THE CONTRIBUTION OF ENERGY MANAGEMENT ON THE SUCCESS OF THE

HOSPITALITY INDUSTRY. A CASE OF SELECTED HOTELS IN ELDORET KENYA.

CHAPTER ONE

INTRODUCTION

1.0 Overview

This chapter will entail the background information of the topic with a brief introduction of the
topic, the purpose of the study, the formulated research objectives and research questions, the
significance and justification of the study and the problem statement where the gap noted in the
hospitality industry will be discussed.
1.1 Background Of Information

Energy Management is the practice of controlling procedures, operations and equipment that
contribute to the energy use in a hotel operation. This can include electricity, gas, water or other
natural resources. The hotel and accommodation sector are a sector in the tourism industry that
contributes to environmental issues, especially during production and through day-to-day
operations which involve the usage of many resources, such as water and energy (Chikita, 2012;
Nezakati et al, 2015; Zengeni et al, 2013). Glover et al (2014), Pan (2009) and Lynes and Dredge
(2006) point out that hotel and accommodation industries are pressed from some parties, such as
customers, stakeholders and governments, to be more environmentally friendly.

In this industry, it is important to minimize any negative experiences by customers, as customers

usually share negative impressions faster than the positive points, which will affect the image of
a particular accommodation and hinder it from attracting new customers (Bhakar & Bhakar,
2015). Due to the increase in environmental awareness and the demand for eco-friendly tourism,
most countries are working to support green tourism through green practices (Ham & Han, 2013;
Hassan & Nezakati, 2014). Terms like green practices, environmental management practices and
eco-marketing practices are new approaches to marketing and are a value-added approach for
organizations (Kim et al, 2017). This approach not only adapts or reinforces existing approaches,
but also searches for different perspectives, while at the same time addressing the gap to
minimize negative impacts on ecology and society (Perera & Pushpanathan, 2015).

Hotels use significant amounts of energy for daily operations and recreational activities. Energy
is therefore a very important resources in the operation of the hospitality industry. In many
facilities, however, energy costs are the second-highest operating costs after payroll. The success
of the hospitality industry is therefore focused on achieving the critical balance between guest
comfort, offered services, operating margins, and brand awareness, and on maintaining this
balance in the long-term. Investments in more efficient energy use and improved housekeeping
practices can lead to significant reductions in operating costs and energy bills, with relatively
short payback periods (Sweeting and Rosenfeld, Tour Operators Initiative).

Due to the economic crisis, hoteliers are nowadays more cost conscious and have adapted energy
management procedures to reduce the energy cost. One of the most important factors for
hospitality is customer satisfaction and customer perceptions of green hotels that are recognized
as energy-responsible consumers and environmentally aware organizations has increased which
has triggered the hoteliers to adapt environmentally friendly and sustainable forms of energy. It
can cost far more not only to build a lodging facility but also to operate it if it is not sustainable.
The cost of energy has increased so much in recent years that lodging construction now
incorporates ways of using natural lighting and constructing energy efficient buildings (Walker,
2010).

Hotels can effectively reduce energy use without compromising the high quality of services for
guests and in the process benefit from cost savings. Managing energy use in your hotel is the first
step towards this. Energy management helps improve your bottom line and holds down operating
costs. Controlling costs is a key to profitability in the hotel industry allowing your hotel to route
resultant savings toward fulfilling other requirements including purchasing additional amenities,
staff salary increases, etc. Energy efficiency means using less energy to perform the same tasks
and functions. For hotels, this could mean reducing the amount of energy needed for heating by
improving insulation of the hotel building, by introducing lighting control or also regulate space
heating and cooling. Energy efficiency saves energy, costs and reduces emissions of greenhouse
gases like CO2 which in return reduces global warming and the destruction of the ozone layer
reducing climate change. Hotels now aim to highlight green businesses so as to have a positive
impact on the environment and strive towards sustainable tourism (Zhang, et al., 2010).

Normally, managing energy use in a hotel building may be seen as part of the overall
environmental management. However, interestingly enough, “most examples of successful
environmental management are in the area of energy management, where there are clear
motivations in terms of financial saving” (Kim et al, 2017). There are numerous ways by which
energy can be managed within your hotel. Renewable energy sources like wind, solar and
hydropower are unlimited, as they capture energy flows available from the natural environment.
Use of renewable energy sources will help secure our future energy supply and lower the human
impact on the environment. It also goes a long way in the reduction of energy cost and the
operation cost hence enabling the hotel establishments remain competitive. Hotels that are using
renewable energy sources reduce energy consumption and increase sustainability, as well as
profits ([Link]

Energy Management Systems provide practical solutions by intelligently conserving energy and
water resources and the same time reducing expensive energy bills, it is also an environmentally
friendly solution that does not compromise the comfortability of the guest in the hotel. Although
it is quite expensive to implement the Energy Management System in hotel facilities, the long-
term impacts of energy cost reduction due to the systems has proven to be quite effective. Energy
management systems are used to improve energy efficiency by monitoring building temperature
inside and outside the building. (Levermore 2000)

There are several contemporary tools such as eco-labelling and wireless energy management
offering to the hoteliers of today efficient energy solutions and significant cost reduction. Energy
efficiency and conservation practices can enhance reputation among guests and others who are
concerned about reducing global energy consumption and the effects of climate change. Energy
efficiency can reduce hotel’s energy cost by 10%-40% depending on the measures taken. This in
turn lowers the hotels operating cost resulting in higher profit margins. (Zhang, et al., 2010).

General guides for achieving better energy efficiency in hotel buildings are available from
relevant government departments (Energy Efficiency Advisory Committee, 1992; Department of
Energy, 1993; Energy Efficiency Office, 1994). In these publications, good operational practices
that may lead to reduced energy use in a hotel such as good housekeeping practices and technical
guidelines to efficiently operate building engineering services systems are included. Good
operational practices for better energy efficiency have also been promoted by hotels’
professional associations (e.g., International Hotels Environment Initiative, 1993).

1.2 Purpose of the Study

The purpose of this study is to evaluate how energy management has contributed to the success
of the hospitality industry with the aim of improving energy conservation.

1.3 Problem Statement

Because of a significant amount of energy consumed in a hotel building for its operational
purpose, there have been increasing concerns on energy use in hotels from, and efforts to study
energy use performance and promote good operational practice in hotels by various parties
concerned. For a typical medium size hotel in Kenya, its annual bills for electricity, gas and
diesel may amount to tens of million Kenyan shillings, contributing significantly to the hotel's
total operating cost. Typically, energy consumption accounts for up to 10% of the total operating
cost of hotels, and 60% of your carbon footprint. Modern practices to control energy usage
includes contributions by the guests themselves which has been popularized by information cards
requesting guests to save water by letting hotel housekeeping staff know if they would care to re-
use towels and bed linens. This reduces the amount of water and/or cleaning substances used by
the hotel laundry department which also reduces the expense to the property owner or manager.

Recently consultants have developed entire organizations for advising hotels regarding
inefficient usage of energy and optimizing its usage. Some of these consultants participate by
providing the products to implement their advice for a share of the cost savings as their
consideration. These companies have proliferated over the years as public and business energy
concerns grow and are popularly known as ESCO's (Energy Service Companies). Other practices
include using Infrared motion sensors, door contacts, and other means to detect occupancy to
control the Heating, Ventilating and Air Conditioning systems (HVAC) when guests forget to
switch off when they leave their room. Turning off the lights when a room is not occupied is
called smart lighting.

Hotel facility managers are using cloud-based software nowadays to manage their energy
efficiency projects. The Department of Energy (DOE) Software Directory describes EnergyActio
software, a cloud-based platform designed for this purpose. Energy management markets in
general have been going through several changes including the shift to service-based models or
performance contracted models used by Energy Services Companies (ESCOs). Traditionally
ESCOs did not address the hotel segment because of the small values associated with hotel
energy retrofits and the difficulty in measuring so many potential load sources.

Energy management practices such as use of renewable energy and use of energy management
systems in the hospitality industry have been proven not only be environmentally sustainable but
they also reduce the energy cost in the organizations hence reducing the operating cost of many
hotels which has significantly led to an increase in their competitive advantage.

Even though many hotel managers know the importance of energy management to their hotels,
many do not know the different methods of energy management and those who know, have not
embraced energy management. The researcher conducts this study with the aim of providing
knowledge to the managers on the different forms of energy management and enable them to
embrace these methods as well as show the impact this has to the success of hotel industry.

