In 2007, Excel Homes, the nation's largest custom modular home manufacturer, generated 700 tons of waste, on average, from each of its three module plants. This year, with its module production only slightly down, the company projects that it will reduce that to 200 tons per plant. And its facility in Marlboro, N.Y., which opened last October, now funnels all of its waste materials through recyclers instead of disposing some of that waste into landfills.

"Being green isn't just something that our customers want," says Steve Scharnhorst, president and CEO of the Camp Hill, Pa.-based Excel. "It's a business factor we have to deal with every day." Plants that build modular homes generate all kinds of waste: cardboard, copper, wire and metal products, plastics, drywall, and lumber. But becoming landfill-free isn't that easy; it requires finding recycling companies that will accept building materials and preparing those materials in ways they can be hauled.

One of the first tenets of any waste management program, says Scharnhorst, should be "if it doesn't go on or in the house, don't take it into the plant." And whatever enters Excel's plants needs to be used optimally, which is why the manufacturer has established internal procedures to repurpose materials and to limit, as much as possible, what plant employees throw away.

The company has worked with its suppliers to cut down on their packaging to reduce the amount of cardboard its plants need to get rid of. Most suppliers have cooperated, but Scharnhorst says Excel has needed to switch a few to find those that can comply with its strategy.

Finding recyclers, though, can be problematic. Indeed, some of the waste from Excel's plants in Avis and Liverpool, Pa., is still ending up in landfills because the company has yet to find a local recycler for all of the materials. And the recyclers it does use can be very specific about how they will receive waste materials.

So each plant has waste disposal bins for cardboard, wood products, and drywall. Scharnhorst notes that recyclers generally don't want lumber with nails in it, so the fasteners need to be removed.

Culling and separating waste materials "doesn't happen for free," says Scharnhorst, but defraying the cost of recycling has gotten tougher as the recovery price for salvaged products like copper has shrunk. (Right now, Excel is giving away its cardboard.) Scharnhorst is convinced that his company saves money by repurposing products in-house, although he admits that it hasn't been measuring that savings too precisely yet.

Excel expects to produce 850 modular homes this year, and Scharnhorst thinks there's still room to further reduce plant waste. In addition, any future facilities—including a plant in Oxford, Maine, the opening of which is now pending a recovery in the housing market—will be set up to be landfill-free, he says.

John Caulfield is senior editor at BUILDER magazine.