Tuesday, April 22, 2008

Earth Day 2008: Fresh & Easy's New 'Green Building' Web Page Goes Live

As we reported yesterday, Tesco's Fresh & Easy Neighborhood Market announced it would go live with a new green building web page today, Earth Day 2008.

On the 'Green Building' web page, Fresh & Easy is touting a number of environmental initiatives it has initiated at its 850,000 square foot distribution center in Riverside, California and in its current 61 small-format, convenience-oriented grocery stores in Southern California, Arizona and Nevada.

Among those include an impressive 500,00 square foot solar panel array and system on the roof of the Riverside distribution center. Fresh & Easy Neighborhood Market says thus far the solar installation is providing about 30% of the facility's total energy needs.

One interesting overall environmental aspect of Tesco's Fresh & Easy grocery stores--which average about 10,000 -to- 13,000 square feet compared to the average U.S. Supermarket which averages about 35,000 -to- 60,000 square feet--is that by the mere virtue of the stores' smaller-size they use less energy on average than the typical U.S. supermarket does.

Therefore, in a sense you could say Tesco is practicing the ultimate in green building practices, source-reduction, by having smaller than average supermarkets. After all, it takes far less energy to heat and cool a 10,000 square foot store compared to a 30,000 or 50,000 square foot supermarket.

Additionally, since the stores are smaller than average, they have fewer and smaller freezer and refrigerated display cases and smaller backroom walk-in boxes, which also means less energy use in the small-format grocery stores compared to the average U.S. supermarket.

Heating a grocery store in the winter and keeping it cool in the summer by running air conditioning, along with the energy required to power perishables display cases and backroom walk-in cooler boxes and freezers, are the number one and two biggest sources of energy use (electricity and natural gas primarily) in a modern supermarket today.

Lastly, since the Fresh & Easy stores are about 1/3 smaller than even the smallest (30,000 square foot) average supermarket in the U.S., that means the carbon footprint per-store is much less than that of retailers who operate conventional-size supermarkets.

Therefore, if you combine the "source-reduction" aspect of the Fresh & Easy grocery stores--that they are much smaller than the average U.S. supermarket and as a result use much less energy overall--with the conservation and green building practices Tesco is implementing in its USA Fresh & Easy Neighborhood market stores, the retailer has a pretty good "green" retailing story to tell, we believe.

We're surprised Tesco's Fresh & Easy Neighborhood Market doesn't tout the source-reduction, energy saving aspects of the stores' small-format in addition to its conservation measures and other "green" building and operations practices. Perhaps the grocer hasn't thought of it? It could be a powerful example to site in terms of gaining some competitive advantage in the "green retailing" arena, we believe.

Of course, like all retailers Fresh & Easy could do better. For example: installing solar panels on the grocery stores' roofs as well as at the distribution center, better "green" building practices in remodeling the numerous empty retail buildings it's turned into Fresh & Easy stores, and selling more produce bulk rather than having everything packaged in plastic tubs and plastic bags (packaging source reduction).

However, the combination of original source-reduction (by design) based on the smaller-format grocery stores (which equals less energy use), combined with the "green" efforts and practices the retailer has initiated, offers a pretty good overall "green" story for Fresh & Easy thus far in its only six months of retail operations in the Western U.S. states of California, Arizona and Nevada.

We will watch the development of Fresh & Easy's 'Green Building' webpage, which we think is a good idea, with much interest in the coming days, weeks and months. Used well it could become a valuable tool for the grocery retailer, its suppliers and consumers, we believe.

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