5 keys to becoming a retail energy leader

Recently, the Retail Industry Leaders Association sat down with a group of our members to discuss the vision for a new retail energy management program. Whenever we have these in-person meetings, two things always are immediately apparent: First, it's how different everyone’s situation is. But second, it's how much everyone has in common. When we bring retailers together, there is always a host of translatable lessons learned or strategies to try.

Given these common challenges and strategies, we wanted to find a tool to help retailers track the maturity of their energy management programs. While numerous frameworks exist, one has shown to be particular useful for characterizing the issues retailers most commonly see.

The “Virtuous Cycle of Strategic Energy Management,” pioneered by MIT and the Environmental Defense Fund, is a path to organizational change that will prioritize energy management. The characteristics inherently read a bit like a dream scenario for most energy managers, but everyone can make steps to make important improvements to their internal process.

1. Executive engagement

It’s easiest to launch or improve an energy management plan when there is strong executive engagement. Top-down buy-in, strategy and goals frame a clear course for success and builds alignment across an otherwise siloed organization. Being able to point to an executive-initiated project accelerates cooperation and better ensures more adequate resource allocation.

Getting there: That isn’t to say that an energy manager without top-down guidance can’t have a highly successful program. The first difference is that it’s up to the energy manager to craft the energy management plan and gain buy-in. Work across the organization to set an internal goal that is ambitious but achievable. Try getting executives engaged by hosting an energy summit to showcase savings opportunities. It might inspire them by outlining the value of a top-down push.

If there isn’t leadership drive, reach out laterally to relevant colleagues across the organization to build buy-in with them; you will need their involvement at some point.

2. Resource investment

Dedicated energy efficiency funds and personnel go a long way in expediting approvals for energy savings projects. With capital set aside, it’s easier to execute on long-term energy targets and to fund pilot projects to test technologies or strategies for wider deployment. And with a dedicated energy team, it’s possible to encompass a much broader scope of work — including creating the capacity to thoroughly research outside funding sources and other energy reduction opportunities.

Getting there: With limited financial resources, the best way an energy manager can prove that he or she can be trusted with a bigger budget is to demonstrate effectiveness.

Start off with projects that have high returns and are visible within the organization. Projects that are easy to explain and are most likely to yield a good ROI can do a lot to build credibility. Try connecting with someone in your finance team to learn how they think about and prioritize projects; it may be that you have a great idea but you need to speak their language to effectively advocate with them.

Explore outside funding options, such as utility incentives or rebates, Property Assessed Clean Energy (PACE) funding and Power Purchase Agreements (PPAs) for solar projects. After a few solid successes, trying to implement a revolving fund that feeds your budget partially through the cost savings your projects have achieved.

3.  People

It takes a dedicated person or team to develop, implement, track and continuously improve a comprehensive energy management plan. As opposed to part-time workers, full time energy managers are in a better position to think holistically about the company’s energy strategy and prevent challenges before they occur. Full-time staff also can use some of their time to educate others at the company because energy is used in all functions of the business.

Getting there: Retailers with limited, part-time, or no dedicated energy management staff still can develop cross-functional teams to identify and execute on projects. Once a few wins have been identified, or once the volume of energy savings projects is great enough to justify it, the team might find value in hiring a full-time energy manager. Bringing together retail staff from the facilities, construction, store operations and other relevant departments can come in handy for sparking new ideas and executing on energy projects; staff will bring their own perspectives to the table.

Don’t forget about any collaborative peer groups of which you may be a members, such as trade associations. You might have a counterpart who already has completed a similar project and may be willing to share his or her lessons learned. Also be sure you are taking advantage of the expertise of any vendors you use — it may be that they offer free or low-cost resources or energy experts to their current or potential clients.

4. Projects and data

Energy managers know all too well that “what gets measured gets managed.” Energy use data is crucial for creating baselines, tracking progress and validating success.

Getting there: Retailers often lack energy use data because they may lease the space or may not have an Energy Management System (EMS) installed in every store. Retailers big and small have justified the installation of an EMS or the use of utility bill aggregators because data is the basis for finding and validating energy reduction opportunities. Build the case for those systems and it will lay the foundation for all other energy projects. If necessary, try piloting energy use tracking systems at representative stores that can demonstrate the potential for a portfolio-wide approach.

5. Visibility

Sharing successes can raise awareness of the benefits of energy management both inside and outside the company. Doing so can boost momentum, excitement and internal engagement.

Getting there: Internally, share the results of projects with key stakeholders, including the finance team and executive management, and through internal news channels such as the company newsletter or intranet site. As one tactic to consider, host an energy summit to outline your successes and vision for the future. You never know where you might find your next ally. And once you share your story, be willing to listen to others’ stories. Then externally, take advantage of key opportunities for positive publicity around innovative projects.

While each component of the Virtuous Cycle stands on its own, the benefit to this framework stems from the connectedness between all of the components. If you improve your program in one dimension, it will enhance your progress in others. For example, visibility is enabled by access to data, which you need a team to analyze. But those individuals must be hired with executive approval that you get after demonstrating opportunities for cost savings.

For retail energy managers, RILA’s Retail Energy Management program offers networking with peers and benchmarking against other retailers.

Top image of keys by Jules_Kitano via Shutterstock