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Testimony: 

Before the Subcommittee on Superfund and Waste Management, Committee on 
Environment and Public Works, U.S. Senate: 

United States Government Accountability Office: 

GAO: 

For Release on Delivery Expected at 2:30 p.m. EDT: 

Tuesday, July 26, 2005: 

Electronic Waste: 

Observation on the Role of the Federal Government in Encouraging 
Recycling and Reuse: 

Statement of John B. Stephenson, 
Director: 
Natural Resources and Environment: 

GAO-05-937T: 

GAO Highlights: 

Highlights of GAO-05-937T, a testimony before the Subcommittee on 
Superfund and Waste Management, Committee on Environment and Public 
Works, United States Senate: 

Why GAO Did This Study: 

Advances in technology have led to rapidly increasing sales of new 
electronic devices, particularly televisions, computers, and computer 
monitors. With this increase comes the dilemma of how to manage these 
products when they come to the end of their useful lives. Concerns have 
been increasingly expressed that while millions of existing computers 
become obsolete each year, only a fraction of them are being recycled.

Some have alleged that the disposal of used electronics causes a number 
of environmental problems. They note, for example, that toxic 
substances such as lead can leach from used electronics. They have also 
noted that computers and other electronic equipment contain precious 
metals that require substantial amounts of energy and land to extract. 
These metals, they say, can often be extracted with less environmental 
impact from used electronics than from the environment.

In this testimony, GAO summarizes existing information on the amounts 
of, and problems associated with, used electronics. GAO also examines 
the factors affecting the nationís ability to recycle and reuse 
electronics when such products have reached the end of their useful 
lives.

This testimony discusses preliminary results of GAOís work. GAO will 
report in full at a later date.

What GAO Found: 

Available estimates suggest that the amount of used electronics is 
large and growing, and that if improperly managed can harm the 
environment and human health. While data and research are limited, some 
data suggest that over 100 million computers, monitors, and televisions 
become obsolete each year, and that this amount is growing. These 
obsolete products are either recycled, reused, disposed of in 
landfills, or stored by users in places such as basements, garages, and 
company warehouses. Available data suggest that most used electronics 
are probably stored. The units still in storage have the potential to 
be recycled and reused, or disposed in landfills; or, they may be 
exported for recycling or reuse overseas. If disposed of in landfills, 
valuable resources, such as copper, gold, and aluminum, are lost for 
future use. Additionally, standard regulatory tests show that some 
toxic substances with known adverse health effects, such as lead, have 
the potential to leach from discarded electronics into landfills. 
Although one study suggests that this leaching does not occur in modern 
U.S. landfills, it appears that many used electronics end up in 
countries without either modern landfills or with considerably less 
protective environmental regulations.

Economic factors, such as cost, inhibit the recycling and reuse of used 
electronics. Consumers generally have to pay fees and drop off their 
used electronics at often inconvenient locations to have their used 
electronics recycled or refurbished for reuse. Consumers in Snohomish 
County, Washington, for instance, may have to travel more than an hour 
to the nearest drop-off location, which then charges between $10 and 
$27 per unit, depending on the type and size of the product. Recyclers 
and refurbishers charge these fees because costs associated with their 
processes outweigh the revenue received from recycled commodities or 
refurbished units. In addition to the challenges posed by these 
economic factors, federal regulatory requirements provide little 
incentive for environmentally preferable management of used 
electronics. The governing statute, the Resource Conservation and 
Recovery Act, regulates the disposal practices of large generators of 
hazardous waste (including electronic waste) but exempts individuals 
and households from these requirements. 

In the absence of a national framework for dealing with the problem, a 
patchwork of potentially conflicting state requirements appears to be 
emerging. Manufacturers in one state, for instance, may have an advance 
recovery fee placed on their products, but the same manufacturers may 
have to take back their products and pay for recycling in another. This 
patchwork may be placing a substantial burden on recyclers, 
refurbishers, and other stakeholders. As GAO concludes its work, it 
will examine the implications of these findings for the ongoing efforts 
among the states to deal with this growing problem, for the various 
legislative solutions that have been proposed to create a uniform 
national approach, and for options the federal government can pursue to 
encourage recycling and reuse of electronics. 

www.gao.gov/cgi-bin/getrpt?GAO-05-937T.

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact John Stephenson at (202) 
512-3841 or Stephensonj@gao.gov.

[End of section] 

Mr. Chairman and Members of the Subcommittee: 

Thank you for the opportunity to discuss our work to date on the issues 
surrounding the growing volume of used electronics accumulating in the 
nation's basements, attics, and landfills. Rapid advancements in 
technology have led to increasing sales of new electronic devices, 
particularly televisions, computers, and computer monitors. 
Approximately 62 percent of U.S. households had computers in 2003, 
compared with only 37 percent just 6 years earlier. With this increase 
comes the dilemma of how to manage these products when they come to the 
end of their useful lives. The Environmental Protection Agency (EPA) 
has estimated that in 2003 alone, about 50 million existing computers 
became obsolete, but one estimate forecast that less than 6 million 
were recycled. 

