Energy is a supermarket’s third-largest cost, after real estate and employee costs. This is primarily driven by the refrigeration system, which uses 55% of the electricity in an average store.
For the last 20 years, supermarket managers have emphasized reducing energy (kWh) consumption of their stores. This is no longer enough. Today, supermarket owners must focus on managing power (kW), which drives 60-70% of their electricity bill.
Power directly affects Demand Charges and has a significant impact on the average Time of Use (TOU) energy charges paid by supermarkets. Demand charges have been increasing at an average rate of 5% per year in California and are growing all around the country, as highlighted in a recent NREL report. Now, when supermarkets consume energy can be more significant than how much they consume.
This is particularly challenging because supermarkets are some of the least flexible electricity consumers because the refrigeration systems must operate 24/7 to keep the food cold, leaving them vulnerable to utility rate trends and changes.
However, the situation is not all doom and gloom. Supermarkets have a golden opportunity to turn their energy intensive, inflexible refrigeration systems into intelligent energy storage assets. The Refrigeration Battery, which Axiom offers as a turnkey managed service, can save money for supermarkets today while also hedging against future utility rate changes.
We put together an infographic to demonstrate the immediate and long term benefits of employing the Refrigeration Battery platform on a fleet of 10 supermarkets. But by quantifying the upside of this service, we must also highlight the downside of choosing to do nothing. This is why we say that there is ‘no middle ground’ - stores must either choose to adapt to a flexible load profile, or choose to do nothing and suffer the financial impacts.