The complexities of Florida’s electric regulatory process are usually taken on only by the state’s power companies. But here’s a surprising participant:
Over the past three years, Walmart has weighed in on an increasing number of issues before the Florida Public Service Commission. Some of the uptick is because of timing — some issues, such as energy efficiency goals, are scheduled to come up once every five years.
But others show the retail giant taking a more active role in dockets that affect its energy bills, particularly those that deal with renewable energy.
“They’ve made pledges to reduce their carbon emissions,” said Andrew Hoffman, professor of environment and sustainability at the University of Michigan. “They want to meet that objective (with) the lowest cost possible.”
Walmart is one of the world’s largest retailers and controls one of the most sprawling supply chains. It’s also one of Florida’s biggest energy consumers.
According to regulatory filings, Walmart buys 1.22 billion kilowatt hours each year from the state’s five major electric utilities. Its monthly energy consumption from those companies is about 102,000 times that of an average household.
Just over a third comes from Tampa Bay utilities — Duke Energy Florida and Tampa Electric —- while 56 percent comes from the state’s largest electric utility, Florida Power & Light.
To keep its costs down, Walmart participates in the state’s electric regulatory process.
Since 2015, the company has intervened in topics such as utilities’ proposed rate increases, energy efficiency goals and more recently, major community solar projects, though its participation dates back to at least 2010.
Having a seat at the table, Walmart director of energy services Steve Chriss said, helps the company advance its sustainability goals and save on overall energy costs.
“General rate cases and other rate-making proceedings represent the only opportunity to engage in the conversation on these issues,” he said.
When utilities filed plans this year for a new storm hardening program, for example, Walmart took issue with the calculation method that Duke Energy and Gulf Power used to determine how much customers would be charged, as it would have higher costs for large-scale customers such as Walmart. The commission hasn’t ruled on the plans yet.
Most recently, Walmart was the only corporation to provide input on large-scale community solar projects from Duke Energy and Florida Power & Light, supporting them publicly in regulatory filings. As a result of that participation, Walmart will save 4 cents per kilowatt hour for the first three years of the program, with an increase of less than 2 percent each year after. Duke Energy spokeswoman Ana Gibbs said the utility approached Walmart about the project because of its size and its renewable goals.
What makes Walmart’s approach with Florida’s regulatory process unique is that it is one of the only companies to participate individually. Legal costs and getting up to speed on the state regulatory landscape can be challenging, so trade associations such as the Florida Retail Federation and Florida Industrial Power Users Group represent most corporate interests before regulators.
Walmart has its own lawyer representing the company before regulators and is sometimes represented by the Florida Retail Federation. It has an energy division that oversees similar issues around the country.
Walmart, Chriss said, has helped “develop or provide regulatory support for” seven renewable programs from utilities across three states within the past year.
Walmart’s goal is to be powered by 100 percent renewable energy. Currently, it is working toward acquiring 7 billion kilowatt hours of renewable energy globally by the end of the year. It also hopes to have half of its worldwide operations powered by renewable sources by 2025.
“What these big guys are trying to do now is survive the scrutiny that a lot of people give them,” said Sharon Hanna-West, graduate professor of sustainable business at the University of South Florida.
Walmart has received sharp criticism over the years for its labor practices, greenhouse gas emissions and environmental footprint. The retailer began a shift in 2005 to become more sustainable. While some criticize the retailer and other companies for pursuing such efforts in the name of goodwill, Hanna-West said companies are beginning to realize that on a practical level, ignoring sustainable business practices will cost them significantly down the line.
“When you look out 50 years, you are looking climate change square in the face,” she said. “You’ve got to stop the greenwashing and roll the sleeves up.”
But going green isn’t free. In 2014, Walmart filed with Florida utility regulators arguing that shouldn’t have to pay twice for sustainability efforts — once for the projects it’s undertaking, and once as a customer for any Florida utility-led initiatives. The Florida Industrial Power Users Group filed jointly with Walmart. Regulators rejected the bid.
Their efforts to sign on to renewable projects may have other effects as well, the University of Michigan’s Hoffman said. Having an accessible household name like Walmart participating in renewable energy may spur other companies to get involved and further bolster public support of renewables.
“The corporate sector has been very influential,” he said. “They can move things in terms of public opinion.”