A paying policy

12 October 2006
A paying policy

With soaring energy prices and growing pressure to cut energy consumption, businesses must now, more than ever, think seriously about implementing an environmental policy. Emma Allen describes how

A couple of years ago talking about renewable energy or reducing carbon footprints would probably have placed you in the camp of open-sandalled eco-warrior rather than savvy business owner. But things have changed. Soaring energy prices, bleak warnings about climate change and growing consumer pressure mean that more and more operators are looking at ways to cut their energy consumption.

Apart from environmental benefits, the cost savings can be significant. Just turning down the heating by 1°C can trim 10% off a building's annual fuel bills, and figures from the Carbon Trust show that most hospitality businesses could save between 20% and 40% on their overall energy overheads just by putting a few straightforward measures in place.

How much do you use?

So, where should you begin? According to Hugh Jones at the Carbon Trust, the best way to get started is to find out how much energy you currently use. "By measuring it, you can manage it," he says. "But don't focus on what you spend; look at your consumption by reading meters regularly and monitoring bills. That way, you'll know which parts of your business use the most and whether you're saving energy or not."

Benchmarking, by comparing energy patterns in identical units such as hotel rooms or across similar-sized sites, can also help to build up a useful picture of performance. It might also be worth installing separate sub-meters in kitchens or other high-consumption locations to isolate exactly what's being used; while half-hour meters, installed free by some energy suppliers, will provide very precise readings if needed.

"Once you know what energy levels you're supposed to be using, it's much easier to identify any problems, like faulty equipment or poor on-site energy management," explains Paul Turgoose, of energy consultancy Energy Management Systems, which works in conjunction with the Carbon Trust. "For example, after comparing sites, one client discovered that one restaurant's noticeably high bill was simply down to staff leaving fridge and freezer doors open all the time."

If you think you could make savings across your business but are not sure where to start, consider an energy audit to pinpoint energy use and how to make improvements. The Carbon Trust offers free surveys to companies with annual energy spends of more than £50,000, and there is a free energy helpline for smaller businesses.

If you don't qualify for a free audit, you could employ one of the growing number of private energy consultancies. Costs vary depending on the size of your business, but expect to pay either an overall project fee or a daily rate for site visits. Other services might include negotiating energy tariffs or offering guidance with loan applications. "Lots of businesses might not necessarily qualify for a free survey but could still benefit significantly from energy savings," says Turgoose. "It's a growing sector, so it's advisable to check the consultant is registered with the Energy Institute first, to ensure quality."

What next?

Once you've got to grips with how much energy you're using, you can start making savings immediately. Hospitable Climates, the free energy advisory scheme for the hospitality sector, managed by the HCIMA, recommends the following no-cost or low-cost steps.

Switch off

The general rule across any business should be to switch off or turn down equipment and lighting whenever possible. Kitchens, in particular, can offer huge energy savings. In quiet periods, try to switch off refrigeration units that aren't being used, or use variable-speed fans rather than having ventilation on full at all times. For equipment not easily turned on and off, like solid-tops, grills and griddles, set to the lowest setting possible when not in use. Turning off signage or equipment such as vending machines, ice machines or display cabinets overnight can save hours of wasted energy.

Elsewhere, unoccupied offices, guest or store rooms don't require heat, air conditioning or lighting, so the aim should be to turn off or turn down as much as possible. Don't forget external lighting either, which can get forgotten and left on unnecessarily.

Get staff involved

Involving staff across all areas of your business in efforts to save energy is essential. Maintenance, kitchen and room staff are all high energy users and they are well placed to cut waste. To get started, encourage staff to review their own working practices and suggest ways of making individual tasks more energy-efficient.

On a simple level, making sure staff realise the importance of remembering to turn lights and appliances off if they are last to leave the room, or shutting doors and windows when air conditioning or heating is on, will make a big difference to the bills.

Use appliances efficiently

One of the biggest users of energy in bedrooms is the TV. Even in stand-by mode, a TV or stereo consumes energy, and this can be up to 40% of the total energy needed when it's actually on. If your policy is to have a TV on stand-by for guests, try to do this just before they arrive, otherwise switch them off.

Another big in-room energy saver is to turn off minibars during off-peak periods. It's also worth asking housekeeping staff to check that minibars close properly and that door seals are in good condition.

