Category: Benchmarks and Targets

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How to reduce energy usage in hotels

Cutting energy and carbon use in hotels

This post looks at hotels, how they use energy and what the industry is doing to cut energy use and emissions.

The hospitality industry is big. Globally, it generates revenue of over $500 billion and is a huge employer of permanent and temporary staff. Hotels are often located in areas of natural beauty and have an impact on their local environment.

It takes a lot of energy to run a hotel.

The largest use is normally electricity. Gas is used for cooking and then diesel for backup generators.

The energy intensity of hotels varies around the globe, as different seasonal weather profiles require different cooling needs. In summary, however, a hotel that uses between 200 – 300 kWh/m2 appears to be doing well, while the norm for one that is average or poor is over 500-600 kWh/m2.

Architecturally, hotels bring together three very different types of spaces:

  1. Guest rooms: Guests stay in bedrooms, with attached bathrooms and often large expanses of windows. They can control the temperature and lighting in their rooms and use small appliances provided by the hotel or that they bring with them.
  2. Common areas: These include the reception, lounges, meeting rooms, swimming pools, gyms, saunas and similar areas. They are usually large spaces and lose energy to the environment around them.
  3. Service areas: These areas such as kitchens, laundries and offices where there is equipment, specialist air handling and ventilation equipment and computers and office equipment.

This means that you have more options in each area to reduce energy usage and the challenge is to select a mix of measures that you can implement within the constraints of the hotel.

Energy costs may be insignificant – but still large

In a typical hotel, the costs of energy may be only 4-6% of the operating costs. It might be a much smaller fraction of overall revenue.

But it can still be the second largest operating cost – and a line item where any saving goes straight to the bottom line.

How can you start to understand how your hotel uses energy?

Hotels, like most organisations, focus on energy costs on the bill. The problem is that knowing how much energy you use in total is of little use when trying to work out where you use it in the hotel itself.

This is because there is rarely any metering that is in place apart from the main billing meter.

There are, however, studies that shows how energy typically is used in hotels. For example, lighting can be 12-20% of the total load. Domestic hot water can use up to 15%. If there are chillers that are metered, the cooling energy requirements can be worked out quite accurately.

Let’s say you have all this data – then what?

Research suggests that most hotels are actually quite poor at managing energy efficiency over time. They are most efficient when initially commissioned, and do well after a major retrofit. Over time, however, performance starts to fall, which is inevitable without some kind of management system in place.

The other thing is that the largest driver of hotel energy consumption is something that you have little control over – the weather. Electricity consumption in particular correlates well with outside air temperature.

So, what does that leave you with as an option to control? Well there are the guest rooms and common areas where you could control temperatures. But you have customers there – and keeping them comfortable is much more important than saving a little bit on energy costs.

Where hotels are doing their bit is using labels to try and get their customers to help them save energy, for example by putting labels in bathrooms asking people to reuse towels if they can.

How do you tell how well a hotel is performing?

Enter what seems like a seriously cool online hotel footprinting tool.

The International Tourism Partnership (ITP) and Greenview have released a free online tool based on data from the Cornell Hotel Sustainability Benchmarking study.

The image below is a screenshot of the tool for the UK. It reports metrics based on 6 key measures:

  • HCMI Rooms Footprint Per Occupied Room (kgCO2e)
  • Hotel Carbon Footprint Per Room (kgCO2e)
  • Hotel Energy Usage Per Occupied Room (kWh)
  • Hotel Energy Usage Per Square Meter (kWh)
  • Hotel Energy Usage Per Square Foot (kWh)
  • HCMI Meetings Footprint Per SQM-HR (kgCO2e)

That’s a fair number of metrics.

From a combination of studies over the last 20 years, it seems that energy usage per square meter close to 200 kWh/m2 represents a very efficient hotel.

400 – 500 kWh/m2 is the mid-range performance while 600 kWh/m2 and above is an inefficient hotel or one with very high energy requirements resulting from the kit is has in the building or the climate in the area where it was built.

Measuring the energy used in hotels

The hospitality industry spends over $7billion on energy every year. So it’s worth putting in place systems to measure and manage this cost.

HCMI stands for the Hotel Carbon Measurement Initiative, developed by the World Travel and Tourism Council (WTTC), ITP and KPMG.

The resources for HCMI can be downloaded here http://tourismpartnership.org/resources/.

Another method of measurement is the EarthCheck Certified program, which appears popular in Australia.

In the US, Energy Star have a benchmarking fact sheet. Although the Energy Star programme may be under threat under the current US administration.

Technology in hotels

Energy use could be cut dramatically by introducing new technology into hotels.

For example, Zen Technologies is offering technologies such as smart thermostats, motor controls, LED lighting and ozone water treatments.

Zen claim that there are savings of 30-40% of utility costs based on such technology.

Other technologies include:

  • Laundry units that use less water
  • Low power Organic LED (OLED) TVs
  • Keycard activated lighting
  • Touchpad controls
  • Software to schedule shifts more efficiently

LED lights can deliver savings of between 50 – 80% according to providers.

On the generation side, you have solutions like an industrial fuel cell at the Radisson Blu in Germany. Supported by Germany’s Federal Ministry of Transport and Digital Infrastructure through a programme called the “National Hydrogen and Fuel Cell Technology Innovation Program”, the fuel cell will supply 3 GWh of electricity and 2 GWh of heat, removing the need for energy from the power grid for the hotel.

Taking action to cut energy and carbon

The tourism partnership has a useful guide on how hotels can go green.

The main areas to focus on are energy use, water use and waste.

This snapshot from the guide is a useful summary.

The areas where you can look to achieve savings include:

  • Heating
  • Lighting
  • Hot Water
  • Air conditioning
  • Refrigeration
  • Kitchen equipment
  • Laundry equipment
  • Swimming pools
  • Building envelope

Typically the energy required to condition spaces, heating or cooling large areas is the largest energy consuming activity, followed by domestic hot water. A rough breakdown could be as follows:

  • Space conditioning: 70-75%
  • Domestic hot water: 15%
  • Lighting: 12-18% and up to 40%
  • Catering: 15%

Lot cost / no cost tips from providers include turning down temperatures, installing energy efficient appliances, defrosting and cleaning behind fridges and freezers, using low energy lightbulbs, and having occupancy sensors.

It is also important to make sure that building energy management systems are commissioned correctly and are responding in the right way to sensors and settings. It is surprising how often systems are heating and cooling the same space at the same time.

In a best practice guide from Hotel Energy Solutions, the authors suggest an order in which to approach how to integrate energy efficiency in hotels:

  1. Evaluation: assess where you are and benchmark
  2. Organisation and behavioural solutions: involve staff and guests for long term change, with information leaflets and training.
  3. Technical solutions: These include reducing the energy needs through modifying the building, installing more efficient equipment and moving to renewables

These are 18 hotel case studies in this document and they provide useful tips and ideas to anyone looking at the options for energy efficiency measures in a particular hotel.

What can you achieve in practice?

The Ritz-Carlton saved over $11 million in energy costs and reduced energy consumption by 13% over three years. They did this by assessing 32 North American hotels, identifying 790 energy conservation measures (ECMs) and implementing 433.

Hotel Rafayel, a 5 star hotel in Battersea saved over £18,000 by installing LEDs and refrigeration control devices.

In India, the Godrej Bhavan office building invested $99,000 in energy efficiency retrofits, reducing energy use by over 11% the following year.

One aspect of this case study that should be followed by more business case modellers is that the team at Godrej modelled paybacks based on three scenarios:

  • 4.7 years under an actual bill scenario
  • 8.9 years under a fixed tariff scenario
  • 9.6 years under an escalating tariff scenario

This approach gives you a greater insight into possible outcomes and what happens when you spend money on energy efficiency measures – helping you spend money wisely.

In 2011, this building became the first one in Mumbai to achieve LEED gold certification.

In North Carolina, the Proximity hotel spent less than $7,000 on sustainability improvements during construction but saved $2,000 a month just through HVAC system monitoring controls. A detailed case study for this hotel is included here.

Summary

The hospitality industry uses a lot of energy but also has a lot of options when it comes to reducing the amount of energy it uses.

Unlike some other businesses, the way in which customers behave has a huge impact on hotel energy use.

You need to do things to Influence and motivate customers to make the right choices, such as reusing towels and turning lights off. You also need to make it easier for them to understand and control temperatures.

The hotel industry is also making efforts to make it easier for hotels to benchmark where they are and what they can do to make a difference.

And, according to the Carbon Trust, hotels could cut costs by 20% quite easily at little cost. So why wouldn’t you look at this if you aren’t doing so already?

Also, you might want to check out the UK’s first hotel energy conference, organised by Vilnis Vesma and the hospitality industry.

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What are science based targets and how can they help with energy management?

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Science based targets are set to achieve the carbon reductions needed to limit global temperature increases to below 2 degrees

Science Based Targets are an initiative set up by WWF, the World Resources Institute, the UN Global Compact and CDP.

The group define science-based targets as follows:

“Targets adopted by companies to reduce greenhouse gas (GHG) emissions are considered “science-based” if they are in line with the level of decarbonization required to keep global temperature increase below 2 degrees Celsius compared to pre- industrial temperatures, as described in the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC AR5).”

The CDP holds and provides data on consumption and emissions from companies and cities around the world.

Some of these datasets are free to access.

For example you can view and chart Scope 2 emissions (emissions from purchased electricity, heat, steam and cooling).