1.4 Research Objectives

1.4.1 Main Objective

 To identify how energy management has contributed to the success of the hospitality
industry.

1.4.2 Specific Objectives

 To investigate the impact of renewable energy on the success of hospitality industry
 To find the effects of energy management systems on the success of hospitality industry
 To find out how staff and guests can be involved in energy saving projects and how it has
contributed to the success of hospitality industry
 To determine the impact of change of practice in hotel operations to the success of
hospitality industry.

1.5 Research Questions

  What are the impacts of renewable energy on the success of hospitality industry
 What are the effects of energy management systems on the success of the hospitality
industry?
 How can staff and guests be involved in energy saving projects and how this contributes
to the success of hospitality industry?
 What are the impacts of change of practices in hotel operations on the success of
hospitality industry?

1.6 Justification of the Study

It is important to carry out this study in order to create awareness to hotel managers on how they
can employ energy management practices to reduce energy cost and increase their profit margin
as well as the impacts these practices have on the environment and as a result in attracting and
retention of their customers. The study included in this paper intends to identify the energy
saving systems in hotels, as well as explore whether these systems reduce the energy and
consequently the operating costs of the hotels. This study is also important as it helps show the
mistakes that managers make concerning energy management and therefore will work as a guide
for other managers on what to do and what not to do concerning energy management.

1.7 Significance of the Study

This study will be beneficial to the industry as it will educate hotel managers on what energy
management is and how it can be applied in the hotel establishments. Through this study, hotel
managers will be able to reduce their energy cost and the operating cost which will lower the
prices of their products therefore achieving a competitive edge as well as increase their profit
margin.

Through this study managers will learn the application of renewable and green energy, which
will go a long way in promoting sustainability and environmental conservation since the use of
more eco-friendly energy will be put into place. This will enable the hotels attract and retain
customers as many customers are now environmentally conscious enabling the hotels to gain a
competitive advantage over their competitors.

This study will also help hotel managers understand the application of the energy management
system and its role in balancing between reducing energy cost and maintaining guest comfort.
Managers are also able to learn how they can involve guests and staff in energy conservation
projects and what operational practices they need to change in order to conservation of energy is
taken in to place during the daily operations of the hotel facility.

Through this study, students will be able to get references when carrying out research projects on
energy management in the hospitality industry. And get suggestions for further study on the
same.
1.8 Conceptual Framework

Independent variable

Energy
management Energy Management Systems
(EMS)
 Application of EMS in
hotels
Renewable/ Green energy  Benefits of EMS to hotel
technology establishments
 solar energy  Difficulties faced in the
 hydropower implementation of EMS
 biofuel  Value of EMS to hotel
 tidal/wind power establishments
 benefits of using
renewable energy to
hotel establishments

Dependent variable

Success of the hospitality industry

 sustainability
 reduction of operating cost
 Improved Hotel Image
 improved business performance
 competitive advantage
 Involvement of staff and guests in energy
conservation Change in practices of hotel operation
 standard operating procedures SOPs that
 Guest control conserve energy
 Total quality management, energy and  change in hotel management Programme
employees
 Increased awareness of energy use  Change of Hotel Management Strategies
among staff
 Demand-side management

 End-Use Efficiency

CHAPTER TWO

LITERATURE REVIEW

2.0 Overview

This chapter will entail a detailed discussion on how energy management contributes to the
successes of hospitality industry through the parameters contained in the conceptual framework,
that is the use of renewable or green energy in the hospitality industry, the different forms of
renewable energy used in hotels, the benefits of using renewable energy in hotels, it will also
entail a discussion on energy management systems, how they are applied in the hospitality
industry, their benefits and the challenges faced in implementing energy management systems in
the hospitality industry, how to involve employees and guests in energy management projects as
well as change in practices of hotel operations in order to manage energy.

2.1 How Energy Management Has Contributed to the Success of Hospitality Industries

Energy management has contributed to the success of hospitality industry in many different ways
which include but not limited to;

It Reduces Carbon Emission. By using a smart hotel energy management system, you will be
able to reduce carbon emissions to a great extent. This will pave the way toward a cleaner planet.
You will also be able to remain compliant with the rules and regulations of the country. You can
also play your part toward sustainable development. Plenty of smart hotel energy management
systems also partner up with environmental bodies such as One Tree Planted which can plant one
tree for every product or service sold, or through carbon emissions saved (Saikrishnan
Ranganathan 2022)

Reduced Operational Costs

Hotels can easily cut their energy consumption by 20 – 35% without changing a
guests’ experience or comfort. By reducing how much energy your hotel uses, you
can lower your energy bills, lower your operating costs, and lower your carbon
footprint. Green and energy-efficient technologies can become self-funding by
reducing overall operating costs. Any money saved can then be reinvested into the
hotel for further green initiatives. (Tomas van Stee 2020).

Reduce Environmental Damage

Hotels attract guests by their location and the surrounding environment. So, its
important hotels work on protecting the environment that sustains them.
[Link] revealed that travelers are willing to make ‘luxury adjustments’ to stay
somewhere green. By making your hotel energy efficient, it can lead to a healthier
and happier hotel environment for your guests, staff, and the community. Energy-
efficient lighting, improved air quality and heating management all help in reducing
environmental harm without affecting the guests' experience. But one of the simplest
ways to lessen your impact is by getting energy from renewable sources, such as
wind, solar and hydro. While it’s hard for smaller and boutique hotels to produce
their energy, they can source renewable energy from utility companies. Along with
saving money on energy bills, renewable energy sources can cut a hotels CO2
emission. In turn, supporting the growth of the renewable sector and minimizing the
impact on the environment (Karl Marx 2022).

Improved Hotel Image

As an hotelier, it's wise to show you’re working on your corporate social

responsibility. Promoting your green activities on your website, through social
media, in your hotel lobby and guest room directories will help to improve your
brand image. There are also various awards, labels, and recognition's available to
green hotels. These are great in reaching new audiences and drawing eco-conscious
guests to your location. Hotels may even find new business through corporations
who want to align with socially engaged companies. An improved brand image can
also help increase your employee retention rates. Staff are more likely to stay with a
company long-term that’s social values mirror their own. By encouraging
environmental action through team-work, motivated staff also tend to give better
customer services and working practices. So, by increasing staff loyalty, you can
help reduce staff turnover and lower the money spent on hiring and training (Nicole
Haper 2017)

Meeting Customer Demand

[Link] found that the number of travelers seeking out eco-friendly

accommodation rose to 68% in 2018. While 67% are willing to pay up to 5% more
for services if it has a positive environmental impact. Hotels can use this to their
advantage by positioning themselves as an eco-alternative. Showing that you’re
actively reducing your hotel’s energy use can meet the demand for eco-conscious
travelers. Meaning your hotel attracts a new clientele while staying a step ahead of
the emerging sustainable trend. But hoteliers must act quickly: soon green initiatives
will become a necessity for all hotels (John Attala 2019).

2.1.1 Renewable Energy in the Hospitality Industry

The power of most hotels in Kenya comes from green energy. This means that the electricity
used at these hotels, comes from sources of renewable energy generation. Renewable or green
energy consumption in most of the hotels in, Kenya covers 62% of the total electricity consumed
by the Group’s hotels worldwide. Hotels and resorts have often demonstrated their role as first
movers for green technologies, and they can obtain advantages beyond cost savings by applying
new cleantech technologies. The core business of hotels, in general, is positively affected by
green efforts. In addition, new cleantech technologies have considerable marketing potential and
might allow hotels and resorts to gain an advantageous position in relation to a new target
segment. The cleantech industry has steadily grown in recent years and has become
economically important. For many employees within the cleantech industry, green commitment
plays an important role during the private purchasing process (McGraw-Hill 2013)

Renewable energy technology has a lower environmental impact than traditional energy sources.
The renewable energy generation systems such as solar, wind, and hydropower can be installed
to generate electricity at hotel buildings. This green and sustainable power reduces the energy
bills and greenhouse gas emissions of the hotels. The solar photovoltaic (PV) panels generate
clean electricity from the sunlight. This electricity is used up by the hotel electricity network
through the electricity meter. The cost of a solar PV system varies depending on size, type of
panels, installation type and equipment used (Power Water, 2014). Hotels throughout the world
are beginning to use renewable sources of energy. Renewable power, including wind and
hydroelectric power are set to rise by 40 percent over the following five years. Energy
Department records already show that renewable energy accounted for 12 percent of United
States electricity over the past year. Of this 12%, 5% came from wind and solar sources while
7% was taken from hydroelectric plants. It’s clear that renewable energy is here to stay as more
companies embrace it. In this group, the travel industry stands out. Here’s a look at how
renewable power is being used by the travel industry to lower operating costs and support a
sustainable future. (Dr Thomas Hillig 2015)

