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Alaska Airlines replaces cups from China with local product

Starting Oct. 1 Alaska Airlines passengers will sip coffee from new high-technology plastic cups, the product of a fast-growing company in Arlington.

Right now, Alaska gets its paper cups for in-flight service from a manufacturer in China. But the new cups, made by Washington-based MicroGreen Corp., are expected to cost one third less, weigh half as much, insulate twice as well, and will be completely recyclable.

“In-flight recycling and using sustainable products is an important part of our on-board product and company values,” said Lisa Luchau, director of onboard food and beverage for Alaska Airlines, a unit of Seattle-based Alaska Air Group (NYSE: ALK), in an email. “This cup meets those needs better than our current cup.”

For MicroGreen chief technology officer and co-founder Krishna Nadella, this Alaska contract is the tipping point for his fast-growing company, which makes plastic cups and containers from polyethylene terephthalate plastic, usually known from the more user-friendly name PET.

“We are in discussion with multiple airlines, this is our first target market,” he said about the Alaska contract. “We need a beachhead.”

PET is the plastic used to make plastic beverage bottles, and Nadella saw its potential about 10 years ago, when he came across a technology to transform the plastic while studying mechanical engineering at the University of Washington.

Vipin Kumar, a professor in mechanical engineering, had developed the technology in the mid-’90s.

“We realized this technology was sitting there and nobody was using it,” Nadella said.

The technique, which MicroGreen on its website calls “ad-air technology,” is a way to inject carbon dioxide under pressure into thin sheets of clear PET. When the plastic is heated, in an extremely controlled manner, the gas doubles the plastic in size, the plastic turns white, and it can be molded into containers like plastic cups.

The product is insulating (because of the tiny bubbles, just 2 percent the size of normal plastic foam bubbles), doesn’t change the taste of drinks (Starbucks verified that), and is considered safe by the Food and Drug Administration. Of course, even these plastic cups have their critics.

That said, Nadella contends that the MicroGreen cups are far safer than polystyrene coffee cups, or even paper hot-drink cups, which are usually lined with polyethylene.

And while you may have noticed that clear PET beverage bottles will deform when filled with hot water, MicroGreen cups don’t do that, because the molecules take a crystalline form that makes the cups keep their shape up to 230 degrees Fahrenheit.

So popular are MicroGreen cups, which the company has sold through Costco since 2012, that Nadella’s team is planning to double its Arlington factory to 60,000 square feet in 2014, and expects $20 million in revenues then.

The company now employs 58, but Nadella thinks that could rise to 200 by the end of 2014.

The current facility’s capacity is 200 million cups a year, Nadella said, which will rise to 600 million when the plant is expanded and new equipment is brought in. Another expansion with more equipment will lift capacity to 2 billion cups yearly, at which point MicroGreen will start looking for other locations for factories.

Nadella hopes to eventually build plants near population centers around the United States, including on the East Coast, Midwest and California, especially if big, fast-food restaurant chains start switching to the cups.

“We need multiple plants to be efficient,” he said. “After about a 1,000-mile radius, it doesn’t make sense to ship food packaging.”

One of the best things about making cups from PET plastic is that it will support plastic recycling. Currently PET beverage bottles are ubiquitous, especially for bottled water and soft drinks. But while 4 million pounds of PET are recycled each year, making it the world’s most recycled plastic, uses for the resulting material are rather limited.

The company is located in Arlington, at the northern edge of Snohomish County. That site was originally chosen because a vice president lives in Bellingham. But the location has proven to be a good one, said Nadella, who lives in Seattle.

‘We just found the location was perfect to find high skilled labor… It just became home for us in the last seven years, and fit our needs very well,” he said. “We wanted proximity to University of Washington, to keep working with research and development.”

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