There is nothing new about using cork as an insulating material; Fridtjof Nansen lined the Fram with a foot thick layer of the stuff, and almost got to the North Pole in it, while Amundsen used the boat to get to the South Pole.
Cork is a completely renewable resource that we actually should use; the cork forests in Portugal provide habitat for the Iberian Lynx and the short-toed eagle. The land that the cork forests occupy is (or was until the crash) in demand for real estate and other developments; if the cork isn't harvested the tree gets it.
A world away in Vermont, Alex Wilson of BuildingGreen is renovating a farmhouse, and using only the greenest and healthiest of materials. Cork is certainly that. Alex writes:
The primary reason I’m excited about using cork insulation on our house is that I don’t like some of the chemicals used in conventional foam insulation. Extruded polystyrene is made with a blowing agent, HFC-134a, which is a very potent greenhouse gas that is contributing to climate change, and nearly all foam insulation materials contain hazardous brominated or chlorinated flame retardants. (more info on this here)
Cork, by contrast, contains nothing but cork—nothing! As it is produced today by Amorim Isolamentos, S.A., the granules are poured into large vats and heated with steam in an autoclave at about 650°F for 20 minutes. The heat expands the granules by about 30% and releases a natural binder, suberin, that exists in the cork. There are no added ingredients.
There are a few downsides; it is not exactly local, having to take a transatlantic voyage. Alex agonized over this but in the end concluded that the virtues outweighed the distance. It is also expensive, three times the price of the extruded polystyrene it replaces. It's not going to take over the market.
However it is a serious option for the seriously green builder. More at BuildingGreen where it may be behind a paywall; if you are in the industry it is worth the price of a subscription.