Amid a worsening climate crisis, sustainable travel has never been more important to consumers. According to a 2021 Sustainable Travel report by Booking.com, 83% of global travellers believe that it is vital, with 61% saying the pandemic has made them want to travel more sustainably in the future.
The hotel industry alone accounts for around 1% of global emissions, according to UNWTO, and this is set to increase as demand continues to grow.
Hotels and resorts are now ramping up efforts to reduce energy consumption not only to win the hearts of customers but to deliver operational savings and improve asset valuation.
The power of solar
Schwartz Family Company Director, Jerry Schwartz, expects scrutiny on hotels’ environmental performance to grow.
“There is a huge amount of interest from the travelling public about whether hotels are being genuine when it comes to their sustainability commitment,” Schwartz told HM.
“The days of ticking the sustainability box by saying you encourage guests to re-use towels is over. It is now all about investing in renewables, reducing energy consumption and controlling waste. Hotel guests have every right to have ‘proof’ that the hotel is really walking the talk.”
Schwartz said the company adopted the NABERS rating system because it is independent, based on science, and supports hotels in an ongoing journey towards greater energy and water efficiency.
“A commitment to sustainability will not only reduce costs, but potentially win business, as corporate and conference tenders increasingly require a detailed outline of the hotel’s sustainability measures,” he said.
“If that influences a large group booking or the holding of a four-day conference, then there is a direct benefit of having a NABERS rating. It is quantifiable and highly respected.”
Schwartz Family Co has invested in solar power to reduce operational costs and the environmental impact of its hotels.
“We have solar panels creating 100kW of energy per hour at Mercure Sydney, Rydges Sydney Central, the Fairmont Resort, and Crowne Plaza Hunter Valley,” Schwartz said.
“This contributes to about 5% of its annual load.”
In addition, Schwarts operates a solar farm in the Hunter Valley which produces 5mW per hour, which is about five times the requirement of the whole hotel, he explained. Any power not used is transferred through the grid to the company’s other NSW and ACT hotels.
“In effect, we produce enough energy to run these hotels,” he said.
“We are building a second solar farm which will more than double our current manufacturing of energy. This will ensure that we will be using 100% renewable energy for our NSW hotels.”
Going green
Australian Government-owned ‘green bank’, Clean Energy Finance Corporation (CEFC) says investment into greener hotels can deliver both economic and environmental benefits and improve customer experience.
“In light of recent challenges in the industry, sustainability can increase resilience and improve risk mitigation as well as increased retention and engagement with guests and staff,” according to CEFC.
The CEFC is backing Pro-invest Group’s development of the Holiday Inn Express Melbourne Southbank hotel, which is targeting a 5-star National Australian Built Environment Rating System (NABERS) Energy rating.
With the support of $39 million finance from CEFC, Pro-invest is using the latest clean energy technologies in the construction stage with the aim of achieving a 25 per cent drop in the hotel’s energy use. This energy saving is expected to provide ongoing benefits for the hotel, carbon-conscious guests and for the environment.
Energy efficiency innovations including sensor lighting, metering upgrades, demand-controlled ventilation with occupancy sensors and integrated heat recovery systems, in addition to energy efficient building management systems have also been used to further reduce emissions.
Pro-invest Group Managing Partner and Co-CEO Europe, Sabine Schaffer, said it’s crucial that the developer, operator and asset managers have a shared interest in making sustainability a success at the hotel and portfolio level.
“This is not always the case, as there is sometimes little incentive, for example, from the builder to design the building with efficient technologies, which can impact the operational trading of the hotel which asset management and operations have to then tackle and navigate,” Schaffer explained.
“The alignment of a hotel’s re/development, operations and asset management allows for the hotel to be efficiently designed/built, while operations and asset management ensure the effective day-to-day operations of the hotel meet set out sustainability, maximising the hotels’ efficiency levels.”
Good for planet and pocket
Pro-invest Group is in the process of refining its emissions targets and exploring further avenues across its hotels to reduce emission levels to meet its 2030 target.
Schaffer says the implementation and management of sustainability initiatives and systems have supported savings, and improved access to finance.
“Initiatives such as the A Greener Stay deliver direct cost savings, while others have yield returns in other ways,” she said.
“This includes the allowance for early identification of inefficiencies in hotel operations. By actively monitoring the assets, we can identify early on what the energy conservation measures need to be implementedand save energy expenses down the line.”
Other benefits include access to green loans due to strong ESG credentials, Schaffer added.
In 2021, Pro-invest Group’s Holiday Inn Express Sydney Macquarie Park was awarded Aareal Bank’s first ever green loan, valued at $39 million, and further green loan achievements and discussions are well underway. ESG efforts have also enabled competitive advantages when applying for environmental grants.
“Overall, we see sustainability as producing ongoing direct and indirect financial benefits, and this will only intensify moving forward,” Schaffer added.
Start small
CEFC Director of Property Investments, Michael Di Russo, notes that little changes can go a long way when it comes to reducing impact on the environment.
“It’s not only large-scale changes that unlock energy savings – eco-smart mini bar fridges and high performing air conditioning systems for example have a positive impact and can be implemented without compromising guest comfort,” Di Russo said.
“The hotel sector can take real action to reduce carbon emissions and benefit from improved sustainability.”
Crystalbrook Collection, which operate under the ethos of Responsible Luxury, is proof that starting small can pay off.
“We started small, making eco-enhancements and changes where we could — recycled wooden key cards, upcycled coat hangers made from pressed receipts/paper,” said Crystalbrook Collection CEO Geoff York.
“As we have grown, with more hotels and larger teams, all with their own unique experiences, passions and plans, we have been able to grow these initiatives.”
A few of the sustainability initiatives in place across the hotel group today include reducing paper through the use of technology, using recycled and upcycled materials for items such as key cards and clothes hangers, farming its own beef, sourcing at least 80% of produce from within a three-hour drive of each hotel, and omitting single-use plastic from its hotels.
Crystalbrook Collection produces a small amount of its own clean energy through rooftop solar panels, for example, and works with energy providers to use renewable energy where possible. The company has also partnered with EarthCheck to transition to more clean energy.
“I would say it’s a journey, we’re not there yet, but we will continue to strive until we are using 100% clean energy,” York said.
For Crystalbrook, sustainability is not about reducing costs, “it’s about doing the right thing”.
“I can’t say we’ve reduced operational costs at this stage, but I can say changing to more sustainable ways of operating hotels and resorts doesn’t have to come with exorbitant costs,” York said.
He advises getting in touch with other businesses that are doing sustainability well and learning from them.
“Start small. Little changes can make big difference,” he said.
“Reach out to other businesses you see doing great things in sustainability and ask for help. Throughout our journey we’ve been heartened by the great sharing environment that exists between businesses looking to operate more sustainably.”
This feature was published in the April 2022 issue of HM Magazine. Read more here.