Disposal of used electronics creates potential problems that can be 
averted through recycling or reuse. For example, concerns have been 
raised because toxic substances such as lead, which have well- 
documented adverse health effects, can potentially leach from used 
electronics. Concerns have also been raised over used electronics that 
are exported from the United States to countries with less stringent 
environmental regulations. In addition, computers contain precious 
metals, such as gold, silver, and platinum, that require substantial 
amounts of energy and land to extract. These metals can often be 
extracted with less environmental impact from used electronics than 
from the environment. The U.S. Geological Survey, for instance, reports 
that 1 metric ton of computer scrap contains more gold than 17 tons of 
ore and much lower levels of harmful elements common to ores, such as 
arsenic, mercury, and sulfur. 

In this context, you and several other Members of the Congress asked 
that we address a number of issues surrounding this problem. 
Specifically, we were asked to (1) summarize existing information on 
the volumes of, and problems associated with, used electronics and (2) 
examine the factors affecting the nation's ability to recycle and reuse 
electronics when such products have reached the end of their useful 
lives. 

To address these issues, we are examining studies that provide 
nationwide estimates on the amount of used electronics,[Footnote 1] as 
well as federal and state government studies (including those by EPA 
and task forces in Oregon and Washington), industry and interest group 
studies, and local studies (including municipal solid waste 
characterization studies) that discuss the problems associated with 
used electronics. We are also visiting states and localities that have 
implemented programs or passed legislation to responsibly manage used 
electronics, including California, Maine, Maryland, Massachusetts, 
Oregon, and Washington. In addition, we are surveying participants in 
the National Electronics Product Stewardship Initiative and other key 
stakeholders, which include key stakeholders from federal, state, and 
local governments, environmental organizations, recyclers, retailers, 
equipment manufacturers, and academicians. To date, we have received 
responses from 41 of the 53 survey participants. We are also comparing 
current government and industry practices with existing practices for 
promoting recycling in other industries, such as bottle-and can- 
recycling programs and the Rechargeable Battery Recycling Corporation 
program. Further, we are examining EPA-sponsored federal, state, and 
local pilot programs that attempt to encourage recycling of electronic 
products. Our work is being done in accordance with generally accepted 
government auditing standards, which include an assessment of data 
reliability and internal controls. 

We are here to present our preliminary observations on these issues. We 
will report the final results of our study and any recommendations we 
may develop at a later date. In summary: 

* Available estimates suggest that the volume of used electronics is 
large and growing and that if improperly managed can harm the 
environment and human health. While data and research are limited, some 
data suggest that over 100 million computers, monitors, and televisions 
become obsolete each year and that this amount is growing. These 
obsolete products can be either recycled, reused, disposed of in 
landfills, or stored by users in places such as basements, garages, and 
company warehouses. Available data suggest that most used electronics 
are probably stored. These units have the potential to be recycled and 
reused, disposed of in landfills, or exported for recycling and reuse 
overseas. If ultimately disposed in landfills, either in the United 
States or overseas, valuable resources, such as copper, gold, and 
aluminum, are lost for future use. Additionally, standard regulatory 
tests show that some toxic substances with known adverse health 
effects, such as lead, have the potential to leach into landfills. 
Although one study suggests that leaching is not a concern in modern 
U.S. landfills, it appears that many of these products end up in 
countries without modern landfills or the environmental regulations 
comparable to the U.S. 

* Both economic and regulatory factors discourage recycling and reuse 
of used electronics: 

* Economic factors inhibit the recycling and reuse of used electronics. 
Consumers generally have to pay fees and drop off their used 
electronics at often inconvenient locations to have them recycled or 
refurbished for reuse. Consumers in Snohomish County, Washington, for 
instance, may have to travel more than an hour to the nearest drop-off 
location, which then charges between $10 and $27 per unit depending on 
the type and size of the product. Consumers in the Portland, Oregon 
area, pay one local recycler 50 cents per pound to have their used 
computers recycled, which is about $28 for an average-sized desktop 
computer. Recyclers and refurbishers charge these fees because costs 
associated with recycling and refurbishing outweigh the revenue 
received from recycled commodities or refurbished units. This point was 
underscored by the International Association of Electronics Recyclers, 
which reported that the value of commodities recovered from computer 
equipment (such as shredded plastic, copper, and aluminum) is only 
between $1.50 and $2.00 per unit. It was further underscored by our 
interviews with eight electronics recyclers, who were unanimous in 
emphasizing that they could not cover costs without charging fees. 

* Federal regulatory requirements provide little incentive for 
environmentally preferable management of used electronics. The 
governing statute, the Resource Conservation and Recovery Act, bars 
entities that dispose of more than 220 pounds of hazardous waste per 
month from depositing hazardous waste (including some used electronics) 
in landfills. However, RCRA does not prohibit households and entities 
that generate less than 220 pounds of hazardous waste per month from 
sending hazardous waste to municipal landfills. Consequently, since 
only four states currently ban disposal of used electronics in their 
trash or local landfill, most consumers in the remaining 46 states (and 
the District of Columbia) are allowed to do so--and have little 
incentive to do otherwise. Not surprisingly, available data suggest 
that states and localities that do not have landfill bans have 
dramatically lower levels of recycling than the four states that have 
enacted landfill bans. In addition, federal regulations provide for 
neither a financing system for responsible management of used 
electronics, nor oversight of these products when exported--a 
particular problem in the case of some developing countries, where 
risks to the environment and human health may be more likely because of 
less stringent environmental regulations. 