Solar Energy

Solar energy should sound pretty familiar to you. By installing solar panels on rooftops or on the
ground, hotels can generate electricity from the panels. Moreover, the installation period is about
2 to 3 weeks. It is a relatively short process, so hotels won’t have to shut down during the
construction period. And the payback can happen as quickly as 5 years after installation. What’s
more, as solar technology becomes more mature, the costs of solar PVs keep decreasing year
after year, making solar energy more affordable, even to small hotels. The solar swimming pool
heaters installed in hotels generate hot water using sunshine which significantly reduces the cost
of pool heating. The installation of solar water heaters depends on factors such as solar resource,
climate, local building code requirements and safety issues. The solar-powered heating is an
efficient option for the hotels located in areas that receive a lot of sunshine (Department of
Energy, 2012). The heating of domestic water for guest services is an energy intensive and
expensive process. The solar domestic hot water system (DHWS) is a cost-effective solution for
hotels to run profitable business. The system pumps cool water into solar collectors where heat is
transferred to the cool water then it passes to the insulated storage tank. The solar domestic hot
water technology is used both by the solar combi systems and solar combi plus systems. The
solar combi system uses heat from solar thermal collectors to provide solar space heating and
domestic hot water. A solar combi plus system provides both solar space heating, cooling and
domestic hot water from a common solar thermal collectors Hotel Energy Solutions (Hamid
Abdi 2013)

Geothermal Energy

Compared to the previous two options, geothermal energy is more expensive and less popular to
hotel owners. However, depending on the hotel’s location, owners could take advantage of
geothermal energy. Geothermal energy is stored in hot water underground. It is difficult to use it
unless hot water makes it through the Earth’s crust in the form of hot springs or steam. For hotel
owners, it is not practical to build a dry steam geothermal power plant themselves, so the best
way to use geothermal energy is through natural hot water or steam. Therefore, if your hotel is
located in a region that is known for hot springs, you can definitely take geothermal energy into
consideration if you want to adopt renewable energy. The micro-hydropower system can be used
to generate electricity from the flowing water. The small and medium hotels energy requirement
could be easily met by this system. The micro-hydropower system needs a turbine to produce
electricity. It is cost effective and simplest form of energy (Department of Energy, 2012). The
ground source heat pumps (GSHPs) system is an extremely efficient form of space heating and
cooling and can also provide hot water for a hotel building. The system is popularly known as
geothermal heat pumps. It makes use of heat energy stored below the earth’s surface. This heat is
brought to the surface in the form of water or steam and moved through turbines to generate
electricity. It requires a capital investment with a payback period of five to 15 years (Johnston,
2012). The GSHP system saves energy, and reduces hotel electricity bills and carbon dioxide
emissions. The combined heat and power (CHP) system generates electricity and thermal energy
for heating and cooling in a single integrated system. The other terms used for this system are
cogeneration and combined cooling, heat and power (CCHP). This system is energy efficient,
reduces GHG emissions and improves the quality of power. The CHP ranges from micro-to
large-scale multi-megawatt power sources (Hager, 2013).

Bio Fuels

According to Society for Sustainable Tourism, biodiesel is becoming more popular and Kenya
has reaped about a lot from it in one year. Organic waste can be turned into biodiesel in a plant.
The bio fuels can then be used to power vehicles. Using bio fuels may sound a little crazy for
some hotel owners because most hotels are located in crowded cities. However, if your hotel is
based on a farm or in a rural area, you will have easy access to a large amount of organic waste,
which allows you to take advantage of biodiesel once you convert the waste. Modern wood
heating, as a result of new wood-burning technology is clean, safe, efficient and cost effective.
The biomass wood chip and wood pellet heating systems offer efficient automated space heating.
The wood chips are small pieces of wood from the logging residues. The wood pellets are small
cylindrical pieces produced from dried sawdust, wood shavings and straw and biomass crops
such as maize, rape and willow compressed under high pressure. The wood chip and pellet
boilers burn wood efficiently, waste little energy and cause less pollution (Yujing Lin 2019)

Reuse

Reuse simply means reusing linens, towels etc. in a hotel. Waste management is an important
issue at hotels because people normally live in the rooms for only a few days. Hotel managers
are required to change the items and clean the rooms before allowing the next guest to move in.
As a result, hotel owners can encourage guests to keep their items rather than getting new ones
each day if they are living in a room for more than one day. Unlike the other options, reusing
items is a simple policy to implement and every hotel is able to do it regardless of the size and
location (Saeid Nahavandi 2013)

Wind Energy

Last but not least, hotel owners can take advantage of wind energy if the hotel has access to wind
farms. It is expensive to build a wind farm that is able to provide all the electricity a hotel needs,
but if the hotel is located in a windy area, this option becomes more practical. Also, as wind
technology keeps developing, it will only be cheaper to build a wind farm in the future, allowing
hotel owners to use wind energy to cover their electricity bills each month. Besides these six
options we introduce in this blog, there are also other ways to help hotel owners to reduce utility
costs, including using LED lights, building automation systems, and more. Just keep in mind,
people nowadays do value corporate social responsibility and if your hotel is running on
renewable energy, you may attract more customers because people trust you more. The wind
energy produces clean electricity for hotel buildings. The small wind electric system lowers the
electricity bills, supplies continuous power and reduces the cost of providing electricity to hotels
located in remote areas. The wind resources can be efficiently used in PNG to mitigate the GHG
emissions [Department of Energy] (Doug Creighton 2013)

Benefits of Using Renewable Energy to Hotel Establishments

Reduced Global Warming

Most renewable energy sources produce little to no global warming emissions. Even when
including “life cycle” emissions of clean energy (i.e., the emissions from each stage of a
technology’s life—manufacturing, installation, operation, decommissioning), the global warming
emissions associated with renewable energy are minimal. The comparison becomes clear when
you look at the numbers. Burning natural gas for electricity releases between 0.6 and 2 pounds of
carbon dioxide equivalent per kilowatt-hour (CO2E/kWh); coal emits between 1.4 and 3.6
pounds of CO2E/kWh. Wind, on the other hand, is responsible for only 0.02 to 0.04 pounds of
CO2E/kWh on a life-cycle basis; solar 0.07 to 0.2; geothermal 0.1 to 0.2;
and hydroelectric between 0.1 and 0.5. (Environmental Protection Agency. 2017)

Renewable electricity generation from biomass can have a wide range of global warming
emissions depending on the resource and whether or not it is sustainably sourced and harvested.
Increasing the supply of renewable energy would allow us to replace carbon-intensive energy
sources and significantly reduce US global warming emissions. For example, a 2009 UCS
analysis found that a 25 percent by 2025 national renewable electricity standard would lower
power plant CO2 emissions 277 million metric tons annually by 2025—the equivalent of the
annual output from 70 typical (600 MW) new coal plants. (Energy Information Agency (EIA).
2017.)

