Posts Tagged ‘Guide’

Regulating Energy Inefficient TVs

Thursday, November 5th, 2009

BusinessWeek’s Cliff Edwards reports on California’s plan to regulate the sale of televisions that are not energy-efficient, leaving consumer electronic companies and retailers up in arms. “As early as Nov. 4, the state is expected to set new guidelines that would require retailers by 2011 to sell only sets that consume about a third less power than they do today,” writes Edwards. “Manufacturers and retailers say the new rules could force them to pull large-screen plasma TVs and many other models off store shelves.”

Smeal’s Dan Guide weighs in on the issue and how this impacts consumers:

California’s proposed rules mandating power consumption from TVs are an excellent example of good legislative intentions with bad outcomes for consumers. The bad outcomes are most likely to be increased prices for TVs and reduced choices for consumers in California. Is the real problem that energy prices are too low? If consumers are indifferent to an increase in their energy consumption then there is a strong possibility that sufficiently raising electricity rates will decrease consumption, but at a high societal cost (e.g., older people on fixed incomes unable to afford air conditioning and dying from heat stroke). Consider the impact of $4 or $5 a gallon gasoline prices on fuel-inefficient SUV sales as a recent case in point. Should refrigerators that consume ‘too much’ energy be banned? It seems a no-brainer for those of us with plenty of money, but energy efficiency comes at a price (a more expensive price tag) and we (hopefully) recover our investment in a reasonable period of time. However, if you are worried about paying for the food every week, then buying a more expensive, but energy efficient, refrigerator may be out the question.

The U.S. EPA’s Energy Star Program already rates TVs on power consumption and makes this information easily available via their website. This option allows consumers to vote with their wallets and if consumers don’t buy energy inefficient TVs, then manufacturers will stop selling them. The California commission claims that 38 million Californians would ‘double TV energy consumption’ by 2020. This claim assumes that manufacturers will do nothing to reduce the energy consumption of their future offerings. This isn’t likely since manufacturers have already made marked improvements in plasma TV energy consumption. It seems odd to single out a single luxury item for this type of legislation. What about flat panel monitors for computers?

A related question (that hasn’t been asked) is where the most energy is consumed during the product life cycle. For example, mobile phones and laptop computers sip energy during the use phase, but require enormous amounts of energy during the production phase. To make the problem worse, both of these products have very short life cycles before they are discarded in favor of the newest model (80 percent of Americans replace their mobile phone within a 12 month period). Recycling of both these products is problematic since there are so many mixed materials present. This is a much more difficult problem to address, but with a higher potential payout.

Tags: Energy-Efficient Products, Guide, Supply Chain, Sustainability
Posted in News | 4 Comments

Electronics Recycling: Cure or Band-Aid?

Monday, July 6th, 2009

The New York Times recently reported on the growing trend of electronics recycling. “Since 2004, 18 states and New York City have approved laws that make manufacturers responsible for recycling electronics, and similar statutes were introduced in 13 other states this year,” The Times reports. However, electronics recycling is likely little more than a Band-Aid that “simply covers up the problem of e-waste for a short period,” according to Smeal’s Daniel Guide, whose research focuses on the creation of industrial systems that are both environmentally and economically sustainable.

More from Guide:

As a result of the recent interest in the recycling of consumer electronics, many states are passing producer responsibility legislation aimed at keeping e-waste out of landfills.  Keeping e-waste out of landfills is an excellent idea—especially older waste that contains lead-based solders and dangerous heavy metal such as cadmium.  However, the United States would be well-advised to learn from the European Union’s recent experiences with the Waste Electronics and Electrical Equipment (WEEE) directive.  The WEEE is widely regarded as a disaster and adds a layer of bureaucracy and associated costs to mandated recycling.  In addition to the high costs of compliance, there is still the nagging issue of demand for recycled materials. Virgin raw materials are often much less expensive than recycled versions and it’s a simple economic fact that no business manager can justify spending more money on raw materials.  The intent of the WEEE was to encourage companies to change the design of products to make it easier to recover materials, but given the collective nature of the system, this simply hasn’t happened. 

In the United States, it seems likely that the simplest, and therefore the most likely, way to handle e-waste is to export it.  There is very little that can be done in the way of product reuse with computers that are three to four years old. The rate of technology change is simply too rapid to support component reuse, so we are left with piles of mixed materials that cannot be easily separated.  This situation leads to very expensive recycled materials with no demand.  Recycling feels good, but it simply covers up the problem of e-waste for a short period. In essence, we are putting a Band-Aid on a ruptured artery and expecting a good outcome.  

I advocate finding ways to make product recovery and reuse profitable for the firm.  The remanufacturing industry in the United States is enormous (larger in direct employment than the steel industry) and very profitable.  Remanufacturing is value-added recovery that restores products back to the original quality and performance specifications (and in many instances better performance). Through our experiences with a variety of companies, my fellow researchers and I have found that remanufacturing is value-creating and saves energy and materials. Consumers routinely put remanufactured parts and components into their autos because of the price savings. However, many consumer products are simply not designed for remanufacturing.  Consumer electronics are often manufactured as cheaply as possible and these design choices often prevent product or component reuse.  When this is combined with rapid product obsolescence (80 percent of consumers upgrade their cell phone within one year), the end result is predictable—overflowing landfills and a public outcry.  Until consumers demand that producers make upgradable, or at least standardized designs, there will continue to be growing piles of e-waste.  Recycling programs make us feel better, in no small part because we’ve done the “responsible” thing.  However, all this does is treat the symptoms, not the root cause.

Tags: Guide, Supply Chain, Sustainability
Posted in News | 6 Comments