EuroShop 2014: stable energy costs in the retail sector

Retailers focus on measures to optimise energy use, covers for refrigerated cabinets and eco-friendly refrigeration methods

Refrigeration alone will occupy 19,000 m2 of net exhibition space at EuroShop

Whereas, in the past, energy costs had been continually rising for retailers, the majority of retailers in 2012 recorded stable developments in the cost of energy compared with the previous year. This was the result of a study published last year by the EHI Retail Institute on energy management in the retail sector. Retailers felt that this was largely due to the relatively minimal increase in the EEC levy, rising from 3.53 eurocents per kilowatt hour in 2011 to 3.59 in 2012. Another factor with a positive impact on the situation was the very good purchase price for electricity in 2012.

This stable development also meant that energy costs per square metre of sales space increased no more than slightly and therefore remained at approximately the same level as in the previous year. On the other hand, when we look at energy costs over the years, it is obvious that there has been a steady year-on-year increase. According to the latest statements about global trends in energy prices and in view of the current institutional and legal framework, we can assume that this increase will continue in the years to come. According to the non-food retailers that were surveyed, annual energy costs (electricity, gas, heating oil etc) have averaged EUR 32.95 per square metre of sales space (m2 SP) since 2009 when such figures were first collected. This amounts to an increase of EUR 2.11 per m2 SP. In the food retail trade annual energy costs are EUR 56.25 per m2 SP, having risen by EUR 4.65 m2 SP since 2009.

Refrigeration in the food trade

Cost reduction and improved cost effectiveness are as important for food retailers as they are everywhere else. Among the food retailers surveyed by EHI, one issue that was especially at their focus was the question of energy optimisation – an area with the greatest amount of energy consumption, at 41 per cent. Many food retailers have had to enlarge the refrigerated sections of their outlets to cater for enlarged service areas, including a growing range of prepacked goods and convenience products requiring mandatory refrigeration as well as an ongoing expansion of dairy products and deep-freeze product ranges. This trend is set to continue and, in particular, will add special significance to energy savings projects in refrigeration technology.

A variety of options are available to reduce energy costs in the operation of refrigeration units. Some are relatively simple, such as the correct placement of products within refrigeration cabinets, regular servicing and the correct positioning of units within the shop, while other measures are more cost-intensive, such as putting covers on cabinets.

Covers for refrigeration cabinets

According to various calculations, freezer cabinets with glass covers require up to 50% less energy, and chillers can save up to 35% under standard operation. One would therefore think that retailers should be willing to invest in such covers. It is indeed standard practice among the surveyed retailers to ensure properly enclosed refrigeration (covers, doors, night-time blinds, etc) for their freezer cabinets. However, when it comes to standard chillers, only just over half of all surveyed retailers use covers, and indeed not even nationwide, but only in some pilot markets.

So the question arises why this should be the case. Covers are still a sensitive issue, as the use of enclosed units means losing the positive aspect of an unimpeded sales-promoting product presentation. Many retailers are concerned that a cover will put customers off. They are particularly worried in the case of dairy and other fast-moving products. This presents a dilemma between those responsible for energy issues in a retail company and those in the sales department, as it means choosing between energy efficiency and reliable sales. Another disadvantage seen by retailers is the more complex handling procedure, as a covered refrigeration unit is more difficult to fill with products.

When conducting refurbishments or building new facilities, 40 per cent of retailers surveyed by EHI decided to put covers on their normal chillers as well. To identify the impact of covers, these companies either asked polling firms to conduct studies or they commissioned such studies to be conducted as part of undergraduate or master’s theses. The result showed that those retailers did not in fact record any decline in sales at all. Instead, customers had responded very favourably, as they found it less cold around the relevant cabinets and therefore continued to look at the products for longer periods of time. Also, the units were tidier, and the covers suggested that the products were of a higher quality.

Retailers that opted for covers on normal chillers at all their new or refurbished facilities clearly felt that the benefits outweighed the drawbacks. In summary, the following benefits were mentioned:

  • No cold air escapes from the units.
  • Customers continue to linger outside units for longer periods of time.
  • Customers perceive better product quality.
  • Less messy product presentation within the units, as the products are not moved around as much.
  • The shop generally gives the impression of higher quality.
  • The retailer signals environmental awareness.

The disadvantage is seen to be the more difficult handling procedure for staff when filling the refrigeration units.

The comparison shows that open refrigeration cabinets are always a compromise between providing a buying incentive and reducing energy consumption. To encourage customers to take products out immediately, retailers often accept substantial losses in energy. In practice, it is a matter of finding the right balance between a sales-promoting product presentation, the required product-specific temperatures and today’s demand for low energy requirements.

In view of rising energy costs, climate change and a transformation in customers’ environmental awareness, covers on refrigeration cabinets are likely to become inevitable. It is probably only a matter of time before appropriate legal requirements will come into force. As soon as all retailers use covers, no one will be able to argue that they might lose out against competitors. All that is required is a few courageous pioneers who will set a positive sign and thus the direction for the future.

Refrigerants

When retailers replace their refrigeration cabinets, they immediately choose units that meet contemporary requirements in terms of energy balance and refrigerants, as eco-friendly refrigeration is becoming more and more important in the face of climate change.

The German, Austrian and Swiss retailer that took part in the EHI survey opted for the following combinations of refrigerants as their standard for all new facilities and refurbishment projects:

  • 43 per cent want to use R-744 for deep freezers and R-134a for chillers.
  • 31 per cent prefer transcritical systems, i.e. with the use of R-744 for both deep freezers and chillers.
  • 26 per cent will continue to use conventional refrigerants, especially R-404A and R-134a.

However, it must be noted that discount stores were not included in the survey. The high proportion of natural refrigerants is partly due to their relatively widespread use  among Swiss companies, in particular, for the last few years, while German retailers are still rather reluctant.

EuroShop 2014, which is attended by trade visitors from the entire globe, will showcase a wide range of innovative refrigeration units and solutions. The refrigeration section will be bigger than on previous occasions, with approx. 160 international exhibitors occupying 19,000 square metres of net exhibition space.

EuroShop 2014 will be open to visitors daily from Tuesday 16 February 2014 to Thursday 20 February 2014, 10:00 to 18:00 hrs. A day ticket is EUR 60 (EUR 42 for an e-ticket, purchased online in advance), 2-day ticket EUR 80 (e-ticket: EUR 60) and a 4-day ticket EUR 135 (e-ticket: EUR 115). Students and trainees pay EUR 20. Entrance tickets include free trips to and from EuroShop on all trains, buses and trams in the VRR transport area (Verkehrsverbund Rhein-Ruhr).

Further details are available at www.euroshop.de.

Press contacts:

Dr. Cornelia Jokisch, Tanja Karl (Assistant)
Tel. +49 (0) 211 4560 998 (or 999)
Fax +49 (0) 211 4560 8548
e-mail: JokischC@messe-duesseldorf.de KarlT@messe-duesseldorf.de

December 2013