caribbean hotel energy efficiency action program … -cref.pdf · • financial impact for the...

Caribbean Hotel Energy Efficiency Action Program (CHENACT)

CREF 2010Atlantis Hotel BahamasOctober 15th 2010

LORETO DUFFY-MAYERS

Project Manager

*

Topics

• Detailed Energy Audits

• Walk-Through Energy Assessments

• Barbados Case Study

• Barbados Hotel Clean Energy Policy

• Caribbean Regional Hotel Clean Energy Market

• Programmatic CDM

Status of Detailed Energy Audits

Item Hotel#

Rooms Location

Completed Audits

1 Colony Club 96 West

2 Crystal Cove 88 West

3 Fairmont Royal Pavillion 75 West

4 Treasure Beach 35 West

5 Turtle Beach 164 South

6 Mango Bay 67 West

7 Crane 418 South

8 The House 34 West

Site Audit Completed

9 Almond BC&S 161 West

10 Amaryllis 146 South

11 Sandy Lane 114 West

12 Accra 224 South

13 Almond Casurina 280 South

15 Sandpiper 65 West

Item Hotel#

Rooms Location

Site Audit Completed (cont.)

16 Southern Palms 91 South

17 Divi Southwinds 133 South

18 Almond Beach Village 435 West

19 Beach View Hotel 47 West

20 South Beach 49 South

21 Allamanda 49 South

Site Audit Outstanding

22 Pommarine 22 South

23 Barbados Beach Club 111 South

24 All Seasons Resort 48 Suncrest

25 Sugar Cane Club 44

26 Blue Horizon 67 South

27 Savannah 80 South

28 Time out at the Gap 76 South

29 Dover Beach

31 Coral Mist

Air-conditioning and lighting represent between 30% to 65% of the total electricity consumption in the hotel sector

19%

39%

50% 50%54%

9%

14%

12% 15% 4%

2%

8%

4%

10%19%

9%

10%11%

11%13%

8%

4% 2%

9%6%

31%

14% 9%

2% 3%11%

21%

7%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Very Small Small Medium Large Very Large

Size of Hotel

BREAKDOWN OF ELECTRICITY CONSUMPTION IN THE HOTEL SECTOR

Miscellaneous

Office Areas Equipment

Hot Water

Pumps

Kitchen

Laundry

Guest Rooms Equip. & Lighting

Lighting

Air Conditioning

Energy Consumption vs. Hotel Size

• Electricity consumption per guest-night in Barbados varies slightly from medium to large hotels, depending upon guest amenities and occupancy levels.

40363

1,428

2,191

5,136

16

37 3632

39

0

10

20

30

40

50

60

0

1,000

2,000

3,000

4,000

5,000

6,000

0‐10 11‐50 51‐100 101‐200 200<

Number of bedrooms

Electricity Consumption by size of hotel

Annual Electricity consumption [MWh] Consumption per guest‐night [kWh]

• Experience has shown that despite the size and age of a property, a hotel can have a low energy efficiency index (kWh/GN) through the use of efficiency equipment and good staff practices.

Sample Detailed Energy Audit Results

Property Characteristics Property Data

Number of Rooms 67

Total Guest Nights 2009 36,705

Total Energy Use (kWh/year) 1,188,366

Total Energy Costs (US$) $220,257

Annual GHG Emissions (CO2 tons/year) 450

Recommended Investment (US$) $172,306

Estimated Savings annually (kWh) 349,930

Estimated Savings Annually (US$) $102,310

Estimated Savings CO2 Tons Annually 245 Recommended Projects

Investment Cost (US$)

Annual Savings (US$)

