOs, this is rapidly changing. Today, the largest manufacturers have established programs as a result of this pressure. States have passed new legislation requiring such programs. Some states prefer the Extended Producer Responsibility (EPR), which require take-back programs. One state, California has decided to use an Advanced Recycling Fee (ARF) to address the problem. States have also banned disposal of various e-scrap products from landfills and incinerators. [2] According to a US electronics expert, refurbishers and recyclers prefer a combination of both EPR and ARF programs. [3]

At the same time, independent NGOs and private companies have established programs and enterprises that refurbish computers for resale nationally and internationally, as well as donation programs that provide refurbished computers to low income individuals, schools, and community development organizations. The environmental benefits of reuse over recycling are "staggering", according to US EPA officials. [4] The use of refurbished computers by low-income individuals and agencies greatly contributes to education and skills training for future careers in small businesses, government agencies and industry. Computer refurbishing and redistribution are essential for social welfare and economic advancement. [5] Steve Baum of Rumarson Technology, Inc. coined the term 'Nused', short for 'newly used' to describe this phenomenon.

By keeping valuable resources local and relying on local skilled workers, refurbishing also, counters one of the prevailing problems in computer technology and distribution--rapid obsolescence. According to one manufacturer of new computers, EPR and ADF programs that concentrate equipment for a few manufacturers, allow the company to have even more control over the scale and pace of planned obsolescence. [6]

In Europe, activity in recycling and refurbishing of computers has been stimulated by European Union legislation. [7]

In the US, however, legislation and corporate programs have neglected to distinguish between recycling and refurbishing. In fact, state legislation has virtually ignored refurbishing in contrast to the environmental, social and economic benefits that they create. Proposed national level legislation also ignores refurbishing. [8] Analysts argue that manufacturers want to eliminate the vibrant network of local refurbishing companies and implement a quota on the resale of refurbished computers in order to augment their sales of new equipment. Others point out that, legislation requiring recycling is too complicated to afford yet another nuance--the preferential treatment of computers set aside for refurbishing companies. Hundreds of companies and computer clubs have been established for refurbishing. These companies and clubs provide not only viable computers for free or low cost, they also provide training, equipment and software updates on a periodical basis. Because of this on-going relationship between refurbishers and customers, refurbished computers are seen as more reliable than even new equipment.

Another argument for mass recycling of computers is economies of scale. The conventional wisdom assumes that only large-scale national programs, overseen by the original computer manufacturers and their subsidiary companies, can solve the problem of e-scrap in the US. Industry, government, and environmental organizations maintain this assumption.

3. Economies of Scale

The belief in necessary, large economies of scale for both refurbishing and recycling is a myth, although one that has its technical support papers. One state sponsors study estimated that the minimum cost for a regional electronic recycling entity would be $29 million. [9]

Two companies pose interesting counter points to the myth of large economies of scale in computer and electronic equipment recycling and refurbishing. Computer Donation Management (CDM), based in Baltimore, MD, refurbishes computers for resale. The company has established working relationships with community organizations through training and marketing programs. CDM estimates that each of its satellite groups requires 5,000 square feet to operate from and costs $25,000 to set up. This cost includes training and repair equipment. CDM also provides for the delivery of old computers and marketing services. It is possible for a small organization to gross $20,000 monthly from operations. CDM and its affiliates use a labor force comprised of sheltered workers for dismantling and more skilled workers for refurbishing. All non-refurbished equipment is recycled in an environmentally sound manner through sub-contractors.

In nearby Frederick, MD, e-END USA, started operations in July 2006. The company handles all electronic discards. Used equipment is delivered to their facility or pick ups are made for large generators such as companies and government agencies. The facility is 6,000 square feet and employs 13 workers: 8 in dismantling and refurbishing and 5 in administration, including sales and marketing. Initial capital investment was $100,000 including traditional technology (degaussing equipment) and new, unique, equipment designed by co-founder Steve Chafitz. All dismantling and refurbishing workers were trained at the facility. Equipment is hand deconstructed, down to the screws of each machine. All working parts and recycled materials are sold in the immediate 400-mile radius of the plant.

The company also serves businesses and private individuals with verified, or witnessed, destruction of hard drives to assure that proprietary information is not disclosed.

There are three keys to the business: rapid processing to avoid inventory costs, careful upgrading of recovered materials and parts, and reliable computer forensics.

The company takes electronic products at no charge from homes and will pick up loads from customers for a fee. There is a fee for commercial clients. Ferrous and non-ferrous metals as well as usable component parts and circuit boards are the primary products processed. Plastic is also processed and delivered to recycling firms, although the company does not get paid for these materials.

