Doing Well by Doing Good
May 27, 2021 | Ratio Institute
An Interview with Vallarta Supermarkets’ Steve Goh
Steve Goh is living proof that food retailers can do well by doing good. As Vallarta Supermarkets’ Director of Energy Management, Goh has spent the past four years on a relentless mission to track down and eliminate energy, food, and packaging waste at the grocery chain’s Southern California locations. The result? Stores in Goh’s portfolio now use 18% less electricity than when he started—even as the square footage he manages has grown—and send less waste to landfills with each passing year.
Goh’s efforts have also saved Vallarta more than $2 million on electricity, and reduced waste management bills at the retailer’s stores by up to 40%.
His work was recognized when Vallarta won Southern California Edison’s 2019 Clean Energy Champion Award and the City of Los Angeles Better Building Council’s 2021 Hometown Hero Sustainability Award.
In February 2021, Goh joined the Ratio Institute Advisory Board. We recently sat down with him to talk about why supermarket chains are in a unique position to move the needle on climate change, what Ratio Institute can do to speed things along, and practical tips that other food retailers can use to reduce their environmental impact. As Steve says, “Knowledge helps. Knowing what I do now, I would do some things differently.”
The interview below has been edited for clarity and concision.
I’ve read your bio online, but could you give me a rundown of your experience and what brought you to Ratio Institute?
My background is actually in energy efficiency. I’ve been helping people save energy for the last dozen years, and when I started at Vallarta Supermarkets they had a goal of energy efficiency, of saving on energy bills. But when I came in, I saw there were more things I could do on water and natural gas. I’ve continued broadening my scope so that it now includes waste management and lowering the carbon footprint of refrigerants. My scope keeps widening more and more.
When I go to the grocery store, I think about the sustainability of the food and other products I buy. But Ratio Institute argues that we should also be paying attention to the sustainability of the places where we buy our groceries. Why do you think grocery stores and other food retail establishments have an important role to play in addressing issues like climate change?
Well, we’re an intensive user of energy and electricity. We have cooking, baking, tortilla ovens, and corn cookers. There’s room for improvement in all these energy-intensive applications. And on top of that, there’s a lot of refrigeration. Refrigerants are greenhouse gases, and many of the ones now in use are considered high-global warming potential (high-GWP) gases, so any leaks are a problem. If we can improve in these areas, we can definitely improve our impact on climate change.
If you were to take me on a behind-the-scenes tour of a grocery store, what else would you show me to demonstrate its impact on the environment?
In a typical supermarket, you have two or three aisles of refrigerated reach-in cases—that’s what you can see as a shopper. But behind the scenes, we typically have numerous refrigeration boxes, either coolers or freezers. When you have a bakery, you have a bakery freezer. When you have a seafood section, there’s a seafood freezer. When you have meat . . . it goes on and on.
For all those refrigerators, you have hundreds of feet of refrigerant line going into what we call rack compressors. We have one rack for low-temperature foods, such as frozen food and ice cream. We have one for what we call medium temperature. We have one for HVAC. So in our stores, we have hundreds of feet of refrigerant line, all of which could potentially leak.
Then for the energy usage, we’re running HVAC and refrigerators, we’re cooking, and our stores are brightly lit.
Could you put the energy intensiveness of grocery stores in context? How do they compare to other buildings?
Typically, a grocery store will use three to four times as much energy per square foot as an office building.
How would you describe the state of food retail sustainability today?
I’ve walked into other stores and seen them using fluorescent lamps. That’s the cheapest and fastest ROI thing you can do to save energy and money: switch to LEDs. There’s a lot of work that a typical grocery store can do to have an immediate impact on things. Some chains are making a good effort, you can tell, but there’s more that can be done.
While you’ve done a lot of work on electricity use, I understand you also have a passion for reducing food waste. Could you explain why you see that as an important issue?
The average grocery store disposes of a whole bunch of food waste because it’s close to the expiration date or has blemishes, and all of those items could be donated to charity organizations. In California, there’s going to be a law that you have to do that—you can’t dispose of it. But for a long time, grocery stores were not giving away much. Landfilling food waste results in short-lived climate pollutants that have adverse effects on human health and ecosystems, as well as contributing to man-made global greenhouse effects.
We have a rigorous recycling program in which we recycle as much as we can: chicken renderings, beef bones, used oil, etc., are all picked up by recyclers to avoid being landfilled. Non-recyclable food waste is hauled off for composting.
Ok, let’s say you’ve wandered into a grocery store that is not part of Vallarta. What’s a bad practice or outdated technology you might encounter that would make you groan?
This sounds very mundane, but equipment maintenance is very important. Every company wants to maintain equipment, but some companies are not maintaining a lot of equipment, and doing that can make the store use a lot more energy. A strict maintenance schedule can have a big impact.
