H-E-B as a ‘Community Hero’ during Hurricane Harvey

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The Texas-based H-E-B grocery store chain served by Enchanted Rock’s microgrids exemplifies the comprehensive benefits of a microgrid backup solution in a retail setting. 

Among retail businesses, grocery stores are especially vulnerable to power outages. They have freezers full of food that must be kept at sub-zero temperatures, prepared foods that will spoil quickly if not kept at the correct temperature, perishable foods such as dairy, fish and meat that must be properly cooled and, often, a pharmacy with temperature sensitive medicines. 

Even relatively short power outages can be costly to grocers. Federal government guidelines recommend discarding any perishable foods, such as meat, fish, poultry and eggs, that have been held at temperatures above 40 degrees Fahrenheit for longer than two hours. The value of perishable foods runs anywhere from about $400,000 to $900,000 at a single store, according to a report from Western Illinois University. 

Enchanted Rock’s resiliency microgrids run on natural gas, which has a robust underground supply chain that rarely becomes disrupted.

In addition, losses from power outages are commonly not covered by insurance. Although some policies cover perishables with a spoilage rider, grocers still tend to face high losses because most insurance policies have a 12- to 24-hour waiting period. Contrarily, most spoilage occurs within the first three hours after an outage. 

Faced with the potential of high outage-related losses, H-E-B needed a solution. The grocery chain was founded at the beginning of the 20th Century, and it has grown into an enterprise with $23 billion in annual sales and more than 370 stores in the U.S. and Mexico. Forty-five of the stores operate in the Houston area, which is especially vulnerable to outages caused by the high winds and flooding from storms sweeping across the Gulf of Mexico during hurricane season. 

H-E-B Houston area stores had experienced intermittent power outages, according to George Presses, H-E-B vice president of fuel and energy. Presses felt the store needed a reliable backup power system that would keep them up and running “without any interruption to our partners, customers, or communities due to a weather event or a general, short term grid outage.” 

Previously, H-E-B had a fleet of mobile diesel generators that were dispatched on trucks during outage events. However, the grocery chain faced the typical drawbacks of diesel generators when flooding and downed trees and power lines prevented the trucks from being deployed where they were needed. 

H-E-B recognized their need for a more reliable solution, so the company approached microgrid developer, Enchanted Rock. 

Enchanted Rock’s solution was to permanently install a natural gas microgrid using the resilience-as-a-service model, where Enchanted Rock owns the equipment and H-E-B pays the fuel costs and a small service fee. 

In 2016, H-E-B partnered with Enchanted Rock to install microgrids at 45 of H-E-B’s Houston area stores using their reliability-as-a-service model. Enchanted Rock’s resiliency microgrids run on natural gas, which has a robust underground supply chain that rarely becomes disrupted. 

With Enchanted Rock, H-E-B’s entire facility is backed up, meaning the store functions normally despite area outages. The microgrids were designed to keep refrigerators and freezers running, the lights on, and cash registers functioning during grid outages. H-E-B stores can stay open and provide the public with food, emergency supplies and even shelter. 

H-E-B was fortunate to have the microgrids commissioned before Hurricane Harvey hit Houston in August 2017 as the storm knocked out power for 300,000 Texas utility customers. Enchanted Rock uses a 24/7 Network Operations Center to monitor the electric grid, so the company knew when to island H-E-B microgrids from Houston’s main power grid. As Harvey made landfall on the Gulf Coast, the stores began receiving power from the microgrid’s on-site generators. Eighteen H-E-B stores received full-facility backup power for five consecutive days during the storm. 

Because H-E-B has a goal of being community-focused, the grocery chain decided to expand the agreement to over 100 MW of additional locations across Texas and, eventually, to all its Texas stores. With this agreement, most H-E-B grocery stores will have full electrical reliability and will be able to serve the community during both major and minor power outages. As of August 2019, Enchanted Rock provides microgrid backup power to 101 HEB stores. 

Enchanted Rock’s solution was to permanently install a natural gas microgrid using the resilience-as-a-service model, where Enchanted Rock owns the equipment and H-E-B pays the fuel costs and a small service fee.

One of these H-E-B microgrid stores is in Kingsville, Texas about 35 miles south of Corpus Christi. In June 2019, a massive storm swept across Kingsville, leaving 9,600 residents without power during one of the hottest weekends on record. Most of the businesses in the area were forced to close as community members endured the heat. However, the Kingsville H-E-B was powered by Enchanted Rock for 39 consecutive hours, providing residents with a convenient place to cool off and purchase food, water, and other necessities. 

Conclusion 

In a digital society, power failure is increasingly costly for retail operations. It wreaks havoc on temperature-sensitive inventory, revenue streams, customer loyalty, and efficient business operations. And unfortunately, grid disturbances are all too common. 

Microgrids offer a solution to an intensifying problem. When the power is out, especially following a storm, customers truly need the services retailers provide. Stores with microgrids can stay up and running and distinguish themselves among their competitors as a resource the community can count on. Through the microgrid-as-a-service offering, retailers have a cost-effective option for the resiliency they need. 

In a world where power outages are increasing in occurrence and destruction, retail businesses must be equipped to protect themselves, their customers, and their communities. 

If you missed the firs four installments of the microgrid retail special report article series, see below to catch up:

• Why Electric Reliability is so Important for the Retail Sector

• How Retailers Can Increase Electric Reliability

• Benefits and Barriers to Retail Microgrid Deployments 

• From the Military to Retail Businesses: How Use of Microgrids is Growing

You can download the full report, “Microgrids for the Retail Sector: Your competition is in the dark, but you’ve got power,” courtesy of Enchanted Rock.