Could hotels charge guests for the utilities they use to encourage conservation?

Question

I travel often for work and stay in hotels. I have observed that with no direct incentive, it's often hard to stay motivated to make such sustainable choices as taking shorter showers, running the A/C less, etc.

Sure enough, research indicates that when homeowners are empowered to read their electric bill, or given regular reminders of the amount of electricity that they use, they tend to reduce their consumption:

• "Reduction of residential consumption of electricity through simple monthly feedback"
• "Effects of self-monitoring and feedback on residential electricity consumption"
• "Reducing household energy consumption: a qualitative and quantitative field study"
• "The impact of informational feedback on energy consumption—A survey of the experimental evidence"

This last paper is a meta-analysis of 12 studies in Europe and North America covering utility pilot programs where in-home displays (IHDs) of electricity consumption information were implemented. The authors state:

Our review indicates that the direct feedback provided by IHDs encourages consumers to make more efficient use of energy. We find that consumers who actively use an IHD can reduce their consumption of electricity on average by about 7 percent when prepayment of electricity is not involved. When consumers both use an IHD and are on an electricity prepayment system, they can reduce their electricity consumption by about twice that amount.

Would this finding translate to hotels? To what extent? Why or why not?

Let's assume that technological and legal challenges to such a system are minimal -- first it makes sense to determine if it could have the desired effect, before looking into implementation.

Answer 1

I don't know about to what extent it currently exists, but I can imagine it could be implemented successfully with a "reasonable usage" policy.

In my experience as a customer, being asked to pay very exact, tiny amounts for one thing or another is often frustrating, especially if I've paid good money for something like a hotel room. However, when my phone company says I will not be charged excess for roaming (EU laws) but there is a reasonable usage policy, that seems perfect - I don't have to count KBs and I can feel comfortable checking my email abroad.

From my experience having help run a hostel, reputation is everything, and making big outlays for equipment is difficult for a small business (electricity meters, water meters etc.) This is where it gets difficult.

If a business did have the funds to put electricity meters on every room and retrofit water meters etc., you'd have to ask if monitoring/charging people for what they use was more ecological in the long run, than investing in Solar PV, solar water, Rainwater harvesting etc.

Answer 2

One of the issues I think would be cost of installing water and electricity meters for each room, including the associated labor cost. It would add to the capital cost of the building.

The other issue is with reading the meters. Do you trust a human to correctly read the meters on a daily basis, at check-out times? This adds to the operating costs of the hotel.

To avoid this, all the meters could be rigged to be read electronically, which again, would add to the capital cost of the hotel.

In the end, someone has to pay for such additional costs and that will be the people staying at the hotels.

If this were to happen, then all hotels would need to be made to install such technology otherwise those that don't will have a price advantage over those that do.

Edit:

Some things that I have noticed how hotels try to limit the amount of electricity and water people use:

In some hotels I have seen notices in bathrooms asking people to consider placing used towels on the towel rack, if they are staying in the room for more than one night, so the towel can be reused by the occupants again. This supposedly saves water and electricity that would have been used to wash the towels.

Most hotel rooms have limited numbers of available power outlets for occupants to plug in personal devices and sometimes the power outlets are in awkward locations.

The other thing that I noticed is some hotels have limited numbers of lights in the room and the lights are low wattage.

Some hotels that still use keys for access sometimes attach a plastic "tag" attached to the key ring and if the occupant wants to use the air conditioner the tag has to be placed into a special slot near the door. When the occupant leaves the room the keys are removed from the slot and the air conditioner automatically turns off.

Answer 3

Yes, hotels could implement room-based monitoring systems for electricity and water consumption, but they have no financial motivation to do so and the effects of doing so are marginal verging on insignificant.

Assuming the 7% reduction (due to IHDs, determined by the meta study) is accurate and translates to hotels, and given that rooms account for only ~63% of total hotel usage (source), installing monitoring/feedback systems would translate to a mere 4.4% reduction in total electricity consumption.

Since such systems would just 'pass through the costs/savings' directly to the guests, there would be no financial return to the hotel. With no return on investment, hotels would actually lose money by installing such systems (as the hardware/software/labour costs involved in operating and maintaining such systems would still be incurred). There seems to be no ROI and thus no business case for installing such systems.

Since operating and maintenance costs are independent of use, they translate to fixed fees which would be added to all guest bills. Everyone would pay extra regardless of how much they use — undermining any savings that may be made by guests.

Given that guest/room consumption of water only accounts for ~34% of total hotel use (source) then everything above applies doubly for water. Not only is there still no ROI for the hotels, but the net savings is an insignificant 2.4% (assuming a 7% reduction) and bills will have to increase (again) to cover the fixed fees.

Zero ROI, increased bills, and total resource savings from 2.4-4.4% is a combination that I, personally, can't spin hard enough to turn into a compelling argument.

In theory, the idea of "feedback on usage resulting in lower consumption" seems plausible. In reality, it is only marginally effective.

In "The question of energy reduction: The problem(s) with feedback" the authors write:

"a recent nationally representative UK survey revealed that... only households that were already interested or involved in energy savings were willing to use energy monitors and learn from them... even when households received free IHDs they did not use them... 59% of bill-payers expressed no interest in having an IHD installed in their homes... initial savings in electricity consumption of 7.8% after 4 months were not sustained 15 months later"

Pretty damning, actually... and it casts doubt on the 7% reduction figure that we've been using — the real figure may be much lower.

What it boils down to is that feedback is only useful to that fraction of the population that already has conservation tendencies. Beyond the 'novelty' stage, feedback does not change the behaviour of the vast majority of the population (who don't have conservation tendencies). Over half the population isn't interested in feedback at all.

Since 'entrenched attitudes' are something that guests do take with them into a hotel, what can be said (with great confidence) is that 'consumption-sensitive' guests will continue to be consumption-sensitive, and the rest won't. The presence — or lack — of feedback systems won't change that.

It would seem — in order to reduce resource consumption in hotels — you 'simply' need to make more of the population consumption-sensitive before they even check in.

Answer 4

BUMP FOR POSTERITY: Feedback is almost always a net positive and would absolutely provide a ROI for hotels in the specific case you provide. Excepting the 4.4% off total electrical usage that @Tim came up with, I think he is missing the point of charging guests for the energy they do use - because they now would be able to effectively meter individual use. This would result in a, what was the statistic you quoted earlier - 63% of electrical use by guests... so a 63% savings on the hotels energy bills, if I'm not mistaken? Moreso even, because as another user mentioned they can sell the energy for a higher rate than they pay the utility for their bulk deals. And this is only in terms of profits due to guests. Ive also seen no mentions of the efficiency increase and resulting profits related to these increases. Short circuit on a lamp in room 236? Well it's unoccupied and reading way higher energy use than an equivalent unoccupied room. Let's get that fixed and see a savings from guest QOL improvements, total hotel energy use, oh and the enormous future potential costs of a hotel fire torching everything. This is one example with a faulty plug. Now translate this to HVAC and heating systems, plumbing systems, normal and emergency power systems, pollution/air quality control, and occupancy control, and this is what my company sells (to hotels etc.) for a living. Feedback systems can save millions of dollars per year for buildings, and the more buildings you have data on the more potential savings there are to be found. Feedback systems keep planes and shuttles from crashing (and do lots of other things) by warning of impending issues before catastrophic failure - saving billions of dollars. The concept is the same for buildings - they just don't usually crash as quickly.

https://ieeexplore.ieee.org/document/7343990

Example - $40-$50/room