The Importance of Seasonal Retail Energy Management
Energy is one of the biggest expenses in the retail industry; the sector spends tens of billions on gas and electricity every year. Costs and demand can fluctuate dramatically from season to season, which complicates budget planning. Careful retail energy management is critical to keeping expenses in check while maintaining a comfortable environment for customers.
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Key Takeaways
Seasonal energy management helps retail businesses anticipate fluctuations in heating, cooling, lighting, and operational demand throughout the year. By improving efficiency, monitoring usage, and adopting proactive strategies, retailers can reduce energy waste, stabilize budgets, and maintain a comfortable environment for customers and employees.
Retail energy demand changes seasonally
Heating and cooling drive major costs
Lighting efficiency lowers energy usage
Insulation improves temperature stability
Energy monitoring supports smarter decisions
Renewable energy can offset seasonal demand
Challenges of Managing Seasonal Energy Costs in the Retail Industry
Changing weather conditions throughout the year have a significant impact on energy usage. As temperatures rise in the summer, retail businesses start to use air conditioning. As fall turns to winter, stores turn on the heat to combat cold weather. Energy rates also tend to rise during these peak periods, exacerbating the impact of seasonal demand variations.
These dramatic spikes in energy consumption can create challenges for business owners in the retail sector. They make it difficult to set an accurate budget, especially amid changing energy rates. And weather that’s hotter or cooler than expected can impact everything from cash flow to profitability.
If you have a retail business, there are no shortcuts. You must maintain an environment that’s comfortable for customers and employees at all times. In fact, temperature management helps your business comply with Occupational Safety and Health Administration recommendations for workplace safety. Consistent interior temperatures can also increase food safety and extend the life of the products you sell.
A proactive approach to seasonal retail energy management is one way to reduce costs — a critical consideration given the rampant energy waste in the commercial sector. According to the Environmental Protection Agency, the average commercial building wastes 30% of the energy it takes in. By tackling inefficiencies, your company could even out seasonal demand fluctuations and spend less on energy year-round.
Understanding Seasonal Energy Trends in Retail
Before you can take action to manage seasonal power costs, it’s important to understand the factors that impact your company’s energy consumption.
Energy Consumption Patterns
Retail energy consumption depends heavily on the temperature and time. Temperature is a key factor; it accounts for between 44% and 67% of the changes in seasonal energy demand. Demand also increases considerably during standard retail business hours, when employees and customers are active.
Consumption is highest in the summer and winter. However, data from the U.S. Energy Information Administration (EIA) shows thatenergy demand curves vary predictably from season to season. In the winter, consumption tends to spike in the morning as the building warms up. It drops during the day as sunlight warms the interior and people begin moving around the space and rises again as the sun sets. In the summer, energy consumption is low in the morning and increases as the outside temperature rises. As stores close and the sun sets, it decreases.
Factors That Influence Energy Usage
The temperature and the time of day aren’t the only things that impact your retail company’s energy usage. Actual consumption can vary based on factors including:
- Store location. According to the EIA, different regions of the United States have different seasonal energy demand patterns. For example, spring, fall, and winter demand in Texas tends to stay roughly between 30 and 45 million kilowatt-hours. In July, it peaks at around 63 million kilowatt-hours. The Northwest, which has a more moderate climate, has a more consistent pattern. Demand peaks from 40-50 million kilowatt-hours in the winter and summer and between 30 and 40 million kilowatt-hours in fall and spring.
- Climate. Climate differences can drive variations in seasonal energy demand. For example, retail businesses in northern Minnesota and the Upper Peninsula of Michigan may have higher winter consumption than other parts of the Central region due to lake-effect snowstorms coming off Lake Superior.
- Product types. Certain retail products have more demanding energy requirements. Businesses that use refrigeration, including supermarkets and florists, often spend more on energy than companies that stock dry goods.
- Operating hours. When a store’s operating hours coincide with peak energy demand times in the area, its energy costs may be higher. A business that doesn’t open until 10 a.m. in the winter might miss the morning peak and spend less on energy than a store that opens at 7 a.m.
- Foot traffic. High levels of foot traffic can increase energy consumption. Customers let in hot or cold air from outside as they enter and exit, forcing the HVAC system to work harder. The same goes for refrigerated units, which use extra energy to keep food cool as the doors are opened and closed. Larger crowds also increase the usage of energy-hungry systems, such as escalators and elevators.
To a smaller extent, your company’s equipment also impacts your commercial energy expenses. You might see higher energy bills if you have older, more inefficient electronics or if your retail location has a large back office or workshop area. Certain businesses naturally have higher loads. Take an electronics store, for example — the TVs, phones, and computers on display consume a steady stream of power throughout the day.
Summer Energy Management
In many parts of the United States, business energy costs are highest in the summer. As the weather heats up outside, the cooling system works harder to create a pleasant interior environment. Here are a few energy-saving strategies to try during the warmer months:
- HVAC system efficiency. Cooling a commercial space accounts for 15% of a building’s total energy usage. Before summer rolls around, bring in a technician to inspect and maintain the system to fix leaks, replace filters, clean condenser coils, and make any necessary repairs. Ask them to check the economizer, an exterior unit that pulls cool exterior air when possible.
