Planned Obsolescence: The Good and the Bad

by Addison Del Mastro

Just like good and bad cholesterol, there is good and bad planned obsolescence – the business practice of consciously limiting a product’s lifespan. This may come as a surprise to many people, since planned obsolescence usually has a negative connotation. As with cholesterol, it’s important that we understand what planned obsolescence is, how it can be good and bad, and what we can do to fight the bad kind.

The good types of planned obsolescence are “value engineering” and “functional obsolescence.” Value engineering is a design process that seeks to use as little material as possible in a product while still delivering an acceptable lifespan. It also suggests that all the parts in a product should fail at about the same time, so that none are “overbuilt” relative to the rest. Functional obsolescence is when a genuinely superior product is introduced, making the old one comparatively less desirable.

The bad kind of planned obsolescence consists of the introduction of superfluous changes in a product that don’t improve utility or performance. This might best be described as “pseudo-functional obsolescence.”

Value engineering

Cell phones don’t last for 20 years. If they wanted to, cell phone manufacturers could make phones much more durable than they currently are. Is this bad planned obsolescence? No. This is value engineering.

The useful life of a cell phone is limited to only a few years due to the rapid rate of technological improvement in the field. This means that it’s wasteful to build a cell phone with a physical lifespan much longer than its useful life. It makes sense that cell phones are built out of inexpensive plastic parts; this ensures a more affordable product. If a cell phone were not value engineered – if it were made out of titanium, for example – it would last longer than anyone would want it to, would cost more, and would use up more resources.

Designing certain products to be less durable than they could be actually conserves resources and delivers a more affordable product to the consumer.

Functional obsolescence

Functional obsolescence occurs when an innovation is introduced into the marketplace, making an older product obsolete. A classic example is the automobile replacing the horse and buggy, or the transition from simple cell phones to more functional smartphones. Functional obsolescence creates waste, but the trade-off is that consumers get a superior product. In many cases functional obsolescence takes place because the new product requires less time and work, meaning an increase in the resource of human time.  [Read more…]


Glass to Cash

As a Bozemanite I live 700 miles from the nearest glass remanufacturing center. In Golden, Colorado glass bottles are melted and reused to produce new bottles. That is a lot of miles and gallons of gas away. Not many would argue that it makes economic or even environmental sense to truck the stuff across country. Nonetheless, we still hear that recycling is the right thing to do.

Certainly, glass can be used in other ways. The nearby town of Livingston grinds up bottles to replace gravel to be used in landscaping and bedding materials. A new firm in Bozeman, Ecomatrix Solutions, has advertised its need for recycled glass for manufacturing “sustainable” cement to be used in countertops and architectural panels. The problem they’ve encountered with the Livingston glass is contamination from grime and paper labels. They are setting up a new supply channel to resolve the issue.

Locals that want to recycle glass can remove labels and wash their used bottles. Ecomatrix will pick up the cleaned glass at no charge. They may even provide a product discount or cement pot in return for the efforts.

“If we’re collecting it clean, de-labeled and all we have to do is reduce it to the sizes we need, it’s saving energy, it’s savings all across the board,” says Ecomatrix founder Jon Cross. Energy savings for Ecomatrix, yes, but energy used by others.

The costs and benefits of recycling vary over time and space. Instead of generically teaching kids to recycle more, perhaps it would behoove us to help them question why, where, and how we recycle. This might just encourage new innovations for reuse instead of spending more resources to recycle for the sake of recycling.

Originally posted at Environmental Trends.


Recycling: Is it the right thing to do?

Recycling, “it’s the right thing to do,” right? We hear that line in Montana a lot. And the people that use it gain the moral high ground against skeptics, like me. I have been accused of being an anti-environmentalist as a result. Environmentalist or not, I do believe in conservation. And recycling more to meet an arbitrary mandate does not necessarily make environmental sense.

Montana State University, like many others across the nation, has a goal to increase recycling. The stated goal is to cut waste by 25 percent by 2020. I am not sure where the 25 percent figure came from. It is a nice figure, divisible by five, sounds good.

The purpose is to reduce waste by recycling more because it saves money and is good for the environment. And, we are told, it reduces our carbon footprint. The argument is that recycling more means less garbage is sent to the landfill, so less money is spent in tipping fees. But the costs expended to do that extra recycling are not fully accounted for. The university may “save” money by sending less to the local landfill, but money is spent collecting and delivering the recyclables. A lot of that is done by individuals using their own time and resources to get the material to a common location. That energy and effort expended is hard to tabulate, so providing a fair analysis can be difficult.

