Southeastern Grocers, BI-LO, Winn-Dixie to Pay EPA Fine, Reduce Leaks

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Southeastern Grocers Inc. and its subsidiaries BI-LO LLC and Winn-Dixie Stores Inc. (together, “SEG”), owners and operators of regional grocery store chains BI-LO LLC, Winn-Dixie Stores Inc., Fresco y Más and Harveys Supermarket, have agreed to reduce emissions of potent ozone depleting gases from refrigeration equipment at 576 stores under a proposed settlement with the U.S. Department of Justice and the U.S. Environmental Protection Agency to resolve alleged violations of the Clean Air Act. Under the settlement, SEG will spend an estimated $4.2 million over the next three years to reduce coolant leaks from refrigerators and other equipment and improve company-wide compliance. SEG will also pay a $300,000 civil penalty.

The United States alleged that SEG violated the Clean Air Act by failing to promptly repair leaks of class I and class II refrigerants, ozone-depleting substances used as coolants in refrigerators. SEG also failed to keep adequate servicing records of its refrigeration equipment and failed to provide information about its compliance record.

“This consent decree will help assure SEG’s future compliance with the Clean Air Act’s ozone-depletion program — by requiring leak monitoring, centralized computer recordkeeping, and searchable electronic reporting to EPA,” said Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Environment and Natural Resources Division.

“Through this settlement, Southeastern Grocers will implement concrete steps to reduce leaks of ozone depleting gases from the refrigeration equipment in their stores,” said EPA Assistant Administrator for Enforcement and Compliance Assurance Susan Bodine. “These steps will not only help to prevent damage to the environment, but should also help save energy.”

SEG will now implement a corporate refrigerant compliance management system to comply with federal stratospheric ozone regulations and to detect and repair leaks through a new bi-monthly leak monitoring program. In addition, SEG will achieve and maintain an annual corporate-wide average leak rate of 17.0 percent through 2022, well below the grocery store sector average of 25 percent. SEG must also use non-ozone depleting advanced refrigerants at all new stores, and an additional 15 existing, non-advanced refrigerant stores.

EPA regulations issued under the Clean Air Act require that owners or operators of commercial refrigeration equipment that contain over 50 pounds of ozone-depleting refrigerants repair any leaks within 30 days. Damage to the ozone layer results in dangerous amounts of cancer-causing ultraviolet solar radiation, increasing skin cancers and cataracts. An added benefit of repairing refrigerant leaks is improved energy efficiency of the system, which can save electricity.

The settlement is the fourth in a series of national grocery store refrigerant cases, including cases previously filed against Safeway Inc., Costco Wholesale Corp., and Trader Joe’s Co.

Southeastern Grocers Inc., and its subsidiaries BI-LO LLC and Winn-Dixie Stores Inc., all headquartered in Jacksonville, Florida, are privately held companies which own and operate regional grocery store chains BI-LO LLC, Winn-Dixie Stores Inc., Fresco y Más and Harveys Supermarket in the southeastern U.S., with 576 stores located in Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina and have a projected revenue of $8.45 billion in for the 2019 fiscal year.

The settlement was lodged today in the U.S. District Court for the Middle District of Florida and is subject to a 30-day public comment period and final court approval. It will be available for viewing at https://www.justice.gov/enrd/consent-decrees.