Х5 Retail Group is implementing cutting-edge sustainability practices, including those focused on reducing its environmental impact and promoting responsible consumption.
As a leader in the Russian retail market, X5 is conscious of the magnitude of its environmental footprint and takes measures to ensure full compliance with Russian legislative requirements and the highest international environmental protection standards.
- improving business processes and developing new technological solutions;
- drawing consumers' attention to eco-friendly goods and promoting responsible consumption;
- reducing the use of single-use packaging and promoting the use of reusable packaging;
- collaborating with R&D centres and manufactures with a view to developing eco-friendly packaging;
- introducing new technologies and investing in energy saving;
- applying new techniques and technologies for waste collection and disposal;
- minimising volumes of unused and unsorted waste, supporting and promoting recycling (processing) technologies along with circular economy principles;
- mitigating the environmental impact of logistics operations;
- engaging in the improvement of regulations seeking to reduce environmental damage;
- maintaining a commitment to the Memorandum on Sustainable Development and improvement of environmental practices in retail under the auspices of the WWF.
Energy consumption and efficiency
We are working to implement new energy efficient technologies that enable us to reduce energy consumption.
As part of our energy efficiency program, X5 is gradually reducing electricity consumption per square meter of retail space. We operate automatic monitoring systems to record electric energy consumption, as well as a monitoring and control centre for these systems.
Electricity consumption accounts for about 80% of our total utility costs, which makes it a priority. In 2018 and the first half of 2019, X5 put in place a number of initiatives to optimise the use of electricity:
- setting up an automatic data collection system across Pyaterochka stores to reduce electricity consumption, analyse the data flow and calculate optimal tariffs. In 2018, we reduced electricity consumption across Pyaterochka stores by 27.9 million kWh, while in the first half of 2019, the reduction amounted to 78.1 million kWh. Effective electricity consumption allowed us to reduce CO2 emissions by 39,000 tons in 2018 and by 109,000 tons in the first half of 2019 ;
- rolling out the extended Smart Store pilot in the Pyaterochka retail chain to cut energy consumption at retail outlets by 5%. At present, the Smart Store solution has been implemented in four Pyaterochka stores in Moscow. The technology is set to be rolled out in 120 branches of the chain in the near future. From 2020, all newly opened and refurbished Pyaterochka stores will be equipped with this technology;
- using remotely controlled refrigeration systems in all Pyaterochka stores, which secured savings of some RUB 70 m in 2018;
- rolling out a comprehensive system in Perekrestok stores that helps to improve the energy efficiency of supermarkets. The automated control and monitoring system will help cut power consumption in stores by an average of 10%. The energy efficiency system regulates equipment and lighting loads based on the operating mode of the retail facility, current temperature indoors and outdoors, and CO2 content in the air. The new technology has already been piloted and is now being integrated into every new store;
- launching the Improving the Energy Efficiency of Automated Electricity Fiscal Metering project across Perekrestok stores to enable checking of electricity meters at the point of metering and to enter into direct power supply contracts based on multiple tariffs;
- installing LED lighting in all Perekrestok and Pyaterochka stores along with 24 Karusel hypermarkets.
Transport and logistics operations have a significant impact on the environment. We use a variety of approaches to mitigate this impact by investing in modern trucks, optimising travel routes and recycling tires, tubes, batteries, ferrous and non-ferrous metals, motor oils and other materials in line with Russian legislation.
The Company is committed to lean manufacturing, which enables us to minimise waste associated with the delivery of products from producers and DC-to-store transportation.
- X5 recycles 100% of the plastic, cardboard, paper and other non-food waste generated by our stores. In 2018, we sent more than 572 million kg of waste for processing, including 307 million kg of cardboard, polyethylene and plastic, as well as over 22 million pallets and plastic boxes used for transporting goods. Used shopping trolleys and waste vegetable oil are also sent for recycling.
- All reusable Perekrestok containers, pallets and plastic boxes are returned to DCs.
- Special containers for separate collection of used batteries and paper are available at our retail chains' headquarters.
- We do not give out free plastic bags at checkout counters in our stores, which brings down the consumption of disposable packaging. In 2018, single-use plastic bags were bought only for every fourth purchase.
- Reusable bags are offered to customers as an alternative to disposable bags. Last year, Pyaterochka, Perekrestok and Karusel sold around 3 million reusable bags.
- Pyaterochka encourages customers to buy cotton eco-bags by crediting doubled bonus points to Vyruchai-Karta loyalty cards.
- Pyaterochka offers reusable bags for weighing fruits and vegetables in some stores as part of the pilot project. Customers who purchase a bag will receive double loyalty points on all produce purchases for the next month.
- In some regional stores, we offer paper bags as an alternative to plastic ones.
- In order to minimise plastic waste, the online supermarket Perekrestok.ru piloted the collection of plastic delivery bags for recycling. Customers will be able to return plastic bags used during delivery to the courier. The pilot service is available in all regions covered by Perekrestok.ru.
- As part of a pilot project to collect used plastic and aluminium beverage containers of any size and colour for recycling, reverse vending machines were installed at ten Pyaterochka stores in Moscow. The project is being implemented in partnership with the Coca-Cola system in Russia. For each bottle and/or can returned, the machine issues a coupon for 15% off a range of Coca-Cola drinks. The company in charge of reverse vending machine maintenance, transportation to recycling facilities, and recycling of the plastic and aluminium is EcoTechnologies.
- Ten reverse vending machines were installed in seven Perekrestok supermarkets and three Karusel hypermarkets in Moscow as part of a pilot project to collect used plastics for recycling. The project is being implemented in partnership with Unilever and EcoTechnologies companies. To encourage consumers to sort their waste, a coupon will be issued for each item of packaging that is returned, offering 10% off a selection of Unilever products at Perekrestok and Karusel stores.
- We constantly review proposals from innovative vendors who compete for the opportunity to produce and supply environmentally friendly packaging for our stores.
All food waste generated by our stores is sent to third parties for landfilling or recycling. The Company is looking for opportunities and piloting technological solutions to transfer food waste for further processing.
- Our Karusel hypermarkets feature bio compactors for treating and compressing organic waste. Sealed containers are watertight, which helps to minimise food waste decomposition, maintain cleanliness and comply with OHS standards.
- Karusel hypermarkets and Perekrestok supermarkets are also equipped with special refrigerators for temporary storage of food and biological waste, which enabled us to fine-tune the process of collecting, storing and disposing these types of waste in line with the veterinary standards and rules.
sustainable development and improvement of environmental practices in retail
- The Karusel hypermarket chain, together with WWF Russia, launched a campaign for its customers, aimed at funding the implementation of the project "Let's create and preserve the national forest heritage of Russia together". This project will cover a national forest heritage area of more than 100,000 hectares located in the North-Western part of the Russian Federation, and will help to preserve the most valuable part of the forest. This is the first joint project of WWF Russia with food retail representatives.