April 16, 2004 12:24 PM PDT

Weighing the results of PC recycling

PC makers want you to clean out your garage.

With Earth Day just around the corner, Dell and other PC companies are stepping up their efforts to recycle old computing gear that businesses and consumers have been sitting on for years.

Dell in May plans to make public a goal to increase the amount of computer equipment it recycles by 50 percent, by weight, and to disclose specific details about how it will get to that point, according to Pat Nathan, director of Dell's "sustainable business" efforts.

News.context

What's new:
Dell is ready to make public its goals for PC recycling, as hardware makers gear up their efforts to take back aging equipment.

Bottom line:
The move by Dell should put pressure on IBM, Hewlett-Packard and others to put recycling trends in plain view of investors and the general public. But the PC industry still has some distance to go in getting green.

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By making its recycling goals public, Dell will likely put pressure on competitors such as Hewlett-Packard and IBM to follow suit. That could help encourage more recycling and establish a de facto method of measuring recycling trends for the PC industry as a whole. It could also help quell criticism that the industry has been slow to act on what environmentalists and legislators have deemed a growing pollution problem.

A common measurement, most likely the weight of materials collected, would be another step forward for recycling, by putting PC-recycling trends in plain view of investors and the general public, said Julie Frieder, an analyst at Calvert Group. Without a common method for measurement, it's difficult to evaluate overall progress on recycling, analysts say.

And PC makers are finding out that the corporate world needs to have its consciousness raised. Businesses are the "the largest users of systems by far, and one out of three said they weren't aware there was anything wrong with disposing of them," Nathan said.

Dell's initiative is a striking change for the company, which just two years ago was criticized by groups such as Calvert for not recycling enough PCs. Others took issue with Dell's use of prison labor to disassemble old equipment, a practice it has since ended.

But since then, Dell has been working with Calvert and other organizations, such as the As You Sow Foundation, to set recycling goals. Calvert began pushing Dell to address PC recycling in 2002, arguing that the PC maker's failure to address the risks and liabilities of electronic waste could hurt Dell's shareholders.

"We are very pleased with the progress that Dell has made" so far, Frieder said. "We anticipate continuing to talk with them and asking them to ratchet up those goals."

It's somewhat ironic that Dell now is the pacesetter, since the company's hesitation over the last couple of years was a source of frustration for the National Electronic Product Stewardship Initiative, whose members included representatives from PC makers, retailers and government agencies. The NEPSI group was trying to set industrywide goals for recycling.

The risks posed by obsolete PCs and related equipment aren't just to the bottom line. Environmental groups have long lobbied for government and industry to address the dangers of electronic waste, or e-waste, that is tossed into landfills, burned in incinerators or poorly handled in disassembly. PCs, monitors and related gear contain metals such as lead, mercury and cadmium, along with other chemicals, that can be harmful, if they get into the environment.

"This is not aluminum cans, this is not paper. These are hazardous materials, and state and federal law provide zero tolerance for the disposal of hazardous waste," said Mark Murray, executive director of Californians Against Waste, a nonprofit environmental organization that sponsored California's Electronic Waste Recycling Act. "Ultimately, we need to see a commitment to zero disposal of these hazardous devices."

Even though Dell, HP and IBM--the world's three largest PC manufacturers, which collectively shipped about 60 million units in 2003, according to IDC--all offer PC recycling programs, the number of PCs they recycle is still relatively low, analysts say. And there's a growing backlog to contend with: The Environmental Protection Agency, for one, has estimated that 250 million computers would be thrown out over the five years between 2002 and 2007.

"I think that if you do the math for any of these companies, what you'll see is a very modest actual recovery number," Frieder said. "I think we're going to use Dell's commitment to move other companies along. We have been in dialog with HP and IBM as well."

And a key incentive for PC makers to act is coming from lawmakers. If the companies want to show state and federal legislators that laws compelling PC recycling are unnecessary, they'll have to act fast. California's recycling law imposes an up-front fee for devices such as PC monitors that use cathode ray tubes and other types of displays.

Crunching the numbers
Dell, which shipped nearly 26 million PCs in 2003, said last year that out of the tens of millions of PCs it had shipped since establishing its first recycling program 12 years prior, only 2 million PCs had been recycled. It hasn't yet published recycling numbers for 2003.

IBM Global Financing, which handles recycling and asset recovery for IBM, has increased the number of PCs it takes back from 15,000 per week in 2002 to 22,000 per week last year, a company representative said. That means that IBM took back 780,000 PCs in 2002 and about 1.1 million PCs in 2003, years during which it shipped 8 million and 9 million units, respectively, according to IDC.

HP, meanwhile, recycles about 6.5 million pounds per month worldwide, or nearly 80 million pounds per year, the company has said. It expects to break down about 42 million pounds of PCs, printers and other gear in the United States during its fiscal 2004. That's an increase of about 3 million pounds from the preceding year, said Renee St. Denis, manager of HP's product recycling initiative.

Although the three can show that they have made progress toward increasing recycling, the companies still have a lot of work to do.

A survey of corporate IT executives conducted by IBM Global Financing last January showed that two-thirds of respondents believed that recycling was important and that 80 percent of the companies they worked for had PC disposal policies. Yet many were unaware that the PC manufacturer that built their machine also probably offered a recycling program.

IBM's survey, which polled 176 senior-level executives at United States-based companies with more than 5,000 PCs each, showed that companies use a wide range of methods for disposal. Just more than 50 percent of companies said they used an outside disposal company, while 40 percent donated PCs to charity. But 23 percent said they still discard at least a portion of their PCs, presumably by crushing them, and of those who used outside companies, half were unable to name any company involved in PC recycling, said Norm Roos, director of market intelligence at IBM Global Financing.

"There's a great opportunity from IBM's point of view--and really from all the top companies' point of view--to take leadership of this issue," Roos said.

Dell surveyed its business and institutional customers as well recently and found similar results. Two-thirds of customers surveyed weren't aware that Dell offered a recycling program. One-third weren't aware of the environmental liabilities related to disposing PCs in a dumpster or landfill.

It's not uncommon for PCs to languish in closets or attics at homes or in conference rooms or hallways at corporations, evidence shows. While most buyers replace their PCs every three to five years, the average age of a PC that is broken down by HP is between 11 and 13 years old, and the average age of a PC that Dell collected at recycling events last summer was about 7 years old, the companies said.

Dell "found that people have a lot of extremely old equipment that they're storing someplace," Nathan said. However, "as people become more and more aware of the environmental risk associated with (computers)...they'll be more likely to start getting them out of the stockpiles."

While Dell has yet to release its recycling goals, making those numbers public should help raise awareness of programs and encourage more companies and consumers to recycle.

"All of a sudden, it moves it out of the press release realm of, 'We're doing recycling!' to (give recycling programs) accountability, to say, 'Here's how much we're doing' and gives a way of comparing manufacturers," said Murray, of Californians Against Waste.

Calvert's Frieder is of the same mind-set. She says the goals will set a benchmark, against which PC makers can be judged.

"We're hoping that we can go back to them and say, 'All right, guys, what are you going to do now?'" she said. "We're hoping that we can use that leverage."

 

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