For example, when I see a reach-in freezer that’s completely iced up, I can tell that maintenance is not at the top of the list for the supermarket.
Not only is an iced-up case unsightly, it also wastes a lot of energy.
Another example is cooking hoods for exhaust smoke. In order to make up for all that air being pulled out, we have air makeup units—they’re there to make up for the air that goes to exhaust. What happens if you have exhaust running and air makeup units that are not running? You create a negative pressure environment, and all this hot, unconditioned air comes into the store. Now you have high humidity in the store.
If you simply don’t make it up and you have high humidity coming in, you will have high condensation in the store. When you go into a store and see condensation on the cases—we call it sweating—you know the pressure in the store is unbalanced. And then you need to have a case heater running to reduce the condensation, so you’re using more energy.
It sounds like many food retailers are essentially leaving money on the table. What are the barriers holding the industry back?
When I started at my company, with the LED light for example, people thought the light would be harsh. Or they thought it would be more expensive. For instance, our LED lights cost $6 instead of $4 for regular lights. But people didn’t think about how you’d be cutting your ongoing electricity use by two–thirds. And LED lights have progressed to the point that you can have any color you want.
There’s another important aspect of LEDs. A typical fluorescent tube might last a year or eighteen months, and it takes a lot of effort to replace them. LED lights can last ten years or more. Everyone should be using them. It’s the least they can do. It should be a requirement, there should be state laws.
But knowledge helps. Knowing what I do now, I would do some things differently. There are two types of LED: one type is plug–and–play, where you remove the fluorescent light and you put the LED in without changing the wiring. Another type is called ballast bypass, where you connect directly to the power system. When we started this program, we were relying a lot on incentives from the utility companies, and most insisted we use a ballast–compatible system. And now, every few months we have to replace the ballast. So it might have been a wise move to forgo the incentive and just go with the ballast–bypass LEDs.
What are some other “low–hanging fruit” strategies supermarkets can implement?
Another thing I see that could have an impact is that a lot of supermarkets still have open cases. They have one whole row of dairy products, and it’s completely open.
The resistance to putting doors on these cases is, “Oh, customers don’t like to open doors.” That doesn’t make sense at all. If a customer wants a gallon of milk, they’re going to open the door.
Something that’s beyond low–hanging fruit, this is more advanced: When you walk into a typical store, there are a lot of motors running. We changed out a lot of the old models to what we call EC models. They’re probably 30%−40% more efficient than old–style models.
Another example, talking about doors on cases: Most of the older–type doors have anti-sweat heaters that are running 24/7. So we put in an anti-sweat heater controller. It actually looks at the conditions in the store, such as humidity and temperature, and when the conditions for condensation occur, it puts in heat to warm up the glass. It uses very, very little energy.
Some of the changes you’ve made took advantage of government incentive programs. What kinds of policies do you think should be widespread, and what’s the state of those policies today?
In California, PG&E and Edison have incentives for adding doors to cases. They cover maybe 40% of the cost. That will encourage a lot of smaller companies to install doors. LED incentives have been discontinued. A lot of utilities have reached the conclusion that LEDs are a commodity, but I think they should continue the incentives to help smaller stores.
The big challenge we’re facing now is changing out refrigerants. There’s a California regulation that will require us to lower the global warming potential of our refrigerants. The problem is, it’s very expensive to change existing refrigerants to refrigerants with lower GWP. Changing them out costs about $75,000 to $100,000 per store. If you have fifty stores, that’s $5 million with no actual benefit to the store. If it’s energy efficiency, you at least get lower energy costs. But when you change refrigerants, there’s no benefit except not getting fined. If the state could help in this area, it would do a lot.
Aside from direct–energy or waste–bill savings, why would it make business sense for a grocery store to take action on sustainability? Have you seen examples of this work translating into customer loyalty or employee retention?
We have a group of loyal customers who pay attention to all our sustainability efforts. For instance, we started bulk food, and that makes a difference to some of our customers who want to reduce their waste.
As you look to the future, what would you define as a successful next five years for sustainability at Vallarta?
To lower our carbon footprint as much as economically feasible, and to improve our resiliency against power outages. To that end, I’m looking at new technologies that will enable us to install microgrid systems.
We’re also excited to team up with the LA Better Buildings Challenge in the quest to be a low–carbon leader in the grocery industry. Participants in the low–carbon leaders program strive to be carbon neutral by 2050.
What are you most excited to see Ratio Institute accomplish?
Sharing information across supermarket chains. I’m excited about it because a lot of things that I’ve done for Vallarta Supermarkets, I’ve done mostly because of what I knew from my previous career, or because I did a lot of research. So instead of someone at a smaller company having to learn the hard way not to use ballast–compatible LEDs, or how to deal with food waste, there are things I can share.