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REI Sustainability Report: Sales Up 8%, CO2 Down 7%

REI cut its absolute carbon emissions by 7.6 percent last year – to 111,982 tons, from 121,201 in 2011– even as it grew sales by 7.4 percent, according to the company’s 2012 stewardship report.

Operational CO2 was down 7 percent, from 78,397 tons to 72,917.

The $1.9 billion outdoor goods retailer– whose president and CEO Sally Jewell left last month to become US secretary of the interior – attributes 43 percent of its 2012 operational greenhouse gas emissions to electricity, 18 percent to employee commuting, 17 percent to product transportation, 8 percent to direct fulfillment, 8 percent to corporate travel, 5 percent to natural gas and 1 percent to other sources.

Emissions in most of these categories declined from 2011 to 2012, employee commuting dramatically so – falling 27 percent, from just shy of 20,000 tons to 13,433 tons. REI says this was due to better employee commuting data and changes in commuting behavior. It is trying to influence employees’ transportation choices by promoting ride-sharing and alternative commuting options.

Report overview

The report is entirely web-based, with no option for a PDF download. The performance metrics and data include REI’s own operations, facilities (headquarters, distribution centers and retail locations), some aspects of supply chain manufacturing, and its adventure travel business.

Electricity, natural gas and GHGs

Emissions from electricity use increased to 31,723 tons last year, from about 30,000 – the chart for this metric (above) does not label 2011 figures. REI describes the metric as staying “essentially flat,” especially as the company added five new stores during the year.

REI says that energy efficiency investments account for the decline in relative electricity consumption. The report does not detail these initiatives. The company website does say that REI is managing energy use through installation of energy-efficient bulbs, greater use of natural lighting, retrofitting and replacement of HVAC equipment, centralized HVAC monitoring, and on-demand ventilation and airflow – but it doesn’t say how any of these initiatives may have changed in 2012.

Meanwhile, the stewardship report says that REI’s natural gas use fell 16 percent, from 685,244 therms in 2011 to 574,839 in 2012, but again offers no details on how this was achieved.

Since 2008, REI has opened 31 stores while total energy consumption increased by 2 percent.

In 2012, REI added solar electrical systems to three stores. This included a new carport system at a store that already had rooftop solar. The company now has solar power at 25 stores – about 20 percent of its retail locations – and one distribution center. The installations generate between 15 and almost 100 percent of each store’s needs.

Last year product transportation emissions fell by 9 percent. REI says its logistics team is working to minimize air freight and consolidate shipments.

The footprint for REI’s travel and recreational businesses, REI Adventures and Outdoor School, fell 8.7 percent, from 42,804 tons to 39,065. The company counts this footprint separately from its operational emissions.

In 2012, REI stopped buying carbon offsets for its travel business, and says it is expanding its sustainability assessments for REI Adventures beyond greenhouse gas impacts. It has completed work with students from the Blekinge Institute of Technology to develop a broad assessment using the Natural Step Framework.

Product stewardship

REI is working to implement the apparel industry’s Higg Index for product sustainability, published in 2012, across its products and supply chain. The tool grew out of the Eco Index, which REI and Timberland began in 2006. REI says that by using the Higg Index, it’s identified opportunities to improve materials selection and development, chemicals management and supply chain engagement.

Next, it plans to define priorities and set goals for improvement. REI is working with the top vendors in its private brands supply chain to assess and ultimately improve their performance, through training sessions. The retailer also uses the Bluesign system to manage chemicals in private brands’ supply chain, and in 2012 it increased Bluesign-certified material use to 23 percent, up from 17 percent in 2011.

But most of the products REI sells are not under its own brand. While it doesn’t have control over the supply chains for these products, the company says it seeks to influence responsible choices through education, engagement, and collaboration.

Waste

REI’s operational waste to landfill increased by 3.3 percent, or 116 tons, from 3,543 tons in 2011 to 3,659 in 2012. (The company did not publish total waste-to-landfill figures, but this can be calculated by adding together the categories in the chart shown below, excluding construction waste.)

The lion’s share of REI’s operational waste comes from its retail stores. There, waste to landfill increased 3 percent in 2012, from 3,382 to 3,487 tons. The company says its distribution centers continue to divert most of their operational waste from landfill. Its Bedford, Penn., distribution center and its headquarters cut waste from 2011 levels.

The Sumner, Wash., distribution center increased landfill waste to 54 tons in 2012, from 36 tons in 2011, which REI attributes to business growth and the timing of some waste hauling. But the current level is still below 2010’s figure of 69 tons.

Meanwhile, construction waste from new store openings, remodels and store relocations was 168 tons lower in 2012 than in 2011. This helped to drive a decrease in total waste of 53 tons, a 1.4 percent reduction.

Paper

REI’s paper use increased by 4 percent, from 6,298 tons in 2011 to 6,549 tons in 2012. It attributes this to an increase in the number of catalogs and direct mail it sent, using 2,450 tons of paper in 2012 versus 1,957 tons in 2011.

In 2012 REI used 4,091 tons of virgin fiber, which it says is only slightly higher than its lowest ever level. It used recycled fiber for 32.1 percent of its paper needs. This achievement was due largely to relatively high levels of post-consumer recycled paper used in the cardboard industry, REI says.

More than 99 percent of the company’s catalogs and printed materials are produced on FSC-certified materials. Of REI’s total paper, 35.5 percent came from FSC-certified virgin fiber sources in 2012, and an additional 5.4 percent came from FSC-certified post-consumer waste.

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