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Thursday, January 14, 2010

GreenBiz: Pilot program helps grocers become "green"

Kent Burnstad is the third generation of his family to be in the grocery store business and knows you have to make adjustments to survive and thrive.

The Green Grocer pilot program of the Wisconsin Grocers Association has helped Burnstad's European Market in Tomah save energy, do the right thing for the environment and help the business's bottom line.

"We are pleased to be one of the first grocery stores in Wisconsin to be Green Grocer certified," said Burnstad, chair of Burnstad's Markets, which also has stores in Black River Falls and Richland Center. "It's all about serving your customers and earning their loyalty in this business. By reducing our energy consumption, we can pass the savings onto those customers. We're also doing the right thing for the environment."

Burnstad's underwent a major remodeling and expansion to include a restaurant, gift stores and other facilities. It made changes to refrigeration compressors, lighting, recycling of plastic bags and other materials, and other areas and practices. It had some upfront costs, but the payback will be worth it .

"Normally you remodel a store every seven years," said store director Alex Zamarripa. "It's been about 10 years since the last remodel. We think a lot of these returns will be in a couple years or three years."

Burnstad's will save enough energy to power 21 homes and the equivalent of taking 31 cars off the road. CO2 greenhouse gas emissions will be reduced by 408,795 pounds.

The store is one of seven in the state currently in the WGA Green Grocer program. Other participating stores are in places like Delavan, Cambridge, McFarland, Janesville. The participating stores will collectively reduce CO2 emissions by more than 3.9 million pounds and save more than 2.3 million kilowatt hours of electricity.

Better Environmental Solutions, a Madison-based environmental consulting group, administers the program for WGA.

Wisconsin Power and Light, an Alliant Energy company, has helped fund the pilot program. Participating stores can receive assistance in paying for their upgrading through WPL's Shared Savings business energy-efficiency improvement financing program and its network of strategic account managers. The stores have to meet standards in a check list provided by WGA and developed by Better Environmental Solutions.

The first phase of the program includes an audit of a store, with points assigned for up to 70 different energy areas. The second phase for certification includes the actual updating and changes to the store.

"We are excited to be working with Burnstad's and several other member grocery stores in Wisconsin," said Brandon Scholz, WGA president and CEO. "This program started with some concerns about recycling plastic bags at stores. I contacted Brett (Hulsey, president of Better Environmental Solutions), and as we talked we realized it was a lot bigger than just plastic bags.

"Grocery stores are energy hogs. For some grocers, their utility bills could be the third or fourth highest line on their monthly expense. So, this program can be a win for the grocer, a win for the environment and a win for the customer."

Scholz said in an industry that has a profit margin of around 1 percent, any cost savings in energy can be very important.

When Burnstad's launched its Tomah program in December, Gov. Jim Doyle said the program showed that businesses can reduce their costs, emissions and improve service with energy efficiency.

"This shows one concrete way for Wisconsin to be a leader to create green jobs and a green economy," added Doyle, who recently awarded a Governor's Award for Excellence in Energy Efficiency to the Green Grocer Program.

Hulsey has served as coordinator of the WGA program through Better Environmental Solutions. "The grocers have been very open to the audit and to making the changes," he said. "We can get the most bang for the buck by reducing their energy bills and carbon emissions.

"A supermarket (45,000 square feet store) pays about $18,000 a month for energy. One grocery store can use as much energy as 50 to 100 homes."

According to the Environmental Protection Agency, grocery stores are the most intensive major energy consumer in the commercial sector and an excellent opportunity for energy-efficiency efforts. Every dollar a grocery store saves on energy is equivalent to $59 in added grocery sales.

The first store to participate in the Green Grocer Program was Stinebrink's Piggly Wiggly in Delavan.

"We took many steps like more efficient refrigerators, lights and motors to save energy and reduce carbon emissions," said Mark Stinebrink, co-owner of the store. "We save money that we can pass onto our customers and pass a better community to our children."

Mike Day, owner of the Cambridge Piggly Wiggly, said, "We upgraded our refrigeration, incorporating energy efficiency features to reduce our carbon emissions and will save $50,844 per year."

Scholz and Hulsey hope to find additional funds to take the program beyond the pilot stage, and perhaps expand it to other areas of the state.

"We've talked with Roundy's and other groups, as well as governmental agencies, about ways to keep this going and expand," Hulsey said.

"It's a great program," Scholz said. "It could become a model for the industry. There's interest in it from those in other parts of the state and other states. I think this shows an industry can make changes like this on its own without governmental mandates. We hope to build on it."

-- Hoffmann has written many columns and features for WisPolitics.com and WisBusiness.com over the years. He writes the GreenBiz column monthly.

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