InterContinental Makes $40m Green Savings
Sunday, 23 Aug, 2009
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New online system Green Engage is helping hotel general managers manage energy consumption more effectively
InterContinental Hotels Group (IHG), the world’s largest hotel company by number of rooms, says that green savings are starting to reap rewards. Although the UK-based group reported a 38 per cent reduction in profits, the hotel giant offset some of the disappointment in the figures by forecasting a USD 10 million improvement in cost savings to USD 80 million.
The new forecast includes $40 million of ‘sustainable savings’. Andy Cosslett, Chief Executive, InterContinental Hotels Group, said, “It was all too easy to scorn changes such as lagging water pipes and turning down the swimming pool temperature, but these savings were not only reducing the group’s environmental impact but also saving a considerable amount of money.”
The new on-line system called ‘Green Engage’ is helping hotel general managers manage energy consumption more effectively. Early trials have shown potential energy savings of up to 25%. If fully adopted by all hotels across the 4,000 strong IHG portfolio, it is estimated that the savings for hotel owners could be as much as $200 million. The system, which was developed in-house, is being rolled out across IHG’s seven brands including Holiday Inn, Crowne Plaza and InterContinental following final trials in 650 hotels which are starting now.
The ‘Green Engage’ software works by hotels directly inputting data on site. The system automatically compares hotels of a similar nature across the world and lists a series of actions that each hotel can take to reduce waste and the consumption of energy and water.
Green Engage responds to growing levels of interest from guests who are looking for sustainable hotels that manage their environmental impact. As well as location, price and amenities, guests are now factoring in a hotel’s environmental credentials when booking a place to stay.
Mr Cosslett said: “It’s amazing how small things can make a big difference and it’s things that most people don’t notice. For example, turning a hotel swimming pool down by one degree saves a lot of money but the guest will hardly notice any difference.”
Tom Corcoran, Chairman of the IAHI Owners’ Association, and owner of a number of hotels taking part in the Green Engage pilot commented "Green Engage is not only good for the environment, but is also good for business. In the current economic climate and with rising energy bills, this tool will help us to identify significant cost savings. At the same time it delivers what our guests want – a greater sense of well-being and less impact on our planet when travelling."
In 2008 IHG launched Innovation Hotel, an online example of what a future hotel might look like if it used new green technologies. Guests can provide feedback on which of these they feel are important, allowing IHG to consider how they can be implemented as part of the Green Engage programme.
Despite the profits dive of 38 percent, IHG appears to be winning market share from rivals. The group said that although there was still “poor visibility” on forward bookings, there had been no further deterioration in demand and a rise in leisure business in July. IHG added a net 117 hotels with almost 27,000 rooms in the first half. It opened 229 hotels and removed 112 that failed to meet brand standards and is on track to open 400 in the full year. It said that it expected to open another 25,000 rooms in the second half of the year.
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