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ENERGY STAR: What Can This Rating Bring to Your Hotel?

By Jim Poad, Director of Client Solutions, Advantage IQ

What is ENERGY STAR?

Just over 10 years ago, the U.S. Environmental Protection Agency and the U.S. Department of Energy created a joint program, ENERGY STAR®. It assists businesses in tracking energy consumption and protecting the environment through energy efficient products and practices. With this energy performance system, energy managers can benchmark the energy consumption of their buildings against similar buildings nationwide. The system, which uses a scaled rating of 1-100, evaluates several factors to make building performance comparisons as accurate as possible. Included are the impact weather differences have on energy demand and consumption, the physical building spaces, and the operating characteristics of each building.

The availability of a tool that conveys the effects of behaviors on energy use enables building operators to clearly demonstrate the need to focus on certain target areas at each site. Over time, behaviors can be influenced and changed as positive impacts are demonstrated through an improved rating. ENERGY STAR provides an easy-to-understand metric of energy performance, and encourages awareness through the publishing of case studies, annual awards, and access to the ENERGY STAR label for site recognition. Using the ENERGY STAR rating system as a first step to benchmark your facilities’ performance is a low-cost means to jump start an energy awareness program.

How can ENERGY STAR impact hotels?

According to ENERGY STAR, each year the hospitality industry spends over $7.5 billion on energy alone. Reducing energy consumption by just 10 percent across the industry could help reduce U.S. greenhouse gas emissions by 6 million tons. Research reveals that tactical improvements in energy efficiency can reduce energy spending by 10 to 30 percent, without forfeiting service, quality, or luxury.

The hospitality industry is well served by a common energy metric because it enables them to benchmark and track energy usage across multiple sites. Benchmarking energy use is a first step in the process of assessing energy performance and measuring ongoing progress towards established goals. Once rated, hospitality facility managers can track changes and differences at each site, letting them consider the necessary modifications to improve energy consumption. ENERGY STAR is a low-cost benchmarking tool that offers a clear-cut way to understand and communicate how a hotel’s performance is measuring up to others.

ENERGY STAR benchmark ratings not only indicate sites in need of improvement, but also illustrate the progress made at each site. It is a straightforward way for managers to see how an energy awareness program, and implemented changes, has reduced both energy consumption and utility costs. This provides necessary data to consider changes at other sites because the information provides legitimate examples of validated approaches. ENERGY STAR can be a component of a larger energy awareness program, yielding significant savings just from supporting the active management and energy awareness within a facility.

Environmental consciousness and an understanding of how energy is consumed continue to be principal considerations for hotel owners. These are two areas where customers can be won and money can be saved. The initial hurdle to overcome is getting everyone in the organization, from top to bottom, to care about energy management. This is where ENERGY STAR can help, as using it to rate each hotel in your portfolio promotes a culture of energy awareness and motivates peers to compete in the benchmark race. Much like being given a grade, an ENERGY STAR rating entices peers to work for the best grade in their region.

An ENERY STAR-based awareness program is also a great market positioning tool. In a time when going green and being environmentally conscious is a top priority for many guests, this is an excellent way for hoteliers to exhibit their dedication to environmental awareness. In order to display the ENERGY STAR label and highlight the site’s energy achievements, the facility has to obtain a rating of 75 or higher. This recognition shows patrons that the hotel is operating with sensitivity to energy consumption and the environment.

Conditions for Rating

Hotels must meet a specific set of criteria that are used as factors by ENERGY STAR to generate a rating. The building must:

• Have at least 5,000 square feet of used space.
• Demonstrate at least 55 percent average annual occupancy.
• Report 12 months of energy data that includes all usage in the building, regardless of fuel type.

When setting up the individual sites, the following information is used to profile each hotel submitted:

• Number of rooms
• Gross floor area
• Workers on main shift
• Number of commercial refrigeration and freezer units
• Presence of cooking facilities
• Percent of gross floor area that is heated
• Percent of gross floor area that is cooled
• Zip code

Partners for data collection

Whether submitting just one hotel or an entire portfolio, gathering site and energy data is required before applying for an ENERGY STAR rating. Beyond gathering all the operating information for each site, a year’s worth of utility billing data must be submitted as well. Compiling this much information can be a tedious job to do in-house, especially when dealing with sites that number in the hundreds, or maybe thousands.

This is where an Automated Benchmarking service provider can be extremely helpful, especially because they already work directly with the EPA. Most multi-site hotels attempting to gain ENERGY STAR ratings should begin working with an expert in order to leverage the service provider’s ability to manage the data across a large portfolio. ABS providers are also well versed in the process necessary to submit for the ENERGY STAR rating, which can make the data compilation and input process much smoother.

While many hoteliers strive for an ENERGY STAR rating for their entire portfolio, starting with a small pilot group may provide significant information regarding the larger opportunity. Starting with a select number of facilities lets hotel owners work out the nuances of the process and better understand the work that will be required to submit the entire portfolio of sites. In order to gain the most comprehensive perspective, the goal should be to pursue ratings for the entire portfolio. This commitment demonstrates dedication to energy awareness across the organization and will support the sustainability goals set for the business.

Once your hotel has been set up and rated by ENERGY STAR, you can take advantage of other tools provided by the EPA, such as carbon reporting and energy intensity measurements. The rating is a worthwhile investment for any business with sustainability goals, and moving forward will be a critical step for an organization’s energy awareness initiatives.

Jim Poad, a 30-year energy industry veteran, serves as Director of Client Solutions for expense and energy management firm, Advantage IQ. In this capacity, Mr. Poad is responsible for developing and directing the Company’s energy management programs on behalf of clients. He works with clients to develop and implement a customized strategy to better manage energy usage, reduce overall operational costs, and meet overriding corporate objectives. He has helped clients save millions of dollars through the implementation of supply-side and demand-side initiatives. Mr. Poad can be contacted at 608-755-1650 or jpoad@advantageiq.com. Extended Bio...

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