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10 Green Business Practices That Will Save
Your Hotel $8,021 Per Employee

What could you do with an extra $8,021 per employee?  Expand your services?  Upgrade your guest rooms? Reinvest in your business?

Conquer the economic recession and find real savings with the easy, actionable green practices contained in this report.  We’ll show you 10 ways to change how you manage your hotel operations to become more sustainable - both economically and environmentally. 

September 2010 - If you’re a hotel operating in today’s market, you can’t have escaped the hard truths of the current economic recession.  Well into its third year, the downturn has created a culture of deep cost cutting that has organizations slashing budgets and cutting costs wherever feasible. A 2009 Zagat survey showed that 30% of business travelers say they are traveling less today3 and multiple studies show that hotel occupancy percentages are down.  In fact, Smith Travel Research recently reported that U.S. hotels had a 55.1% occupancy rate - one of the lowest ever recorded by the company4.

Many hoteliers are responding to the downturn by lowering room rates to retain customers and stay ahead of the competition.  Unfortunately, according to Zacks Investment Research, this tactic has long-term detrimental effects on business for two main reasons5.  First, when rooms are occupied, there is a corresponding increase in operational expenses.  When combined with a discounted room rate, this significantly narrows profit margins.  Secondly, it’s difficult to reinstate previous room rates as the economy starts to improve.  When customers are used to receiving deep discounts, they will resist the return to higher rates6.

What if you could identify business practices that would result in significant operational and materials savings - allowing you to recoup more profits despite discounted rates? We’ve identified 10 green business measures that will result in an annual savings of just over $8,000 per employee, with little or no impact on the quality of guest service. 

“…Energy efficiency is still the cheapest, simplest way to put money back into people’s pockets and meet environmental goals.”
–Stephen Cowell, Huffington Post.
Did you know…According to ENERGY STAR, America’s 47,000 hotels spend, on average, $2,196 per available room each year on energy. This represents about 6% of all operating costs, and energy represents the single fastest-growing operating cost in the lodging industry at about 12% a year. Implementing energy efficiency measures presents a significant opportunity for cost savings7.

1. Recommissioning
Commissioning occurs when a building is completed - and is bascially a run-through of all mechanical systems to ensure they are working properly.  Recommissioning, on the other hand, can take place any time after a building is in operation and involves a tune-up of those same systems.  According to ENERGY STAR, recommissioning can save up to 15% in energy costs, or roughly $30,634 per year - or in our case, $2,000 per employee8. 
Savings per employee: $2,000

2. Put It On Your Card
Heating, ventilation and air conditioning (HVAC), along with lighting,  represent almost 70% of the energy used by hotels and motels.  Turning down the heat or air conditioning and turning off the lights when guests are out of their rooms is a simple but hugely effective way to reduce a hotel’s energy consumption. A key-card energy management system only powers a room when a guest is inside. This technology can save up to 45% in energy expenses without compromising guest comfort.  Sustainable Suites spends approximately $139,000 per year on HVAC and lighting - which means a savings of $41,600 or $4,000 per employee9.
Savings per employee:   $2,777

3. Tweek the Heat 
Once you’ve implemented the key card energy management system outlined above, you can save additional HVAC expenses by raising the thermostat two degrees and using a ceiling fan to further cut energy costs by about 14%. At Sustainable Suites, that’s $11,000, or $733 per employee10.
Savings per employee:  $733

4. Rest Your Computer 
For hotel office spaces, a computer monitor can use two-thirds of the total energy of a desktop system, so it is important to power down monitors whenever they are not in use. There are free software programs available11 that can automatically place active monitors and computers into a low-power sleep mode through a local area network. Whole-computer power management can save $15 to $45 annually per desktop computer; managing only monitors can save $10 to $30 per monitor annually.  For Sustainable Suites, with five desktop computers, that means a total savings of $225 per year for whole computer energy management, or $15 per employee.
Savings per employee:  $15

5. Increase Performance
Compact flourescent lightbulbs (CFLs) cost less and last longer than incandescent bulbs - saving you a significant amount in lighting expenses.  In fact, switching from incandescent bulbs to CFLs in non-guest areas and guest rooms can reduce your overall lighting expenditure by up to 35%.  Replacing incandescent and T12 fluorescent lamps with CFLs or high-performance T8 lamps and electronic ballasts can reduce energy consumption, and adding specular reflectors, new lenses, and occupancy sensors or timers to these fluorescent lighting systems can increase these savings even further. Switching from 75 watt incandescent bulbs to 20 watt CFLs in guest rooms can significantly lengthen lamp life - assuming five hours of use per day, a CFL will last five times longer than an incandescent bulb.  These changes to lighting can be made without impacting guest satisfaction. At Sustainable Suites, switching to CFLs and other flourescent fixtures in back-of-house areas and guest rooms can result in a savings of up to $14,000, or $930 per employee.
Savings per employee:   $930

