Evaluating the ROI of Supermarket Sustainability

The spectrum of supermarket sustainability concerns has expanded significantly in recent years. As more retailers set short- and long-term sustainability targets, many are evaluating opportunities to reduce their carbon footprints while earning a return on investment (ROI).

Supermarket sustainability often starts with transitioning to eco-friendly refrigerants and/or minimizing refrigerant leaks. Another traditional decarbonization goal includes improving energy efficiency in HVAC, lighting and refrigeration. Although these steps are as important as ever, today’s retailers are considering nearly every aspect of their supply chains as part of their holistic sustainability footprints.

Consumers are increasingly aware of the sustainability of the food supply chain and selecting retailers accordingly. Among their concerns include:

Organic and natural food products
Sustainable packaging materials
Environmentally responsible food sourcing and processing practices

Retaining the loyalty of sustainability minded customers is a competitive differentiator and a key factor to consider when calculating the ROI of decarbonization.

Per global climate initiatives such as the Paris Climate Accord, 2050 has been set as the year when countries, institutions and companies should strive to achieve Net Zero greenhouse gas (GHG) emissions. Net Zero simply means consuming only as much energy as is produced by balancing the reduction of GHG emissions strategies that achieve a carbon-neutral operating footprint. Some food retailers are even pledging 2040 Net Zero timelines, prioritizing the following short- and long-term targets:

Minimizing GHG emissions
Optimizing energy management to reduce energy costs and drive ROI
Transitioning to lower global-warming potential (GWP) refrigerants and/or phasing down the use of hydrofluorocarbons (HFCs)
Electrification of transport vehicles and refrigeration
Integration of renewable energy sources
Reducing food waste
Working with suppliers to reduce their own emissions

The path to Net Zero will be different for every retailer; the Environmental Protection Agency (EPA) recommends following science-based evaluations of all sources of GHG emissions. Scopes 1 and 2 refer to GHG emissions originating from a company’s own operational footprint, while Scope 3 expands the scope to the company’s larger supply chains.

Scope 1 — refers to direct GHG emissions originating from a company’s owned assets. This includes fuel combustion from heating, kitchens and vehicles, and refrigerant emissions from commercial refrigeration and HVAC equipment in retail stores, storage facilities and distribution centers.

Scope 2 — encompasses indirect GHG emissions from all sources of energy consumption, including refrigeration, HVAC and lighting. Reducing energy consumption also provides an opportunity to claim ROI. Strategies include:

Installing LED lighting
Leveraging advanced energy management controls and tools to enable grid-interactive optimization
Integrating wind, solar and other locally generated renewable energy sources
Retrofitting equipment to minimize energy consumption and maximize performance

Scope 3 — includes direct and indirect GHG emissions from all producers and providers within a company’s supply chain, such as those occurring after goods are sold, throughout product lifecycles and disposal. Strategies include: