Green Wombat

photo: sudweeks
Macy’s will install rooftop solar arrays at 26 of its California stores that will produce 8-megawatts of green electricity. Coupled with an energy-efficiency overhaul, the retailer expects to cut its utility bill at the stores by an estimated 40 percent. Solar cell maker SunPower’s (SPWR) PowerLight subsidiary will install the solar energy systems. Macy’s will buy the arrays for 11 of the stores. For the other 15 stores, Macy’s will purchase the electricity produced by the solar panels from a third-party financier who will retain ownership of the systems. Macy’s is just the latest big retailer to go solar. Last month, Wal-Mart (WMT) said it will install solar arrays at 22 stores using third-party financing in deals with SunEdison, BP (BP) and SunPower.

But Macy’s move is notable on a couple of counts. First, it’s integrating solar power with an energy efficiency upgrade, installing electricity-conserving lighting, and heating and cooling along with energy management systems. The one-two punch is expected to eliminate 88,450 metric tons of carbon dioxide emissions over the course of the systems’ lifetimes. "By combining energy efficiency with solar power, Macy’s is taking the extra step to cut our peak load demand," said Macy’s vice chairman Tom Cole in a statement on Tuesday.

Of course, all this is great PR. But there’s also some serious green at stake. Macy’s will get all the state and federal tax breaks for the solar systems it owns as well as any potentially marketable renewable energy credits associated with the projects. The financier of the other solar arrays will retain the tax benefits and share any renewable energy credits with  Macy’s. SunPower and Macy’s will jointly manage the energy efficiency upgrades. SunPower spokeswoman Ingrid Ekstrom told Green Wombat that SunPower is still negotiating the third-party financing. But the Wombat can’t help noting that San Francisco solar banker MMA Renewable Ventures (MMA) just last week announced a new division that will finance and manage energy efficiency projects much the way it finances solar arrays for corporate clients.

The other point worth considering is the impact on the power grid and big utilities as more and more big box stores and warehouse operators pursue a solar solution. By cutting peak electricity demand, these massive solar arrays take the load off the grid and lessen the need for additional coal or natural-gas fired power plants. That also means that utilities sell less electricity. In a state like California, where investor-owned utilities’ profits are not tied to how much power they provide, that’s not a problem. In fact, PG&E (PCG), Southern California Edison (SCE) and San Diego Gas & Electric (SRE) will benefit as companies like Macy’s will make it easier for them to meet their state-mandated renewable energy targets if they don’t need to crank up so many fossil-fueled power stations. For utilities that make their money pushing as many electrons as possible, the rise of the distributed power grid is more problematic. But with a national greenhouse gas emissions cap all but inevitable, even the coal belt will benefit from the spread of the sun belt.