6. Snack Smart
According to the US Department of Energy, a single vending machine running 24hr/day costs $400 to operate12. Installing occupancy sensors reduces energy during long periods of non-use, like overnight.  These sensors, which turn the machine on only when a customer is present, can save up to 50% in machine operating expense, or $200 per year.  At Sustainable Suites, that means a saving of about $13 per employee per year for each and every vending machine. 
Savings per employee:  $13

Did you know…
one easy way to reduce your vending machine cost is to ask your vending machine company to de-lamp the advertising lights inside the machine. The lights and ballasts in a typical refrigerated vending machine use about 180 Watts. At a rate of .15¢ per kWh, delamping vending machines can save $27 on every machine every year!  This technique works best in back-of-house, non-guest areas where employees can be educated about how delamping saves energy.  You can also apply decals to machines stating, “This Machine Is Operational. Lights Turned Off to Save Energy.”12
“But now, with reduced operating budgets, hotel owners are ... focusing on smaller environmental initiatives that don’t cost as much and may even save money at the same time. ”
–The New York Times
Did You Know...
...according to the US EPA, the average occupied hotel room uses 209 gallons of water during a one night stay13.

7. A Royal Flush
“Old” design toilets use up to 3.5 gallons per flush, while newer, more efficient low-flow toilets use just under half that amount at 1.6 gallons per flush.  If we assume an average of 1.5 occupants per room at six flushes a day per occupant (national average), and using Smith Travel Research’s 54.8% occupancy rate, the installation of these efficient toilets would result in a savings of Sustainable Suites would realize a savings of 318,000 gallons a year14.  At the US average of $1.50 per 1,000 gallons of water, Sustainable Suites would save $477 per year, or about $32 per employee.
Saving per employee:   $32

8. Slow the Flow
As with the low-flow toilets above, installing low-flow (2.5 gallons per minute) showerheads in guest rooms can result in big water savings.  Older showerheads average about 3.5 gpm.  Using the same number of occupants and occupancy rate as in the previous example, and assuming an average shower time of 10 minutes, Sustainable Suites can expect to save almost 280,000 gallons of water per year15.  This translates to $418 per year, or $28 per employee.
Savings per employee:  $28

9. Hit the Pool
Besides the water required to fill them, hotel pools also require energy for heating and filtration.  Some of these expenses can be recouped simply by using a cover.  Covering a heated pool can save 50 to 70% of the pool’s energy use and 30 to 50 % of its makeup water8. In addition, draining or covering closed pools and spas allows filter systems and pumps to be turned off. A 10-horsepower pump motor can consume $4,000 worth of electricity if run continuously for 12 months16.  Turning systems off for six months results in a savings of $2,000, or $133 per employee. 
Savings per employee:  $133

10. Bulk Up
Buying in bulk has always been a cornerstone of going green.  Bulk means less packaging, less waste, and a lower per unit cost.  Hotels of all types – from the lowliest travel lodge to the poshest five-star, are realizing the financial and eco-benefits of bulk when it comes to purchasing and offering amenities to guests.  Items like soap, shampoo and conditioner are perfect candidates for tasteful bulk dispensing in guest rooms., a provider of environmental program materials for hotels, estimates that savings from using bulk dispensers average $.60 per room per day17.  At Sustainable Suites, that means a savings of almost $20,400 per year, or $1,360 per employee.
Savings per employee:  $1,360

Recommissioning $2,000
Key card energy management system $2,777
Temperature adjustment/installation of ceiling fans $733
Whole computer energy management $15
Replacing incandescent light bulbs with CFLs in guest rooms $930
Installing sensors on vending machines $13
Installing low-flow toilets in guest rooms $32
Install low-flow showeheads in guest rooms $28
Reducing pool season $133
Switching to bulk amenities dispensers in guest rooms $1,360

Total Green Savings Per Employee:   $8,021

Lowering room rates in response to the economic downturn can help buoy a hotel’s occupancy rates.  But, because of the disparity between these discounts and the increase in operational costs when rooms are occupied, and because deep discounts are difficult to phase out when the economy starts to perk up, this isn’t a sustainable approach in the long-term. Implementing the sustainable business measures we’ve described in this report can mean real, impactful cost savings for hotels that will carry beyond the current economic downturn. 

At the Green Business Bureau, we’ve designed a green certification program specifically for hotels that want to save significantly on operational and materials costs and grow their business by attracting green travelers.  Our green certification program for hotels offers over 250 initiatives like those presented in this report that will help you save money while saving the environment.  Call us today to find out more.

This report gives you an exclusive look into just a few of the cost-saving initiatives from the Green Business Bureau database.

To learn more about helping your hotel go green, visit us at: 1.866.979.1071


Marcos J. Cordero, LEED AP
Green Business Bureau
m: 954.770.5136   w: 713.979.1072



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