Safeway Stays Cool with Clean Energy

Safeway sells a lot of groceries, and it buys a lot of energy in the process. Freezers, refrigerators, and air-conditioned stores combine to make the supermarket chain one of the largest energy consumers in California. When the state experienced an energy crisis in 2000, Safeway had to rethink how it managed its energy supply. They hired Joseph Pettus, a former energy-industry executive, to take on the task. And even though the company originally set out just to reduce cost and temper variability in supply, their energy initiative has driven them to become one of the leaders in clean energy consumption. Here's a truncated version of the story from a MarketWatch article by Russ Britt:

A former employee of ExxonMobil and Fluor Engineering, Pettus recognized that businesses could negotiate directly with power wholesalers, but there were really only the big utilities available since the market liquidity for electricity had dried up after California's power debacle [...] So Pettus started trading natural gas futures. Once Safeway had accumulated enough of a stake in that form of energy, he sought out idle power plants that were state-of-the-art but had been shuttered after the industry scaled back operations.
With those power plants, Safeway forged what are known as "tolling" agreements in which they brought the ingredients [natural gas] to the power marketer and asked them to produce electricity that it could buy [...] Safeway now can generate its own energy if it wants. It went to the Federal Energy Regulatory Commission and obtained a wholesale energy marketing license. While Safeway doesn't produce its own energy, it can get creative about where it gets it, Pettus said.
[...] The company also pays wind-based producers to generate a supply equivalent to what it needs to power 18 stores, the company's corporate headquarters in Pleasanton, Calif., and all of the 280 retail gas-pumping stations that it owns.