By David Peake, Chief Strategy Officer, The Consultus International Group
You hear the phrase ‘energy optimisation’ a lot these days. For retailers, it’s become something of a business imperative. In tough trading conditions, every penny saved, every positive impact on your brand reputation, could have an impact on the bottom line.
Focusing on energy consumption, energy performance, demand reduction and optimisation can not only help retailers reduce costs and achieve their sustainability goals, it also sends the right messages to customers who simply expect companies to be greener.
We all know that bricks-and-mortar retailing is under pressure. In January this year, the British Retail Consortium reported “the worst year in retail for 25 years” (that was the BBC News headline). In 2019, total sales fell 0.1% – the first annual sales decline since 1995.
At the same time, Barclaycard reported that a rise in consumer confidence didn’t translate into higher spending over the Christmas period. In fact, consumer spending growth actually declined if you took inflation into account.
Department store chain Beales is struggling to stay afloat. Major retailers like Debenhams and M&S are closing stores. Mothercare closed its final sites in January 2020. It’s been reported there are 50,000 fewer shops on UK high streets than a decade ago. And it’s clear the landscape will continue changing. But it’s not all doom and gloom; some retailers are doing okay, with new formats, and new approaches. And when it comes to making savings while also improving your operations, every little helps, right?
Energy reduction and energy optimisation are two areas that can help, particularly at a time when “sustainability has rocketed up the retail agenda… as brands and retailers come under mounting pressure to reduce their impact on the environment.”1 (Underlines magazine).
It also seems clear that achieving full sustainability will take quite some time. A 2019 study2 found that “two thirds (66%) of UK retailers believe it will take their business three years or more to achieve true sustainability.” Of almost 2,000 national and independent retailers who took part in the study, 73% said they’d made changes to their operations to become more sustainable but were “realistic that total sustainability was still out of reach.” It’s certainly not an easy journey.
But you can take steps now that make a difference and provide measurable wins. You can go paperless. You can take serious steps to reduce waste, perhaps reaching back through the supply chain, focusing on packaging, and using recycled materials. Be transparent with consumers in the organisation’s sustainability efforts. Look for cleaner, greener energy options – and focus on optimising the energy that you do use.
Here’s an example of a project we worked on, for a UK client, that did precisely that. We helped a high street retailer on a pilot energy optimisation program that involved more than 25 store sites across its estate.
We were initially commissioned to help reduce energy consumption by 10% in 10 stores over six months. Although each store had up-to-date technology, including Building Energy Management Systems (BeMS) with remote access and sub-metering, it was clear they weren’t running as efficiently as they could. Our team soon identified opportunities in heating, ventilation and air conditioning (HVAC) along with store lighting.
First, we analysed the energy actually being consumed using cloud-based software, providing transparency and baseline data. We then implemented an Optimised Analytics platform to track the performance of the Building Energy Management Systems and HVAC using intelligent algorithms and rules. This quickly identified anomalies. We then focused on optimising the assets and their operations, analysing energy profiles store-by-store. This, for example, included identifying energy usage outside store trading times, and ensuring heating and cooling were not operating simultaneously: fighting against each other.
The final piece of the jigsaw was a remote Optimised Bureau service to track each store’s energy performance on an ongoing basis: continuous monitoring to identify issues and generate reports, alerts and further energy management recommendations. Savings of 11.1% were achieved in the first six months. This led to further stores being rolled into the Optimised Bureau service, with further savings of 18.2% in the first two months of that stage two optimisation project.
The net business impact was an overall reduction in electricity consumption of around 14% by optimising existing assets, with no additional systems or controls installed. As the retailer’s Energy & Environment Manager said, “Even stores that I thought were working efficiently had scope for further savings.”
As with all such projects, it all started with a desire to enable sustainable change alongside a business imperative to further
improve operations and reduce costs.
A world-class consulting partner for energy and utilities, Consultus was named (Most Trusted Consultancy (Large Customers) at the TELCA awards 2019.
1 https://underlinesmagazine.com/2019/08/06/true-sustainability-take-three-years-uk-retailers/
2 Conducted by Pure London and Spring & Autumn Fair trade shows (Hyve Group)