11
Waste—
Turning an Environmental
Problem into a
Business Opportunity
This final chapter is about Joe’s favorite topic and about the ultimate in being sustainable; instead of using resources and producing waste, using waste to produce resources. Sustainable businesses are popping up all over that are making money by turning an environmental problem into a business opportunity. In the United States, we create a lot of waste. This waste can be repurposed into something useful to create jobs, sustain the environment, and inspire innovation.
Living creatures spend most of their time finding and eating food. A creature that finds a food source that no other species is using is defined as its own species and guaranteed survival. That is one of the reasons why in nature, every creature’s waste is another creature’s food.
Life has been on this planet for approximately 3.5 billion years. With an estimated annual biomass production of approximately 200 gigatons,1 if all creatures’ waste was not eaten by other creatures and recycled, the entire surface of the earth would be covered in excrement approximately 700 miles thick.
It’s impossible to be sustainable without using other creatures’ wastes as your raw materials. In our unsustainable recent past, things were made with whatever was cheap and abundant. Oil, coal, and natural gas were cheap and abundant, so pretty much every chemical was made from them.
This is why architect and designer William McDonough refuses to use the term “cradle to grave” in life cycle analysis and designs with a cradle-to-cradle approach. He and Michael Braungart designed a series of textiles in a full palette of colors that are ultimately “edible” in that the products, once they have completed their intended use, can be used as a feedstock or raw material for another process.
In manufacturing, the cost components are fairly equal for all manufacturers in the same product category. Facility costs, capital equipment costs, labor costs, energy costs, and raw material costs are generally the same from company to company in one product category. So, the company that can reduce its material costs relative to the competition wins.
For example, 100 years ago Henry Ford gave specifications for the wood crates in which his suppliers would ship parts to his factory. After uncrating, Ford disassembled the crates and used the precut wood pieces as parts in the car bodies. The remaining wood scraps were made into charcoal and sold under the Kingsford brand name, still a leading manufacturer of charcoal. Converting waste into a raw material made economic sense then and now.
Recycling Waste
Smart businesses use someone else’s waste as their raw material, and the purer the waste stream, the higher its value as a raw material. With the development of automated sorting centers, a large variety of pure raw materials are available.
Huge amounts of recycled and recyclable materials are available to replace your business’s raw materials. Not only are some companies getting good at sourcing recycled material,they are getting good at making continuous progress in getting it cheaper and purer.
The cleverest of companies go after the purest forms of discarded materials to use as raw materials to make their products. For example, biaxially oriented plastic resin is what is used to make shrink-wrap. It’s so strong that a 1/1,000-inch film can hold over a ton of products together on a pallet. The resin costs up to $1 per pound. Waste shrink-wrap at home is comingled with other waste and no recycling infrastructure exists for it, but if you access the waste stream at a company that receives palletized goods, you can get used shrink-wrap in a largely uncontaminated pure form. Several companies use this superstrong, expensive polymer, which they get practically for nothing, to manufacture their products.
In the same way, Recycline takes the plastic lids that customers send back to Stonyfield Farm and converts the resin into toothbrushes. Metal Wood Common Good on Gasoline Alley in Springfield, Massachusetts, retrieves abandoned building materials and creates custom high-end furniture (basically, a zero-cost-of-goods process). IceStone in the Brooklyn Navy Yard uses crushed glass as the principal material in its beautiful countertops, which are environmentally superior alternatives to Formica or to quarried, cut, and polished stone.
One company David worked with had a brilliant business model. With only a small warehouse, a front-end loader, a desk, a chair, and a telephone, the company was given or bought for pennies on the dollar out-of-date-code Oreos, matzoh, Twinkies, breakfast cereal, and other long-shelf-life foods. It would blend them together, supplementing the mixture with vitamins and protein sources like soybeans, to make and sell hog feed meeting exacting specifications for nutrition. This client became a multimillionaire by “mining,” repurposing, and selling refuse as a value-added product.