In the absence of a national approach, a patchwork of potentially 
conflicting state requirements is developing. This patchwork may be 
placing a substantial burden on recyclers, refurbishers, and other 
stakeholders. As we conclude our work, we will be examining the 
implications of our findings for the ongoing efforts among the states 
to deal with the problem, for the various legislative solutions that 
have been proposed to create a uniform national approach, and for 
options the federal government can pursue to encourage recycling and 
reuse of used electronics. 

Background: 

Few people are aware of recycling options for their old televisions and 
personal computers. Because of the perceived value of used electronics, 
some pass their used equipment to family members or friends before 
eventually storing these units in their attics, basements, or garages. 
Eventually, though, consumers need to dispose of these units in some 
manner. By choosing to have these products recycled, consumers ensure 
the recovery of resources like copper, iron, aluminum, and gold, which 
would otherwise be procured through less environmentally friendly 
practices such as mining. Likewise, consumers who choose to recycle 
also reduce the amount of waste entering the nation's landfills and 
incinerators. Since used electronics typically contain toxic substances 
like lead, mercury, and cadmium, recycling or refurbishing will prevent 
or delay such toxic substances from entering landfills. 

The Congress affirmed its commitment to reducing waste and encouraging 
recycling, first through enactment of the Resource Conservation and 
Recovery Act (RCRA) of 1976, and then again with passage of the 
Pollution Prevention Act of 1990. Both RCRA and the Pollution 
Prevention Act address alternatives to waste disposal. RCRA promotes 
the use of resource recovery, either through facilities that convert 
waste to energy or through recycling. To promote recycling, RCRA 
required EPA to develop guidelines for identifying products that are or 
can be produced with recovered materials. RCRA also requires federal 
agencies to procure items that are, to the maximum extent practicable, 
produced with recovered materials. The Pollution Prevention Act 
provides that pollution that cannot be prevented should be recycled or 
treated in a safe manner, and disposal or other releases should be used 
only as a last resort. It specified that pollution prevention can 
include such practices as modifying equipment, technology, and 
processes; redesigning products; and substituting less-toxic raw 
materials. Executive Order 13101, issued on September 14, 1998, also 
affirmed the federal government's commitment to encourage recycling by 
directing federal agencies to consider procuring products that, among 
other things, use recovered materials, can be reused, facilitate 
recycling, and include fewer toxic substances. 

Nonetheless, while large-quantity generators, such as businesses, 
schools, and government agencies, must treat some used electronics as 
hazardous waste due to the relatively high level of toxic substances, 
it is not illegal for households or for small quantity generators--non- 
household entities disposing of less than 220 pounds per month--to 
dispose of used electronics in landfills in most states. Under RCRA, 
household hazardous wastes, including used electronics, may be disposed 
of at municipal solid waste landfills. However, some states have begun 
imposing more stringent disposal requirements for used electronics. For 
example, because of concerns regarding the potential environmental and 
health effects of leaded glass in cathode ray tubes (CRTs), California, 
Maine, Massachusetts, and Minnesota recently banned them from disposal 
in municipal landfills. 

As national awareness of potential problems associated with the 
disposal of used electronics has grown, EPA has taken steps to 
encourage recycling of used electronics. For instance, EPA, together 
with electronics manufacturers, retailers, and recyclers, sponsored 
several pilot programs in 2004 to measure the success of convenient 
collection options for used electronics. Other recent EPA efforts, such 
as the Federal Electronics Challenge and the Electronic Product 
Environmental Assessment Tool (EPEAT) program, attempt to leverage U.S. 
government procurement power to drive environmentally preferable design 
for electronic products. Finally, through the establishment of the 
National Electronic Product Stewardship Initiative (NEPSI) in 2001, EPA 
established a voluntary, multi-stakeholder initiative to reach 
consensus on a national approach to encourage recycling of used 
electronics. This voluntary effort ultimately dissolved in 2005 without 
agreement, however, because stakeholders could not reach consensus on a 
nationwide financing system. 

Volume of Used Electronics and the Problems They Pose: 

The information we have reviewed to date suggests strongly that the 
volume of used electronics is large and growing. For example, in a 1999 
study, the National Safety Council forecast that almost 100 million 
computers and monitors would become obsolete in 2003--a three-fold 
increase over the 33 million obsolete computers and monitors in 
1997.[Footnote 2] Additionally, a 2003 International Association of 
Electronics Recyclers report estimated that 20 million televisions 
become obsolete each year--a number that is expected to increase as CRT 
technology is replaced by new technologies such as plasma 
screens.[Footnote 3]

Thus far, it appears that relatively few units have found their way 
into either landfills or recycling centers. Available EPA data indicate 
that less than 4 million monitors and 8 million televisions are 
disposed of annually in U.S. landfills--only a fraction of the amount 
estimated to become obsolete annually, according to EPA. Additionally, 
the 1999 National Safety Council report forecast that only 19 million 
computers, monitors, and televisions would be recycled in 2005. Hence, 
the gap between the enormous quantity of units that are obsolete (or 
becoming obsolete), and the quantity either in landfills or sent to 
recycling centers, suggests that most used electronics are still in 
storage--such as attics, basements, and garages--and that their 
ultimate fate is still not certain, or have been exported for recycling 
and reuse overseas. 

