Every month our colleague Bridget Donofrio offers us, directly from the VDA Telkonet headquarters in the United States, her personal point of view on the latest innovations in terms of technology, sustainability and energy saving to help hotel and non-hotel establishments remain competitive.
Let’s read together her article for Bridget’s Suite, September 2023.
ROI
When I think of ROI, I think,” I can’t afford NOT to buy it!” It’s one of my favorite expressions.
ROI is an acronym for Return on Investment: an approximate measure of an investment’s profitability.
HOW DOES ROI WORK WITH ENERGY MANAGEMENT SYSTEMS (EMS)?
- Let’s say you invest in an energy management system for your hotel.
- Once you have it installed, it begins saving energy immediately.
- Saving energy means saving money on energy bills every month.
- Typically, in three years, the amount saved surpasses the initial
PAID FOR ITSELF IN LESS THAN TWO YEARS
One of our clients in Farmington, CT invested in a Telkonet energy management system in 2015. The investment for the entire platform, including hardware, software, and installation, was $27,795.
Our EMS saves them an average of 37% on their energy bills.
How do we know this?
EcoSmart, our well-established EMS platform, collects data, analyzes it, and reports on it. (Our new, state-of-the-art EMS platform called Rhapsody does the same. In a year or two, I’ll report on some Rhapsody success stories!)
If you’re geeky for details like we are, here is more information:
• Without Telkonet EcoSmart: $43,600.20
• With Telkonet EcoSmart: $27,404.70
• Savings: 37%
• Devices in Sample: 120
• Annual Savings: $16,195.50
• Average Per Unit:
– Sample Period: 2905.21 days
– Runtime Savings: 4749.18 hours
– Electric Savings: 6510.48 kWh
– Gas Savings: 0 Therms
Our Farminton, CT client recouped the money they invested in less than 2 years: $27,795 / $16,195.50 = 1.716 years
This property’s energy savings is not exceptional. Honestly, when researching this story, I just opened our EcoCentral software and randomly picked a property. In fact, I was reminded by a colleague that we have a local casino client, near and dear to our hearts here in Wisconsin, that saves 49% annually!
WHAT FACTORS AFFECT ENERGY SAVINGS?
PMS/BMS integration: our Connecticut client is one of many who integrate our platform with their property management system. Room temperature is allowed to drift when the room is unsold. However, immediately upon guest check-in, the temperature begins its return to setpoint.
Electricity rates: ironically, our clients in Hawaii usually experience a quicker return because their average electricity rate is among the highest in the US (all other factors being equal).
Guest room occupancy: our clients with low occupancy rates can experience a quicker payback time because our solution saves the most energy when rooms are unoccupied.
“Recovery Time”: we define Recovery Time as the number of minutes it will take for the room temperature to return to setpoint after a guest enters the room. Most of our customers opt for this method. Recovery time optimizes payback.
Guest comfort versus energy savings: each client determines the right balance between guest comfort and energy savings for their property’s unique needs. A five-star hotel places the highest importance on guest satisfaction, so energy savings will be less aggressive.
VIP Mode: properties that reserve this energy-saving “override” for circumstances will please their discriminating guests plus save energy. Unfortunately, if a property is too liberal with placing guest rooms in VIP mode, it negates energy savings. Seriously, I’ve seen this. Use VIP mode judiciously and remind your staff to do the same.
Lanai Setting: this is such a simple solution. We install door contacts on patio (“lanai”) doors. When guests open their patio doors to revel in the beautiful ocean breeze but leave them open while the air conditioning is on, we can have the a/c shut off until the door is closed. We also offer other, less draconian responses, like merely adding a “Door Open” message on the thermostat or alerting facilities to close the door upon check-out.
Aggressive dehumidification: our clients who opt for aggressive passive dehumidification will experience a longer payback time, but it helps prevent furniture and carpet damage due to mold and mildew. It’s a very valid tradeoff.
We have a treasure trove of other solutions to help with ROI. Supplementary occupancy sensors in suites, door locks that identify who is entering (housekeeping vss guest), utilizing deep temperature setback for blocks of rooms during the off season, defining parameters differently for sunny and shady sides of the building.
And indeed, HVAC type affects energy savings, although that’s beyond the scope of this article.
SUMMARY
Our engineers estimate that project payback is typically approximately 2-5 years depending on the industry, size of deployment, and level of integration. Many factors weigh into this estimate.
Take-Aways:
- Integrations (EMS, PMS, door locks, etc) drive payback
- Electricity prices have a broad and deep impact on payback.
- Natural gas prices have a narrow and shallow impact on payback.
- Actual guestroom occupancy aggressively drives savings and payback.
- Recovery Time® optimizes payback regardless of HVAC Type.
- Effective passive dehumidification solutions such as Telkonet’s Refresh Cycle® lengthen payback but save furniture, walls, carpeting and guest/occupant health.
- Striking the right balance between guest comfort and energy savings enhances customer loyalty plus drives project payback.
- Less than three-year paybacks are feasible in all
Energy Management: You Can’t Afford NOT to Buy It!
Contact us to learn more about our new EMS, Rhapsody. Write us an email now