Those recyclables then need to be delivered to the manufacturing plant where they are actually transformed. That can be a long way. That transportation takes energy, and more energy is used to remanufacture them. The additional transportation and remanufacturing have their own environmental impact.

Finally, by reducing the waste in the landfill there is less methane produced which can reduce greenhouse gas emissions. Many new landfills actually collect methane, however, and use it to power homes and industry nearby. The local landfill here does not have that capability. But all that additional transport of recyclables and the remanufacturing increases carbon emissions. Whether those emissions are better or worse than the methane that would otherwise be emitted from the landfill has not been determined.

The bottom line is that recycling can be more or less environmentally friendly than the alternatives. It depends upon the materials being recycled, the location of recycling, or distance from remanufacturing, and who is doing the recycling. Recycling at the industry level, for example, often makes more environmental sense because the recyclable materials are already in one common location.

For more, see Dan Benjamin’s study on the myths of recycling.

Originally posted at Environmental Trends.


Abundance in 2012

In 1980, Paul Ehrlich, a world famous biologist and author, accepted a bet proposed by Julian Simon, an economist. The bet was to resolve an ongoing debate about resource scarcity. Ehrlich chose five metals (copper, chromium, nickel, tin, and tungsten) and hypothetically bought $200 worth of each. If the real price of the metals increased over the following decade, Ehrlich wagered, it was an indication of increased scarcity. Simon won the bet. The real price of all five metals declined, signifying less scarcity.

Timing is everything. As demonstrated in the figure, the prices of metals wax and wane over time following an overall downward trend. Regardless, Simon’s point remains true. It is human ingenuity that prevents us from running out of resources – even finite resources. The key is not that prices continue to fall over time, rather that prices reflect consumer desires, and producers, given appropriate institutions, will respond.

Prices do reveal scarcity by increasing which, in turn, encourages conservation, substitution, and increased innovation and supply. In the end, the problem of scarcity is resolved by market coordination as shown by prices that peak and fall through the course of history.

Originally posted at Environmental Trends.


What To Do With That Christmas Tree?

Once the holidays are over and the glitter and glam is stripped from the fir, chances are the Christmas tree ends up in the trash. Perhaps the trees could be useful even after they lose their glow. Why not turn them into woody biomass for energy? A few companies, such Biomass One, are doing just that.

Biomass One, which has been recycling Christmas trees for the past four years, estimates it will receive 4,500 trees this year. According to Biomass One Vice President Gordon Draper, this amount “equals out to approximately 56 dry tons of wood biomass, which can provide about an hour and a half worth of power to the company’s wood-fired cogeneration power plant.” This is only a tiny amount compared to the 325,000 dry tons of wood it grinds up annually to power the plant. And an even smaller amount compared to the woody biomass the state of Vermont is using to heat schools and other public buildings.

Burning wood for energy is, of course, an ancient technology, but as Steven Bick points out in a new PERC case study, wood can provide an economic and environmentally viable solution for high heating costs in many parts of the country.

Bick goes on to explain that beginning in 1985, the state of Vermont developed a program using mill waste to power boilers in public schools. At the time, most schools in the state were heated with expensive electricity. Replacing electric heaters with wood-powered boilers resulted in considerable savings in heating costs. Vermont is now home to nearly half of the facilities in the United States using woody biomass for heat. Other states are starting to replicate Vermont’s success and few  private companies, including Lockheed Martin, are beginning to convert to woody biomass heating.

“Thermal energy from woody biomass is not a panacea to all heating needs,” writes Bick, “but Vermont and other cold locations have proven it is a viable and renewable option.”

You can read the case study here.


Recycle the Intermountain West

Since 1997, more than 40 million acres of forests across the West have been devastated by pine beetle. The beetle is a natural predator, but historic timber management and climatic conditions have given advantage to the species in current times. The end result is tinderbox forests across the Intermountain region.

Fire is another natural predator in the forest. The increasing kindling in the forest — such as the bug-killed trees — together with growing development in the wildland-urban interface are a dire mix.

Recycling dead and dying trees through harvest and re-use is one method to reduce the problem. Though the timber value of small-diameter wood is low, there are beneficial uses. The wood can be used for firewood, fence posts, and poles, even garden mulch, but these are small players. The real potential is in biomass but existing uncertainties are making investment tenuous.

The inability of the Forest Service to provide a continuous supply of material is troublesome. It is not a lack of biomass material available on National Forest land, nor a question of the benefits from removing the material, rather it is the process of contracting for timber removal that is costly and time consuming. The Forest Service expenditure on procedure to allow timber harvest, even for restoration, is excessive and slow.