This shows that major emitters include miners, steel makers and retailers.

Scope 2 emissions are important because they are caused as a result of activities that companies can control and change.

Transparent information on the level of Scope 2 emissions could cause companies to increase their purchases of renewable energy and step up energy efficiency measures.

Corporations have a clear role to play in the transition

According to the World Resources Institute:

  • The corporate sector is the world’s largest source of emissions.
  • 80% of the world’s 500 largest companies have targets in place.
  • Over 200 companies have signed up to the science based targets initiative

But the Guardian says that most global companies still don’t have any obligation to cut emissions. They do try, but what they do isn’t enough to make a real difference.

Advocates of Science Based Targets argue that the benefits of setting targets include:

  • Building long term value
  • Innovating
  • Saving money
  • Becoming more competitive
  • Being credible and influential

The pressure on companies to have some form of commitment, target and measurement and verification system is likely to continue as countries recognize the need to reduce emissions and decouple GDP growth from energy usage.

How do you set Science Based Targets?

There are 7 methods put forward by the group

1. The Sectoral Decarbonization Approach (SDA)

The SDA looks at how similar energy intensive companies can choose the lowest cost technology mix to meet their energy demand.

The SDA looks at how sectors differ from each other, the potential for reductions and how quickly each sector grows over time. A free web-based tool has been developed for companies to use but is currently offline.

2. The 3% solution

Developed by McKinsey, WWF, CDP and Point 380, US corporates would cut emissions by 3% per year overall, while individual corporates would have tailored targets using a tool called the Carbon Target Profit Calculator.

This tool tells you how much you could save if you followed its guidance.

3. BT – CSI

BT (British Telecom) have come up with a Carbon Stabilization Intensity (CSI) target in 2008 is calculated  by comparing its emissions with how much it as a corporation contributes to GDP.

The contribution to GDP is defined as “value-added”, and the CSI is measured as the emissions per unit of value added.

BT’s CSI target is to reduce CSI by 20% by 2020.

4. C-FACT

Corporate Finance Approach to Climate-Stabilizing Targets (C-FACT) is a relative target that divides a company’s greenhouse gas emissions footprint by its GDP contribution (measured by gross profit) and calculates a Carbon Intensity Reduction Rate that takes into account growth rate.

The company then commits to the target, creates an annualized pathway and works its plan.

5. CSO’s context-based carbon metric

The Center for Sustainable Organization’s (CSO) developed a context-based carbon metric along with Ben & Jerry’s in 2006.

The metric compares emissions from an organization to targets based on climate change mitigation scenarios. It works out an individual target that looks at how the organization will grow and is updated based on what others are doing and the change in global emissions over time.

6. GEVA (Greenhouse gas emissions per unit of value added)

The GEVA analysis suggests reducing greenhouses gases per unit of GDP by 5% a year to meet the 2 degree target, which then translates into a corporate target of 5% reduction in GEVA per year. This seems similar in form to the BT-CSI at first glance.

7. MARS Method

The MARS method targets Scope 1 and Scope 2 emissions, where it has direct control and selects to “overdeliver” on targets on these emissions by targeting a reduction of -100% in 2040 rather than -80% in 2050. This takes pressure off Scope 3 emissions that cover agriculture and are harder to influence.

It is also based on an absolute reduction, with the objective to reduce Mars’ emissions by 8-% from its level of around 14 MT.

What about carbon budgets in the UK?

The one method missing from the Science Based Targets initiative is the system of carbon budgets in the UK – although the difference is that the initiative targets global companies.

The Climate Change Act in the UK set a target for the country to cut emissions by at least 80% by 2050 from 1990 levels in order to limit global temperature increase to as little as possible above 2 degrees C.

The first five carbon budgets covering the period to 2032 are now set in law.

For UK companies, these are targets that guide the policies introduced by the government such as subsidies and carbon taxes.

The Climate Change Committee (CCC) in the UK has looked at how emissions can be reduced at the lowest cost, given the available technology and policy. It recommends that:

  • Energy efficiency improvements are cost effective and save money.
  • Supporting innovation in technology will increase costs in the short term but help in long term.
  • As we move towards the long-term target, we should use measures that cost less than the carbon price projected by the government if available.

The budget is set to be consistent with EU targets – but we will need to wait and see how EU and UK climate change policy evolves after Brexit.

Summary and conclusion

The Science Based Targets initiative is a significant step in the right direction with commitment from some major companies.

Implementation by some of the largest companies in the world will cause a ripple effect through their supply chains and reduce emissions far beyond their own companies.

But there are concerns over whether the voluntary targets can be met and whether companies are even reporting their carbon footprint correctly.

Finally, companies in the UK should consider whether they should align their targets with UK policy or a global initiative – and to a large extent this will depend on whether their emissions are created in the UK or internationally.

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