How to reduce energy consumption in hotels
 
How to reduce energy consumption in hotels
22 APRIL 2015 6:13 AM
Energy accounts for 60% of a property’s carbon footprint. Hoteliers can reduce that number through low-cost, high-impact steps—many of which are being pushed by global chains. 
Hotel companies are promoting actions to make their hotels more sustainable and reduce their impact on the environment. However, they still have limited tools to constrain their structures to respect their sustainability standards.
 
One idea to reinforce the value of a brand’s sustainability policies would be to include sustainability clauses within the operating agreements signed between the brands and their properties, defining which measures can be included (meaning the ones that can be measured and monitored) and how they can be regulated. Energy is one sustainability issue that can be monitored and easily controlled and reduced. 
 
Even if energy costs represent a small percentage of hotel’s operating costs, their reduction can provide significant increases in revenue, especially in this economic climate where energy prices are increasing along with consumption.  
 
Indeed, tourism is a key talking point in debates on sustainability. The sector’s carbon impact is 2% of the earth’s total but will soon increase to 3% due to the fast growing tourist demand (from 25 million travelers in 1950 to 1 billion in 2012, and forecasted to reach 1.8 billion in 2030, according to the United Nations World Tourism Organization, which has urged the tourism industry to take sustainability measures).
 
Energy consumption in hotels
Energy is the second largest spending category for a hotel after employment, representing 3% to 6% of hotel operating costs and accounting for approximately 60% of its CO2 emissions, according to Energy Solutions.
 
Energy consumption is influenced by various technical, architectural, local and management factors, as illustrated in the following table. All of these factors can induce significant fluctuations in energy consumption, which makes it difficult to define and estimate energy targets. 


 
During the past decade, energy consumption in hotels has increased from 25% to 30% due to the growth in occupancy but also because of the new ways of living and consuming. This is most evident in the more demanding standards (more facilities and services), the more intensive usage of electronic equipment (computer, TV, music appliances) and the development of operating equipment (electric cooking, cold rooms, elevators). This exponential curve is expected to continue over the next few years, with a 10% to 25% rise forecasted, according to Vlasta Zanki Alujevic´.
 
How is hotel energy consumption split?
Energy in hotels is mainly consumed by temperature regulation, which represents on average 69% of energy consumption (63% for heating and hot water and 6% for air conditioning), according to REST 2005. These figures can be even more important in extreme climate conditions, where temperature regulation within properties requires even more energy. 
 
Operators can reduce energy consumption by first defining average temperature levels inside properties to avoid extreme temperatures (e.g. too hot, too cold) and find a balance between acceptable temperatures for guests and appropriate energy spending. An acceptable average is 19°C (66°F), according to various worldwide health authorities. 
 
To a lesser extent, other important energy end-users are kitchens and “other unidentified” sources (11% each). Surprisingly, lighting/TV/radio ranks fifth in this classification (4%), followed by laundry (4%).


How to reduce energy consumption in hotels
In order to reduce energy consumption, hoteliers have at their disposal a range of tools and practices that can be easily implemented, depending on the state of the hotel. Hotel owners are frequently reluctant to install sustainability measures in general, especially in the more economic segments that are more cost-sensitive and perceive eco-friendly measures as expensive. 
 
However, even if the cost of the following actions might vary, the impacts on the environment and the cost reduction will be significant, justifying the investments needed. Moreover, some of the suggested actions listed in the table below have no financial costs; they only need human investment and care. 
 
It is important to point out that the difficulty in implementation and costs mentioned are informative and based on an industry average. They might vary depending if the hotel is already opened or planned, and if the building is existing or not. Indeed, it is easier to include environment friendly technical requirements when planning a new-build rather than modifying the technical characteristics (shape, insulation, specific construction materials, equipment) of an already constructed building. 



 
The hotel chain’s role
Implementing sustainability measures in the hospitality industry is not an easy task. As opposed to the airline industry, where companies are grouped together under international alliances, there are limited synergies between hotel chains, which each have multiple stakeholders. Divergent interests and targets create a difficult combination between the owner’s profit goal and hotel chain’s standard requirements, making it challenging to develop coordinated and global sustainability actions involving all the stakeholders.
 