Payback Period (Years)

kWh Saved

Retrofit present mini split unit system to an inverter type variable refrigerant volume (VRV) system with heat recovery for hot water $124,000 $61,851 2 157,658 Install guestroom controls and occupancy sensors $35,000 $21,892 1.6 124,122 Install a Variable Frequency Drive (VFD) on pool pumps $1,500 $1.561 1.0 4,802 Corporate Energy Management Practices $6,000 $11,631 0.5 38,236 Retrofit all 40W fluorescent tubes to 25W Sylvania Octron XP Super Saver Ecologic3 lamp or an equivalent fixture with their respective ballasts. $5,050 $1.471 3.4 5,563 Replace all incandescent bulbs with 13W compact fluorescent bulbs throughout hotel $756 $3,901 0.2 14,747 Total US$172,306 US$102,309 1.7 349,930

Walk Through Energy Assessments

Status of Walk Through Assessments• Target – 35 Hotels• First wave – 17 (50%); 15 completed, 2 to be

re-scheduled

Common Findings/Recommendations• Many properties unaware of the length of time

their hot water switches are on – Staff training– Install a mechanical timing device

• Over-lighting continues to be a problem particularly in newly refurbished hotels

• Maintenance of equipment to ensure efficient operation– AC units– Refrigeration equipment– Solar water heating equipment

• Install Solar Water Heaters

Significant variation in electrical energy index among small hotels (<10 kWh/GN to >60 kWh)

Barbados hotel sector accounts for approximately 9% of the total electricity consumption

• Total electricity consumption in the island was 952 gigawatt-hours (GWh) in 2009. The 84 Hotels and Guest Houses (BHTA members) accounted for approximately 89 GWh, or 9% of total electricity sales.

9%

91%

Electricity Consumption of the Barbados Hotel Sector

Hotel Sector Other sectors

• The average electricity tariff paid by hotels to the power utility (Barbados Light and Power Co) lies between 0.25 to 0.27 US$/kWh depending on the rate (voltage) class.

• Natural gas consumption in the hotels could represent approximately between 16% to 20% of the electricity consumption (or 14% to 17% of total energy consumption)

Initial audit reports indicate significant opportunities for energy efficient savings in the hotel sector

• Average potential electricity savings near 40% of total hotel’s consumption

• Most savings are related to:

– 1) Retrofit of present mini split unit systems to high efficient AC systems (such as inverter type variable refrigerant volume (VRV) system ) with heat recovery for supplying hot water also.

– 2) Installation of high efficient lighting systems.

• Average total paid back period around 2.5 years

• Total investment costs between US$200,000 and US$550,000 million depending on property size

Hotel size# of

RoomsPotential Annual

Electricity SavingsInvestment Cost per hotel [US$k]

Payback period [months]

Small 0-50 38% 200 37 Medium 51-100 39% 320 28 Large 101-200 40% 410 33 Very Large 200< 39% 550 27

Impact of potential energy efficient savings in the total hotel sector in Barbados

• Total savings of 32,600 MWh per year,

– 36% of total hotel sector consumption

– 3% of the total electricity consumption in Barbados

• Estimated total investment cost in the Barbados hotel sector: US$ 23 Million

200

320

410

550

‐

100

200

300

400

500

600

0‐50 51‐100 101‐200 200<

number of rooms

Estimated Average Investment Cost per Hotel [US$ 000´]

9.2

6.7

5.3

2.2

‐

2.0

4.0

6.0

8.0

10.0

0‐50 51‐100 101‐200 200<

number of rooms

Total Required Investment Cost [US$ million]

3,032

10,498 10,821

8,218

‐

2,000

4,000

6,000

8,000

10,000

12,000

0‐50 51‐100 101‐200 200<

number of rooms

Total Annual Energy Savings [MWh]

Other impacts from potential energy efficient savings

• Equivalent Barrels of oils saved in electricity generation:– 49,200 Barrels per year

• Potential reduction of Greenhouse Gas emission:– 28,600 CO2 tons per year(1)

• Financial impact for the power utility (BLPC)– US$ 8.2 Million reduced revenue per year as result of reduced sales