Elsewhere, try to use dishwashers or glasswashers only when full. If kitchen equipment is more than 15 years old, it's probably worth replacing it with more energy-efficient versions. New dishwashers, for example, often use less than one-third of the energy of older appliances and are usually more water-friendly (see next week's issue for an equipment buying guide on dishwashers and washing machines).

Cleaning and maintenance

Dirty windows and light fixtures can reduce light levels by as much as 50%, so make sure fittings and windows are routinely cleaned for maximum use of daylight and to deter guests from turning lights on unnecessarily. Some cleaning products available on the market can be used with cold, rather than hot, water. Try to encourage staff to use bowls or buckets rather than constantly running hot water.

In kitchens, blackened surfaces and scale can reduce operational performance, especially with large cooking surface areas such as griddles which, if poorly maintained, can operate at as little as 30% efficiency. Keep all equipment such as air-conditioning units and condensers free of dust and dirt. Regular cleaning can improve refrigeration energy efficiency by a quarter and extend the equipment's lifespan.

Routine wear and tear can reduce energy efficiency. Don't wait for equipment to break down before organising a service. Make sure seals and gaskets on oven doors fit snugly to prevent heat loss, likewise with seals on fridge doors so that the fridge doesn't have to work harder than it should.

Insulation, boilers and heating


Up to 20% of total fuel costs can be saved by good loft insulation. Most buildings probably have some form of insulation but you should aim for at least 20cm or more of fibrous insulation to really benefit. A business that insulates its loft from scratch can expect payback within one year. Heating and hot water pipes should be insulated with up to 40mm of insulating materials, especially in loft areas and under floorboards. Install draught excluders on doors and windows and make sure your boiler is properly insulated, too. Keeping curtains or blinds drawn in unoccupied rooms will also prevent heat loss.

Cavity wall insulation can prevent heat losses of 35% and help cure localised damp problems. For a small hotel of 25 bedrooms, cavity wall insulation can be relatively expensive to install (about £2,000) but will typically pay back in 3-5 years. Buildings without cavity walls could consider insulation-backed plasterboard or dry lining insulation, although these options can be expensive and might need to be done during refurbishment.

Boiler efficiency

Heating and hot water can account for up to 70% of a hotel's energy overheads, and boilers are a key part of this energy consumption. Most modern boilers operate at about 70% efficiency, some older boilers only as little as 50%, and state-of-the-art technology can deliver 90%. Get your boiler checked at least once a year and, if it's very inefficient, it might be more cost-effective to invest in a new one. By investing in new technology, you might qualify for an Enhanced Capital Allowance (ECA) or an interest-free loan.

Air conditioning

The cheapest and most efficient type of air conditioning is free, by opening a window, so before investing in any air con, make sure it's really necessary. Alternatives include outside window shades, solar film and ceiling fans. Be aware that if buying air-conditioning units, those with the highest energy-efficiency rating might be more expensive but can consume up to 40% less energy than cheaper models.

Thermostatic controls

These can be easily and cheaply fitted to most radiators and can save you money on heating costs. Make sure thermostats aren't placed in draughts as this might result in overheating. If individual thermostats are fitted in rooms, get staff into the habit of checking they are at the right temperature. Badly set thermostats on heating/cooling systems can result in both air conditioning and heating units operating at the same time, so check that cooling thermostats come on at least 5°C above the heating switch-off point.

Other checks

All time clocks should be checked so they do not trigger heating when it's not needed; and thermostatic radiator valves and pipework should be regularly checked for leakage or poor functioning.

Invest in new technology

Most of the above steps above can be carried out for a minimal cost. But if you are considering installing new systems or equipment, Hospitable Climates offers the following tips:

  • Priority should be given to replacing the oldest, or least efficient, plant and equipment.
  • It's usually cheaper to invest in and install new technologies during a refurbishment.
  • Always plan for the long term and have a master plan. Ad hoc investment is not always cost-effective.
  • Seek professional advice to check that the technology is economically feasible and will deliver the promised payback.

Buying a new boiler?

