4 ways sustainable hotel operations boost your bottom line and guest satisfaction

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As our rapidly shifting climate underscores our need to decarbonize business operations, sustainability is a growing priority across the global economy. This expectation can be especially acute for hotel owners trying to make their operations less carbon-intensive while still meeting guest demands for comfort and convenience.

The good news is that improving your properties’ sustainability can also bring bottom line advantages. But successfully doing so requires planning beyond a one-and-done upgrade, especially with existing buildings. Schneider Electric provides planning guidance at each step of the way.

What does sustainability mean for hotels?

Today, sustainability efforts are heavily focused on reducing – and eventually eliminating – CO₂ production related to building design, construction, and operation. Since 70% of a building’s lifetime CO₂ emissions are generated during its use rather than construction, improving operational efficiency is critical to meeting established targets for reducing climate risks.

It’s important to note that operational emissions aren’t limited to those produced by a building itself (Scope 1 emission). They also include those generated from purchased electricity, heat, steam, and cooling (Scope 2) and other indirect sources, including related business travel, waste management, and the larger related value chain (Scope 3). With this in mind, it’s evident how hotel performance contributes to its guests’ carbon footprints. As guests – especially business travelers – become more aware of their own efforts to reduce Scope 3 emissions, becoming a sustainable hotel has never been more important to drive revenue.

What is sustainability in the hospitality industry?

Sustainability in hospitality industry involves minimizing environmental impact, conserving resources, and supporting local communities. It encompasses energy efficiency, waste reduction, and ethical sourcing. By prioritizing sustainability, hotels and restaurants aim to create a positive social and environmental footprint while fulfilling the needs of today without compromising future generations.

Hotel industry carbon targets

Industry leaders have committed to supporting the Paris Agreement on Climate Change targets. According to the Sustainable Hospitality Alliance, “The hotel industry needs to reduce its carbon emissions by 66% per room by 2030 and 90% per room by 2050 to ensure the industry’s projected growth doesn’t lead to a corresponding jump in CO₂ emissions.”

Fortunately, the efforts needed to reach that level of reduction can also be good for business. A trend report by Finances Online notes that focusing on sustainability can:

• Improve efficiency
• Reduce costs
• Boost guest experiences
• Drive revenue

Further, the younger workforce wants to work for innovative and green companies. 65% of hoteliers said their businesses are adding new technology to attract and retain staff.

Four steps toward a more sustainable bottom line

While hotel owners want to improve their operations’ sustainability, they can understandably be concerned about the financial impacts. Sustainability improvements are not just a cost of doing business in today’s climate-challenged environment but can be revenue drivers that help guests along their sustainability journeys.

Positive bottom line results from investments in new practices and equipment include:

1. Energy-efficiency measures such as adopting climate controls that automatically adjust heating and cooling based on occupancy can result in significant utility-cost savings.
2. Allowing guests to reduce linen changes during their stay saves on housekeeping and laundry-related energy expenses.
3. Reducing your hotels’ carbon footprint also does the same for your guests, providing a competitive advantage – especially for business travelers facing corporate targets for reducing their Scope 3 emissions.
4. Publicizing corporate sustainability goals and programs – and, perhaps, building guest participation in efforts like reduced linen changes into existing frequent-stay programs – can build brand loyalty, meaning more stays across branded properties. Brand loyalty programs can increase revenue and help offset operational costs.

Improved hotel sustainability is a process – Schneider Electric can help

Integrating sustainability into your hotel is a process, not a one-and-done initiative. Schneider Electric has a proven three-step approach to sustainability:

1. Strategize. Assess your current portfolio and building levels situation and create a plan to deliver measurable results.
2. Digitize. Create a single source of truth for your energy and resource usage to make data-driven decisions and report on progress toward your goals.
3. Decarbonize. Reduce your carbon footprint at scale across your portfolio and strengthen your business, leveraging the insights from the above two steps.

It’s important that hotel owners and operators begin decarbonizing operations now. Local and national emissions standards will only become more comprehensive, and investors now expect hotel assets to commit to more ambitious goals.

Transforming your hotel into a smart, connected building is the fastest path to reaching these goals. IoT devices and innovative software can provide the data and control needed to uncover opportunities and risks along the route toward decarbonized hotel operations. Schneider Electric partners with owners and operators to develop implementation strategies that add economic and environmental value so sustainability becomes a driver of bottom line results.

Learn more

Learn how Schneider Electric helped the operators of one of Las Vegas’s newest resorts support their sustainability visions, or download our brochure covering how we can support your organization’s sustainability targets. EcoStruxure for Hotels provides more details on how we can help optimize operations over a hotel’s lifetime and support green certification efforts.