REI Forges Ahead with Solar Plan

REI Forges Ahead with Solar Plan

Outdoor gear and apparel company REI has installed solar arrays on three stores in the San Francisco Bay Area — bringing the firm more than halfway to its goal of outfitting 10 percent of its retail sites with systems to harness power from the sun.

The company, the largest non-financial consumer co-op in the United States, is on track to complete solar panel installations at five other stores — three in Oregon and two more in California — by year's end, said Kevin Hagen, the program manager for Corporate Social Responsibility at REI.

In all, 11 of the company's 105 stores in 27 states are to sport rooftop solar power systems as result of the project this year.

REI's San Francisco Store

And all told, the installations, which amount to more than four acres of solar panels, are expected to generate a total of 1.1 million kilowatt hours of electricity.

The company celebrated the completion of the Bay Area solar installations yesterday with an event at the San Francisco store that included info sessions about the technology and energy efficiency.

The PV installation in San Francisco by the Blue Oak Energy firm was completed in October after similar projects wrapped up at the firm's San Carlos store in September and Santa Rosa store in August. The San Francisco setup is expected to provide 19 percent of the site's annual electricity needs. In San Carlos, the figure is 40 percent; in Santa Rosa, 38 percent.

The firm's progress on its solar and green building plans comes as the persisting economic crisis has driven some companies to pull in their horns on capital investments.

Asked what motivated REI to move ahead, Hagen said the company is fortunate to be in a strong position — it reported a nearly 14 percent increase in business for 2007 bringing sales to $1.34 billion — and has an equally strong commitment to the environmental stewardship ethos that's the foundation for the company's business model.

"Certainly challenging economic times are upon us, our organization feels and it and we feel it all around us." Hagen acknowledged. At the same time, he challenged the "either/or"  assumption that businesses must choose between "doing the right thing and making money."

REI in San Carlos, California

"What we're really trying to do is change that mindset," Hagen told GreenerBuildings. "You never hear anyone say, 'In tough economic times, do you stop devoting yourself to good customer service?' For us, it's about being committed to the mission of the co-op and aligning our business goals with that philosophy."

For REI that entailed a sea change in operations about three years ago, he said. That's when the firm moved away from what President and CEO Sally Jewell called random acts of kindness in environmental and social responsibility to "an organized, frameworks-based, metrics-driven, process approach to a sustainable business strategy," said Hagen.

The strategy has included setting a goal of becoming a climate-neutral company by 2020 and achieving that milestone through zero emissions, rather than carbon-offsets. Key to that strategy is a drive for zero load growth while still growing the business.

While the company hasn't hit that mark yet, it's trying to rein in energy use. From 2006 to 2007, sales increased by 13.6 percent, eight stores opened and energy use increased by 9.8 percent. Hagen conceded that moving that percentage to zero is a "tough row to hoe," but firm is sticking by it.

Making new stores high-performance, energy efficient buildings is another key point of the strategy, as is the company's commitment to addressing all its energy needs with renewable resources. The firm has sought to do so with purchases of wind-, landfill gas- and solar-generated power.

But as REI's 2007 sustainability report notes, "we cannot find enough qualified renewable energy offerings from local utilities to fulfill our current demands. We are working with utility companies to develop more options and we will make additional investments in on-site generation."

That's where the on-site solar projects come in, and REI's approach so far has been different from that of most retailers pursuing PV installations for their sites.

REI in Santa Rosa, California

The company is not acting as a host for the arrays. REI owns them.

"We have a strong cash position and we are a profitable business and we had the opportunity to take advantage of the tax credits possible ... and we thought if someone else can make money on our roofs, so can we," Hagen said.

The company will continue to explore the idea of purchase power agreements — the leasing arrangements that some 80 percent of retailers take up when affixing solar setups to their properties, Hagen said. But for REI's 11-store project this year, "the numbers looked so attractive, our financial team said, 'Wow, we should do this,' " Hagen told GreenerBuildings.

"Buying solar for these stores isn't a one-shot deal or a stunt," he added. "It's an element of a strategic plan that aligns with our business goals and business values."

Images courtesy of REI.