California Grocers Association Unveils the CGA Emergency Energy Conservation Program.

Business Editors/Food & Energy Writers

SACRAMENTO, Calif.--(BUSINESS WIRE)--Aug. 9, 2000

Members of the California Grocers Association are powering down, and dimming lights in an effort to save energy during the current electric power shortage now impacting the Western United States.

Given the current limits on California's power supply and recognizing the key role supermarkets play in the state's energy market, the association announced today the implementation of its voluntary CGA Emergency Energy Conservation Program, effective immediately. Member companies that sign on to the program will agree to reduce electric power consumption by 10 percent upon the declaration of a Stage I Alert by the California Independent System Operator (ISO).

Each store, or chain of stores may employ different measures to achieve the 10 percent reduction, but it is anticipated that stores will:

-- reduce store lighting by as much as 50 percent.

-- reduce air conditioning.

-- reduce or restrict the use of certain store equipment such as

battery chargers, electric cooking/slicing/packaging

appliances, compactors/balers, etc.

"The Western United States is currently experiencing a severe shortage of electric power due to inadequate generator capacity," said CGA President Peter Larkin. "Other factors, such as increased demand from rapid economic expansion, utility de-regulation, and weather conditions have also contributed to the problem."

As a result, some areas, particularly Southern California and the San Francisco Bay Area, have experienced soaring power bills and/or periodic blackouts. Virtually all areas of California have been subjected to utility company calls for voluntary and sometimes mandatory power curtailment.

"While government and the private sector are aware of the issues, there are no short-term, easy fix solutions," Larkin said. "Experts estimate that these conditions could continue for at least two more years."

Although consumers may notice some differences while in their local supermarket, the energy saving measures will not affect normal store operations.

"None of these energy conservation measures will have a negative impact on food safety or quality," said Larkin. "Food safety is the first priority and will not be jeopardized."

The Association is working in concert with California Governor Gray Davis to develop ways industry can save energy during this crisis.

"The state's current energy crunch is a challenge for all Californians," said Governor Gray Davis. "Grocers have stepped up to the plate, now other businesses should follow."

Due to the unique and particularly severe situation in the San Diego area, all stores participating in the program in the San Diego Gas and Electric service area will initiate their 10 percent reduction efforts immediately and not wait for a California ISO Stage I Alert. This will remain in effect through August 31, 2000 at which time it will be reviewed.

More than 2,000 California grocery stores have already agreed to participate in the program. It is estimated that these stores will save enough electricity to power between 50,000 and 60,000 homes. Many more are expected to sign up in the next few weeks following the CGA Board of Directors' official endorsement of the conservation program at its quarterly board meeting on Tuesday, Aug. 8.

The Grocery Industry

Grocery stores, supermarkets, convenience stores and membership warehouse stores all play a vital role in providing California consumers with a reliable and plentiful supply of fresh food and grocery products year round. To do so requires the use of a considerable amount of electric power.

Power is required to cool and freeze products to ensure safety and freshness, light the store, provide heating and air conditioning and run food preparation equipment and many other appliances throughout the store.

Out of necessity, food retailers are large consumers of power, but as a result, years of experience have taught the industry how to be one of the most efficient users. Many energy conservation technologies were pioneered by grocers as a way to reduce consumption and contain costs.

The California Grocers Association is a non-profit, statewide trade association representing the food industry since 1898. CGA represents approximately 500 retail members operating over 6,000 food stores in California and Nevada, and approximately 300 grocery supplier companies. Retail membership includes chain and independent supermarkets, convenience stores and mass merchandisers. The association is recognized as the industry leader in the areas of government and industry relations, public relations, education and communications. CGA maintains its headquarters in Sacramento with a satellite office in Long Beach.