One of the cleverest recyclers is Julie Lewis. When other little girls were playing with dolls, she was playing with garbage. She created a line of shoes called Deja Shoe that transformed the industry. Many shoe companies now copy her approach to material reuse. The soles for her shoes were made from recycled car tires and cork, sourced from decorked wine bottles at Portland area restaurants. She set up recycling programs at schools to collect pen barrels and used them to manufacture the midsoles. The foam from discarded seat cushions was used in the tongues, and the uppers were made from the trim from disposable diapers, PET (polyethylene terephthalate) bottles, hemp, and discarded jeans. The logo on the shoe was made from recycled milk jugs. All in all she used twenty-two different waste materials in the manufacture of her shoes.2
All of this was great for marketing, and it even got her on Oprah, but to Julie it wasn’t about marketing. In nature, one creature’s waste is another creature’s food. In traditional business, waste is stuff whose raw materials you had to pay for and use energy and labor to assemble and then you have to pay to get rid of it. Reduced cost of goods means more profit.
Deja Shoe was eventually sold. So what’s Julie doing now? She recycled the name “Deja” into “Jade” and is working on a shoe made from recycled materials that uses the energy from each footstep to “inhale”—pump in air and sequester the excess carbon dioxide from the atmosphere. She is also making products like pocketbooks from old 35-millimeter film, purses from soda can pop tops, and pocketbooks and knapsacks from old PVC (polyvinyl chloride) lottery and advertising banners. Go, Julie!
Even the ultimate human waste, excrement, has value as a raw material. One company’s product, Milorganite, is a premium fertilizer sold as a retail consumer product. It is made from human excrement processed at a wastewater treatment plant. The methane gas produced from the sewage treatment is even used in drying the fertilizer.
For years, companies made money mining bird and bat waste to be used as fertilizer and ingredients for detergent. Bion Environmental Technologies3 built a company around mitigating the environmental footprint of livestock waste. Agricultural runoff is the number one water pollution in America, according to the EPA, and livestock waste is also a major source of air pollution. Bion’s process squeezes the liquid out of cow manure, producing a hemicellulosic material that has the same energy content as wood per pound. In a clever eco-industrial manufacturing loop, the dewatered manure is combusted to power a corn-to-ethanol process.
Instead of feeding whole corn to cows, the cornstarch portion is fermented into alcohol and the wet distillers grain from the ethanol process is fed to the cows, which can’t digest the cornstarch in the corn anyway. This process saves the equivalent of over 40,000 Btu of natural gas per gallon of ethanol, which has only 76,000 Btu per gallon. This process also produces tradable nutrient and carbon credits. The value of these credits is more than enough to pay for the installation of this technology.
Other companies such as Mascoma, Masada Range Fuels, and Lanza are making ethanol directly from the chemically or biologically digestible portions of garbage. One company, Qteros, is leveraging evolutionary biology and has found a microorganism that digests cellulose. This company has developed a microbe with a chemistry similar to that of termites that can eat sawdust and excrete ethanol. Qteros has even taken the reuse of human waste one step further. With its Q microbe, which converts cellulose into ethanol, it converts the cellulosic content of human sewage (which is responsible for biological and chemical oxygen demand in sewage treatment plants) to ethanol fuel.
Companies such as Honeywell UOP, Byogy, Delta Energy, and Sustainable Power have developed pyrolytic processes using temperature, pressure, and catalysts to convert organic material directly into an oil that can be refined into gasoline, aviation fuel, or diesel. While a bushel of soybeans will yield 20 percent biodiesel, that same bushel of soybeans in one of these processes will yield about 50 percent biodiesel, 25 percent flammable gas, and 25 percent char. But these processes will also make fuel from sawdust, crop waste, or even municipal waste consisting of paper, plastic, tires, and food waste. Similarly, Jason Tankersley at Waste Technology Transfer is taking cellulose in a bioliquefaction process and converting it into a high-Btu liquid fuel.
