Tesco's "green DC" plan hits snag

Even a distribution center that's about as green as they come can get tripped up by environmental regulations.

That's what's happened to British retail giant Tesco, which has hit a snag in its plans to saturate the West Coast with its Fresh & Easy food markets. The company's energy-efficient, 820,000-square-foot distribution center in Riverside, Calif., is tangled up in a year-old environmental lawsuit brought against the March Joint Powers Authority, the agency that oversees the Meridian business park on the former March Air Force Base, where the DC is located.

Now, a judgment handed down by the Riverside County Superior Court says that the March Joint Powers Authority acted too quickly when it approved the Tesco project and shouldn't have exempted it from the California Environmental Quality Act, which would have required a lengthy environmental review. Environmental attorney Raymond Johnson, whose firm has brought similar lawsuits against distribution centers run by Wal-Mart and others, has said in published reports that he will ask the court to shut down Tesco's DC until the company has completed the environmental review process, which could take as long as a year.

However, Tesco spokesman Brendan Wonnacott said that scenario is unlikely. "There is nothing in the petitioner's papers that suggests a shutdown of the current operations would be required," Wonnacott said, noting that the challenge is actually against the March Joint Powers Authority and not Tesco. "Basically the judge ruled that the project needs to be brought into compliance with the California Environmental Quality Act, and we're working with March to clarify the scope and the timing."

Approximately 120 people work at the DC, which supplies 24 stores in three states. A second building phase could expand the facility to just under 2 million square feet. At that point, the DC could employ about 1,400 workers and serve up to 250 stores. Altogether, the retailer plans to invest more than $2 billion to expand its business into the United States.

Ironically, Tesco brought its retail business to the United States touting an eco-friendly business model. Among the retailer's green initiatives is a $13 million solar roofing system at the Riverside DC, which is believed to be the world's largest rooftop solar panel installation.