Another barrier to investment in biomass is forthcoming regulation on emissions. In spring of last year, the EPA instigated, then suspended, the tailoring rule. The rule would tax emissions from biomass energy production at a rate equal to fossil fuel emissions. The tax would marginalize the profitability of biomass production.

There is a significant difference in the carbon cycle between wood and fossil fuel energies. Wood sequesters carbon from the atmosphere in its living, tree form, then emits it back into the atmosphere when burned for energy. Put simply, it has net zero atmospheric emissions. Fossil fuel moves carbon that is held in the earth and releases it into the atmosphere when burned, causing a net increase in atmospheric carbon.

Recycling small diameter forest products is one answer that could help reduce the risk, and therefore the costs, of catastrophic wildfire in wildland-urban interface, while providing renewable energy. The fight to get there, however, is a battle between enviropreneurs, who see good environmental results from profitable economic activity, and environmental advocacy groups that see profit as evil and exploitive.

Originally posted at Environmental Trends.


One Person CAN Make a Difference

by Laura E. Huggins

Founder and president of Living Lands & Waters, Chad Pregracke, is proof that one person can make a difference. Chad told journalists at a PERC conference back in 2003 about his plans to clean up the cluttered Mississippi River.

Turns out he’s doing it! Chad was recognized March 21 at the Points of Light Institute’s “All Together Now” celebration, which was shown last night on NBC-TV to a national audience.

The event also honored former President George H.W. Bush for his leadership in American volunteer service. He and three other former presidents — George W. Bush, Bill Clinton, and Jimmy Carter — were in attendance.

Chad has won countless awards for leading a push to clean trash out of the Mississippi River. In his spare time he wrote From the Bottom Up: One Man’s Crusade to Clean America’s Rivers. You can watch him on ReelCYCLE: The Rivers’ Garbage Man.


Resources Versus Refuse in Recycling

Almost every state has a policy to discourage dumping trash, or waste, into the landfill. Reducing waste makes sense and saves resources. But is it logical to reduce the amount of waste put into the landfill when the alternative comes at a higher cost? Some policies encourage exactly that.

Waste is something that is low in value and costly to reuse. A resource, on the other hand, is an item that provides value for use where the costs of reusing the item are less than the value added from its use. Reusing, or recycling, resources makes sense and is a choice that markets help us make. People are willing to pay for a resource which signals to the owner that there is a value for it.

It is a widely held belief that we are running out of landfill space and, hence, should reduce the amount of garbage we dump. As shown by the chart above, the number of landfills has declined over the past two decades. Landfill capacity, however, has increased. According to the EPA, the number of years of remaining available landfill space has increased from about 9.5 years in 1990 to 20 years today. Landfill dumping fees (tipping fees shown on the graph) also demonstrate there is no lack of landfill space available. Tipping fees rose in the late 1980s and early 1990s in response to increased EPA regulations but have declined slightly since.

Recycling resources makes sense. Recycling garbage is a waste of resources.

Originally posted at Environmental Trends


Rubbish or Resource? Hawaii Recycling

by Holly Fretwell

Recycling is the reuse of resources. Resources are inputs used to produce the goods and services we buy. You can reuse a bag to recycle it, or you can take it to the recycling center for remanufacturing into something else, like a fleece jacket. These two very different processes have very different costs associated. We are led to believe that recycling is paramount and necessary to maintain a ‘green’ life style. Yet, recycling uses resources, sometimes more than letting our garbage be the rubbish that it is.

On the Big Island of Hawaii land is extremely valuable, therefore landfill space is costly. Putting less in the trash makes sense. Many people reuse plastic bags (or store them in their cupboards). Others use cloth bags instead of plastic. Plastic bags also end up in the recycling bins. To motivate more recycling of cans and plastic containers, some have a deposit in Hawaii. Five cents is paid upon purchase and refunded when the container is returned.

There are no remanufacturing plants for recyclables in Hawaii because it is not cost effective. There is simply not enough of it. The recyclables must be shipped elsewhere. Many of the fibrous materials, such as cardboard and some plastics, for example, are shipped to Oregon. That is a long way. There, they are manually sorted on a conveyor belt and then remanufactured onsite or shipped elsewhere to create new products that are used in the states and Asia.

A lot of energy goes into the transport and remanufacturing of Hawaii’s rubbish: fossil fuels and manual labor. I am curious what the real environmental tradeoffs are between land filling garbage and sending it across the ocean. Recycling has become so paramount that it is rarely questioned for its own environmental impact. That is a thought to ponder.

