From The Spring 2005 Issue of Natural Grocery Buyer

Green products mean green profits

Jennifer Alsever

Photo courtesy of Food Lion

Green business practices are regular among natural foods retailers. But today, supermarkets also look for energy-efficient and environmentally friendly practices. And now more than ever, they don’t have to go far for ideas on how to go green, nor go broke getting there.

In December, a Giant Eagle store near Cleveland became the first grocer in the nation to win Leadership in Energy and Environmental design certification. The 80,000-square-foot store uses ozone-free refrigeration, cabinetry made of recycled strawboard and 50 skylights equipped with sensors that adjust the electric lighting inside the store, based on natural light levels.

In 2002, green construction made up 7 percent of all U.S. construction projects, and that number is rising. “There’s a lot of interest, and there’s sort of a momentum building,” says Brendan Owens, manager for LEED, a program of the U.S. Green Building Council that guides environmentally sustainable construction.

In announcing the LEED award, Giant Eagle noted that it is the first supermarket in the world to receive such a designation.

“The marketing is absolutely key. It puts them out there in the forefront, and customers are going to respond to it,” Owens says.

But going green can also provide a financial payoff. Green construction can net tax credits in some states and can also earn a business better insurance rates. The U.S. Department of Energy also claims that building owners can cut electricity, natural gas, fuel oil and heating costs by 30 percent.

Giant Eagle’s new store is expected to save 30 percent on energy costs and half a million gallons of water a year inside and outside the store.

For cost-conscious retailers, protecting the environment can be as simple as recycling, buying bus passes for employees and encouraging car pools. Businesses can also use wheat-board shelving, a substrate laminate taken from the husk of wheat.

They can buy energy-efficient vehicles or use nonchemical cleaners to prevent allergic reactions or illness among employees.

Prices are dropping on products such as recycled-paper containers or paint with lower levels of the volatile organic chemicals that cause headache-inducing fumes. As availability rises, and general acceptance of such products increases, “It’s all become really affordable,” says Courtney France, an engineer with Architectural Energy Corp., a Boulder, Colo.-based environmental consulting firm.

Recycled products proved to be less expensive for Wild Oats Markets when it built new stores for its Henry’s Marketplace chain in Southern California. The stores used reclaimed brick and wood from old barns, and flooring made out of recycled plastic. The 23,000-square-foot Henry’s stores cost about $2 million each to build, or about 25 percent less than traditionally constructed Wild Oats stores, says Sonja Tuitele, spokeswoman for the chain.

For many food retailers, perhaps the biggest lure to be green is energy conservation. Food retailers typically spend 60 percent to 80 percent of their energy costs on refrigeration, Owens says. That contrasts with an office building, which uses 20 percent of its energy intake on cooling.

Energy costs are the second-largest expense behind labor for the Salisbury, N.C.-based Food Lion grocery chain, which has won plaudits for its efforts to reduce energy use since 1998. “Anything a grocer can do to decrease energy goes straight to the bottom line,” says Jeff Lowrance, spokesman for the chain of 1,220 stores.

More than 200 Food Lion stores—more than any U.S. retailer—have earned the U.S. Environmental Protection Agency’s Energy Star designation. H-E-B Grocery Co., based in San Antonio, is another supermarket chain in the Sun Belt to win Energy Star certification for its 137 stores.

Food Lion estimates it has reduced its energy use by more than 1.62 trillion British thermal units since 2000. In 2004, Food Lion says, the amount of energy it saved was equivalent to preventing 270 million pounds of carbon dioxide emissions, taking 27,700 cars off the road, planting 37,000 acres of trees or powering 12,159 American homes.

Food Lion cut its energy costs by 18 percent last year after switching to energy-efficient lighting, installing new anti-reflective freezer doors and setting up company-wide rules that require employees to turn off unused equipment.

Shading sun-exposed windows and repainting building exteriors with light colors can also cut air conditioning expenses.

A number of retailers, including Whole Foods, are increasingly using natural light from windows and skylights specially designed to prevent glare and allow the proper amount of daylight. Because light can hurt produce, some retailers use a “kawl wall,” which lets 99 percent of the light through but cuts out the harmful UV rays.

Switching to compact fluorescent lamps or other energy-efficient lighting is perhaps one of the simplest ways to yield fast paybacks on an energy bill, according to the Department of Energy. A calculator at www.eere.energy.gov can help estimate potential energy savings for lighting systems, water and heating, air conditioning and refrigeration.

Jennifer Alsever is a business reporter in Denver.