Conventional disposal of used electronics in landfills raises two 
primary concerns, according to research we reviewed: the loss of 
natural resources and the potential release of toxic substances in the 
environment. By disposing of these products in landfills or 
incinerators, valuable resources are lost for future use. For example, 
computers typically contain precious metals, such as gold, silver, 
palladium, and platinum, as well as other useful metals like aluminum 
and copper. Further, the U.S. Geological Survey reports that one metric 
ton of computer circuit boards contains between 40 and 800 times the 
concentration of gold contained in gold ore and 30 to 40 times the 
concentration of copper, while containing much lower levels of harmful 
elements common to ores, such as arsenic, mercury, and sulfur.[Footnote 
4] The research we have thus far reviewed also suggests that the energy 
saved by recycling and reusing used electronics is significant--the 
author of one report by the United Nations University states that 
perhaps as much as 80 percent of the energy used in a computer's life 
can be saved through reuse instead of producing a new unit from raw 
materials.[Footnote 5]

Regarding the issue of toxicity, the research we have reviewed to date 
is unclear on the extent to which toxic substances may leach from used 
electronics in landfills. On one hand, according to a standard 
regulatory test RCRA requires to determine whether a solid waste is 
hazardous and subject to federal regulation, lead (a substance with 
known adverse health affects) leaches from some used electronics under 
laboratory conditions. Tests conducted at the University of Florida 
indicate that lead leachate from computer monitors and televisions with 
cathode ray tubes exceeds the regulatory limit and, as a result, could 
be considered hazardous waste under RCRA.[Footnote 6] On the other 
hand, the study's author told us that these findings are not 
necessarily predictive of what could occur in a modern landfill. 
Furthermore, a report by the Solid Waste Association of North America 
suggests that while the amount of lead from used electronics appears to 
be increasing in municipal solid waste landfills, these landfills 
provide safe management of used electronics without exceeding toxicity 
limits that have been established to protect human health and the 
environment.[Footnote 7]

Economic and Regulatory Factors Deter Recycling and Reuse of Used 
Electronics: 

The costs associated with recycling and reuse, along with limited 
regulatory requirements or incentives, discourage environmentally 
preferable management of used electronics. Generally, consumers have to 
pay fees and take their used electronics to often inconvenient 
locations to have them recycled or refurbished for reuse. Recyclers and 
refurbishers charge fees to cover the costs of their operations. In 
most states, consumers have an easier and cheaper alternative--they can 
take them to the local landfill. These easy and inexpensive 
alternatives help explain why so little recycling of used electronics 
has thus far taken place in the United States. This economic reality, 
together with federal regulations that do little to preclude disposal 
of used electronics along with other wastes, have led a growing number 
of states to enact their own laws to encourage environmentally 
preferable management of these products. 

Cost and Consumer Inconvenience Discourage Recycling and Reuse of Used 
Electronics: 

Consumers who seek to recycle or donate their used electronics for 
reuse generally pay a fee and face inconvenient drop-off locations. 
Unlike their efforts for other solid waste management and recycling 
programs, most local governments do not provide curbside collection for 
recycling of used electronics because it is too expensive. Instead, 
some localities offer used electronics collection services, for a fee, 
at local waste transfer stations. These localities send consumers' used 
electronics to recyclers for processing. For example, transfer stations 
in Snohomish County, Washington, charge consumers between $10 and $27 
per unit for collecting used electronics and transporting them to 
recyclers. Moreover, such transfer stations are generally not 
conveniently located, and rural residents, such as those in Snohomish 
County, may need to drive more than an hour to get to the nearest drop- 
off station.[Footnote 8] In some localities, consumers can also take 
their used electronics directly to a recycler, where they are typically 
charged a fee. In the Portland, Oregon area, for instance, one recycler 
charges consumers 50 cents per pound to recycle computers, monitors, 
and televisions, which means it costs the consumer about $28 to recycle 
an average-sized desktop computer system. 

Recyclers charge these fees to cover the costs they incur when 
disassembling used electronics, processing the components, and refining 
the commodities for resale. As noted in a 2003 report by the 
International Association of Electronics Recyclers, most recyclers and 
refurbishers in the United States cannot recoup their expenses from the 
resale of recycled commodities or refurbished units. The report, which 
compiled data from more than 60 recyclers in North America, stated that 
the costs associated with recycling are greater than the revenue 
received from reselling recycled commodities, and that fees are needed 
to cover the difference. Furthermore, the report states that the value 
of commodities recovered from computer equipment, such as shredded 
plastic, copper, and aluminum, is only between $1.50 and $2.00 per 
unit.[Footnote 9]

The costs associated with recycling make it unprofitable (without 
charging fees) for several reasons. First, recycling used electronics 
is labor intensive--the equipment must be separated into its component 
parts, including the plastic housing, copper wires, metals (e.g., gold, 
silver, and aluminum), and circuit boards, as well as parts that can be 
easily reused or resold, like hard drives and CD-ROM drives. Officials 
with Noranda Recycling Inc., which recycles used electronics for 
Hewlett-Packard, told us that over 50 percent of their total costs for 
recycling are labor costs involved in disassembly, even though they 
operate some of the most technologically advanced equipment available. 
Labor costs are high, in part, because electronic products are not 
always designed to facilitate recycling at their end of life. For 
instance, a Hewlett-Packard official told us 30 different screws must 
be removed to take out one lithium battery when disassembling a Hewlett-
Packard computer for recycling. According to this official, if Hewlett-
Packard spent $1 in added design costs to reduce the number of 
different screws in each computer, it would save Noranda approximately 
$4 in its disassembly costs. 

