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Kmart Corporation (NYSE: KM) today announced that approximately 11,500 residents will benefit from an energy consumption reduction, via in-store lighting retrofits to be implemented at 85 Kmart stores throughout the state. The San Francisco Bay and San Diego store locations will be given first priority in an attempt to provide the immediate relief to local residents who may have already experienced recent power outages.

California Energy Commission has approved a $2 million grant issued to Kmart, which will be used to retrofit its lighting in older stores, reducing energy consumption of sales-floor lighting fixtures by as much as 40 percent. By altering store lighting fixtures, Kmart will help reduce peak electricity demands and provide an overall reduced base load demand.

"At Kmart we believe it is important to reduce energy usage and to help lessen the chance of power outages in our store communities for our customers. Kmart is proud to be the only major retailer that has embraced "green energy" alternatives and makes every effort to use renewable energy resources, including wind and solar power," said John Duke, Kmart National Director of Facility Management." Duke emphasized, "By improving energy efficiency in our facilities, California residents will benefit from reduced power outages, cleaner air, more comfortable stores, and our shareholders will benefit from reductions in our operating costs."

"As California struggles through a severe energy crisis, Pacific Gas and Electric Company is doing everything it can to help consumers large and small find ways to use energy more efficiently," said Gordon R. Smith, president and CEO of Pacific Gas and Electric Company. "The leadership shown by Kmart and many of our customers should be commended as we all work together to develop solutions to the energy shortage."

"Building electrical generating plants for eight megawatts could cost as much as $8 million and take more than a year to begin producing energy. A watt that's not used is a watt we don't have to generate, and the benefits are instantaneous. As Kmart is demonstrating, energy efficiency offers a cheaper, faster and more environmentally friendly solution to California's energy problems," said California Energy Commissioner Robert Pernell.

Kmart is an EPA Energy Star庐 Buildings Partner, and has made a commitment to install energy-efficient lighting, heating and cooling systems. Energy Star Buildings program participants reduce the emission of carbon dioxide, sulfur dioxide, and nitrogen oxides -- air pollutants associated with smog, acid rain and global climate change.

Kmart Corporation is a near-$40 billion company that serves America with more than 2,100 Kmart and Kmart supercenter retail outlets. In addition to serving all 50 states, Kmart operations extend to the Caribbean Islands and Asia Pacific. More information about Kmart is available on the World Wide Web at under the "About Kmart" section.

SOURCE: Kmart Corporation

Contact: Susan Dennis of Kmart Corporation, 248-463-1021

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