Environment:

Energy/Carbon

Kroger has a commitment to environmental sustainability. We strive to reduce our impact on the environment by using natural resources responsibly and minimizing waste in all of our operations.

Our aggressive work in energy management has enabled us to reduce overall energy consumption in our stores by 35.22%. We have saved more than 2.32 billion kWh—that is enough electricity to power every single-family home in Charlotte, North Carolina, for one year. This is the carbon equivalent of taking 336,791 cars off the road for one year!

HOW WE REDUCE ENERGY

New stores include any number of energy efficiency features, including LED lighting, variable speed drives, skylights with setback controls, anti-sweat heat control, distributed refrigeration systems, heat reclaim systems, nighttime lighting control, building and refrigeration control systems, motion sensors and high efficiency lamps and ballasts, as well as newer features including refrigeration case controls, digital scroll compressors, demand defrost and demand control ventilation.

Kroger utilizes the ENERGY STAR program to track and assess energy consumption across our retail locations. We can benchmark building energy performance, assess energy management goals over time, and identify strategic opportunities for savings. The Kroger families of stores have 696 ENERGY STAR Certified store locations and 166 new stores have been "Designed to Earn" the certification.

We are proud of what we have accomplished thus far. This work earned Kroger the prestigious ENERGY STAR Partner of the Year Award in early 2015.


HOW WE IMPROVE IN OUR RETAIL STORES

Our nearly 431,000 associates are engaged in reducing energy consumption in the workplace in numerous ways. Their actions are as important as ever in making a real difference to help maintain and reinforce the basics like FAST (Food at Safe Temperatures)—an automated system of over 200 sensors per store to ensure our food safety program—to proper case stocking, closing doors, and monitoring case temperatures, as well as turning out lights and turning equipment off at night. All of which save energy. Our goal is to build on our current energy savings and continue to reduce an additional 5% consumption by the end of 2020.


Energy
Star


"Kroger is a leading example of how businesses and organizations are incorporating ENERGY STAR into their sustainability programs," said EPA Administrator Gina McCarthy. "Kroger's role in energy management is helping reduce our nation's greenhouse gas emissions that fuel climate change and preserve a healthy planet for future generations."

Data
centers

Over the past five plus years, the Kroger Technology group has driven energy efficiency in its datacenters through technology refreshes and facility improvements. These improvements include modernizing power and cooling systems to improve efficiency, monitoring and control, adopting new techniques for more efficient hot/cold air management, adding reflective roofing to reduce heat gain, consolidating and virtualizing server and storage equipment to reduce power demand.


HOW WE IMPROVE IN OUR MANUFACTURING PLANTS

Kroger's manufacturing plants continue to make progress in reducing consumption of electricity and gas. Overall, they reduced enough electricity to annually power 1,000 American homes and reduced enough gas to annually power 32,800 American homes.

Ten of our plants were able to simultaneously reduce electricity, gas, and water. The manufacturing group is leveraging the ENERGY STAR program as part of their ongoing commitment to reduce energy. In 2015, 32 plants have formed energy teams who are charged with increasing awareness, monitoring progress and incorporating feedback into the process.


CARBON FOOTPRINT

In 2015, Kroger's total carbon footprint decreased by 3.8% as compared to 2014 (6.57 million metric tons of CO2e).* This can be primarily attributed to a significant decrease in store electricity usage and vehicle diesel fuel consumption.

Key accomplishments that helped Kroger reduce energy use include the extensive use of LED lighting in refrigerated cases and implementation of best practices for refrigeration, lighting and HVAC. For the transportation, we have enhanced our efforts in reducing miles driven and fuel usage, including a switch from traditional LNG (Liquefied Natural Gas) to renewable LNG in one of our fleets.

Emissions from refrigerants increased with 5.7% from 2014 to 2015, which was mainly a result of more comprehensive and accurate tracking of refrigerant charges within our divisions. Kroger joined U.S. EPA's GreenChill program in 2014. GreenChill is an EPA partnership program with food retailers to reduce refrigerant emissions and decrease their impact on the ozone layer and climate change. As a member we report on our refrigerant management progress and goals. 2016 goals include reductions in emissions and further testing of technologies that reduce initial system charges. Additionally, Kroger is committed to further investigation of the cost and efficacy of refrigerants with lower global warming potential (GWP).

