Financial basis

Roast chickens earlier and dim the lights: French retailers brace for power cuts

The Carrefour supermarket chain has come up with an original idea to cope if the worst-case scenario of a power shortage materializes this winter in France: turning on the rotisseries it uses to cook chicken an hour earlier in the morning.

This is one of many changes the group is planning or has already implemented in its 1,700 French stores, all aimed at consuming less energy or minimizing use at peak times. As part of an agreement recently signed with the French network operator RTE, Carrefour will voluntarily reduce its energy consumption when it receives an orange or red alert signifying a risk of power cuts because the network is under tension.

“It doesn’t make a big difference to us if we start roasting chickens at 7 a.m. instead of 8 a.m., but RTE tells us that such measures would help them at peak times,” said Bertrand Swiderski, director of sustainable development. of Crossroads. “There may not be enough electricity for everyone this winter, so we have to be ready.”

Although retailers do not consume as much energy as manufacturers, they too are now embroiled in France’s preparations for power and gasoline shortages following the Russian invasion of Ukraine. .

The so-called tertiary sector, which includes shops, financial institutions and service companies, accounted for 16% of France’s energy consumption last year, compared to 20% for industry and 30% for residential buildings. .

President Emmanuel Macron warned in a recent speech that a “general mobilization” of businesses, households and government agencies was needed as Russia was likely to cut off gas exports to Europe.

It was a marked change from the government’s more reassuring message that the country’s nuclear power production made it less vulnerable to disruption than places like Germany and Italy, which are more dependent on Russian gas imports. .

But with the state-controlled EDF-operated nuclear fleet suffering widespread outages this year, output has fallen to multi-decade lows and forced the country to start importing electricity from the country. instead of exporting it as it usually does.

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A wide range of sectors are now required to prepare contingency plans and report to the Department of Energy. The government has also set a new target to reduce energy consumption across the economy and the public sector by 10% by 2024 compared to 2019 levels.

Nicolas Goldberg, an expert at Colombus Consulting, said the government was pressuring the service sector to do more because there are a lot of potential energy savings, especially during peak hours from 8 a.m. to 12 p.m. and from 6 p.m. to 8 p.m. “Retailers, facility managers and the service sector have never focused on energy efficiency because it is not a source of competitive advantage for them, unlike heavy industry where energy represents a significant portion of their costs,” he said.

Unusual discussions between EDF and its consumer business customers have begun over how to handle peak consumption periods on the network. “They called to ask if they could turn off the power to our stores for an hour a day in the morning,” a retail executive said. Such a breakdown would make it difficult for employees to prepare for the opening, which is why the company refused.

Electricity providers have long used “load shedding” contracts, where companies commit to reducing consumption during peak periods in exchange for financial compensation. But they’ve always been more common in industries like automotive, aerospace, and chemical manufacturing.

Fish for sale in a supermarket in Paris
Carrefour plans to produce ice for its fish stalls before electricity consumption peaks and staff will let it melt naturally at the end of the day instead of using hot water © Paul Quayle/Alamy

“We will do more this winter to help our customers modulate their energy consumption during peak hours, but I don’t know yet if it will work for the tertiary sector,” said Nelly Recrosio, director of EDF.

“A factory can turn off a production line or an oven for a day in winter to ease strain on the grid, but a hotel can’t just turn off the lights when there are people staying there.”

Carrefour’s agreement to reduce the days when RTE issues an orange or red alert is not accompanied by financial compensation. In a store in the center of Paris, the managers presented a software tool that allowed them to control the heating, air conditioning and lighting systems of all its stores from an iPad. If he receives an alert from RTE, then it’s fairly easy for him to reduce his consumption using the software, and he’s also identified other offline steps, Swiderski said.

In addition to roasting chicken, ice for fish displays can be produced earlier in the day and then stored so that machines are not turned on at peak electricity consumption times. “We also told the staff to let the ice melt naturally at the end of the day and not to melt it with hot water,” he said.

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An industry group called Perifem which includes 11 major food retailers, including Leclerc, Carrefour, Monoprix and Lidl, as well as shopping center operators, also agreed in July to a voluntary peak-hour energy-saving protocol from mid-October. This includes turning off signs after stores close, limiting winter heating to 17°C instead of the usual 19°C, dimming lights by 50% before stores open and 30% during Business hours.

The energy consumption of food retailers varies significantly depending on the store format, product mix and equipment used to prepare, hold and display food in-store. Analysts said the refrigeration system typically accounts for 30-60% of the electricity consumed, lighting 15-25%, and heating and air conditioning the rest.

UK retailers are also increasing energy saving initiatives. “We have already set out an ambitious plan to reduce our energy consumption,” said Neil Coleman, COO for Energy and Innovation at John Lewis. “With rising energy prices, we are accelerating these plans.”

Retailers aren’t just making changes out of a desire to contribute to the national cause – some face skyrocketing electricity bills when long-term contracts expire next year. For a small 1,000m² supermarket, annual electricity bills are set to double next year to €160,000-200,000, which would wipe out “most of the profits”, said Thierry Cotillard, owner of three stores Intermarché and also at the head of Perifem.

“Retailers really have no choice but to act,” he said.

Frozen food retailer Picard has been working on energy efficiency for a long time as electricity bills are a significant cost, at around 1.5% of last year’s €1.7bn turnover . By replacing freezers and installing new equipment, Picard has reduced its electricity consumption by 10% from 2012 to 2020, and aims to reduce it by another 10% from 2020 to 2026.

“Every little savings helps, but everything we’ve done hasn’t worked,” said chief executive Cathy Collart Geiger.

Picard unsuccessfully tested painting the roofs of stores white to reflect light and reduce the need for cooling. However, he found another more promising tweak: stores can increase the temperature in freezers by 2°C to minus 20°C at night without damaging products because no one opens the freezers at that time.

Hiring employees to make small changes is another key. “I’ve asked them to dust the backs of the freezers more regularly, to keep the fans from working overtime,” she said.