Whereas:

Hydrofluorocarbons (HFCs), a common class of refrigerants, are super pollutants with global warming potential (GWP) hundreds to thousands of times greater than CO2. Research shows a global phase out of HFCs could preclude up to one-half degree Celsius of warming by 2100.

Kroger identifies “a significant refrigerant capacity in its supermarkets, manufacturing, logistics, and other facilities.” While Kroger has joined the EPA’s GreenChill program and seeks “to minimize leakage from our air conditioning and refrigeration units,” it did not meet now expired annual goals to reduce refrigerant related emissions in 2018 or 2019. Kroger’s HFC-related GHG emissions were nearly 1.7 million tons in 2019, accounting for over 68 percent of the Company’s gross global scope 1 carbon footprint. More aggressively addressing HFC emissions would help Kroger achieve its broader climate goals and prepare for regulation. 

Ongoing implementation of past regulatory updates caused Kroger’s HFC emissions to increase ten percent in 2019; the most common replacement for supermarkets is a HFC with a GWP 3,900 times greater than CO2.[[1]] Kroger anticipates significant costs from further regulation: “As the U.S. Climate Alliance develops HFC phase down rules similar to those proposed in the EPA SNAP Rules 20 and 21, higher Global Warming Potential (GWP) refrigerants used by Kroger today could be phased down and would need to be replaced. This would incur significant equipment, labor, and operating costs for Kroger.”

Experts suggest numerous strategies to address refrigerant emissions including, enhanced refrigeration efficiency, preventing leakage, and replacing HFCs with lower GWP refrigerants. 

The Consumer Goods Forum, of which Kroger is a member, is committed to phasing out harmful HFCs and has demonstrated ultra-low GWP refrigerants can be cost- and energy-efficient alternatives. Aldi has over 300 HFC-free stores and has committed to using HFC-free technologies in new stores and remodeling projects. Target has installed over 10,300 HFC-free units in its stores.

Resolved: 

Shareholders request Kroger issue a report, at reasonable cost and omitting proprietary information, describing if, and how, it intends to limit its impact on climate change by increasing the scale, pace, and rigor of its plans to reduce refrigerant-related emissions from its operations.

Supporting Statement:  

The requested report would address refrigerants released from equipment used in Kroger operations, i.e., refrigerators, chillers, and cooling and air conditioning systems in stores and company vehicles, but exclude refrigerants attributable to supply chain operations or to the sale of products in Kroger stores. Proponents defer to management’s discretion, but believe meaningful disclosure could include consideration of the benefits and drawbacks of approaches such as:

• Adoption of short-, medium-, and long-term, quantitative targets to reduce refrigerant emissions;

• The installation of ultra-low GWP refrigerants in new refrigeration systems and equipment;
• Strategies to substantially reduce the company's HFC footprint in existing equipment during remodeling or replacement of existing refrigeration systems;
• Limiting leakage and ensuring end of life refrigerant recovery by use of good management practices;
• Increasing refrigeration efficiency.

[1] https://ww2.arb.ca.gov/resources/documents/high-gwp-refrigerants#:~:text=For%20more%20information%2C%20please%20visit,a%20ton%20of%20carbon%20dioxide.

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