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Thread: Giant Retailers Look to Sun for Energy Savings

  1. #1
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    Giant Retailers Look to Sun for Energy Savings

    [URL="http://www.nytimes.com/2008/08/11/business/11solar.html"]NY TIMES[/URL]

    August 11, 2008

    Giant Retailers Look to Sun for Energy Savings

    By STEPHANIE ROSENBLOOM

    Retailers are typically obsessed with what to put under their roofs, not on them. Yet the nation’s biggest store chains are coming to see their immense, flat roofs as an untapped resource.

    In recent months, chains including Wal-Mart Stores, Kohl’s, Safeway and Whole Foods Market have installed solar panels on roofs of their stores to generate electricity on a large scale. One reason they are racing is to beat a Dec. 31 deadline to gain tax advantages for these projects.

    So far, most chains have outfitted fewer than 10 percent of their stores. Over the long run, assuming Congress renews a favorable tax provision and more states offer incentives, the chains promise a solar construction program that would ultimately put panels atop almost every big store in the country.

    The trend, while not entirely new, is accelerating as the chains seize a chance to bolster their environmental credentials by cutting back on their use of electricity from coal.

    “It’s very clear that green energy is now front and center in the minds of the business sector,” said Daniel M. Kammen, an energy expert at the University of California, Berkeley. “Not only will you see panels on the roofs of your local stores, but I suspect very soon retailers will have stickers in their windows saying, ‘This is a green energy store.’ ”

    In the coming months, 85 Kohl’s stores will get solar panels; 43 already have them. “We want to keep pushing as many as we possibly can,” said Ken Bonning, executive vice president for logistics at Kohl’s.

    Macy’s, which has solar panels atop 18 stores, plans to install them on another 40 by the end of this year. Safeway is aiming to put panels atop 23 stores. And other chains, including Whole Foods Market, BJ’s Wholesale Club and REI, the purveyor of outdoor goods, are planning projects of their own.

    Wal-Mart, the nation’s largest retailer, has 17 stores and distribution centers with solar panels in operation or in the testing phase. It plans to add them soon to five more stores. People at the chain are considering a far larger program that would put panels and other renewable technologies at hundreds of stores.

    “It’s going to be the Wal-Marts of the world that will buy these things over acres and make a difference,” said Roger G. Little, chairman and chief executive of the Spire Corporation, a Boston company that provides solar equipment.

    Analysts are not sure how much power the rooftop projects could ultimately produce, but they say it could be enough to help shave total electricity demand. In many communities, stores are among the biggest energy users. Depending on location and weather, the solar panels generate 10 to 40 percent of the power a store needs.

    If Wal-Mart eventually covered the roofs of all its Sam’s Club and Wal-Mart locations with solar panels, figures from the company show that the resulting solar acreage would roughly equal the size of Manhattan, an island of 23 square miles.

    Booming demand in recent years has driven up the price of solar panels, and analysts say it costs far more to generate electricity from solar energy than from coal.

    Coal generation costs about 6 cents for a kilowatt hour, which is enough electricity to run a hair dryer for an hour. Natural gas generation costs about 9 cents a kilowatt hour, said Reese Tisdale, a senior analyst with the consulting firm Emerging Energy Research. In comparison, “best case” for power from solar panels is about 25 to 30 cents a kilowatt hour, he said.

    But retailers believe that they can achieve economies of scale. With coal and electricity prices rising, they are also betting that solar power will become more competitive, especially if new policies addressing global warming limit the emissions from coal plants.

    Retailers, hoping to create a bigger market and positioning themselves at the forefront of a national shift toward renewable energy, are encouraging one another to join the bandwagon.

    “We’re hoping that our purchases along with some other retailers will help bring the technology costs down,” said Kathy Loftus, who is in charge of energy and other initiatives at Whole Foods Market.

    Most of the efforts so far are in California, New Jersey and Connecticut, states that offer generous incentives. Executives say they would like to convert many more. How quickly they can do so depends on government policy because retailers rely on tax incentives to offset the cost.

    Corporate officials describe a federal tax credit for renewable energy, one that Congress has let expire and then renewed several times, as particularly important. A Congressional deadlock over offshore oil drilling has held up legislation that would renew the credit for next year.

    “Every project that starts development has to be finished by Dec. 31 or you lose tax equity advantage, and nobody’s willing to take that risk,” said George Waidelich, vice president for energy operations at Safeway. “You’re talking about millions of dollars.”

    Retailers are fast becoming energy experts. They are experimenting with traditional solar panels, a new type of thin solar panel and ground-mounted tracking systems that move with the sun.

