Tuesday, December 19, 2006

Paying People to Recycle... Sort of..

Several years ago, I had an idea (which I may have brought up here... can't find it if I did): why not harness market forces (or, at least, the desire to save money) to encourage people to throw away less. My idea: charge by the pound for garbage collection, but credit households and businesses for recyclables. I had no idea how the logistics on this would've worked, and shelved the idea.

Now, Forbes reports that an entrepreneur has started a business that's modeled on similar thinking, Philadelphia's RecycleBank. Founder Patrick Fitzgerald took note of dismal recycling rates in New York City (where he was attending grad. school at Columbia), and figured out a way to increase people's participation: "pay" them:
"There are a lot of companies out there, like Starbucks and Home Depot, that are spending a lot of money on environmental programs, but [most] people don't know about them," says Fitzgerald. "If I could get those companies to reward households that are recycling, I could increase recycling rates."

A year later, in 2003, with the help of high school friend Ron Gonen and a $100,000 grant from Columbia University's Business School (where Gonan was grabbing an M.B.A.), Fitzgerald launched RecycleBank in Philadelphia. Its aim: to increase municipalities' recycling rates--and lower their landfill costs--by enticing constituents with coupons from big companies such as Starbucks, Bed Bath & Beyond, Staples and Whole Foods Market. RecycleBank collects a facilitation fee less than the amount saved by the municipality; customers get a free latte; and big corporations get to burnish their images. Everybody wins.

RecycleBank tracks each household's contribution by providing containers embedded with radio frequency identification tags that correspond to each household address. Scanners on sanitation trucks record the weights of each pickup in RecycleBank's database. Each household gets an account number and can track their recycling points a la airline miles.
I've always found it kind of strange that we have to pay to have recyclables picked up (at least we do here), because, of course, these materials can be sold. That system relies on "green guilt," or at least peer pressure -- recycling is viewed (at least among many middle-class folks) as virtuous behavior. But recyclables are commodities -- I can't think of another industry where a provider of "raw materials" has to pay the person who will take those materials and sell them. Is it just me, or is that backwards? I'm sure the folks that charge a fee to pick up your bottle and cans just love it...!

Of course, the other half of my concept is still there. If you can figure out a way to cash in on making people pay by the pound for having garbage hauled away, go for it...

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