- Energy-efficient cooling solutions. When it’s time to replace your HVAC system, consider investing in an efficient replacement. It’s one of the most effective ways to boost energy efficiency in retail stores. Choose ENERGY STAR-certified HVAC equipment which reduces electricity consumption by 6% or more.
- Lighting management. The lights in a commercial building consume 17% of its energy. Switch to cool, energy-efficient LEDs to use less energy and minimize added heat. Installing motion-sensor lights in your coolers, dressing rooms, bathrooms, and break room can also reduce energy costs. If your store gets ample indirect sunlight, turn off overhead lights to save energy and create a more pleasant atmosphere.
- Window treatments. Use shades and blinds to block direct sunlight, reduce glare, and keep out excess heat. Exterior awnings are another great option; they reduce heat gain by 65% to 77%, all while preserving natural light.
- Insulation. Adequate insulation reduces the flow of heat between the interior of your building and the outside environment. In the summer, it helps prevent heat from getting into the building, so your cooling system can expend less energy.
Winter Energy Management
Winter is the second most energy-intensive season in most regions. The days are colder and shorter, which leads to soaring energy costs for heating and lighting. Finding ways to manage your retail energy usage can go a long way toward increasing winter energy savings:
- Heating optimization. The fall months are another opportunity to conduct HVAC maintenance and repairs. A quick tune-up can help your system run efficiently and reduce wasted energy. You can also pair programmable thermostats with occupant and temperature sensors to optimize the amount of heat that flows into each space. This strategy maintains a consistent temperature in each part of your business while conserving energy in areas with low foot traffic, such as the stockroom or employee kitchen.
- Insulation and air sealing. Heat can escape through any small crack or hole in your building. Insulating exterior walls and sealing the areas around windows, doors, and outlets can help close these gaps. Insulation also contributes to more consistent temperatures throughout your business, keeping customers and employees more comfortable.
- Lighting and window management. Make the most of the winter sun by opening your building’s shades as far as possible. This strategy also allows the sunlight to heat your space and reduce the burden on the heating system; it can also allow you to turn off interior lights in the middle of the day. Consider replacing older windows with more efficient models that prevent heat loss.
Balancing Customer Experience With Retail Energy Management
In a retail space, it’s important to balance energy-saving initiatives with the customer experience. Lighting is a particularly sensitive area. Although lights account for a large percentage of your building’s energy expenses, they also impact customers’ moods, buying behavior, and perception of your store. If your efficient lighting doesn’t invite customers to spend time in your store, the energy savings could be offset by a drop in profits. Many customers feel a cozy and inviting ambiance in warm-white lighting. However, your business’s lighting should match your business aesthetics while still properly illuminating products.
Comfort is another important factor in managing seasonal energy usage, especially when it comes to heating and cooling. The interior temperature should feel comfortable for customers who are coming in from the heat or the cold. Although it seems counterintuitive, the thermostat should usually be set higher in the summer and lower in the winter. That way, the store doesn’t feel too hot or cold for people entering from outside, and customers are more likely to stick around and browse. You may need to experiment with several settings to find the right balance between efficiency and comfort.
Leveraging Technology for Real-Time Energy Monitoring
The latest energy technology can take the guesswork out of seasonal retail energy management. Many retail businesses can benefit from energy management systems (EMS). Using a combination of sensors and connected devices, an EMS enables you to monitor and adjust the building’s lights, HVAC system, automated shades, and other equipment from a central dashboard. The system monitors energy usage in real time and adjusts different components to accommodate foot traffic and weather conditions. If you have motorized shades, for example, the EMS can lower them automatically when the temperature rises above the desired level.
Many EMS platforms also include IoT sensors, which can monitor the systems and devices that use energy. They collect data and employ predictive analytics to recommend maintenance schedules, forecast energy demands, and manage energy usage based on historical patterns.
Incorporating Renewable Energy to Offset Seasonal Costs
When space allows, retail businesses can install renewable energy systems. The electricity generated by solar panels or wind turbines can reduce the amount the company pulls from the grid, which saves money. Many states offer rebates and renewable energy tax credits that cut costs even further.
Renewables also reduce your carbon footprint and strengthen your sustainable practices — two factors that can inspire brand loyalty among environmentally conscious customers.
Utility and Supplier Negotiations
Retailers are among utility companies’ most lucrative customers. Leverage this position by negotiating better rates with providers, either alone or with the help of a business energy broker. You might ask for favorable seasonal rates, for example, or work out a fixed-rate plan that helps you avoid peak pricing. A demand response program, which provides credits in return for reducing energy usage on high-demand days, is another way to save. Leverage the expertise of an energy professional, like Integrity Energy, to explore energy solutions customized for your business needs.
Seasonal Energy Strategies Create Yearlong Savings
Understanding the seasonal patterns for your business’s energy consumption unlocks ample opportunities for cost savings. With some minor adjustments and operational changes, you can set your business up for comfort and cost savings, no matter the season.
If your retail business is looking for ways to manage changing seasonal energy costs, consider pairing your efforts with a cost-effective commercial energy plan. Integrity Energy’s experts analyze your company’s unique needs to find the lowest business energy rates on the market. If you’re ready to take control of seasonal retail energy costs, request a free quote to start saving today.
Control Seasonal Energy Costs for Your Retail Business
Work with Integrity Energy to find a commercial energy strategy that helps stabilize costs and improve efficiency throughout every season.
About the Author 
Rob Barto
