STORE SPACES

Smart Energy Management Trends for Brick-and-Mortar Retailers

BY James McPhail

Commercial retail is a unique and rapidly changing space. With the rise of online shopping, retailers are creatively adapting to improve the experience of being in a physical store. Strategies like experiential retail make shopping a personalized and engaging experience instead of a simple transaction.

Retailers are also providing customers with a more tech-friendly brick-and-mortar shopping experience in response to online competitors – the prevalence of self-serve check-out stations being just one example.

Other tech-driven strategies are being used to improve operations. Smart energy management is of growing interest to retailers seeking to cut costs, and while many of these strategies don’t have a direct impact on the shopping experience, the upgrades ultimately benefit customers. Savings accumulated from strategic energy management are significant and can be used to improve operations or be invested in other areas. Energy is the fourth largest in-store operating cost for U.S. retailers, and decreasing energy costs by 20% can have the same bottom line impact as a 5% sales increase.

Communicating through the cloud

Cloud-based software is becoming increasingly popular – from smart devices for schedule-based plug load shutdown to integrated data collection platforms. Removing paper and clipboards from the energy management process makes it accessible and efficient for time- and resource-strapped facility managers. Of course, as cloud use continues to grow, new challenges arise.

Security is a concern for many, and software not only has to be optimized for top performance but also ensure protection against any potential threats. Congress is even paying attention to this need, most notably in recent legislation introduced this summer requiring baseline safety features for Internet of Things (IoT) devices at federal facilities.

Utility partnerships

Another emerging trend in retail efficiency is automated demand response (ADR), a utility-commercial partnership that capitalizes on IoT solutions to effortlessly shift resources for cost savings on both sides of the meter. Utilities have worked with select smart energy management companies to further ADR programs and participation from retailers, helping them automatically cut back during times of peak demand, which adds to the easy savings that already come from such devices. These types of programs are especially helpful for stores with set operation hours, providing resource control beyond scheduled store shutdown times.

ADR partnerships also benefit the larger community by stabilizing the grid for another changing industry: utilities. Because of this, utilities sometimes even offer monetary incentives through rebates and bill incentives for businesses that participate in ADR programs.

The frequency and duration of major outages are on the rise, and power problems are estimated to cost the U.S. economy more than $150 billion annually. If U.S. businesses were to fully embrace ADR, the nation’s peak load in 2019 could be reduced by as much as 150 GW over 2009, according to a Federal Energy Regulatory Commission report. Both utilities and businesses have an incentive to work together through ADR programs.

Customer consciousness

Consumers are increasingly looking to brands and retailers to adopt more sustainable practices. A recent Unilever study found one-third of customers are choosing to buy from brands they believe are doing social or environmental good. The highly coveted millennial market lists green packaging as a top priority, resulting from the increasing importance placed on social responsibility. The greenhouse gas reductions from energy cuts shine bright in a company sustainability report. If all U.S. commercial and industrial buildings improved their energy efficiency by 10 percent, the environmental benefits would be equal to removing emissions from about 49 million vehicles – or about 19% of all registered highway vehicles in the U.S.

Smart energy management is a clear path in an evolving landscape for retailers to benefit their bottom line and benefit the planet.


James McPhail is CEO of Zen Ecosystems, which provides intelligent energy management solutions to businesses and consumers. Zen HQ is an energy management system designed for the unique needs of businesses and utilities to provide insights and control over multisite commercial energy usage with a fast payback.

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