To date e-END has exceeded expectations in the company's initial business plan. The company envisions the need for a modest expansion in space as more and more businesses and individuals use them as their e-scrap point of disposal. Within a few years, e-END could double its space and employment. This will probably happen sooner than later, based on the rapid growth of the company to date.

Up grading materials is critical for getting the best market prices, as is efficient use of space. Trust is also critical, as companies turn over computers with valuable proprietary data that must be destroyed.

4. Issues to be Addressed

Collection systems for computers are important, as careless recovery procedures will damage computers beyond repair. Most programs rely on self-delivery by individual household computers and special pick-ups for business and government computers.

Legislation that reflects the superior value of reuse over recycling, including legislation that favors reuse over recycling through incentives; and that favors local reuse and recycling over exporting to national and international markets. European-wide and European national legislation offer constructive models for how US legislation and policy can reward refurbishing over recycling even as it bans e-scrap from landfill and incinerator disposal. [10]

Design, Design, Design. There is a critical immediate need for changes in the way that electronic goods are designed. Paul Palmer urges the creation of institutions that can create new designs for products that feature perpetual reuse. Such research institutions should be part of industrial research parks for sustainable electronic products and their reuse. [11]

The following international conferences, which focus on refurbishing and reuse of computers, have been conducted in the past few years:

International Computer Refurbishing Summit, March 2007
Compumentors National Summit, March 2007
Asian Ecological Design Electronics Conference, December 2006
E-Scrap News, Resource-Recovery Magazine, E-Scrap Conference, annual

Other sources of information and assistance for computer refurbishing and reuse include:

Center for Sustainable Design/Asia Eco-Design Project University College, Farnham, Surrey, UK

Computer Aid International, London, UK
CompuMentor, San Francisco, CA
Electronic TakeBack Campaign, San Jose, CA
EVK Sp, Poland
Flection International, Netherlands
Greenpeace International, Amsterdam, Netherlands
Goodwill Industries, Austin, TX
International Institute for Industrial Economics, Lund University, Lund, Sweden
MaSeR Corporation, Marblehead, MA and Ontario, Canada
National Cristina Foundation, Greenwich, CT
Per Scholas, New York City, NY
RDC, Ltd., London, UK
Renewed Computer Technology, Ottawa, Canada
Resource Recycling, Portland, OR
Silicon Valley Toxics Coalition, San Jose, CA
US Environmental Protection Agency, Washington, DC
Warmer Bulletin, UK

Neil Seldman is co-founder and president of the Institute for Local Self-Reliance. He is a former manufacturer and university lecturer. For the past 34 years he has been helping start and expand recycling enterprises in the private and community sectors.

Eddie Lu, Arlington, VA, provided research assistance for this paper.

Footnotes:

[1] Refuse and Recycling Are Preferred Methods of E-Scrap Management, December 21, 2006.

[2] For a state-by-state guide to legislation, contact Electronic TakeBack Network, San Jose, CA.

[3] Correspondence with Jerry Powell, Resource Recycling Magazine, January 2007.

[4] See, US EPA Benefits Calculator, at http://eerc.ra.utk.edu/ccpct/eebc/eebc.html.

[5] See, Karen Kaplan, "Integrating Old PCs Back Into Society: Computer Companies Are Refurbishing and Reselling Used equipment--and Helping the Environment in the Process", Los Angeles Times, December 20, l995; and, Jonathan Lambeth, "There's Life in an Old PC Yet", The Daily Telegraph, October 25, 2001; and, Joseph Fried, "Refurbishing computers, and Lives, Too", New York Times, October 15, 2006; and, Wayne Rash, "Going the refurbished Route", Washington Post, April 18, 2004; and, IBM Finds New Profits in Recycling Old Computers", Los Angeles Times, January 2, 2002.

[6] Conversation with Mary Lou Van Deventer, Urbane Ore, Berkeley, CA, August 2007.

[7] See, Lloyd Hicks, "Exploring Options for Individual Producer Responsibility for waste From Private Households for the Waste Electrical and Electronic Equipment Directive", Proceedings, International Symposium on Electronics and the Environment, New Orleans, LA, May 2005.

[8] See, Binns, Shannon, et al, Electronic Waste Recycling Promotion and Consumer Protection Act, New York, NY, 2006. This study calls for a national agency with a $1.7 million annual budget.

[9] Oregon Electronic Scrap Baseline Survey, Oregon Department of Environmental Quality, October 2006.

[10] Conversation with William D'Alessandro, Editor, Crosslands Bulletin; See http://crosslandsbulletin.com.

[11] See, Paul Palmer, Getting to Zero Waste: Universal Recycling as a Practical Alternative to Endless Attempts to 'Clean Up Pollution', Purple Sky Press, Sebastopol, CA, 2004; Also see http://gettingtozerowaste.com; For a review of Getting to Zero Waste see, Biocycle Magazine, March 2005.