Improved Public Health

The air and water pollution emitted by coal and natural gas plants is linked with breathing
problems, neurological damage, heart attacks, cancer, premature death, and a host of other
serious problems. Most of these negative health impacts come from air and water pollution that
clean energy technologies simply don’t produce. Wind, solar, and hydroelectric systems generate
electricity with no associated air pollution emissions. Geothermal and biomass systems
emit some air pollutants, though total air emissions are generally much lower than those of coal-
and natural gas-fired power plants (National Renewable Energy Laboratory (NREL). 2012)

In addition, wind and solar energy require essentially no water to operate and thus do not pollute
water resources or strain supplies by competing with agriculture, drinking water, or other
important water needs. In contrast, fossil fuels can have a significant impact on water resources:
both coal mining and natural gas drilling can pollute sources of drinking water, and all thermal
power plants, including those powered by coal, gas, and oil, withdraw and consume water for
cooling. Biomass and geothermal power plants, like coal- and natural gas-fired power plants,
may require water for cooling. Hydroelectric power plants can disrupt river ecosystems both
upstream and downstream from the dam. However, NREL's 80-percent-by-2050 renewable
energy study, which included biomass and geothermal, found that total water consumption and
withdrawal would decrease significantly in a future with high renewables (Energy Information
Agency (EIA). 2017.)
Inexhaustible energy

Strong winds, sunny skies, abundant plant matter, heat from the earth, and fast-moving water can
each provide a vast and constantly replenished supply of energy. A relatively small fraction of
US electricity currently comes from these sources, but that could change: studies have repeatedly
shown that renewable energy can provide a significant share of future electricity needs, even
after accounting for potential constraints In fact, a major government-sponsored study found that
clean energy could contribute somewhere between three and 80 times its 2013 levels, depending
on assumptions [8]. And the previously mentioned NREL study found that renewable energy
could comfortably provide up to 80 percent of US electricity by 2050 (Mark Bolinger. 2017)

Stable energy prices

Renewable energy is providing affordable electricity across the country right now, and can help
stabilize energy prices in the future. Although renewable facilities require upfront investments to
build, they can then operate at very low cost (for most clean energy technologies, the “fuel” is
free). As a result, renewable energy prices can be very stable over time. Moreover, the costs of
renewable energy technologies have declined steadily, and are projected to drop even more. For
example, the average price to install solar dropped more than 70 percent between 2010 and 2017.
The cost of generating electricity from wind dropped 66 percent between 2009 and 2016. Costs
will likely decline even further as markets mature and companies increasingly take advantage of
economies of scale. (National Renewable Energy Laboratory (NREL). 2012)

In contrast, fossil fuel prices can vary dramatically and are prone to substantial price swings. For
example, there was a rapid increase in US coal prices due to rising global demand before 2008,
then a rapid fall after 2008 when global demands declined. Likewise, natural gas prices have
fluctuated greatly since 2000. Using more renewable energy can lower the prices of and demand
for natural gas and coal by increasing competition and diversifying our energy supplies. And an
increased reliance on renewable energy can help protect consumers when fossil fuel prices spike.
(Wiser and Ryan 2016)

Reliability and resilience

Wind and solar are less prone to large-scale failure because they are distributed and
modular. Distributed systems are spread out over a large geographical area, so a severe weather
event in one location will not cut off power to an entire region. Modular systems are composed
of numerous individual wind turbines or solar arrays. Even if some of the equipment in the
system is damaged, the rest can typically continue to operate. For example, Hurricane Sandy
damaged fossil fuel-dominated electric generation and distribution systems in New York and
New Jersey and left millions of people without power. In contrast, renewable energy projects in
the Northeast weathered Hurricane Sandy with minimal damage or disruption (Mark Bolinger.
2017)
Water scarcity is another risk for non-renewable power plants. Coal, nuclear, and many natural
gas plants depend on having sufficient water for cooling, which means that severe droughts and
heat waves can put electricity generation at risk. Wind and solar photovoltaic systems do not
require water to generate electricity and can operate reliably in conditions that may otherwise
require closing a fossil fuel-powered plant. The risk of disruptive events will also increase in the
future as droughts, heat waves, more intense storms, and increasingly severe wildfires become
more frequent due to global warming—increasing the need for resilient, clean technologies
(Environmental Protection Agency. 2017)

2.1.2Energy management systems (EMS)

An Energy Management System (EMS) refers to applications that are designed to help
organizations to balance between reducing energy cost and maintaining guest comfort in a hotel
establishment. The Energy Management System is integrated with the Guest Relation software
which contains guests’ information on their preferences, the EMS is therefore able to care for
these preferences hence maintaining guest comfort. Energy management is not just for
maintenance managers or facility managers and requires wider adoption in order to be
successful. Savings of up to 20% have been reported by some hotels by simply changing energy
behavior and this must come from all hotel staff, most of which are responsible for operating or
controlling energy using appliances. The hotel energy management must also be on board, led by
example and encourage staff to become involved in the process. Energy Management System
(EMS) controls heating, cooling, lighting, and water consumption. Used mostly in hotels and
office buildings, an EMS automatically senses room occupancy and optimizes energy
consumption whilst maintaining maximum comfort. (Jordan Hollander 2020)

Application of energy management systems

Smart Lighting.

Like with HVAC systems, an energy management system can control lighting systems in
guestrooms, public areas, and back-of-house spaces. One can program schedules in the EMS so
that lights turn on or off at specific times, and the system can alert you when light bulbs need to
be replaced (Levermore G. 2000)

Integrations.

Your energy management system should integrate with your lighting system, climate control
system, IoT devices, and utility meters for most effective use. In hotels, it’s also useful to
connect your EMS to your property management system or building management system. Some
energy management systems also offer open APIs so you can connect any other relevant
software, like a business analytics tool (Hamele, 2001).
Smart Energy Management Using Internet of Things (IoT)

IoT drives process automation and operational efficiency in many hospitality industries. IoT
applications in energy sector gain particular attention from consumers, businesses and even
governments. Apart from numerous benefits to the electric power supply chain, IoT energy
management systems give way to new smarter grids and promise unprecedented savings,
improved security and enhanced efficiency.

The Wireless Energy Management Solutions

The wireless energy management solutions include: key card system controlling lighting, HVAC
system, television and motorized draperies; lighting and automation controllers with LCD
programmable displays allowing for a number of functions such as the ability to control each
section of a room’s lighting levels and on/off status, adjust temperature and call for
housekeeping/do not disturb; back-office software that gives the front desk and engineering the
ability to monitor and control the lighting and temperature of each room, wing, floor, or the
entire facility remotely, in order to maximize both energy savings and customer comfort. This
also gives the front desk the ability to preregister guests for VIP treatment, by pre-setting rooms
to customer lighting and temperature specifications (Patterson M.J.2011)

Room Energy Management System

A Room Energy Management System (REMS) controls heating, cooling, lighting, and water
consumption. Used mostly in hotels and office buildings, a REMS automatically senses room
occupancy and optimizes energy consumption whilst maintaining maximum comfort. Guests and
hotel operators recognize the need to conserve resources to combat climate change. A typical
hotel room can be unoccupied nearly 70% of the time. In addition, hotel guests are much less
concerned about saving energy in a hotel room than at their own home. Therefore, many hotel
owners end up having to pay for heating, cooling, lighting, and power such as TVs for a
guestroom with no one in it. Our REMS provides a practical solution by intelligently conserving
energy and water resources and at the same time reducing expensive energy bills. What is more,
this AIS environmentally friendly solution does not comprise on guest comfort (Blair 2018)

Benefits of Energy Management Systems

With skyrocketing energy costs, reducing energy consumption and monthly bills have become
some of the biggest concerns for hospitality establishments. Almost everything we do and use
relies on electricity, thus impacting both our energy bills and our carbon footprints. However,
EMS platforms can help organizations manage their energy more efficiently and become
“greener”, while also bringing significant reductions in energy costs (Blair 2018). Some of these
benefits include;
Defining Energy Requirements
The reporting and analytical features inside EMS can help property managers and business
owners understand energy consumption patterns. Everything from when the most energy is
needed to what processes or devices use the most power is visible on the main EMS dashboard,
providing exactly the information needed to adjust energy usage. EMS platforms can also help
businesses identify and reduce their energy waste without negatively affecting core operations.
An EMS can break down energy usage into separate processes, showing how much power each
one requires and what the possible ways to reduce usage are (Maleviti, E. 2011)
Reduction in Operational Costs

One of the main reasons why businesses install energy management systems is to reduce their
monthly bills. By using these solutions, most companies can easily save up to 10% on their
energy bills. The savings come from a few places. First, EMS sensors monitor all connected
devices (lighting, heating and cooling, ventilation, etc.) 24/7 and can immediately send a
warning whenever there is a suspicious change in energy usage patterns. Second, many EMS
platforms also have preventive maintenance features that can notify managers if a specific device
or equipment might malfunction in the near future. Spending on maintenance costs now can
prevent far more costly equipment failures in the future. Finally, keeping unnecessary devices
turned off when not in use (for example, switching off the lights and HVAC after employees
have left) and reducing energy consumption during peak hours can also result in significant
savings for building owners (Blair 2018 )
Improve Guest Experience

An EMS can prep a guestroom at check-in to arrival state. This setting adjusts the thermostat to a
comfortable temperature, turns on welcoming room music, provides a welcome greeting on the
TV, and turns on necessary lighting. An EMS also recognizes when a room is occupied by a
guest, which can help avoid unnecessary housekeeping disruptions (Stipanuk 2006)

Optimize Preventative Maintenance

An EMS can track HVAC run-times and notify hotel maintenance when filter and battery
updates are required. This feature allows proactive maintenance before guest complaints and
avoids generic, unnecessary replacements (Johnston, R. 2008)

Value of energy management system to hotels

Cuts energy usage and utility costs.