Be aware that the fuel used to power the boiler over its lifetime will cost far more than the initial capital investment. For example, a large-scale boiler purchased for £40,000 might consume more than £10,000 in fuel each year, meaning that a 1% variation in efficiency is worth £100 in fuel savings a year, or £1,000 over a decade. Spending an extra £500 at the time of purchase to buy the most efficient boiler will therefore pay back relatively quickly. If you're considering a new hot water system, it might even be worth looking at solar hot water heating. Payback can be long, but energy is obviously free from then onwards.

Combined heat and power (CHP)

Typically, hotels with heated swimming pools, leisure centres or on-site laundries are likely to benefit most from CHP, as they have a predictable year-round heat demand. The main benefit is the reduction in overall energy costs. CHP produces electricity on-site, up to about 60% of what's needed, so it cuts down the amount of electricity that has to be bought from the grid. It also recovers heat, which can then be used for heating or hot water for the building. Although capital costs are much higher than for conventional boilers, CHP is often the most cost-effective option in the long term. For further information call the CHP Club helpline on 0800 585794.


As far as energy savings go, it's important not to overlook lighting. Lighting makes up a fifth of the UK's total electricity consumption and can be responsible for as much as 50% of a building's energy load, according to Tim Downey, director at light designers Pinniger & Partners. "We're seeing operators waking up more and more to costs in this area. It depends on your business, but you could save up to a third on your operating costs by getting the lighting right," he says.

For many, that means switching to low-energy light bulbs, or compact fluorescent lamps (CFLs), at least to start with. These are 80% more efficient than normal bulbs, and in heavy-use areas payback can be just a few months. In the past, CFLs weren't always popular as they took time to light up properly, but technology has moved on. Philips, for example, has developed a new Softone energy-saving bulb which is small, fits most light fittings and illuminates immediately. Depending on use, CFLs can last up to six years.

Halogen spotlights, heavily used in hotels and restaurants, are one of the worst offenders when it comes to high-energy, wasteful lighting. But new versions are now on the market, such as the Philips Masterline ES bulb, which consumes 40% less energy than the old type and generates more than a third less heat, which in turn puts less strain on cooling or air-conditioning systems. For maximum efficiency, Downey suggests replacing a 50W bulb with a 30W bulb wherever possible.

Another more sophisticated option is to use LEDs (light-emitting diodes). "LEDs are very efficient, reasonably easy to install and work brilliantly if you're looking to create a bit of colour or excitement," says Barbara Neate, of Philips. "They might not be the cheapest option, but prices are coming down. If used as part of an overall lighting scheme, they can be quite cost-effective."

The other main point to consider is lighting control. Examples include motion sensors in areas like store rooms or toilets that aren't occupied all the time, or daylight sensors which can flick lights off when artificial light isn't needed. "Everyone, whatever their budget, should be using some form of intelligent control either to turn lights down or off completely," says Downey. "It could just be a cheap dimmer system or something much more complex. Most control systems will easily pay for themselves in five years or less."

Training staff

For any business serious about tackling energy waste, it's crucial to get staff on board. "Being more efficient isn't just about hard bargaining with an energy supplier or installing the latest technology," says Linda Martin, programmes director at the HCIMA. "It's also about changing behaviour and developing new mind-sets through training."

Martin suggests:

• Lead by example. Changes in practice have to be taken seriously from the top down. "If supervisors and senior managers don't lead by example, any results will be wasted. Try to make energy efficiency a part of induction for new staff so that you are reinforcing the message from the beginning," she advises.

• Look at job roles and what they involve so that you can identify exactly where improvements can be made. Make training sessions simple and practical, and give real examples and clear objectives to produce the best results.

• Keep staff motivated. Recognising achievement and measuring performance can help, and try to be creative. "Messages that use humour or tug at the heart strings can be very effective," she says.

• Other ideas to inspire staff include a monthly energy "walk round" to monitor appliances; regular updates on progress; and appointing a green "champion" in the team.

At Accor hotels, environmental training is given to all staff at induction, followed by six-monthly updates on energy, water and waste consumption. Environmental notice boards, energy-saving stickers and newsletter articles have also helped raise awareness. At the group's 629-bedroom Novotel London West hotel, the building's total gas and electricity usage has been cut by 20%, something that health and safety manager Benoît Charrière puts down to effective training. "We've got a big hotel and over 200 staff, so their input has been invaluable. All the little things together add up to make a huge difference."