Second, to obtain sellable commodities, the resulting metal and plastic 
"scrap" must be further processed to obtain shredded plastic, aluminum, 
copper, gold, and other recyclable materials. Processing in this 
fashion typically involves multimillion-dollar machinery. According to 
officials with one international electronics recycling company, 
processing costs are high, in part, because this sophisticated 
machinery is being used to process the relatively limited supply of 
used electronics being recycled in the United States. The firm's 
officials noted that in Europe, by contrast, where manufacturers are 
required to take financial responsibility for the disposal of their 
products, the increased supply of recyclable electronics has decreased 
the firm's per-unit processing costs and increased the profitability of 
recycling used electronics. 

Finally, recyclers incur additional expenses when handling and 
disposing of toxic components (such as batteries) and toxic 
constituents (such as lead), which are all commonly found in used 
electronics. These expenses include removing the toxic components and 
constituents from the product, as well as handling and processing them 
as hazardous material. Once separated from the product, these wastes 
are considered hazardous wastes and are subject to more stringent RCRA 
requirements governing their transportation, storage, and disposal. 
CRTs from computer monitors and televisions are particularly expensive 
to dispose of because they contain large volumes of leaded glass, which 
must be handled and disposed of as a hazardous waste. Since CRT 
manufacturing is declining in the United States, some recyclers send 
their CRT glass to a lead smelter in Missouri that charges recyclers 
for their CRT glass. A study on the economics of recycling personal 
computers found that the cost associated with disposing of CRT monitors 
substantially reduces a recycler's net revenue.[Footnote 10]

Refurbishers charge similar fees to cover the costs involved in 
guaranteeing data security by "wiping" hard drives, upgrading systems, 
installing software, and testing equipment. A program manager for a 
nonprofit technology assistance provider told us that it generally 
costs about $100 to refurbish a Pentium III computer system, plus an 
additional licensing fee of about $80 for an operating system. 

To encourage used electronics recycling, EPA sponsored pilot programs 
that addressed the cost and inconvenience issues. Office Depot and 
Hewlett-Packard, for example, partnered to provide free take-back of 
used electronics at Office Depot retail stores. Collected used 
electronics were sent to Hewlett-Packard facilities for recycling. Over 
a 3-month period, nearly 215,000 computers, monitors, and televisions 
were collected and recycled. EPA officials told us that the pilot 
program showed the extent to which recycling can be encouraged by 
making it inexpensive and convenient to the consumer. 

Federal Regulatory Framework Governing Used Electronics Provides Little 
Incentive for Recycling or Reuse: 

The lack of economic incentives promoting recycling and reuse of 
electronics is compounded by the absence of federal provisions that 
either encourage recycling, or preclude their disposal in landfills. 
Specifically, current federal laws and regulations (1) allow hazardous 
used electronics in municipal landfills, (2) do not provide for a 
financing system to support recycling, and (3) do little to preclude 
electronic products generated in the United States from being exported 
and subsequently threatening human health and the environment overseas. 
While several promising federal initiatives supporting electronics 
recycling have been launched, their voluntary nature makes their 
success uncertain. 

Hazardous Used Electronics Are Allowed in Municipal Landfills: 

Regulation of used electronics at the federal level falls under RCRA 
Subtitle C, which was established to ensure that hazardous waste is 
managed in a manner that is protective of human health and the 
environment. However, households and small quantity generators are 
exempt from many RCRA regulations, thus allowing them to deposit their 
used electronics in municipal solid waste landfills--even though 
cathode ray tubes in computer monitors and televisions, and potentially 
circuit boards in computers, exhibit characteristics of hazardous 
waste. EPA's Office of Solid Waste regulates hazardous waste under 
RCRA, but it lacks the authority to require environmentally preferable 
management of used electronics through recycling and reuse or to 
establish a mandatory national approach, such as a disposal ban. As a 
result, all of the office's efforts with regard to the recycling of 
used electronics are voluntary. 

In response to RCRA's exemption for household hazardous waste and the 
growing volume of obsolete electronics within their boundaries, four 
states--California, Maine, Massachusetts, and Minnesota--recently 
banned from landfills some used electronics.[Footnote 11] Our 
preliminary work suggests that such bans have contributed to a higher 
degree of recycling than in states where disposal in solid waste 
landfills is allowed. In San Ramon, California, for instance, a 1-day 
collection event for television monitors yielded 24,000 units. In 
contrast, in Richmond, Virginia, a metropolitan area 4 times the size 
of San Ramon but without a landfill ban, a similar collection event 
(organized by the same electronics recycler as in San Ramon) only 
yielded about 6,000 monitors. This difference in yield is consistent 
with assessments of California and Massachusetts officials, who all 
told us that their states have seen substantial increases in used 
electronics recycling. One international electronics recycler, for 
instance, set up recycling facilities in the San Francisco area in 2003 
because of the large volume of used electronics that were no longer 
being disposed of in landfills. In Massachusetts, an official with the 
Department of Environmental Protection told us that six businesses 
dedicated to electronics recycling were created following the enactment 
of a landfill ban. Finally, about 75 percent of the survey respondents 
to date said that a national disposal ban should be enacted to overcome 
the economic and regulatory factors that discourage recycling and reuse 
of used electronics. 