    They are also combining those systems with other rooftop technologies like skylights and solar water heaters.

    “Solar has become part of the kit that we think about when we open a store,” said Sharon Im-Lee, REI’s energy manager.

    American retailers are following the lead of stores in Europe, which are much further along. Store-roof projects are so numerous in parts of Germany that they can be spotted in satellite photos. Government subsidies there, however, have lasted for years.

    “In Germany, there are none of the concerns you find in the United States about whether support will be around next year,” said Jenny Chase, an energy analyst in London.

    Retailers in the United States tend to buy their own solar-power systems, at $4 million to $6 million for a store the size of a Wal-Mart, or enter into an agreement with a utility company that pays the up-front costs and then gives the store a break on power bills — an approach that appeals to big chains.

    “It really helps make it economical for the retailer,” said Kim Saylors-Laster, Wal-Mart’s vice president for energy.

    Retailers are also looking at other ways to extend their use of renewable energy by testing technologies like wind turbines and reflective white roofs, which keep buildings cooler in warm weather.

    Bernard Sosnick, an analyst with Gilford Securities who has examined Wal-Mart’s plans, said the day might come when people can pull their electric cars up to a store and recharge them with power from the roof or even from wind turbines in the parking lot.

    “It’s not as over the horizon as it might seem,” he said.

    James Kanter contributed reporting.

  2. #2
    There are opportunities for tremendous savings here for the Wal-Marts of the world, because their stores are so massive.

    Seems to me it would be relatively easy to lay solar panels atop these big boxes.

    Also, their business model (which uses trucks instead of wherehouses, and, as such, a crapload of gas) could be a lot more efficient if they could somehow convert those trucks to hybrids or at least models with better fuel efficiency. The cost of gas has got to be really hurting them, because its one commodity their scale would not seem to help them with.

  3. #3
    Big Business isn't stupid. They see which way the wind is blowing, clearly.

    Tax Breaks, and Oil/Coal Cost Increasing Legislation Defense both are huge benefits to them.

    Reduced Costs over the longterm helps.

    They can easily afford the initial cost outley to do it.

    Seems like a no-brainer for big-box retailers.

  4. #4
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    [quote=Warfish;2682994]Big Business isn't stupid. They see which way the wind is blowing, clearly.

    Tax Breaks, and Oil/Coal Cost Increasing Legislation Defense both are huge benefits to them.

    Reduced Costs over the longterm helps.

    They can easily afford the initial cost outley to do it.

    Seems like a no-brainer for big-box retailers.[/quote]

    This is the way a capitalist society is supposed to work. If there is a market and money to be made, private industry will get it done. Not nancy pelosi and the government.

  5. #5
    [QUOTE=Spirit of Weeb;2683022]This is the way a capitalist society is supposed to work. If there is a market and money to be made, private industry will get it done. Not nancy pelosi and the government.[/QUOTE]

    On a single company level, you are right. But on a macro level, these are not necessarily mutually exclusive.

    Veyr interesting column from Tom Friedman in Sunday's NYT on how Denmark became energy independent...


    [QUOTE]Op-Ed Columnist
    Flush With Energy
    By THOMAS L. FRIEDMAN
    Copenhagen

    The Arctic Hotel in Ilulissat, Greenland, is a charming little place on the West Coast, but no one would ever confuse it for a Four Seasons — maybe a One Seasons. But when my wife and I walked back to our room after dinner the other night and turned down our dim hallway, the hall light went on. It was triggered by an energy-saving motion detector. Our toilet even had two different flushing powers depending on — how do I say this delicately — what exactly you’re flushing. A two-gear toilet! I’ve never found any of this at an American hotel. Oh, if only we could be as energy efficient as Greenland!

    A day later, I flew back to Denmark. After appointments here in Copenhagen, I was riding in a car back to my hotel at the 6 p.m. rush hour. And boy, you knew it was rush hour because 50 percent of the traffic in every intersection was bicycles. That is roughly the percentage of Danes who use two-wheelers to go to and from work or school every day here. If I lived in a city that had dedicated bike lanes everywhere, including one to the airport, I’d go to work that way, too. It means less traffic, less pollution and less obesity.

    What was most impressive about this day, though, was that it was raining. No matter. The Danes simply donned rain jackets and pants for biking. If only we could be as energy smart as Denmark!

