Cost of living crisis: how the hotel sector could make savings on energy bills

Businesses in the hotel sector are among those most impacted by rising inflation. Here are some pointers for making savings on your energy costs.

Even before the energy price cap rise came into effect in April 2022, hotel businesses were paying upwards of an estimated £420 a day on electricity, according to price comparison website Selectra. We’ve partnered with Octopus Energy to offer some short- and long-term fixes that could help your hotel business reduce energy costs. The short-term tips require little or no investment and could have an immediate impact on costs. The steps to long-term savings may require some additional investment, but could improve your cash flow well into the future. What’s more, becoming more eco-conscious about energy use could make your hotel business more attractive to customers.

David Scott, our Head of Retail and Leisure, says: “We have been inspired by actions taken by our hoteliers to implement cost savings whilst acknowledging our responsibility to act in a more sustainable way. These practical solutions represent simple steps that in a time of rising costs can make a real business difference.”

Five short-term tweaks for your business

1. Choose the right tariff

How and when you use your energy should determine your choice of energy tariff. Depending on your meter type, you may be able to opt for an Economy 7 tariff, which would give you both a day unit rate and a night unit rate. If you have energy-intensive appliances that you can programme to come on at night – for example ovens, dishwashers, or heating and cooling systems – you could make use of the cheaper night-time unit rate.

2. Keep it clean

Ensure that air conditioning units and refrigeration and freezer systems are kept clean and free from dust, debris and obstruction. While it may seem a simple step, this could produce big results in efficiency, helping to bring down your energy bills. It could also extend the lifetime of the machines.

3. Switch off

Many appliances continue to draw on a small amount of power when on standby, and encouraging staff to be mindful of this could help save costs. Computers and monitors should be switched off if not being used for more than two hours, and when equipment isn’t being used for an extended period, unplug it. These are just a few examples, but engaging employees in a conversation about small changes could make a big difference.

4. Maintain your equipment

Service your boiler annually, check your refrigerators and freezers are not leaking fluid or cold air, and test any technology you have, such as computers or servers, to make sure it’s all operating efficiently. While there may be some costs involved, you could save money on your energy and fuel bills in the long run. It also helps if you can delay switching on heating or air conditioning until later in the year.

Ensure that air conditioning units and refrigeration systems are clean and free from dust, debris and obstruction. This simple step could produce big results in efficiency

5. Reduce water temperature and consumption

Less water consumed means a lower water bill and a lower energy bill. Low-water-consumption showers and toilets, automatic shower controls, and tap aerators – clever devices that reduce the amount of water flowing through a tap without losing water pressure – are some of the tools you can use to achieve this. You can also avoid running appliances such as washing machines on half loads, and try turning down the water temperature on your boiler. As well as using less energy to heat the water, this helps reduce standby losses – where heat escapes from the water heater because the water is already hot.

Four steps to long-term savings

1. Install LEDs

According to the Department for Business, Energy & Industrial Strategy (BEIS), lighting uses about 20% of the electricity generated in the UK. Light emitting diodes (LEDs) are more efficient than traditional incandescent bulbs, and BEIS suggests that upgrading to LED technology throughout your business could deliver “cost savings of up to 80%”.

2. Use fewer fridges and freezers

It’s often cheaper to run one larger unit than two smaller ones. By more effectively using the space you have, you may find you’re able to make do with fewer units.

3. Generate your own

You could save money through on-site generation by installing solar panels on your roof, or elsewhere on your property. The Scarlet hotel in Cornwall, renowned as one of the greenest in the UK, uses solar energy to heat its outdoor pool. With the cost of energy rising quickly, investing in solar that can generate at least some of your own power could lead to significant long-term savings.  If you don’t use all the energy you generate, you could sell it back to the grid for an additional revenue stream.

4. Electrify your fleet

As the prices of petrol and diesel rise, your employees and your business will be facing higher charges. Switching to electric vehicles and installing charging points in your car park could help both you and your employees to save on vehicle running costs.

Support for your business as costs rise

If you feel under pressure with rising costs, you’re not alone. Find services, resources and guidance, which could help you adapt, cut costs and plan ahead. 

This material is published by NatWest Group plc (“NatWest Group”), for information purposes only and should not be regarded as providing any specific advice. Recipients should make their own independent evaluation of this information and no action should be taken, solely relying on it. This material should not be reproduced or disclosed without our consent. It is not intended for distribution in any jurisdiction in which this would be prohibited. Whilst this information is believed to be reliable, it has not been independently verified by NatWest Group and NatWest Group makes no representation or warranty (express or implied) of any kind, as regards the accuracy or completeness of this information, nor does it accept any responsibility or liability for any loss or damage arising in any way from any use made of or reliance placed on, this information. Unless otherwise stated, any views, forecasts, or estimates are solely those of NatWest Group, as of this date and are subject to change without notice. Copyright © NatWest Group. All rights reserved.

scroll to top