Experts Believe a National Financing System is Needed to Support 
Recycling: 

Given the inherent economic disincentives to recycle used electronics, 
we found widespread agreement among our survey respondents and others 
we contacted that the establishment of some type of financing system is 
critical to making recycling and reuse sufficiently inexpensive and 
convenient to attract the participation of consumers. For instance, 
almost 90 percent of survey respondents believe that either an advanced 
recycling fee (ARF), extended producer responsibility (EPR), or a 
hybrid of the two should be implemented if national solution is 
instituted. Yet despite broad agreement in principle, participants in 
the recent multi-stakeholder NEPSI process, particularly those in the 
computer and television industries, did not reach agreement on a 
uniform, nationwide financing system after several years of meetings. 

In the absence of a national system, several states have enacted their 
own financing systems through legislation to help ensure 
environmentally preferable management of used electronics. For example, 
in 2005, California implemented an ARF on all new video display 
devices, such as televisions and computer monitors, sold within the 
state. The fee is charged to consumers at the time and location of 
purchase, and can range between $6 and $10. According to an official 
with the California Department of Toxic Substance Control, the revenues 
generated from the fee are intended to deal with a key concern--used 
electronics in storage, or "legacy waste." The officials explained that 
while California's recycling industry for used electronics had 
sufficient capacity to recycle large volumes, consumers and large- 
quantity generators had little incentive to take products out of their 
basements or warehouses to have them recycled. The state uses revenues 
from the fees to reimburse electronics recyclers at the rate of 48 
cents per pound of used electronics recycled. The recyclers, in turn, 
pass on 20 cents per pound to collectors of used electronics, thereby 
providing an incentive for entities to make collection free and 
convenient for households. 

The state is still in the preliminary stages of program implementation, 
and state officials acknowledge that they face a number of challenges. 
Some of these challenges underscore the difficulty of dealing with the 
electronic waste problem on a state-by-state basis. The officials 
noted, for instance, that the ARF applies only to electronics purchased 
in California, and that the fees are intended only for used electronics 
originating in the state. Implementing the program within the state's 
boundary, however, may prove difficult because the payout for used 
electronics may attract units originating in other states. Preventing 
this problem, they say, requires substantial documentation for each 
unit, and may require a substantial enforcement effort. 

While California's ARF focuses on consumers of electronics, Maine's 
approach focuses on producers. In 2004, the state passed legislation 
requiring computer and television manufacturers who sell products in 
Maine to pay for the take back and recycling of their products at their 
end of life--a strategy referred to as EPR. Under this plan, consumers 
are to take their used electronics to a consolidation point, such as a 
transfer station, where they are sorted by original manufacturer. Each 
manufacturer is responsible for transporting and recycling its 
products, along with a share of the products whose original 
manufacturer no longer exists. According to one official with Maine's 
State Planning Office, a key challenge of its EPR system is the lack of 
a financial incentive for consumers to take their used electronics out 
of storage: they must still take their products to a consolidation 
point, and will still likely have to pay a fee. 

Several other states, as well as some countries, have implemented or 
are considering implementing financing systems for used electronics. 
Earlier this year, Maryland passed legislation requiring all computer 
manufacturers that sell computers in the state to pay $5,000 into a 
fund to help implement local recycling programs.[Footnote 12] Other 
states, such as Arkansas, Colorado, Florida, and Massachusetts have 
allocated grants to help pay for the recycling of used electronics, and 
New York, Rhode Island, and Vermont are considering enacting 
manufacturer take-back programs. In Europe, the European Union 
implemented the Waste Electrical and Electronic Equipment Management 
Regulations in July 2004, which requires producers of electronic 
products to be financially responsible for the recycling or reuse of 
their products at end of life. In our final report, we will provide a 
more complete examination of various strategies for financing 
environmentally preferable management of used electronics. 

Oversight of Exported Used Electronics Is Limited: 

The lack of oversight over exports of used electronics could also 
discourage environmentally preferable management of used electronics. 
In the United States, businesses, schools, government agencies, and 
other organizations, as well as households, face multiple options for 
their used electronics. In some instances, organizations and recyclers 
receive e-mails from brokers, who typically have partners in Asia, 
willing to pay them for their used electronics, regardless of whether 
they can be reused. For example, one broker requests up to 50,000 used 
monitors per month and does not require the monitors to be tested. 
Another broker specifically requests nonworking monitors and wanted to 
fill at least 10 containers, which equals anywhere from 6,000 to 11,000 
units, depending on their size. One Seattle area recycler said that 
brokers such as these are probably not handling the units in 
environmentally preferable ways once the units are exported. Even so, 
one business we contacted said it regularly receives e-mail requests 
such as these. 