With more intelligent and strategic control over your building systems, you can reduce energy
usage, which, in turn, reduces your energy costs. It’s not unheard of for a hotel to reduce energy
costs by 35-45% after implementing an energy management system (Blair 2018)
Enhances the guest experience.

The thought of decreasing energy costs might conjure images of guests shivering in winter
months, unable to turn the heat above a certain threshold. In fact, the opposite is true; guests and
employees can be even more comfortable with an EMS in place because the system ensures all
devices are functional at all times. The savings occur when the system eliminates unnecessary
energy usage like heating unoccupied meeting rooms (Inge, C. 2008)

Building a positive brand image

One of the more surprising potential benefits of an EMS platform is that it can actually give you
a nice boost to your brand reputation. The majority of organizations in the world are now keen
on reducing their carbon footprints – especially because that’s something their customers want to
see.

By optimizing energy consumption and minimizing waste, companies can show their customers
that they are serious about protecting the environment and are acting responsibly in this regard.
This helps build better relationships with customers, partners, and potential investors (Johnston,
R. 2008)

Making businesses more resilient

Considering how volatile the energy market has become and the growing risks of energy
shortages and potential power cuts on the horizon, it is essential to learn how to manage energy
more effectively. Identifying and eliminating energy leaks, setting energy priorities for essential
business processes, and learning how to manage their consumption better can help businesses
minimize the impact of rising energy prices and power cuts (Stipanuk 2006)

Challenges faced in the implementation of energy management systems

To make a sizable investment in an energy management system, one does not want to rush
through implementation. The setup process involves connecting your existing building systems
(lighting, HVAC, IoT devices) to your new energy management system or you might install new
devices if you’re replacing old systems or opening a new property. You’ll also connect the EMS
to your energy meters so you can accurately track usage. During implementation, a customer
support representative will also lead personalized training webinars for your team so that
everyone feels comfortable using the system (Inge, C. (2008, June) In the early days of using
your EMS, you can configure personalized reports that make the metrics you want to track
accessible at the click of a button (Hotel Tech Report 2022). Some other challenges faced in the
implementation of energy management systems include;
Improper Maintenance

Equipment needs repair and maintenance – and when the technician is on-site, he or she may
have silenced an alarm or disconnected the asset from the control system while performing the
work, then been in a hurry to get out and on the next job, leaving the asset virtually invisible to
EMS. To address this, have a checkout procedure when anyone is conducting onsite maintenance
on these critical assets. The procedures should include verification that all standards and
parameters have been implemented prior to the technician leaving the site. As a starting point,
review your CMMS or maintenance work order system to identify areas where you’ve had past
issues. Then pilot the new checkout procedure for a few months to measure its impact before
rolling it out to all assets. This can dramatically reduce recalled work orders or callbacks to fix
issues that should have been resolved the first time.

There’s no question that an energy management system (EMS) will deliver value to your
organization, but these best practices will help you truly maximize the value of your investment
and realize savings in energy, maintenance and operations (Graci, S. 2011)

Sensor Location

During EMS installation, sensors are usually installed in a location that optimizes the system’s
performance – but over time, as facilities are remodeled and change, this ideal location may
become more of a nuisance. For example, you may have a sensor that controls exterior lighting.
It was in a good location when that maple tree next to it was just planted, but years later, when
that tree grows and thick foliage shades the sensor, it may cause the lights to come on in the
middle of the day. So how do you discover these sensor failures? Leverage your data if you
aren’t receiving sensor alerts to look for outliers. Compare sensor readings against other sensors
that can help you identify issues. Coordinate with remodels and site improvement projects to
ensure the sensors aren’t affected – or move them if they are. Also, leverage technology to help
you gather all sensor data in one place, then standardize and centralize the data on one platform,
which makes it not only easier to access but to analyze as well. If you don’t have the resources to
do this, there are third parties—like ENGIE Impact—that can do it for you (Clark G., 2008).

System Overrides

In a perfect world, system settings would stay constant over time. However, overrides are simply
a necessity, especially when you have employee or customer complaints about lighting or
temperature, or have to adjust settings for an unusual event or different store hours. Monitoring
these overrides is fairly simple if you only have a handful of sites, but it becomes a real
challenge with hundreds or thousands of locations. Process and communication are key to
managing this challenge. Implement a Variance Management Process and communicate it to
your entire organization, which identifies a mechanism for requesting a variance and associated
approval, both of which should be documented. You can then ensure schedules and setbacks are
changed back. Periodically review your portfolio to identify outliers. And also, establish user
permissions that set limits on which people can access and override settings (Clark, G. 2008).
2.1.3 Staff and Guest Involvement in Energy Saving Project

In-service programs can be offered for staff to conserve energy. This program trains the technical
and operational personnel in the areas of energy efficiency improvements in hotel operations and
renewable energy technologies. This program will encourage staff to realize their responsibilities
to save energy and reduce their impact on environment. It is also essential to involve guests in
hotel’s energy efficiency plan. The hoteliers should let their guests know that they care for the
environment and invite guests to participate in their effort to minimize their environmental
footprint. Guests can also be motivated to reduce energy use through display signage on energy.
Most guests will participate to improve the environmental friendliness of their stay (Melbourne
City Council, 2007)

Guest Control

It should go without saying that in higher-service hospitality settings, the guest should have
(apparent) ultimate control over their surroundings. This will naturally include control over the
climate within their rooms. Guests are able to control the temperatures in their rooms to suit their
preferences. Creating awareness to guests on the need turn off power in their rooms when not in
use goes a long way in managing energy. The installation of EMS sensors which use key cards or
sense the presence of a guest in the room and turns on or off the energy in the room also helps in
involving the guests in the energy management projects as they are able to activate or deactivate
energy using their key cards (Jenna Tesse 2023)

Total Quality Management, Energy and Employees

Improve productivity and quality, while decreasing environmental emissions and energy costs
constitute a great motivation for businesses to put into practice energy management (Turner,
2004). According to Martin et al. (2011) organizations handle the pressure of improving the
product and fulfilling the growing market demands, at the same time as decreasing the
environmental footprint, through increasing their energy efficiency. Total Quality Management
(TQM) is one example of a program that helps companies develop with a broad and integrated
approach on how to operate a business thus energy costs should be included in this model
(Turner, 2004). This author outlines that the main idea of TQM is that front-line employees
should have the power to make modifications and other decisions at the smallest operating level.
As a result, if these employees have energy management training, they can easily make educated
and rational decisions and advices on energy operating costs (Turner, 2004). The idea that
employees may have a crucial role to play in this energy management program is very important
and often not mentioned enough. Employees are part of the structure of any company and are
frequently the most unexploited resource for these kinds of programs (Turner, 2004). Involving
employees and solicit their ideas on how to use energy in a more efficient manner can be the
most fruitful effort of the entire program (Turner, 2004). The author also states that the team that
is coordinating the program should be doing so for a specific amount of time, and then rotate.
This alternation brings a dynamic component to the program as new people came with new ideas
and approaches, but also it provides the opportunity to diplomatically move non-performers, and
to engage a superior number of people (Turner, 2004).

Increased Awareness of Energy Use among Staff

The staff are now more aware of the electricity cost that this business is dependent on. Now they
are more understanding on the importance of need to save electricity bills, and how much the
company can save. Staff should therefore be trained on the importance and how to use the
sustainable energy management methods. With this knowledge staff are aware of why they need
to manage energy and the consequences the hotel suffers due to failure to manage energy
(Leicester 2012)

2.1.4 Change of Practice in Hotel Operation

The electricity is considerably consumed by lighting, space conditioning (heating and cooling),
housekeeping, and kitchen in general hotel operating system. Lighting creates a comfortable,
safe, relaxing and enjoyable environment for both staff working on premises and guests stay in
hotel rooms. The lighting requirement of the facilities and amenities offered must be monitored
by hoteliers to enhance energy performance. A number of general best practices and measures
can be applied for reducing energy consumption. These practices do not require large
investment, yet bring noticeable improvement in energy management. One of the easiest ways to
save energy is to turn off lights in unoccupied areas (Sustainable Energy Ireland, 2004). The
common areas must be vigilant around the clock when lighting is unnecessary or natural light is
enough to turn lights off. The lighting controllers such as timers and photocells used in public
areas should be well maintained and properly set for efficacy.