Since 2006, we have been measuring and managing our total carbon footprint. Kroger has decreased our total normalized footprint by 9.3% (tCO2e/1,000 sf).*

Kroger is committed to continuing to seek ways to better manage and reduce refrigerant impact. We publicly report our carbon footprint to the Carbon Disclosure Project (CDP). This international organization records scope 1 (direct), scope 2 (electricity indirect) and scope 3 (other indirect) greenhouse gas emissions measurements. Our total scope 1 and 2 carbon footprint for 2015 was 6,568,979 metric tons of carbon dioxide equivalent (tCO2e). Reducing our carbon footprint remains an important pillar in Kroger's sustainability agenda. Kroger expanded our footprint in 2014 to include a partial scope 3 which includes company generated waste, employee commute and business travel. In 2015, these scope 3 sources totaled 1,350,902 tCO2e.

* For consistent tracking of emissions over time, 2006–2014 emissions have been recalculated to include the acquisition of Harris Teeter, a new division as of January 2014. Based on Harris Teeter's 2015 emissions and historical sales by year, 2006–2014 emissions were adjusted for growth and added to Kroger's footprint. This methodology is recommended by the Greenhouse Gas Protocol (http://www.ghgprotocol.org/files/ghgp/public/ghg-protocol-revised.pdf), the standard used to calculate Kroger's greenhouse gas inventory, in order to maintain consistency over time.


RENEWABLE ENERGY

WIND

Kroger has two wind energy turbines located at the Turkey Hill Dairy in Lancaster, PA. Kroger's Turkey Hill Dairy purchases all of the wind energy produced from The Frey Farm Wind Turbine Project. For the fourth full year of operation, these turbines supply up to 25% of the dairy's annual electricity needs which will be enough power to produce six million gallons of ice cream and 15 million gallons of iced tea for one year.

SOLAR

Seven Kroger stores have approximately 815 kW of solar energy capacity that produces nearly 958,000 kWh per year. The Clackamas Distribution Center (DC) in Oregon was the first DC to install a photovoltaic system in December, 2011. It has a 500 kWh capacity, which continues to provide about 10% of the DC's power requirements.

Total solar production in 2015 was approximately 3.94 million kWh.



FOOD POWER

The Kroger Recovery System, located in Compton, CA at the Ralph's/Food 4 Less distribution center has been in operation since 2013. It utilizes anaerobic digestion, a naturally occurring process, to transform food waste into renewable biogas. It has an annual capacity to process 46,500 tons of food waste. (In this circumstance, food waste is food which cannot be sold or donated as well as on-site dairy processing effluent.) This biogas is then turned into power for onsite operations. The process is carried out in an enclosed, oxygen-free environment, which means the process takes up less space and generates no odors. The system provided 3.5 million kWh of renewable energy for the 650,000 square foot Ralphs/Food 4 Less distribution center. The system reduces area truck trips by more than 500,000 miles each year and reduces waste costs by $4.5 million dollars. These efforts are estimated to reduce carbon emissions by an estimated 90,000 tons per year. This system inspired the strategic collaboration between the dairy industry and Kroger. See Kroger Gives Hope by the Gallon for Hunger Action Month.


Fry's PowerParasol

In 2013, Fry's installed the first commercial application of the PowerParasol—a patent-pending solar energy and shade technology. This unique design shades our parking lot while producing renewable energy. In fact, the 580 kilowatt system covers 1.7 acres and generated nearly 850,000 kilowatt hours of clean renewable energy. This test was successful and Fry's will be installing three more units.

Utah Solar Array

In 2014, Smith's Food & Drug Stores unveiled the 2nd largest rooftop mounted system in Utah at its main distribution center in Layton, Utah. The 1 megawatt AC solar photovoltaic (PV) rooftop system consists of 4,066 solar panels, which produced 1.67 million kilowatt hours of clean electricity last year and covers 1/4 of the energy usage of the distribution center. The new system establishes a guaranteed cost for approximately 20% to 25% of the total electricity for the grocery and freezer storage operations over the next 20 years. The project is in partnership with Rocky Mountain Power. Smith's Layton Distribution Center will reduce energy production needs by 20–25% per year.

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