Companies export used electronics because the largest markets for 
reused computers and computer parts are overseas, according to an EPA 
official. Likewise, demand is high for recycled commodities, which can 
be processed more cheaply due, in part, to lower wages and less 
stringent environmental requirements. Also, unlike their counterparts 
in some other developed countries, the United States officials have 
permitted the export of hazardous used electronics, such as CRT 
monitors and televisions, if the exporter asserts that the equipment is 
destined for reuse. While some environmental groups have called for a 
ban on exports of used electronics, the Congressional Research Service 
noted that such a ban would cut recyclers off from many of the markets 
able to reuse the materials.[Footnote 13]

However, few safeguards are in place to ensure that exported used 
electronics are indeed destined for reuse.[Footnote 14] Used 
electronics that are destined for reuse are not considered to be waste 
subject to RCRA export regulations. Instead, such electronics are 
considered to be commodities, which means that they can be exported 
with little or no documentation, notification, and oversight. 
Nonetheless, instances have been recently documented in which 
environmental and human health threats have resulted from the less- 
regulated disassembly and disposal of U.S.-generated used electronics 
overseas. For example, a 2002 documentary by the Basel Action Network 
and Silicon Valley Toxics Coalition videotaped egregious disassembly 
practices in China that involved open burning of wire to recover 
copper, open acid baths for separating precious metals, and human 
exposure to lead and other hazardous materials.[Footnote 15] Without 
the ability to track the exported units to importing countries, or to 
audit companies exporting used electronics, it is difficult to verify 
that exported used electronics are actually destined for reuse, or that 
they are ultimately managed responsibly once they leave U.S. shores. As 
our work continues, we will further examine the extent of the problems 
associated with irresponsible management of used electronics overseas. 

Opportunities Exist for Federal Initiatives to Enhance Electronics 
Recycling: 

The federal government has taken some steps to affirm its commitment to 
encourage recycling of used electronics through the implementation of 
two voluntary programs sponsored by EPA. The Federal Electronics 
Challenge (FEC) and the Electronic Product Environmental Assessment 
Tool (EPEAT) both leverage U.S. government purchasing power to promote 
environmentally preferable management of electronic products from 
procurement through end of life. For example: 

* The FEC program challenges federal agencies and facilities to procure 
environmentally preferable electronic products, extend the lifespan of 
these products, and expand markets for recycling and recovered 
materials by recycling them at their end of life. The FEC provides 
guidance on environmentally preferable attributes of electronic 
products information, on operating and maintaining them in an energy- 
efficient manner, and on options for recycling or reusing them at the 
end of their useful lives. To date, 11 federal agencies and 26 
individual federal facilities participate in the FEC to some extent. 
The Bonneville Power Administration (BPA) recently documented cost 
savings associated with its FEC participation. BPA noted, for example, 
that the program extended the lifespan of its personal computers from 3 
to 4 years. With over 500 computers procured each year at an annual 
cost of more than $500,000, a BPA official told us extending computer 
life spans could generate substantial savings. Additionally, BPA 
decided to procure new flat-screen monitors instead of CRT monitors, 
reducing both hazardous waste tonnage and end of life recycling costs. 
According to BPA, it expects to save at least $153 per monitor over 
each monitor's life. 

* The EPEAT program promotes environmentally preferable management of 
electronics by allowing large purchasers, such as government agencies, 
to compare and select laptop computers, desktop computers, and monitors 
with environmentally preferable attributes. For example, EPEAT 
evaluates an electronic product's design for energy conservation, 
reduced toxicity, extended lifespan, and end of life recycling, among 
other things. EPEAT's three-tier system--bronze, silver, and gold-- 
provides purchasers with the flexibility to select equipment that meets 
the minimum performance criteria, or to give preference to products 
with more environmental attributes. For manufacturers, EPEAT provides 
flexibility to choose which optional criteria they would like to meet 
to achieve higher levels of EPEAT qualification. EPA expects EPEAT to 
be instituted in 2006, and products with higher environmental ratings 
could receive preferred consideration in federal procurement decisions. 

While we will continue to examine the FEC and EPEAT programs in greater 
detail, including how stakeholders say they might be improved, our 
preliminary work suggests that the federal government can build on 
these initiatives by using its purchasing power to lead markets for 
electronic products in environmentally friendly directions. In fact, 
there is ample precedent for such a strategy, perhaps most notably in 
EPA's and the Department of Energy's Energy Star program. In that 
program, the federal government partners with industry to offer 
businesses and consumers energy-efficient products that ultimately save 
money and protect the environment. According to EPA, in 2004 alone, 
Energy Star products helped save approximately $10 billion in energy 
costs and reduced greenhouse gas emissions by an amount equivalent to 
that produced by 20 million automobiles. Part of Energy Star's success 
can be attributed to federal actions, particularly those outlined in 
two executive orders that required federal agencies to purchase 
products equipped with Energy Star features. Since the federal 
government will spend over $60 billion on information technology 
products in fiscal year 2005, including televisions, computers, and 
computer monitors, it could go beyond the voluntary and limited FEC and 
EPEAT programs by broadening the programs' scope and requiring agency 
participation in, or adherence to, some of the programs' key practices. 
As with the Energy Star program, such actions may lead to cost savings 
and greater environmental protection. Of particular note, over 80 
percent of the survey respondents to date said that federal government 
procurement criteria along the lines of FEC and EPEAT should be 
required, and about 95 percent of the survey respondents to date said 
that such procurement criteria would encourage environmentally 
preferable product design, as well as recycling and reuse. 