Different kinds of heating, ventilation and air conditioning systems are used in hotels for guest
comforts. If occupancy level of the hotel is known these systems can be used efficiently to lower
the energy consumption. The equipment such as ventilation, space cooling and heating must be
shut off when not required especially during off-hours or while facilities are closed. The timer
switches and thermostats can be set to meet the minimum heating, ventilation and cooling loads.
The thermostat must be kept away from the heat producing appliances such as television,
computers and hair dryers since they lead the thermostat to work longer to cool the place and
thereby increases the energy consumption (Hotel Energy Solutions, 2011).

Standard Operating Procedures SOPs That Conserve Energy

The housekeeping in guest rooms and hotel premises should be carried out during day hours to
make use of natural light. The housekeepers are advised to open curtains and blinds to allow
natural light into guest room while servicing. They are discouraged to turn on television while
cleaning. Once a room is made up, curtains and blinds must be closed and make sure all lights
turned off. Dirty lamps and fixtures reduce the level of lighting by 50 percent. Therefore,
cleaning lamps and lighting fixtures regularly is necessary to ensure optimum efficiency. Reduce
the number of lamps in areas where over lighting is apparent and install task lighting where it is
needed. The exterior and swimming pool area lighting must be turned off when not needed for
safety and security reason (Natural Resources Canada, 2003)

It is necessary to keep windows and doors closed when the heating or air-conditioning equipment
is on. The lobby main entrance door must always be kept closed to prevent the ingress of heat
from outside that adversely affects air conditioning. The amount of lighting can be adjusted to
minimum leveling areas such as bars, entertainment venue, toilet, souvenir shop and poolside as
the lighting load affects the hotels cooling system. The air from the heating and cooling units
must circulate freely without having obstructions on the way. The objects lay on the floor or
bench may hinder the air flow and makes the units work longer. It is the responsibility of the
hoteliers to check thoroughly the individual rooms and remove if any obstructions seen. The
cooling towers must be serviced regularly to avoid clogged nozzles, and poor pump performance
(Natural Resources Canada, 2003). By regularly cleaning condensers, intake louvers, evaporator
coils and air filters the energy losses caused by dirt or pipe/duct leakage can be prevented. A
routine maintenance check-list may be developed to insure peak efficiency (ICF International,
2008)

To keep energy consumption at a reasonable level, the kitchen staff should turn off the cooking
appliances when not needed. The oven, grills, broilers, fryers and other equipment can be pre-
heated before cooking according to manufacturer’s instructions. However, it should not be turned
on when not required. The equipment should be operated at right temperature to produce quality
food. The temperature set at high to increase the production during peak hours wills intake more
energy and destroy the quality of food. The overloading of equipment should be avoided as it
may result in poor food quality. The right pot sizes that match with element sizes on ranges are
advisable. If pots and pans are covered while cooking the energy can be saved to a large extent.
The fans that are positioned directly onto the cooking ranges must be turned off. The kitchen
appliances must be kept clean and a regular maintenance schedule can be strictly followed. The
dishwashers must be turned on when fully loaded (Sustainable Energy Ireland, 2005). To
conserve energy in kitchen refrigeration it is necessary to keep the doors of cold stores shut all
the time (Australian Hotels Association, 2013). A refrigerator door must seal completely to keep
kitchen air out. Placing food in refrigerator shelves as per manufacturer’s instruction reduce
energy consumption. The shelves should not be overfilled to allow air circulation throughout.
Storing hot food in refrigerator and freezer is not recommended as it increases the energy
consumption. Set refrigerator at 37˚F and freezer between 0˚ and 5˚F for efficient operation.
Check frequently the door gaskets and replace any torn, cracked and worn-out gaskets (Natural
Resources Canada, 2003). To ensure efficient and safe operation of boilers servicing at least
annually is prudent. The water heating in hotels is required for various purposes such as
guestrooms, kitchen, public restrooms, janitorial work and swimming pools. In general water
heaters are set to higher level than they need to be. It is good to turn them down to reduce energy
waste. A thermostat fit into the hot water tank will enable the water not to heat more than
necessary. A tank wrap or blanket can prevent heat loss and keep water hot for a long period.
The hot water system is to be inspected once a year to ensure that there is no leaks and build-up
of sediments in the system (ICF International, 2008)

Hotel Management Programme

Hotel Energy Management Programme for Energy management should be organized in a similar
manner to water management in a hotel. However, energy use in a hotel building should be by
various hotel engineering services systems; energy management is therefore more complicated
and difficult than water management. Fundamentally, energy management is more technically
biased and should therefore be directed more towards engineering staff. The key elements of a
successful energy management Programme can be summarized as managerial and technical. The
Managerial element opined that energy management should be fully integrated into hotel’s
overall management systems and treated with equal importance to other management functions.
Hence, there should be a clearly defined energy use policy and action plan, with the
responsibility for implementation vested in a senior executive or an energy manager if appointed.
This will require the training and involvement of all staff to participate in energy management.
Moreover, good housekeeping practices should be exercised in all departments while data or
information on energy use and its associated cost should be regularly communicated to staff to
raise their awareness of energy conservation issues. The Technical element on the other hand
focus on allowing part of annual operating budget for upgrading the existing engineering
systems, with particular emphasis on upgrading energy intensive equipment’s such as air
conditioning, chillers, and air handling units. As well carrying out energy audits on a regular
basis, preferably once a year, and installing or adding suitable electricity and gas sub-meters to
monitor energy use in various electricity end-users and in kitchens, thus facilitating the
breakdown of the total energy use to identify major end- users. It includes educating and training
engineering staff to be aware of the effect of their operational activities on energy use. It
involves establishing a well- defined operation and maintenance Programme for engineering
staff, so that waste can be curtailed. It also covers adopting technically advanced energy efficient
equipment including lights, chillers and energy efficient motors, etc. (Uzun, A. & Değirmen, M.
(2018).

Change of Hotel Management Strategies

 Hotel Energy Management Strategies (HEMS) Studies indicated that hotels rank among the top
five in terms of energy consumption in the commercial building sector. However, energy use in
most buildings is known to be highly inefficient, with large heat losses through poorly insulated
walls, roofs, and windows and heating pipes, poor management of lighting, and design features
that necessitate excessive energy use for both heating and cooling. Energy resources is one of the
assets of a hotel need for a manager to decide how best to use them to achieve an organizational
objective. Especially nowadays as several studies indicated that the increasing prices of energy
resources and growing pressure from governments and stakeholders provided increased
motivation to lodging operators to enhance energy efficiency in their properties. With regard to
the hotel industry as one of the major sectors of the hospitality industry, they need a base load of
energy that forms a fixed cost to operate equipment such as heating, ventilation, cooling and
lighting regardless of the number of guests staying at the hotel. Various initiatives have been
established to encourage the tourism industry and hotels in particular, to improve their energy
performance and environmental impacts. In addition to adopting various strategic initiatives,
review of the energy strategy is also vital. Reviewing the use of energy within a hotel not only
provides the opportunity to identify where savings can be achieved for the business prosperity.
(Bell, M., & Leach, M. (2016).

New and more efficient ones while the later entails how users behave and use energy. Both
approaches are often considered under ‘end-use efficiency’ and ‘demand-side management’
respectively. Putting the hotel Facilities in perspective, the behavioral approach leaves the
management with no control over individual’s behavior towards energy usage and obviously, the
customer has little or no stake in relation to its costs. But the two approaches i.e., can be
managed through the following techniques. (Bell, M., & Leach, M. (2016).

Demand-Side Management (DSM)

DSM is a set of interconnected and flexible programs by utility companies and energy planners
which allow customers a greater role in shifting their own demand for electricity during peak
periods and reducing their overall energy consumption. Demand-side management programs
comprise two principal activities which are; demand response programs or “load shifting” and
energy efficiency and conservation program. Due to this advantage of flexibility, it offers, the
technique ushers greater potentials in reducing energy consumption of hotel facilities and by
implication reducing their operating costs. Some DSM techniques used today involves; night-
time heating, direct load control, load limiters, commercial/industrial programs, frequency
regulation, time-of-use pricing, demand bidding and smart metering. An example is the
implementation of the use of prepaid meters (smart metering) in buildings stand to reduce the
consumption of electricity. Despite the advantages and huge potentials involved in adopting the
DSM approach, it is faced with various challenges such as lack of ICT Infrastructure; DSM
requires much intensive deployment of various sensor and advanced measurement and control
devices. Although key elements of technology exist, targeted trials are required to gain
experience with DSM network operation; Electricity demand patterns start shifting in
unpredictable ways; lack of understanding of the benefits of DSM solutions; DSM-based the
assumption of normality, linearity and homoscedasticity, because the values obtained are less
than 13.83, 1, and10 which are the critical values for evaluating Mahalanobis distance, Cook’s
distance and VIF(variance inflation factor) respectively. (Uzun, A. & Değirmen, M. 2018).

