McKee Foods Corp. is looking at turning wasted Little Debbie snacks into ethanol and biodiesel as it eyes an environmentally friendly green strategy.

The company is studying the setup of processing stations at each of its three manufacturing plants in the United States, including the Collegedale facility, to turn waste food into fuel.

"All the financial analysis in these projects looks good," said Terry Howell, director of research for the company that employs about 3,000 people as Hamilton County's largest manufacturer.

Mr. Howell said the processing, which could still be a couple of years away, might produce 700,000 gallons of ethanol a year from the Collegedale plant alone.

"The other locations could generate similar amounts," he said about plants in Arkansas and Virginia.

In addition, production of biodiesel could amount to 400,000 gallons a year, Mr. Howell told the Chattanooga Engineers Club.

"In all our plants, we could generate 1 million gallons a year," he said.

Larry Martin, an engineering group manager for McKee, said fuel costs at McKee are significant.

"The cost of fuel has come down but prices are probably going to go up again," he said. Mr. Martin said the company continues to look at using biodiesel in its shuttle trucks.

"It could be a significant saving in our fleet," Mr. Howell said.

Mr. Howell said McKee competitors are making changes to become greener.

"We're trying to match them," he said.

Current food waste amounts to under 10 percent and is sold to an animal feed company, Mr. Howell said.

"If they struggle, we'd have a lot of waste to deal with," he said.