Observations on Federal Actions to Encourage Recycling and Reuse of 
Used Electronics: 

In our future work, we will continue to examine factors affecting 
recycling in greater detail, and the diverse efforts by individual 
states and others to deal with these issues. It is becoming clear, 
though, that in the absence of a national approach, a patchwork of 
potentially conflicting state requirements is developing, and that this 
patchwork may be placing a substantial burden on recyclers, 
refurbishers, and other stakeholders. A manufacturer in one state, for 
example, may have an advance recovery fee placed on its products, 
whereas in another state, the same manufacturer may have to take back 
its products and pay for recycling. Further, a retailer may have to set 
up a system in one state to collect fees on specific products and, at 
the same time, set up a different system in another state to take back 
a particular manufacturer's product. Hence, manufacturers we contacted 
said that while they had their preferences regarding, for instance, an 
ARF or EPR system, their main preference is to operate within a uniform 
national system that mandates a financing mechanism that preempts 
varying state requirements. Our preliminary survey results substantiate 
these views, with over 90 percent of survey respondents indicating that 
national legislation should be enacted and, if so, almost 90 percent 
believe a financing mechanism should be included. 

Our future work will also discuss some of the options--both legislative 
and administrative--being considered to encourage environmentally 
preferable management of used electronics at a national level. 
Frequently cited options include disposal bans, consumer education 
programs, a variety of financing systems, export restrictions, and 
federal government procurement requirements. These options may offer 
suggestions for a uniform national approach and what aspects should be 
considered. Additionally, an examination of EPA's voluntary programs-- 
the FEC and EPEAT--may shed light on other, more effective options 
available to the federal government that can save money over electronic 
products' life cycle; enhance environmental protection; drive markets 
for environmentally preferable product design; and establish a 
recycling infrastructure and markets for recycled commodities. 

Finally, with rapid advances in technology, particularly in consumer 
electronics, new products are reaching the marketplace with remarkable 
speed. Consequently, our future work will also examine the implications 
of these newer generations of electronics entering the nation's waste 
stream. 

Mr. Chairman, this completes my prepared statement. I would be happy to 
respond to any questions you or other Members of this Subcommittee may 
have at this time. 

Contact and Acknowledgments: 

For further information, please contact John B. Stephenson at (202) 512-
3841 or stephensonj@gao.gov. Individuals making key contributions to 
this report included Nathan Anderson, Charles Bausell, Virginia 
Chanley, Bernice Dawson, Steve Elstein, Omari Norman, Alison O'Neill, 
Judy Pagano, Carol Herrnstadt Shulman, and Arvin Wu. 

FOOTNOTES

[1] For the purposes of our study, used electronics includes computers, 
computer monitors, and televisions that have reached the end of their 
original useful life. 

[2] National Safety Council, Electronic Product Recovery and Recycling 
Baseline Report, May 1999. These estimates are based on major 
assumptions, as well as responses from only 38 percent of sampled 
companies. Although the study supports the existence of a large and 
growing problem, the precise estimates should be used with caution. 

[3] International Association of Electronics Recyclers, IAER 
Electronics Recycling Industry Report, 2003. These estimates are based 
on major assumptions, as well as responses from only 20 percent of 
sampled companies. Although the study supports the existence of a large 
and growing problem, the precise estimates should be used with caution. 

[4] Bleiwas, Donald and Kelly, Thomas, Obsolete Computers, "Gold 
Mines," or High-Tech Trash? Resource Recovery From Recycling 
(Washington, D.C.: U.S. Geological Survey, 2001). Because we have not 
yet reviewed this study, this data should be used with caution. 

[5] The United Nations University is a think tank for the United 
Nations and is not a degree granting university. 

[6] Townsend, Timothy, et al, Characterization of Lead Leachability 
from Cathode Ray Tubes Using the Toxicity Characteristic Leaching 
Procedure. (University of Florida, Department of Environmental 
Engineering Sciences: 2000). Because we have not yet reviewed this 
study, these estimates should be used with caution. 

[7] Solid Waste Association of North America, The Effectiveness of 
Municipal Solid Waste Landfills in Controlling Releases of Heavy Metals 
to the Environment (2004). Because we have not yet reviewed this study, 
this data should be used with caution. 

[8] Over 70 percent of the survey respondents felt that existing 
collection options for recycling used electronics were inconvenient for 
households. 

[9] This point is further underscored by our interviews with 8 
electronics recyclers, who were unanimous in emphasizing that they 
could not cover costs without charging fees. 

[10] Boon, J.E., Isaacs, J.A., and Gupta, S.M. "Economic Sensitivity 
for End of Life Planning and Processing of Personal Computers." Journal 
of Electronics Manufacturing (Vol. 11, 81-93, 2002). Because we have 
not yet reviewed this study, this data should be used with caution. 

[11] The landfill bans in Maine and Minnesota take full effect in 2006. 

[12] An official with the Maryland Department of Environment estimated 
that anywhere from 40 to 200 computer manufacturers might be required 
to pay the fee. He cited one estimate that the fee will provide the 
state with about $400,000 to use toward recycling used electronics. 

[13] Congressional Research Service, Recycling Computers and Electronic 
Equipment: Legislative and Regulatory Approaches for "E-Waste," 
(Washington, D.C.: 2003). 

[14] The following are generally not classified as solid wastes under 
RCRA: Used electronics for reuse, whole circuit boards, shredded 
circuit boards, if free of certain hazardous materials, metal from used 
electronics, and scrap metal. 

[15] The Basel Action Network is an environmental group that works to 
prevent the trade of toxic wastes from developed countries to 
developing countries. The Silicon Valley Toxics Coalition is an 
environmental group that works to prevent environmental and human 
health problems caused by the electronics industry.