Grasmere House hotel

When Dale Naug, owner of the Grasmere House hotel in Salisbury, Wiltshire, decided to add 15 new bedrooms he realised that the new extension could significantly push up his energy bills. He decided to replace the hotel's outdated main heating boiler as well as install five new hot-water boilers. The total cost was £12,000, funded by an interest-free loan from the Carbon Trust.

The new boilers are 65% more efficient than before, and Naug estimates he's saving well over £3,000 a year in energy costs. Having separate boilers also means the heating can be completely turned off in summer.

"Even though the hotel has got bigger, we're paying the same amount as we were before," says Naug.

The payback period on the investment is five years. "The amount we're saving in energy costs pays the loan repayments so it's been extremely worthwhile for us," adds Naug.

Grants and finance

• Interest-free energy-efficiency loans from the Carbon Trust allow eligible SMEs in England or Wales to borrow between £5,000 and £100,000 to fund projects such as lighting, boilers or insulation. In Northern Ireland, businesses may be able to borrow up to £200,000.

• Under the Enhanced Capital Allowances (ECA) scheme, you can claim an "enhanced" 100% capital allowance on qualifying investments in equipment in the first tax year. Normal capital allowances on plant and machinery are only 25% a year on a reducing balance basis. Call 0870 190 6236 or visit www.eca.gov.uk.

• Loan Action Scotland, funded by the Scottish Executive, offers interest-free loans up to £50,000 to help finance energy-saving measures. Contact 0800 092 9002.

• In April the Department of Trade and Industry launched a low-carbon buildings programme managed by the Energy Saving Trust. It's open to individual property owners and businesses across the UK, and grants are available for technologies including turbines, solar panels and CHP boilers. Contact 0800 915 0990 or visit www.lowcarbonbuildings.org.uk.

Check your bills

Knowing your energy patterns means you should have a good idea of how much to pay. But it's still worth checking the bills. Nearly 75% of bills that came through energy consultancy ECA in one month were incorrectly calculated, according to managing director Stephen Mellor.

He recommends checking four key areas:

  • Make sure it's your bill.
  • Is consumption in line with your expectations?
  • If you have multi-billing, make sure it corresponds to the right part of your business. Check that the kitchen's bill hasn't been confused with the store-room, for example.
  • If you've negotiated a discount with your supplier, check that's the rate you're paying.

Apex Hotels

Apex Hotels started its green policy back in early 2005. Driven by environmentally conscious members of staff, the hotel chain set up a green committee to deal with strategic issues such as recycling and laundry across its five hotels in Edinburgh, Dundee and London.

With the successful implementation of eco-friendly practice in the day-to-day running of the business, the green committee has more recently changed into an "energy team". The primary concern has now shifted to the daily monitoring of energy used. Over the past four months consumption savings have averaged 21% on electricity, 9% on water and 19% on gas.

There is no end in sight to the growth of its environmental policy, according to Apex marketing executive Jo Springford, as all green issues will undergo constant review. Apex's responsibility to the environment has been rewarded with three Keep Edinburgh Clean awards and three gold medals in the Green Tourism Business Scheme.

Policies in place include:

• Offsetting carbon footprints. The hotel group has applied to the Carbon Footprint Organisation to calculate its primary footprint and awaits confirmation on what needs to be done to offset this. Guests are also offered a means to calculate the carbon footprint of their total trip and can opt to have this offset as an addition to their bill for donation to the environmental body Climate Care.

• Building design. Architects Ian Springford designed the group's Dundee hotel using energy-efficient materials for lighting, elevators and windows. Thermographic imaging was also employed in the construction process to ensure the building was airtight and to identify thermal waste spots.

• Staff management. All staff participate in environmental awareness training. They are encouraged either to cycle to work or to share car and taxi journeys

• Energy efficiency. All rooms use Ding cards, which shut down all electrical equipment when a guest leaves the room. Energy-saving lighting, dimmers and motion detectors are also in place, as are dual-flush toilets.

• Recycling. The hotels have dedicated recycling units, and everything possible is sent there, including paper, plastic, cardboard, glass, CDs, polythene wrappers, mobile phones, polystyrene, waste cooking oil, toner cartridges and dry cleaning coat-hangers.

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