End-Use Efficiency

End-Use efficiency refers to technologies, appliances or practices that improve the efficient use
of energy at the level of the final user for example, the appliances in offices and homes. End-Use
efficiency is not limited to electrical appliances as it can also be used for other areas of efficiency
such as measures to improve the ability of the building to absorb and retain heat in the cold
seasons and keep out heat in the hot season. Improved end-use technologies and practices can be
substituted for less efficient ones thereby reducing electricity demand and generation; among the
three segments of electric energy system generation, delivery and end-use. End-use offers the
greatest near-term potential for large increases in efficiency. End- uses in buildings can be for
cooling, ventilation, lighting, cooking, plug loads and others. (Ottosson, M., & Thollander, P.
(2016).

2.2 How to Measure the Success of Hospitality Industry Resulting from Energy
Management

Energy management has led to great success in the hospitality industry which is evident and can
be measured in different forms which include; sustainability and environmental conservation
which is a contemporary issue that most guests and travelers are taking into consideration when
selecting their place of accommodation, reduction of energy cost which in return leads to the
reduction of operational cost. When the cost of operation is low then the profit margin is high
and therefore the hospitality facility gains a competitive advantage against its competitors.
Energy management also enables the organization to build and improve their image.

2.2.1 Sustainability

The hospitality industry has been shifting its focus and taking a robust approach when it comes
to sustainability. Through better managing energy and water consumption the industry is
working toward championing responsible business and tourism. In an effort to accurately
measure their impact and provide transparency to investors, customers, and employees, hotels
have begun scrutinizing their sustainability practices, moving from symbolic initiatives to those
that actually combat climate change. With the help of technology such as energy management
systems, hotels are uncovering their true environmental impact, and quantifying less-tangible
indirect emissions that are adversely affecting the planet (Drew Conte 2021)

Producing and using electricity more efficiently reduces both the amount of fuel needed to
generate electricity and the amount of greenhouse gases and other air pollution emitted as a
result. Electricity from renewable resources such as solar, geothermal, and wind generally does
not contribute to climate change or local air pollution since no fuels are combusted. Along with
saving money on energy bills, renewable energy sources can cut a hotels CO2 emission. In turn,
supporting the growth of the renewable sector and minimizing the impact on the environment.
(Nasir 2021)

Energy is a crucial component of a country's economic success. According to various criteria,

energy is classed as "primary and secondary energy resources" or "renewable energy resources
and non-renewable energy resources." Primary energy sources are those that can be found and
stored in nature. Fossil fuels (coal, crude oil, natural gas) and biomass are the most well-known
primary energy sources (wood, straw). Solar energy, tidal wave energy, wind energy, nuclear
energy, geothermal energy, and antigravity potential energy are some of the other key energy
sources. The majority of primary energy sources are transformed into secondary energy sources
for industrial usages, such as coal, oil, or natural gas, which are then turned into electricity and
steam. Primary energy sources are immediately used in industry. Some basic energy sources,
such as natural gas or coal, are not used as raw materials in fertilizer manufacturers and are only
used to generate energy. Renewable energy is energy derived from non-depletable sources. Wind
energy, solar energy, geothermal energy, tidal energy, and hydroelectric energy are examples of
renewable resources (BEE, 2005). The most essential aspect of renewable energy is that it is
produced without the generation of damaging pollutants. In addition to being a reliable
investment, renewable energy is of great importance in terms of reducing dependency on non-
renewable fuels, increasing energy diversity and preventing economic risks (Ulusoy, 2017).

2.2.2 Reduced Operational Costs

Hoteliers are always looking for ways to save energy in hotels and save money. Luckily, there
are many new technologies available that can help accomplish this goal and help with the
question of how to save energy in hotel industry. Hotels can easily cut their energy consumption
by 20 – 35% without changing a guests’ experience or comfort. By reducing how much energy
your hotel uses, you can lower your energy bills, lower your operating costs, and lower your
carbon footprint. Quick low and no-cost solutions can include:

Conducting an energy audit

introducing dimming systems

Having separate HVAC systems in lobbies, service areas and guest rooms
Covering pools and saunas to minimize heat loss
Asking guests to opt-out of housekeeping
Training staff in green policies and energy efficiency
Checking you are getting the best rate from your utility provider

Long-term solutions include:

Upgrading all lighting to LEDs

Installing occupancy and motion sensors in bathrooms, corridors etc.
Upgrading to highly efficient boilers, cooling systems and appliances

Integrating a building management system

Installing green roofs, insulation, and protective coverings

Green and energy-efficient technologies can become self-funding by reducing overall operating
costs. Any money saved can then be reinvested into the hotel for further green initiatives. (Irmak,
E., Calpbinici, A., & Güler, N. 2012).

2.2.3 Improved Hotel Image

As an hotelier, it's wise to show you’re working on your corporate social responsibility.
Promoting your green activities on your website, through social media, in your hotel lobby and
guest room directories will help to improve your brand image. There are also various awards,
labels, and recognition's available to green hotels. These are great in reaching new audiences and
drawing eco-conscious guests to your location. Hotels may even find new business through
corporations who want to align with socially engaged companies. (Güney, S. 2001)

An improved brand image can also help increase your employee retention rates. Staff are more
likely to stay with a company long-term that’s social values mirror their own. By encouraging
environmental action through team-work, motivated staff also tend to give better customer
services and working practices. So, by increasing staff loyalty, you can help reduce staff turnover
and lower the money spent on hiring and training. (Bierer, A., & Götze, U. 2012)

2.2.4 Improved Business Performance of Hospitality Facilities

Present conditions influence enterprises to give attention to energy management (Patel, Shah &
Trivedi, 2022), a procedure to optimize energy consumption. It includes multi-disciplinary fields,
from engineering to finance (Lee et al., 2011). The International Energy Agency (IEA) states that
implementing systematic energy management is one of the most profitable options to maintain
energy efficiency in enterprises since it assists businesses with applications and processes for
improving sustainably and taking advantage of new opportunities (Reinaud, Goldberg & Rozite,
2012). Furthermore, applying energy management successfully in a business indicates
sustainability, no matter it's in the industrial (Chowdhury et al., 2019) or the tourism sector
(Tiwari, Rosak-Szyrocka & Żywiołek, 2022), as it decreases energy consumption per unit of
output by optimizing procedures and systems regarding energy usage.
Previous research shows that when energy efficiency is perceived as strategic, companies tend to
have a high level of energy management. Energy performance is quantified by measurable
results related to energy consumption, energy use and energy efficiency. On the other hand,
despite the easiest, quickest and cheapest way to reduce energy consumption is to improve
energy efficiency, there is still considerable potential for energy efficiency improvement and for
saving energy in many companies. Investments in energy efficiency often remain undecided
upon, even though they may be highly profitable Cooremans & Schönenberger, 2019).

Another aspect of energy management has come along from pure cost to quality and productivity
efficiencies and is in the transition toward environmental performance efficiency. Closely related
to significant improvements in environmental and economic terms, the energy efficiency topic
has become important as a field that concerns businesses worldwide, going beyond traditional
energy-intensive industries such as the steel, cement, and chemical industries. Over the last few
years, policies and private households have also been stirred up by energy efficiency topics due
to emergent media coverage and drivers such as climate change, scarcity of resources and rising
energy prices May et al., 2015). A company's relationship with the environment starts with its
physical location. As it runs to fulfill human needs, it is constantly affecting the environment.
Businesses contribute to environmental pollution by releasing emissions during production.
Environmental awareness has grown as a result of recent increases in environmental issues and
their negative effects on people's lives. A business evaluation of this situation is necessary
because it has become a significant problem. Businesses have come to understand how important
it is to develop an environmentally friendly marketing strategy in order to stand out from the
competition and appeal to environmentally conscious customers (Uydacı, 2002). The enterprise's
energy use can cause environmental pollution, which harms the operating system. This situation
manifests a change in how well and effectively the employees can work. The operating system
may experience disruptions due to the staff's slower working pace, which delays the work as
well. The poor environmental conditions burden businesses in terms of financial and social
levels. Therefore, enterprises should incorporate a healthy environment to increase employee
productivity (Özbakır, 2006). Furthermore, it is shown that indoor air pollution depending on
many factors such as particle detachment, resuspension and transport due to indoor human
walking causes millions of illnesses and deaths (Motlagh et al., 2019). On the other hand, it is
known that energy management systems are capable of ensuring environmental indoor quality
while providing energy efficiency (Kumar et al., 2016). This indicates that energy management
systems helps providing a quality indoor environment, which in turn increase the contentment of
employees and customers.