Instead of paying a tipping charge to throw something out, some companies are getting money to receive waste that they then remanufacture into new products. Depending on the material and the location, tipping charges run up to $125 per ton. The math on this is great. These companies are making money by
• Receiving tipping charges
• Not paying for raw materials
• Paying less to process materials (such as aluminum)
• Getting an increased market share by distinguishing the product as made from reclaimed materials
• Getting environmental credits (emissions credits, carbon credits, nutrient credits)
Another great example is Lancaster County’s waste-to-energy facility in Pennsylvania. It’s one of 100 facilities that burn municipal solid waste to make steam to run turbines. Trucks line up to enter the facility and dump their loads of trash. A crane picks up the waste and dumps it down a long shaft. At the bottom is a flameproof conveyor belt. The material burns on the belt, the ash falling through, and the metal is recovered at the end. At the back end are all manner of pollution control devices and baghouses to ensure that the emissions from this facility are largely just water and carbon dioxide. The ash goes to the landfill and the scrap metal is sold. Revenues come from the sale of electricity and tipping charges. Every truck is weighed coming in and going out, and the difference is assessed at $60 per ton. The facility also earns federal production tax credits for producing renewable energy. It’s a sweet, sustainable business.
So, one way to make your company more sustainable is to examine your input materials and see if you could use someone else’s output (waste) as your input. Can you make your product from recycled aluminum cans or from green, brown, or clear glass from glass bottles? What about using the bottles cut in half and fire-polished to make drinking glasses or using them as light conduits and insulation in a bottle house? How about PET, HDPE (high-density polyethylene), polypropylene from plastic bottles, paper, or cardboard? Is there something someone throws out regularly and in quantity that you can use to make your products?
Can you use your customers’ waste as part of your raw materials stream? Aaron Lamstein built Worldwise, Inc., which “innovatively uses recycled resources and fashions them into high-quality pet products available at more than 30,000 leading retail stores throughout North America.”4 Its products include pet blankets made from recycled PET soda bottles. Similarly, Jason Tankersley is working with Beyer Block in using waste plastics that are not part of the plastics recycle commodity chain (plastic shopping bags) mixed with wood scraps to manufacture building blocks.
David visited the Fort Howard Paper Company in Wiscon-sin. All of its paper towel and tissue products are made from 100 percent postconsumer waste. Garbage trucks come in, and the material is sorted into piles of usable materials, including the fiber needed to make tissue and paper products. The company is very proud of its plant and offers tours. One tour consisted of a group of bankers. Walking through the facility, the tour guide grabbed a piece of used office paper from the pile waiting to be recycled and handed it to one of the bankers. Unfortunately, he happened to be the president of the bank where the paper had originated and it had confidential client information on it. Oh well.
If you start your business around the clever use of a material or item that no one wants, make sure the item that no one wants is an item you can reuse. One company David worked with is in the business of manufacturing soaps, hand cleaners, and hand lotions for institutions, shops and garages, and manufacturing facilities. It also provides the soap/lotion dispensers. At a deep discount, the company bought the entire dispenser inventory of another manufacturer that went out of business—25,000 dispensers. However, when workers began to install the dispensers, they got complaints. Janitors did not like them because they had to be turned upside down to be filled. Unless they were completely empty, the remaining contents ended up making a gloppy mess on the floor.
The company went to work to figure out what to do to salvage the use of these 25,000 brand-new dispensers. After an internal team spent a few years on the project with no success, they hired David. He took one look at the dispenser and came up with the idea of a standpipe/snorkel. It took David only thirty minutes of shop time to build the prototype. The plant manager looked at the device, rubbed his chin, and then had David follow him into the warehouse. The racks of shelves that housed the 25,000 dispensers had smaller boxes on the top shelves. The plant manager put up a ladder, climbed to the top, removed one of several thousand identical smaller boxes, took it down, opened it up, and removed a standpipe/snorkel virtually identical to the one David had made and said, “Oh, so that’s what those things were for.” Apparently the company had bought the solution along with the dispensers and just did not know it had it.
