Hospitality sector: What is the Next Big, Unexpected Crisis? Are We Prepared?

The threat of the next pandemic is very real and needs our constant attention and preparation. Whether it strikes in two years, twenty years, or beyond, the imperative to remain vigilant and prepared is non-negotiable. Scientists caution us that another crisis on the scale of the recent COVID-19 pandemic could emerge at any moment. Moreover, the presence of climate change looms large as a pressing crisis that demands immediate action. To assess our current preparedness, let's reflect on how the tourism sector, particularly the city hotels, weathered the storm during the last crisis.

How Did Hotels Fare in the Last Crisis?

There are enough data and reports on the impact available in the public domain. Summing it up, the onset of COVID-19 triggered a dramatic change in the landscape of urban hotels, resorts, restaurants, and tourist attractions, transforming bustling city centers into deserted ghost towns virtually overnight. As tourists vanished, the hospitality industry, especially urban business hotels, grappled with the challenge of managing exorbitant electricity bills. The hospitality sector was one of the worst affected sectors during the crisis.

With 24-hour 365-day operations, hotels are one of the highest energy and water consumers per square foot. HVAC (heating, ventilation, and air-conditioning) costs, along with other fixed expenses, became unsustainable as hotel revenues plummeted due to lock-downs and reduced travel. HVAC systems can account for 40-60% of a hotel's total energy consumption. This cost is significant, especially when combined with other fixed expenses and reduced revenues during the COVID-19 pandemic.

In the face of another potential COVID-19-like outbreak, hotels necessitate a mandatory shift towards sustainable energy sources such as solar, wind, bio-waste, etc. While renewable energy alone may not guarantee survival during a crisis like COVID-19, it can certainly enhance a hotel's resilience, reduce operational costs, and contribute to long-term sustainability. The COVID-19 disruption has sparked some initial actions towards this important goal.

Way Forward

1. Hotel Sustainability Basics Toolkit by WTTC: This 12-point criteria toolkit provides a comprehensive guide for hotels to implement sustainable practices.

2. Hotel Carbon Measurement Initiative (HCMI) by Sustainable Hospitality Alliance: This methodology and free tool helps hotels calculate the carbon footprint of stays and meetings at their properties.

3. According to the International Energy Agency (IEA), renewable energy sources like solar and wind are becoming increasingly significant in various sectors, including hospitality. Renewable electricity capacity additions reached an estimated 507 GW in 2023, almost 50% higher than in 2022, with continuous policy support in more than 130 countries spurring a significant change in the global growth trend.

4. Solar photovoltaic (PV) systems are commonly installed on hotel rooftops or grounds to generate electricity, with excess energy stored in batteries for use during non-sunny periods. Wind energy, though less common, is also utilized where consistent wind patterns exist Additionally, geothermal energy is used for heating and cooling in some hotels, leveraging the Earth's natural heat to reduce reliance on fossil fuels.

5. You have it, you flaunt it. Net Zero hotels or 100% renewable energy hotels are good for the industry to promote sustainable tourism to tourists.

The Big Question: Are Hotels Truly Prepared?

Despite the promising strides made through these initiatives, a critical inquiry looms large: to what extent and in how many countries are hotels earnestly embracing green energy solutions to offset their HVAC operational costs? No global level or even regional level data is currently available, so I guess the industry is still early on the learning curve.