 
For example, a hotel owner might be reluctant to implement a new energy efficient air conditioning system required by the brand because he sees it as expensive and unnecessary, regardless of the fact that the impact on the environment with the new system will be reduced as well as the energy bills. This is especially true in the lower hotel categories, which are most cost-sensitive as they have a lower financial power. 
 
Cost is a crucial parameter to take under consideration while setting up a sustainable policy. Moreover, each hotel is different and characterized by various factors, from category to location, size to facilities, making it difficult to find a proper benchmark and “models” to apply to each property.
 
Hotel chains have a strong influence in the tourism industry due to their size; the concentration of hotels they own, operate, lease or franchise in different parts of the world; their financial strength; and their relationship with the international community. Each year, they accommodate a high number of guests from all over the world and the major companies are internationally renowned. Thanks to this recognition, they are influential and impose standards to the industry. 
 
Because hotel chains are so influential, they have a duty to push for the implementation of sustainability measures, first within their properties and then in every hotel. This duty is made easier by the fact that sustainability is now a real concern for guests who increasingly are aware of environment issues. The evolution of technologies also popularizes environmentally friendly products, making them more accessible and less expensive.  
 
However, their upcoming work toward making the hospitality industry more sustainable is considerable and critical, as hotel demand is continuously rising, increasing consumption and creating a crucial need to take environment measure and, in our case, regulate energy use, as the degradation of our environment is not reversible. 
 
The tools
In order to achieve their mission as sustainability ambassadors, hotel chains dispose of a range of operating, marketing/communication, training, monitoring, certifying and rewarding tools they can use in their properties. Some of these tools are listed in the following table and qualified according to the impact they have on the success of a sustainable policy. As we can see, operational and communication actions are the most effective chains can promote sustainability.


Conclusion
Sustainability policies are still a long way off from being implemented in every hotel, but the industry is waking up and stakeholders are starting to get involved. 
 
Hotel chains are playing their part with operating contracts that establish rules and requirements a hotel needs to fulfill in order to enter a chain. Monitoring systems and low-cost steps to reduce energy consumption, which represents 60% of hotels’ CO2 emissions,
produce immediate effects on energy bills.
 
However, sustainability measures only can work with the involvement of all stakeholders. Even if awareness on the subject is increasing, sustainability is still associated, for a part of the population, as boring or expensive and not taken as seriously as it should be. It will take time to change mentalities and make eco-friendly tools the rule and not the exception, but this can be accomplished with the involvement of all stakeholders and communication with staff, industry, investors/owners and guests. 
 
Hotel chains should not shy away from talking about what they concretely do to make their hotels sustainable and communicate these actions to their guests. This could help with integrating these measures into guests’ fundamental requirements for a hotel experience by generalizing these practices.
 
It is also important to reassure hotel owners and investors that sustainability is good for the environment and their wallets. Establishing case studies, evaluating for a range of benchmark hotels in different categories the cost for implementing a sustainability policy and the medium and long-term return on investment can help. This also can assist in understanding trends and complications.
 
Even if it is one of the most important economies in the world, the hospitality industry is not bound by strong international regulation and depends mainly on the rules established in each country. A 4-star hotel in France has different standards than a 4-star in the United States or in China. And hotels do not all use the same measurement metrics for energy. 
 
Therefore, in an ideal world, we can imagine that an international government body may be able to harmonize and globalize hospitality policies and hotel requirements though a global hotel ranking system that would include sustainability measures. 
 
Celine worked for six years as a consultant and project manager in investment for a consulting firm specialized in hotels and tourism, first in London and then in Rome. Her missions included market and feasibility studies, conceptualization of hotels, economic analysis, operator search and contract negotiation, strategic development advisory. She also has experience in marketing and commercialization, with a focus in e-distribution through experiences within a hotel chain and an online tour operator. She has an MBA in Tourism Management from the ESCAET and an oenology certification Level1 from Ecole du Vin. She also had a certificate in environmental management of tourism development courses from Harvard University. She is now a teacher in Transportation and Hospitality industry principles, including products, distribution and Revenue Management at the ESCAET tourism business school. The ESCAET is a business school specialized in Tourism management, preparing BA and MBA students as well as vocational students to international leisure and business travel, transportation, hospitality and event positions in various areas, including revenue management, marketing, distribution, commercial, purchase, IT. www.escaet.fr 
 
The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Columnists published on this site are given the freedom to express views that might be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns. 
 
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