Energy Management Systems: A Retailer’s Solution to Successful Sustainability in an Evolving World

“Hot enough for you?” That was the common refrain during the summer of 2024. The excessive heat gave retail facilities managers and sustainability directors another stark reminder of the challenges they face to improve energy efficiency and meet sustainability requirements.

It's all the more reason a robust energy management strategy is critical. Fortunately, there’s some relief: energy management systems that are founded on advanced technologies such as the Internet of Things (IoT), and further enhanced with artificial intelligence overlays, make it easier than ever to stay ahead of energy issues. These solutions drive a retailer’s ability to retain staff; keep customers happy; enable safer, more comfortable environments; and, ultimately, maintain positive brand awareness. The even better news? These solutions can quickly help retailers deliver a strong return on investment — often within one year.

How EMS Takes the Heat Off Energy Challenges

First, a primer: an energy management system (EMS) is a platform that integrates hardware, software and data analytics. By providing real-time control and monitoring, EMS solutions can automate equipment schedules, delivering savings as well as insights into energy usage and equipment performance.

An EMS allows retail businesses to:

• Gain significant (and immediate) energy savings by automating and optimizing the operation of HVAC systems and other major loads.
• Proactively and more affordably maintain equipment, which extends its lifespan and reduces downtime.
• Monitor and improve energy consumption by leveraging data to identify equipment that’s working efficiently and equipment that isn’t.
• Ensure customer comfort is prioritized by providing automatic oversight of heating and cooling systems, even from remote locations.
• Enhance environmental safety by ensuring proper lighting and security systems are on when needed.

Address Sustainability Demands. Reduce Energy Costs.

Consider this example of the ideal outcome: By applying a robust EMS solution, one 1,000-location discount retailer optimized its energy consumption and gained energy savings of $2 million-plus annually. Other retailers can hit their sustainability goals and drive cost savings by applying these best practices:

• Implement AI-enabled IoT platforms to reduce electricity demand by automatically synchronizing the run times of HVAC equipment to optimize energy usage 24/7. Smart thermostats and sensors provide precise temperature control feedback for HVAC systems. When integrated with an EMS, these tools offer real-time data that help retailers automate heating or cooling schedules and load management. Retailers can establish consistent temperature set points to accommodate weather conditions and schedule setbacks when buildings are unoccupied. The detailed oversight also helps retailers minimize their energy consumption during peak power usage times — i.e., when energy is most expensive, which can reduce monthly energy bills by 30 percent or more.
• Further reduce energy consumption and expense by leaning into the data and analytics that AI-enabled IoT systems deliver. For example, by monitoring the energy efficiency of all HVAC units, retailers can identify and prioritize the use of the most efficient equipment and get underperforming units repairs before they become a larger and more expensive problem.

Drive Operational Efficiency. Keep Businesses Open.

• Smart technologies allow predictive analytics and real-time remote monitoring that alert retailers to potential equipment failures. Proactive equipment repairs are not only three times less costly than reactive repairs, but they're also much less disruptive to a retail business because preventative maintenance can be conveniently scheduled during off-hours. What’s more, stores are less likely to experience a costly crisis, such as the air conditioning breaking down on a hot day or pipes bursting on a freezing cold day, forcing the business to close for repairs.

Just as important, a proactive maintenance strategy extends the life of expensive equipment. This approach further contributes to sustainability by not only keeping original equipment out of landfills longer, but also by reducing the carbon intensity of producing, shipping and installing new equipment. It’s a strategy that customers support.  According to a survey by McKinsey & Co., 66 percent of all respondents and 75 percent of millennial respondents consider sustainability when making a purchase.

Enable Safety and Comfort. Keep Brands Strong.

• Customer and employee comfort and safety are a top priority for every retailer. EMS streamlines the approach. For example, automating a store’s lighting keeps stores bright, inviting customers to shop longer and enabling employees to work more safely. During off-hours, lights are automatically adjusted to reduce energy expenses.

When it comes to brand perception, EMS data helps retailers demonstrate their commitment to sustainability to socially conscious consumers. This reporting also helps retailers prepare for an initial public offering (IPO) by communicating their environmental, social and governance (ESG) performance to investors. Comprehensive sustainability reporting has become more and more critical for investors to assess a retailer’s risks and growth opportunities.

Start by Assessing Current Energy Usage. Prove ROI in Phases.

Implementing an EMS strategy in phases is the key to success. Retailers can establish a strong energy management strategy by first conducting an audit of current consumption to establish a baseline. From there, define measurable goals and metrics. Prove EMS in the initial phases to gain wide stakeholder support. When the right solution is deployed, retailers often experience a strong ROI on their EMS investment within the first year.

Even as temperatures cool this fall, the heat will remain high for retail facilities managers and sustainability directors charged with optimizing their organizations’ energy consumption as they get ready for the important holiday season. EMS offers game-changing solutions that will improve sustainability, reduce operational costs, and keep their brands strong.

Jay Fiske is president of Powerhouse Dynamics, the leading Internet of Things (IoT) solutions provider for eliminating waste in the operations of multisite foodservice and retail facilities.