• Fiscal impact for the government (without including grants)– Loss of US$ 1.2 Million per year from VAT revenues over utility’s electricity sales– Loss of US$ 800,000 in customs duty revenues, due to 5% customs duty incentive for

EE equipment (2)– Loss of US$ 600,000 per year in Income Tax Revenues of due to the 150% write-off

of Loan Interest Income Tax concession (3)– US$ 7 Million in Income Tax Credits as included in the Tourism Development Act– Reduction of US$ 3,7 Million per year in the annual imports – exports deficit due to

fewer oil imports (4)– Increase of approximately US$ 1 million revenues from VAT on EE goods and

services(1) CO2 Emission Factor 0,88 C02 Tons / MWh , based on Barbados Sustainable Energy Framework(2) Proposed 5% custom duty for the hotel sector applied over 70% of 70% of the total investment cost (3) 30% Equity, 8% Interest Rate, 25% income tax(4) Based on an oil price of US$ 70 per barrel

Cost estimates for implementation of renewable generation in the hotel sector

• Solar power potential– Based on Thin Film PV Panel technology with fixed mounting racks, there is a total

electricity production potential of approximately 2,134 MWh per year in the hotel sector. (Assuming all hotels could set apart a small portion of their roofs)

– This renewable generation could represent 2.5% of the total energy consumption in the hotel sector, requiring a total investment cost of approximately US$5.5 million.

• Wind power potential– In a small hotel, a 10kW installed of vertical axis wind turbines, could yield

approximately 22 MWh per year (assuming a conservative capacity factor of 25%), leaving an offset of 20 tons of CO2 per year.

– This production could represent approximately 6% of its total hotel’s electricity consumption, with a required investment cost of US$55,000

Hotel Size

Number of Hotels & Guest

Houses

Likely Available Roof Area per Hotel

Total Annual Electricity Production

[m2] L [m] W [m] [MWh]Very Small 20 50 20 2.5 112

Small 26 125 25 5 365 Medium 21 250 50 5 590

Medium-Large 13 500 50 10 730 Large 4 750 50 15 337

TOTAL 84 2,134

Other impacts from potential Solar PV renewable generation in the hotel sector

• Equivalent Barrels of oil saved in electricity generation:

– 3,200 Barrels per year

• Potential reduction of Greenhouse Gas emissions:

– 1,875 CO2 tons per year (1)

• Financial impact for the power utility (BLPC)

– US$ 550,000 per year as result of reduced sales

• Fiscal impact for the government (without including grants)

– Loss of US$ 80,000 per year from VAT revenues over utility’s electricity sales– Reduction of US$ 200,000 per year in the annual imports of oil (2)

(1) CO2 Emission Factor 0,88 C02 Tons / MWh , based on Barbados Sustainable Energy Framework(2) Based on an oil price of US$ 70 per barrel

Illustrative Hotel Clean Energy Investment Program for Barbados

Energy Efficiency Investments• Total investment of US$ 23.5 Million

• Investment cost per property: US$ 200,000 -US$ 550,000

• Investment payback period : 27 - 37 months

• Reduced electricity consumption per year: 32.5GWh

• Annual barrels of oil saved: 49,000 Barrels

• Annual reduced CO2 tons: 28,600 Tons

Micro Generation Investments• Total investment of US$ 6 Million

• Investment cost per property: US$ 20,000 - US$ 55,000

• Investment payback period ~ 100 months (9 years)

• Reduced electricity consumption per year:: 2.3 GWh

• Annual barrels of oil saved: 3500 Barrels

• Annual reduced CO2 tons: 2,000 Tons

32,569

2,309

Annual Energy Savings [GWh]

Energy Efficiency Oportunities

Renewable Micro Generation

23.5

6.0

Total Investment Cost [US$ Million]

Energy Efficiency Oportunities

Renewable Micro Generation

Model Hotel Clean Energy Policy

Elements of Proposed Hotel Clean Energy Policy

Model hotel clean energy policy consists of 5 inter-related elements:

• Institutional support – Ministry of Energy, Ministry of Tourism, Ministry of Environment, Ministry of Finance, Barbados Hotel and Tourism Association, Barbados Power and Light

• Financing – Investment incentives, grants, low interest loans, supplier credit, revenue from RE sales to utility, revenue from Carbon Emission Reduction (CER)

• Technology support – Equipment testing, standards and rating, building codes and certification, operator training, energy savings monitoring and verification

• Programmatic CDM/ emissions offsets – Standardized EE/RE applications, simplified CDM registration and verification, consolidated CER accounting and trading/sales

• ESCO industry – Auditors, equipment suppliers, engineering procurement contractors, O&M contractors, performance contracting

Proposed Barbados Hotel Clean Energy Policy Instruments

Policy Instrument Proposed InterventionTourism Development Act Establish preference for EE verses non-EE investments,

increased incentives for solar PV

Renewable energy system interconnection pilot program

Standardized long term power purchase agreement

Utility Demand Side Management (DSM) programs

Recovery of utility expenditures and allowable return on investment through rate base

Building code (draft energy efficiency code) Lighting, air-conditioning, hot water, appliance standards for hotel applications

SMART Energy Fund Pre-investment grants, low interest loans tied to payback period, performance risk sharing, upfront payments for CERs

GHG Mitigation Action Plan Business as usual forecast for hotel sector, emissions reduction targets, registration of CDM projects, emissions reduction monitoring and verification

Carbon Neutrality Program Promotion and marketing of “low carbon” development in tourism sector, accreditation of “low carbon” hotel properties

Caribbean Regional Clean Hotel Market• EE action for hotels in 25 Caribbean states -

Pick the low hanging fruits

– 25% of total hotels are properties with 120 rooms or more

– Accounting for ~75% rooms & electricity use.

• Total electricity use in the hotel sector is 4638 GWh

– Only six contries/territories account for ~73% of the total electricity use

• 3.47 million tons of CO2 emitted annually

• Suite of EE measures in hotels can reduce CO2 emissions by 1.46 million tons annually.

2670 Hotels in 25 Caribbean Countries/Territories

Anguilla, Antigua/Barbuda, Aruba, Bahamas, Barbados, Bermuda, British Virgin Islands, Cayman Islands, Cuba, Dominica, Dominican Republic, Grenada, Guadeloupe, Haiti, Jamaica, Martinique, Montserrat, Netherlands Antilles, Puerto Rico, St Kitts/Nevis, St Lucia, St Vincent/the Grenadines, Trinidad/Tobago, Turks/Caicos Islands, US Virgin Islands

527

548

445

189

245

23184

# of Hotels by Property Size

< 20

20 to 39

40 to 79

80 to 119

120 to 239

240 to 479

> 480

3% 6%

10%

8%

18%32%

23%

% of Rooms by Property Size

< 20

20 to 39

40 to 79

80 to 119

120 to 239

240 to 479

> 480

Electricity Use in Hotels by Property Size

0

100

200

300

400

500

600

700

800

900

1,000

1,100

1,200

1,300

Ann

ual E

lect

rici

ty U

se b

y H

otel

Siz

e (in

1,0

00 M

Wh)

>480

240 to 479

120 to 239

80 to 119

40 to 79

20 to 39

<20

CO2 Emissions from the Hotel Sector

0

100

200

300

400

500

600

700

800

900

1000

1100

1200

CO2

Emis

sion

s (in

1,0

00 to

ns)

EE Initiatives Can Avoid 1.46 Million Tons CO2 Emissions Annually

0

50

100

150

200

250

300

350

400

450

CO2

Emis

sion

s Off

set (

in 1

,000

ton

s)

caribbean hotel energy efficiency action program … -cref.pdf · • financial impact for the...

Documents