    Unlike America, Denmark, which was so badly hammered by the 1973 Arab oil embargo that it banned all Sunday driving for a while, responded to that crisis in such a sustained, focused and systematic way that today it is energy independent. (And it didn’t happen by Danish politicians making their people stupid by telling them the solution was simply more offshore drilling.)

    What was the trick? To be sure, Denmark is much smaller than us and was lucky to discover some oil in the North Sea. But despite that, Danes imposed on themselves a set of gasoline taxes, CO2 taxes and building-and-appliance efficiency standards that allowed them to grow their economy — while barely growing their energy consumption — and gave birth to a Danish clean-power industry that is one of the most competitive in the world today. Denmark today gets nearly 20 percent of its electricity from wind. America? About 1 percent.

    And did Danes suffer from their government shaping the market with energy taxes to stimulate innovations in clean power? In one word, said Connie Hedegaard, Denmark’s minister of climate and energy: “No.” It just forced them to innovate more — like the way Danes recycle waste heat from their coal-fired power plants and use it for home heating and hot water, or the way they incinerate their trash in central stations to provide home heating. (There are virtually no landfills here.)

    There is little whining here about Denmark having $10-a-gallon gasoline because of high energy taxes. The shaping of the market with high energy standards and taxes on fossil fuels by the Danish government has actually had “a positive impact on job creation,” added Hedegaard. “For example, the wind industry — it was nothing in the 1970s. Today, one-third of all terrestrial wind turbines in the world come from Denmark.” In the last 10 years, Denmark’s exports of energy efficiency products have tripled. Energy technology exports rose 8 percent in 2007 to more than $10.5 billion in 2006, compared with a 2 percent rise in 2007 for Danish exports as a whole.

    “It is one of our fastest-growing export areas,” said Hedegaard. It is one reason that unemployment in Denmark today is 1.6 percent. In 1973, said Hedegaard, “we got 99 percent of our energy from the Middle East. Today it is zero.”

    Frankly, when you compare how America has responded to the 1973 oil shock and how Denmark has responded, we look pathetic.

    “I have observed that in all other countries, including in America, people are complaining about how prices of [gasoline] are going up,” Denmark’s prime minister, Anders Fogh Rasmussen, told me. “The cure is not to reduce the price, but, on the contrary, to raise it even higher to break our addiction to oil. We are going to introduce a new tax reform in the direction of even higher taxation on energy and the revenue generated on that will be used to cut taxes on personal income — so we will improve incentives to work and improve incentives to save energy and develop renewable energy.”

    Because it was smart taxes and incentives that spurred Danish energy companies to innovate, Ditlev Engel, the president of Vestas — Denmark’s and the world’s biggest wind turbine company — told me that he simply can’t understand how the U.S. Congress could have just failed to extend the production tax credits for wind development in America.

    Why should you care?

    “We’ve had 35 new competitors coming out of China in the last 18 months,” said Engel, “and not one out of the U.S.” [/QUOTE]

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    Slight technicality in the article- it said Whole Foods has recently gone to putting solar panels on the roof. Whole Foods has actually been doing that for quite some time now.

    There's acres of roof area on these big box retailers, why not harness the sun. Retrofitting an existing roof to handle the solar panel weight is more costly than accounting for it in a new building, though.

  7. #7
    [QUOTE=Big L;2683031]Slight technicality in the article- it said Whole Foods has recently gone to putting solar panels on the roof. Whole Foods has actually been doing that for quite some time now.

    There's acres of roof area on these big box retailers, why not harness the sun. Retrofitting an existing roof to handle the solar panel weight is more costly than accounting for it in a new building, though.[/QUOTE]

    Exactly. The mega chains can presumaby purchase panels at a steep volume discount, and, even if they only provide, say 15%-30% of a store's electricity, the savings across an entire national chain is enormous in the current gas-price environment.

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    [QUOTE=Spirit of Weeb;2683022]This is the way a capitalist society is supposed to work. If there is a market and money to be made, private industry will get it done. Not nancy pelosi and the government.[/QUOTE]

    So you favor government subsidies for renewable energy?

  9. #9
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    yikes... I'm surrounded by crazy environmental whacko libtards

    :rolleyes:

  10. #10
    [QUOTE=Buster;2683183]So you favor government subsidies for renewable energy?[/QUOTE]

    No, No more subsidies for anything!

  11. #11
    Then you agree with Pelosi's moves concerning drilling. Not the gov't's problem.

    [QUOTE=Spirit of Weeb;2683022]This is the way a capitalist society is supposed to work. If there is a market and money to be made, private industry will get it done. Not nancy pelosi and the government.[/QUOTE]

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