2.2.5 Achieve Competitive Advantage

Studies on energy management have focused principally on environmental

conservation, reduction in operation and production expenses, energy savings, lower utility bills,
and minimization of energy wastage. However, the gains of energy management practices can
be transferred to competitive advantage strategies among manufacturing companies in Kenya
so as to boost their efforts in attaining competitiveness. Success in managing
competitive advantage arises out of a firm’s ability in identifying and implementing actions that
can give the company an edge over its rivals and attain competitive advantage. Manufacturing
firms in Kenya are the highest consumers of both electricity and petroleum products.
Literature reviewed showed that a sizeable number of multinational companies have left the
Kenya market due to high energy costs. In this regard, the study posits that there is need to
transfer the gains of energy management practices to competitive advantage strategies.

The study objectives were: to determine the effect of implementing energy management
regulations on attaining competitive advantage, to examine the effect of implementing company
energy management policy on attaining competitive advantage, to assess the effect of
implementing energy efficient technology on attaining competitive advantage, and to assess the
effect of energy expenses on attaining competitive advantage among manufacturing firms. The
study adopted a survey research design, with a study population of 1,459,870 employees
employed by manufacturing firms in Nairobi County. A sample of 399 respondents was
selected randomly from selected firms in Nairobi County and its surrounding areas.
Questionnaires were used to collect primary data while secondary data was obtained by
reviewing previous studies in the area of study. Data analysis was done using descriptive
statistics (mean, standard deviation, and frequency distributions). Inferential statistics included
correlation for test of association, chi-square for test of agreement and regression for test of
hypothesis. The study found that energy management regulations, company energy management
policies, energy efficient technology and energy expenses are significant predictors of
competitive advantage with an explanatory power of 44.8% (Soultana Tania Kapiki 2019)

CHAPTER THREE

METHODOLOGY

3.0 Introduction

The study aims at establishing strategies for enhancing energy management in the hotel industry in
Kenya. The methodology chapter describes the methods and procedures adopted by the researcher to
conduct the entire study with justifications for their choices among the available alternatives. The
subtopics include; the study area, the target population, the research design, the sampling techniques, the
sample size, data collection method, data analysis, the research instruments to be used, the validity and
reliability and the ethical issues the research will consider.
3.1 Study Area
The research will be carried out at Eldoret town which is located at Uasin Gishu county. In this town four
hotels preferably, four-star hotels will be selected for the study. Eldoret town hosts a number of schools
and universities and therefore attracting education tourists. It is also known as the home of champions
with a lot of athletes living within the town, this attracts sports tourism as many sports personnel visit
Eldoret town to train and take part in athletics and other sport activities. Due to these tourism activities,
the accommodation sector has expanded leading to emergence and growth of many hotels in the town,
which will be used in the collection of data for this project. In the selected hotels, the study will focus
major energy consumption departments, that is; the housekeeping department, the food production
department, the food and beverage service department and the maintenance department.
3.2 Research Design

The study will adopt a phenomenology research design. This research design aims to identify
phenomena and focuses on subjective experience and understanding the structure of those lived
experiences (Ponte et al., 2017). The design helps describe the possible benefits that would result from
adopting various energy management practices within the hotel industry (Gray, 2019). With this
research design, which is used in the qualitative approach of the research procedure, the researcher will
gather qualitative data, observe trends in them, and make a critical judgment based on the nature of the
trends (Ponte et al., 2017).

The research design was chosen because it enables forming a basis for a sound theory and contributes
to formulating relevant policies for intervention (Payne, Pearson, & Carr, 2017). Also, through in-depth
interviews, which is the most appropriate method of data collection, phenomenology research helps to
adjust to new issues and ideas as they emerge from different respondents. The study aims to describe
the contribution of energy management in the hotel industry in Kenya. Hence, a phenomenology
research design was the most appropriate approach. It contributes to developing new theories through
natural data, which can paint the actual picture of the phenomenon.

3.3 Target Population

A study population is a collection of all units that the researcher is interested in investigating. In the
current study, the study population included all businesses that operate in hotel industry in Kenya. In
the context of this study, the hotel industry referred to the section of the service industry that deals
with guest accommodation and lodgings (Hassan, 2018). This included hotels and many other forms of
overnight accommodations such as motels, inns, guesthouses, and hostels. However, since study
population is too wide, the target population will include hotel managers and other service operators who
use energy in their day-to-day operations in four- and five-star hotels in Eldoret, Kenya. The study will
mainly focus on the energy users of the selected departments and energy management managers who will
help us answer our research questions.
3.4 Sample Size and Sampling Techniques

3.4.1 Sample Size

A very small sample will give the researcher inadequate information, while a very large sample will be
too expensive and time costly to conduct the study on, the researcher will therefore need the
appropriate sample size. The researcher will use the Yamane (1967) formula to calculate the required
sample size;

n=N/(1+N(e)2

Where; n=sample size

N= population size

e= level of precision (margin error)

3.4.2 Sampling Technique

The research will use the purposive sampling technique to select the hotels and the departments in
which to conduct the study. Stratified sampling method will be used to select the respondents where the
target population will be divided in groups with similar characteristics that is service providers from the
same departments, then use the simple random method to randomly select their sample from the
groups. This will give the target population an equal opportunity of being selected for the study and
therefore reducing biasness.

3.5 Data Collection and Analysis

3.5.1 Data Collection

The study adopted the primary data collection method. Under this data collection method, the
researcher gathers data from first-hand sources, using methods like surveys. However, such data will be
collected with the research project in mind, approaching a very appropriate method for many
researchers. The justification for the choice of primary data collection method for the current study is
that it allows the researcher to gather data to investigate the impacts of energy management practices
on the sustainability index of hotels in Kenya (Payne, Pearson, & Carr, 2017). Energy management is a
new and sensitive area in the hotel industry which has not been widely embraced in the industry. The
research will therefor use the survey method where they will come up with questionnaires and collect
data by administering the questionnaires to their target sample.

3.5.2 Data Analysis

The analysis procedure will involve identifying, examining, and interpreting patterns and themes in
responses and determining how the patterns and themes helped answer the research questions (Shaw,
Bishop, Horwood, Chilcot, & Arden, 2019). In particular, the study uses content analysis to analyze the
qualitative data. Under this data analysis method, the researcher will evaluate patterns within the
content under this data analysis method, including words, phrases, images, or other sources (Shaw et
al., 2019). In the current research, the researcher is interested in assessing the impacts of energy
management practices on the hotel industry in Kenya. Therefore, the researcher uses the content
analysis technique to identify patterns of deeper underlying interpretations concerning the adoption of
green energy, energy management systems, involvement of staff and guests in energy conservation and
changes in practices of hotel operations in ensuring energy management (Green & Thorogood, 2018).

3.6 Validity and Reliability of The Research

The researcher will validate the reliability of the results by using the test-retest method, where they will
repeat the test severally and see if the results are the same. In order to ensure the reliability of the
sample size, the researcher will apply the Yamane (1967) calculation formula to come up with the
appropriate sample to study. To validate the results, the researcher will apply the methods consistently
to ensure that the results are similar.

3.7 Research Instrument

The researcher will use a questionnaire to collect data since the researcher will use the survey data
collection method. The questionnaires will contain both open and close ended questions, where they
will start with the close ended questions followed by the open-ended questions for the respondents to
give more detailed answers. This will enable the researchers to collect both qualitative and quantitative
data.

3.8 Ethical Issues

During the research, the research will have to consider ethical issues such as;

 The researcher will not pressure the respondents for information.

 The researcher will not provide incentives to bribe the respondents before the research begins.
 The research will seek consent for participation, they should have the respondent’s expressed
willingness and knowledge to conduct the study.
 The researcher will avoid biasness. This is where the researcher deliberately attempts to hide
information found during research or highlights something which is not true.