The ultimate waste feedstock is your business’s own waste. For years Xerox was scolded by the environmental community for not refilling its disposable toner cartridges for its copy machines and laser printers. Finally it relented and built a facility to refill used Xerox toner cartridges. The facility cost around $10 million and the company assigned the costs to its public relations budget because it was thought of mainly as a way to promote the company’s positive social attributes. To the company leaders’ surprise, that one-time $10 million cost was responsible for annual profits in the hundreds of millions simply from refilling used cartridges instead of disposing of them and making new ones.
Interface Inc. makes its carpeting from used carpeting. When workers install new carpeting, they remove the customer’s old carpeting and remanufacture it into the carpeting for the next customer. The company calculated that it has avoided $372 million in waste costs from 1995 to 2007, reduced its energy use by 45 percent since 1996, diverted 100 million pounds of material from landfills, and sold over 50 million square yards of climate neutral carpeting.
Safety-Kleen picks up hazardous and toxic material from companies and sells it back to them as new products. Every year the company picks up 400 million gallons of industrial waste and turns it into 300 million gallons of products.
TriState Biodiesel is among a growing group of companies that takes used vegetable oil or fat and makes it into a carbon neutral fuel that can be blended with diesel fuel or heating oil.
Finding New Business Opportunities
If you are thinking of starting a business or adjusting your existing enterprise, think about something someone throws out consistently and what you can make out of it. A variety of Web sites exist where people post information on their material needs and material surpluses. Check out what is available in quantity. Research the steps needed to create the infrastructure to collect it in a way that you make money in the collection.
Write down and quantify the bona fide environmental benefits of your product or process. One company was making plastic bags with 60 percent recycled content. This sounds great except it was using a 3-mil core of 100 percent recycled material with a 1-mil film of 100 percent virgin resin on each side (2 mils total). The result was a trash bag that was not as strong as a 1-mil-thick bag made from virgin material yet had twice the virgin plastic content. The core of the three-layer sandwich just became a place to throw out used plastic.
Ask, “What do people throw out that is not utilized? How can I secure a consistent supply of this material in a cost-effective, sustainable manner?”
If you make an existing product, make a list of the ten top raw materials you use. Where do you get the materials? Where do your suppliers get them? What are the steps employed to make them into the form you buy it in? Can any of the materials be sourced from materials someone discards? If you don’t use raw materials but use value-added materials, think about what it would entail to produce one or more of those value-added materials yourself. For some companies that extrude mold plastic resin, it may merely take installing a grinder and a cleaning line.
Make a list of the top ten things your top ten customers throw out. Look at your own waste as a source of raw material. For example, Jody Wright’s Motherwear used fabric scraps from its clothing to fill its nursing pillows. Reward employees for coming up with clever ideas on material sourcing. Think about the companies that replaced manufactured Styrofoam packaging inserts with shredded paper from their own office waste or die-cut corrugated paper made from boxes they received raw materials in. How about buying a shredder for your office and using the shredded paper for packing?
Summary
Turning waste into cash is not just good environmental stewardship, it’s good business. Model sustainable businesses are collecting plastic lids to make toothbrushes, used shrink-wrap to make plastic buckets, discarded seat cushions to make tongues on shoes, human and animal excrement and garbage to create energy, soda bottles to make pet blankets, discarded building supplies to make furniture, and used vegetable oil to power vehicles and heat buildings. An abundant number of ways exist to turn trash into money. Here are just some of the steps you can take:
• List the raw materials you use and determine if these materials can be sourced from materials someone discards.
• List the things you and your customers throw away and determine if you can use any of these in your production.
• Source waste you can get consistently, in quantity, and in pure form and think of what you can make out of it.
• List materials that companies pay to throw away, get paid for removing them, and use them for a feedstock or fuelstock or get environmental credits for receiving them.