Wal-Mart faces hurdles in green electronics

By Nicole Maestri

LAS VEGAS (Reuters) - A campaign to reduce packaging has been a success for Wal-Mart Stores "green" campaign, but a move toward environmentally friendly electronics is proving that changing the mechanics of a TV is much more complex than changing the mechanics of a cereal box.

Manufacturers that sell goods in Wal-Mart's stores have responded quickly to the company's request to cut packaging waste, slashing the size of cereal boxes or bulking up toilet paper rolls to eliminate the need for extra cardboard centers.

This year, Wal-Mart wants electronics makers to fill out scorecards that will rate their products on areas like energy use, durability and ease of recycling. Wal-Mart will use the scores to help decide which products to stock on its shelves.

But the foray into "green" electronics is proving to be more complicated than its foray into "green" packaging.

Also, there are no uniform U.S. guidelines regarding energy consumption or recycling, so Wal-Mart is sorting through a maze of international and local standards.

"We'd like to see some kind of federal legislation that would take all the individual state programs and bring it together," said Kevin O'Connor, Wal-Mart's general merchandise manager for consumer electronics, in an interview at the Consumer Electronics Show, or CES, this week in Las Vegas.

THE GREENING OF WAL-MART

Wal-Mart has set a goal of one day using only renewable energy and creating zero waste, and it has challenged its suppliers to remove nonrenewable energy from their lives.

Because of its status as the world's largest retailer, Wal-Mart is considered one of the few retailers with enough heft to make direct changes to global energy consumption.

While the efforts may help the environment, they are also designed to help Wal-Mart's bottom line.

Wal-Mart said it will save $3.4 billion by reducing packaging 5 percent by 2013, and CEO Lee Scott bristles at the notion that being green clashes with low-cost business.

"Even if you're against the idea that climate change is important, why in God's name would you be against saving money?" Scott said at the company's annual meeting.

"It's taking out cost," he added "...We're not doing things that are silly."

Indeed these goals are no laughing matter for Wal-Mart suppliers, who know that producing poor scorecard ratings could mean losing space on the retailer's shelves.

"When they move to make it (the scorecard) a buying criterion, it will become a very powerful force," said Theo Schoenmakers, head of sustainability for Philips Consumer Lifestyle, at CES.