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KKR ESG & Citizenship Report

Eco-Efficiency: Mills Fleet Farm

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Optimizing Operational Efficiency in Commercial Retail

Key Environmental Performance Area:

  • Greenhouse Gas Emissions (Facilities)

Expected to reduce energy use per lighting fixture by more than 35 percent on average, saving more than 21 million kWh of electricity annually.

Expected to avoid more than 10,000 metric tons of greenhouse gas emissions annually.

Projected to reduce Mills Fleet Farm’s annual electrical utility expenses by more than 25 percent.

All data and information in this case study are as of December 31, 2016, unless otherwise noted.

Challenge

Retail buildings in the United States have the highest energy costs of all commercial buildings, approximately $20 billion annually, and account for the second largest percentage of greenhouse gas (GHG) emissions.i Retail building managers can decrease their energy costs and associated greenhouse gas emissions through energy efficiency initiatives.

Mills Fleet Farm is a Midwestern, value-based retailer of lifestyle merchandise serving do-it-yourself and active families. The company operates 36 stores located throughout Wisconsin, Minnesota, Iowa, and North Dakota.

Responseii

In mid-2016, Mills Fleet Farm began working with the Green Solutions Platform (GSP) team to evaluate and implement energy efficiency projects, including lighting upgrades. The lighting project is expected to begin in 2017. When fully implemented, the project is expected to reduce energy use per fixture by more than 35 percent on average, save more than 21 million kWh of electricity annually, and avoid more than 10,000 metric tons of greenhouse gas emissions annually.

The program is expected to have positive financial benefits from electricity cost savings and maintenance savings, including reducing Mills Fleet Farm’s annual electrical utility expenses by more than 25 percent.

i Energy Star. "Retail: An Overview of Energy Use and Energy Efficiency Opportunities." n.d. Web. 07 August, 2017.

ii Self-reported portfolio company data is not calculated, reviewed or independently verified by KKR or KKR Capstone. For more information regarding the results methodology for companies evaluating their own data, please see the methodology section. There is no guarantee that any GSP-related avoided costs or added efficiencies will positively impact the portfolio company’s valuation or performance.

Unless otherwise noted, portfolio company data represents 2016 results, published in October 2017. These case studies may contain forward looking statements including descriptions of planned projects and projected results and savings. These statements are subject to the risk that the projects will not develop as planned or at all or that projected results and savings are not realized.