Rooftop Solar: What Are the Economic, Environmental and Operational Benefits for Hospitality Businesses?

by | May 29, 2024 | Articles

 

Our MD, Jamie Shaw, recently spoke with CLH News about the advantages of rooftop solar for hospitality businesses. If you missed the original article, catch up below.

The UK’s hospitality sector has faced many challenges in recent years – increasing food and drink prices, rising inflation, and high energy and utility costs being a few of the concerns keeping managers and owners up at night.

With research finding that in 2022-23, the average energy bill for hotels, pubs and restaurants had increased by around 81% – and were three times higher than in 2021 – it’s unsurprising that just under a third of businesses in the sector were optimistic about the future.

Energy was also cited as the biggest worry, with 86% of respondents ‘concerned’ or ‘very concerned’ about energy costs.

And while, in 2024, inflation may be slowing, the uncertain cocktail of corporate challenges remains. 

In recent times, trade bodies have been calling upon the Government to urge energy suppliers to offer fair rates, but is this a long-term solution?

 

Resilience of Supply is Key

Energy prices can decrease and stabilise, but markets will always be volatile, so there’s no guarantee they will stay this way.

But this doesn’t give peace of mind to the sector’s decision-makers when it comes to long-term financial, environmental, operational, and social stability and planning.

This is one of the reasons why on-site renewable energy solutions are gaining such momentum in the hospitality conversation.

Rooftop solar panels can reduce a business’s bills by up to 30%, as well as allowing for less demand and reliance upon the National Grid – and the price variability linked to this energy supply.

The results are energy independence and a future-proofed supply – achieved via an installation in an otherwise redundant, and non-profit-generating space.

It also helps to avoid situations like what happened a couple of years ago when, as energy prices soared, many businesses were forced into long-term fixed-rate contracts.

Of these hospitality companies, research  uncovered that 46% declared they felt their business was at risk of failure over the next 12 months – with 92% mentioning energy prices as a significant contributor to this.

With high footfall and round-the-clock services, energy is vital for the sector’s operations. But energy itself is not the problem, rather how and where this energy is generated.

 

The Environment, Net Zero and Consumer Attitudes

The UK’s hospitality sector is responsible for up to 15% of the UK’s greenhouse gas emissions.

And with businesses’ annual energy costs coming in at over £1.3bn, this also results in carbon emissions in excess of 8 million tonnes per year.

The truth is that energy is a significant part of any company’s carbon footprint – and all businesses are expected to play a role in moving towards Net Zero by 2050.

And with 73% of travellers more likely to choose accommodation if it has implemented sustainability practices, it’s never been more important for the industry to listen.

Customer attitudes, experience and expectations will drive the future of the sector, and if consumers are being more selective over where they stay, businesses need to be aligned or risk getting left behind – both financially and reputationally.

There is also more supply chain pressure than ever before.

As more organisations look to decrease their value chain emissions and reduce their environmental footprint, Scope 3 Emissions will continue to become a bigger topic for hospitality companies.

 

Hotel Brand Championing Solar Energy

One business leading the way is Dakota Hotels, as the brand has installed rooftop solar at its Edinburgh, Motherwell and Manchester sites.

In Manchester, the brand was looking to reduce its environmental impact and operational costs, while maintaining uninterrupted service for guests.

Another key driver was the business having noticed an upward trend in consumers looking for greener places to stay.

Dakota, therefore, wanted to cement its position as a forward-looking, sustainable hotel brand. A rooftop solar PV system was installed, as a result.

This now means the Manchester hotel can generate 59,317kWh of clean green energy annually, which is projected to save £17,795.10 on its electricity bills in its first year.

As reducing its carbon footprint was also important, the business is also pleased to be saving 11,848kg of carbon emissions per annum.

Dakota’s total carbon savings across all three hotels is now over 84 tonnes.

 

The Future of Solar in Hospitality

On-site renewable energy solutions – such as rooftop solar and solar carports – put hospitality businesses back in the driving seat when it comes to their energy expenditure and decarbonisation objectives.

There are also fully funded options – Power Purchase Agreements – available out there, that don’t require capital outlay or ongoing operational expenditure, so don’t put pressure on already squeezed hospitality budgets.

And with collaboration, innovation, and a little help from the sun, the future of the hospitality sector can be very bright indeed.

If you’d like to find out more about the benefits of solar energy for your business, contact our team. You can also learn more about our fully funded solar PV solutions for hotels by downloading our brochure. 

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