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Social Responsibility

Good Day Sunshine

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Since its founding in Sweden nearly 70 years ago, IKEA has offered low-priced home furnishings of good design and quality. Its warehouse-like stores feature room vignettes displaying IKEA-designed full kitchens, living and dining rooms, as well as bedrooms with furniture and closet systems that IKEA sells ready-to-assemble. There’s also a “marketplace” with home accessories.

Privately held IKEA, a global player with more than 300 stores in 38 countries, takes sustainability seriously. In February, IKEA announced plans for a nine-turbine wind farm in Dalarna County, Sweden, that, when completed, will bring IKEA closer to its goal of 100 percent renewable energy powering, heating and cooling its facilities in that country. At full capacity, the wind farm is expected to generate enough electricity to power the equivalent of 17 IKEA stores.

IKEA began the transition to renewable energy in 2009 when it purchased three wind farms in France, and quickly followed that with the 2010 acquisition of six German wind farms. The company now owns 52 wind turbines that generate approximately 10 percent of its total energy requirements.

Long drawing from a desire to minimize its operations’ impact on the environment, IKEA believes it can be a good business while doing good business. Globally, IKEA evaluates locations regularly for energy savings, works with Global Forest Watch to maintain sustainable resources and flat-packs goods for efficient distribution. IKEA incorporates environmentally friendly efforts into day-to-day business and continuously supports initiatives including UNICEF, Save the Children and American Forests.

While that all sounds lofty, IKEA is not always so serious when it comes to evangelizing all things environmental: It often displays its humorous side in ad campaigns. In April 2011, to celebrate the annual Week for Sustainable Development in France (encouraging people to adopt a more responsible environmental attitude), IKEA launched “The Mysterious Passenger” promotion through television spots. Participants registered on the IKEA France carpool site with the hope that they will attract the “mysterious passenger” to their IKEA carpool. Drivers (and passengers) were eligible to win €1,000 gift certificates.

Sustainability as business model
IKEA operates 37 U.S. stores supported by five distribution centers, where recycling containers have been de rigueur since the first stateside store opened in 1985. More recently, many of its stores are being built to LEED (Leadership in Energy and Environmental Design) standards.

Ongoing sustainability efforts in the United States include recycling paper, wood and plastic waste materials, incorporating energy-efficient HVAC and lighting systems into facilities, using recycled construction materials, installing skylights in warehouse areas and designing water-conserving restrooms.

In January, all U.S. IKEA stores stopped stocking and selling incandescent lights – well ahead of impending Energy Independence and Security Act of 2007 measures designed to phase out all incandescent light sources by 2014 – becoming the first major retailer to do so.

Such efforts have paid off publicly; in 2009, TIME magazine named IKEA one of the eight most global eco-conscious companies.

“Conserving natural resources and minimizing impact on the environment is part of our business model,” says IKEA U.S. president Mike Ward, “as reflected through our smart product design and manufacturing, efficient distribution as well as education and waste reduction at stores.”

Recent capital-intensive projects include a store under construction in Centennial, Colo. Due to open this month in a Denver suburb, IKEA Centennial will be its first U.S store to incorporate a geothermal system for heating and cooling.

Elsewhere, solar water heating systems are up and running in Charlotte, N.C., Draper, Utah, Orlando and Tampa. Solar energy systems are operational in Brooklyn, Pittsburgh and Tempe, Ariz., with systems currently being installed at a handful of additional locations. “Investing in renewable energy such as solar panels atop our buildings,” Ward says, “simply furthers this commitment to helping reduce our carbon footprint and improving the lives of many people.”

Beyond retail operations
Earlier this year, IKEA threw the switch on two new solar energy systems built with REC Solar of California. First to go online was IKEA’s southwestern U.S. distribution center in Tejon, Calif. The 1.8 million-sq.-ft. DC, opened in 2000, is now crowned with a 370,000-sq.-ft. solar array consisting of a 1.8 MW system designed and installed by REC and built with 7,980 REC Group panels.

The Tejon array system is estimated to produce 2.88 million kWh of electric power annually, the equivalent of reducing 1,986 tons of carbon dioxide, eliminating the emissions of 389 cars or powering 241 homes yearly. The Tejon installation also contributes to the local utility’s renewable portfolio goals and reduces the electrical grid’s carbon intensity.

“Having solar panels on the roof of [the Tejon] distribution center demonstrates that the company’s sustainable commitment extends beyond our stores into all facets of the retail operations,” says Martin Grieder, distribution operations manager for IKEA U.S. Western North America. “This solar photovoltaic system will reduce significantly the carbon footprint and electricity costs of this facility and will continue the global and U.S. initiative of IKEA to incorporate sustainable practices wherever feasible.”

The Centennial store has the largest single-use commercial rooftop array in the state. The 60,000-sq.-ft. array consists of a 498-kW system, built with 2,212 panels. IKEA and REC Solar estimate that this unit’s solar program will produce approximately 740,000 kWh of electricity annually and have the impact of removing the equivalent of 564 tons of CO2 from the atmosphere.

“This effort by IKEA will contribute to the local utility’s renewable portfolio goals,” adds REC Solar’s Ben Collinwood, director of national accounts, “and will lower the carbon intensity of the electrical grid.”