M&S sold on renewable energy

25 February 2009

Marks & Spencer and npower have signed the UK retail sector’s biggest renewable energy contract. The six year deal will see npower provide M&S with 2.6 TWh of renewable electricity from April this year.

Npower will provide enough power from renewable sources to ultimately power all of M&S' stores and offices in England and Wales. M&S has now committed to purchasing enough renewable electricity to power its entire UK portfolio of stores and offices (excluding the Isle of Man where no renewable power is currently generated).

Under the landmark contract, npower will supply M&S with electricity from its portfolio of renewable sources, which includes wind and hydro farms. Uniquely the contract also allows for a significant amount of the supply to be purchased directly from independent small-scale generators of renewables, meaning that M&S can continue with its pioneering drive to encourage the development of renewable electricity.

The contract is a major step towards M&S’ Plan A goal to become carbon neutral through reducing energy usage, sourcing renewable power and using offsetting only as a last resort. From a 2006/07 baseline, M&S has already reduced its like-for-like electricity consumption by over 6% and sourced over 30% of its electricity from renewables, including five distributed generation sites featuring wind turbines, anaerobic digestion plants and small hydro schemes.

Richard Gillies, Director of Plan A at Marks & Spencer said: “Securing this contract with npower is a major achievement for M&S. Not only does it significantly move us towards our goal of using 100% renewable electricity across our stores and offices, it also strengthens our market-leading commitment to encouraging small third-party generators, including some of our own suppliers, to develop renewable electricity. This is a viable secondary business opportunity for many farmers – who can be confident that M&S will purchase, via npower, any renewable electricity they generate.”

Kevin Miles, Retail CEO at npower said: “Marks & Spencer’s objectives to lower emissions mirror our own: npower has already announced investments of over £2.0bn on greener power stations to reduce its ‘carbon intensity’ by around 33% by 2015** and we’re committed to helping our customers reduce their own energy consumption and CO2.

“This exciting, landmark deal is one that we trust the high street will follow. We have worked closely with M&S to understand their business and the challenges they’re facing to get the right contract in place to meet their needs. The public is now aware of the impact of business operations on the environment and this deal is a clear sign of M&S’s desire to meet the demands of its customers. We’re delighted to have been able to do the same.”

Grant Mackie was one of the first farmers to benefit from M&S’ drive to develop renewable power sourced from small third party generators, when he launched the first M&S wind turbine on his farm in Aberdeenshire in July 2007. Grant now has three fully operational wind turbines on the same site.

Grant Mackie commented: “I am very pleased that M&S have structured their supply agreement with npower in a way that allows renewable distributed generation to be purchased direct from farmers. Over many years, M&S have developed a close working relationship with their farming supply base. This is now being extended to those farmers investing in renewable energy developments, including wind turbines and anaerobic digestion. Farmers are continually being advised to diversify, yet there are several barriers to investing in renewables and it can be a costly process. The encouragement from M&S is really welcome.”

All of M&S’ existing renewable energy contracts with small distributed generators will be integrated into the new npower contract when it commences in April 2009.