Originally posted at Environmental Trends


Greener Than Thou: Recycling Edition

by Shawn Regan

In today’s Boston Globe, columnist Jeff Jacoby says he’s not too excited about a recent household recycling campaign in Brookline, MA. But, he writes, “things could be worse.”

Clevelanders will soon have to use recycling carts equipped with radio-frequency ID chips, the Plain Dealer reported last month. These will enable the city to remotely monitor residents’ compliance with recycling regulations. “If a chip shows a recyclable cart hasn’t been brought to the curb in weeks, a trash supervisor will sort through the trash for recyclables. Trash carts containing more than 10 percent recyclable material could lead to a $100 fine.’’ In Britain, where a similar system is already in place, fines can reach as high as $1,500.

San Franciscans, meanwhile, must sort their garbage into three color-coded bins — blue for recycling, green for compost, and black for trash — and scofflaws who pitch teabags or coffee grounds into the wrong bin can be fined. In other cities, residents must bag their trash in clear plastic, lest they be tempted to toss recyclables out with the garbage.

Does any of this make sense? It certainly isn’t economically rational. Unlike commercial and industrial recycling — a thriving voluntary market that annually salvages tens of millions of tons of metal, paper, glass, and plastic — mandatory household recycling is a money loser. Cost studies show that curbside recycling can cost, on average, 60 percent more per ton than conventional garbage disposal.

He concludes with the work of PERC senior fellow Daniel Benjamin on recycling.

But if recycling household trash makes everyone feel warm and fuzzy, why does it have to be compulsory? Mandatory recycling programs “force people to squander valuable resources in a quixotic quest to save what they would sensibly discard,’’ writes Clemson University economist Daniel K. Benjamin. “On balance, recycling programs lower our wealth.’’ Now whose idea of exciting is that?

Read Dan’s recent Policy Series paper on recycling here or his recent interview on here.

UPDATE: See Part II of Jacoby’s recycling column, which discusses more of Dan’s findings.


Crosses, Stars, Moons, and Green Street-Side Bins

What do these four symbols have in common? Well, to start with they all cost resources, that is, they are not free. Why in the heck then do practitioners waste their money on them? Why do churches have steeples, and synagogues wonderfully ornate glass windows, and mosques, exquisite wool carpets? Surely the money spent on these trappings could have been used to do missionary work, feed the poor, or heal the sick. What is going on?

For some time, economists have understood that wasting money could pay big dividends, if the money was wasted carefully (see herehere, and here). Ornate signs, symbols, or Super Bowl ads, more than drawing attention, signal commitment. When money is spent on trappings, it will only return if the seller delivers as promised.

So, Christians wear crosses, perhaps for adornment, but also to signal to others that they believe in certain things and might be expected to act in certain ways. Some Jewish merchants close for Sabbath, even while it might appear to cost them money, presumably it pays more in loyalty and customer satisfaction by the symbol of their commitment.

The time that Muslims spend praying each day precludes a lot of production. Yet it remains valuable to them for many reasons, one of which might be external signaling to friends and colleagues of their religious and personal beliefs.

The modern environmental movement is hardly different. People desire to commit to a way of life, to signal their preferences, their values, their beliefs, and they also seek to enlist converts in their cause. Hence, symbols that are otherwise a waste of time and resources, come to play.

As Dan Benjamin at PERC, and others, have noted, a lot of recycling is (directly) wasteful and does not help the environment. Yet recycling remains a mantra of the movement. I offer that it is symbol of commitment, a willingness to waste, that bonds the recycler to a course of action, begs others to join, and creates a sense of community within the movement.

So here’s my prediction. The more people learn from Dan that recycling is wasteful, the more they will recycle. If recycling paid for itself, then it would not serve as a symbol and commitment of heart and soul to the cause. Recycling is good by virtue of the fact that it wastes, and the more that people learn this, the more they will do it. If crosses could heal or feed the masses, churches wouldn’t put them on the top of steeples. Their uselessness is their virtue, their symbol, their commitment.

While I agree with Dan that most street side recyling is an economic waste and environmentally unwise, the green street side recyling bin is a valuable important social sign precisely because it proves a willingness to waste. It says to the person pedaling by, “I am a believer.” The environmental movement would be less without it; that’s why I leave mine on the street for a couple days after the truck comes by and doesn’t empty it (cause it already is).

Bobby McCormick is a senior fellow at PERC and professor emeritus of economics at Clemson University.