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Environmental Management of Tourism Growth in China White Paper Prepared for Wyndham Hotel Group Linda Powers Tomasso. Tourism-related expenditures in China, US$, 1995-2015 Source: Deloitte & Touche , 2011.
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Environmental Management of Tourism Growth in China White Paper Prepared for Wyndham Hotel GroupLinda Powers Tomasso Tourism-related expenditures in China, US$, 1995-2015 Source: Deloitte & Touche, 2011 E118 presentation 11/17/2011
WTO predicts that China will be the world’s top destination for international tourism by 2020. E118 presentation 11/17/2011
Twin Pillars of Tourism Growth in China: Inbound international visitation: slowing of business travel > boom in leisure/adventure travel promoted by successful hosting of 2008 Beijing Olympics 100 million visitors by 2015 = 8% of global tourism market 5.2% of Chinese GDP, US $20 billion in foreign exchangeChinese Domestic Tourism fueled by: political restrictions on mobility lifted newly mobile middle class with disposable income government investment in national infrastructure 1.9 billion domestic trips in 2010, 3.3 billion by 2015Compound growth rates: 8-10% luxury / 25% domestic travel E118 presentation 11/17/2011
Key Environmental Challenges To Hotel Sector Growth In China: • Water Scarcity • Energy Needs & Energy Delivery Systems • Indoor Climate Management (IAQ) • Air Quality at Building Sites • Grey and Black Water Management • Food and Solid Waste Management • Workplace Health and Productivity • Worker and Managerial Training • 3-week vacation = “emergency situation” E118 presentation 11/17/2011
Environmental impacts specific to hotel expansion trends in China: 1. Luxury hotel focus = average guest resource consumption • lighting and electricity draw • business centers, personal computers & electronics • water for bath, kitchen, & laundry • HVAC use: larger room size > more heating/cooling 2. Resort area development (Boao) stresses environmentally pristine areas & creates tourist-related impact to coral reefs. 3. Rising income reflected in hotel celebration of Chinese banquets, generating huge amounts of hotel food waste. E118 presentation 11/17/2011
Chinese response to hotel industry growth: • MoC goal to create 10,000 Green Hotels by 2012 • “Green Measures,” or sustainability, officially added as core criteria of CNTA’s Hotel Ratings System on 1/1/2011 • Points for green design, procurement & consumption, food safety, waste treatment, customer education • use targets of 20% less water and 20% less electricity • waste reduction by foregoing one-off disposable amenities • Unclear oversight of hotel energy efficiency requirements: Construction or Commerce Ministry? • CNTA’s National Hotel Rating System vs its Green Ratings System -- integration of five-star and five-leaf systems? E118 presentation 11/17/2011
Building Energy Use in China: • China has the world’s second-highest building energy use behind U.S. • Energy for building operation & construction currently = 45% of China's total annual energy use vs. a worldwide average of 39%. • Warning the hotel sector, MoC faults hotel hot water use as a major driver of China’s increased building energy. LBNL, 2010 E118 presentation 11/17/2011
Ministry of Construction Building Energy Mandates: • 2005 Energy Conservation Law> energy reductions over pre-code buildings of 50% by 2010 and 65% by 2020. • 2012-2017 five-year plan> 1-star rating for all new construction, including hotels. • Government sell-off of State-owned hotels primed for energy retrofits and hotel chain growth. E118 presentation 11/17/2011
Tools for managing building energy sector from an environmental perspective: • International Green Building Support • Certification schemes: LEED vs 3-Star • Best Practices and Tools suited to China • Renewable Energy Strategies: • 15% government target by 2017 • Global share of solar hot water/heating=58.4% • Low level technologies like insulation E118 presentation 11/17/2011
Sheraton Hotel Shenzhen Jing JiDameisha , ChinaAecom Construction Sustainable Features: S-shaped design complements surrounding environment Orientation that makes maximum use of natural sunlight All rooms have an exterior view to oceanfront Energy-saving strategies: low-emissivity glass, lighting sensors, LED E118 presentation 11/17/2011
Training franchisees in sustainable hotel management will be key for chain expansion: • Franchising a late-comer to hotel industry in China. • Ability to maintain branded standards past detriment to hotel franchising in China now changing. • Pool of franchise managers from State-owned hotels: 83% expressed interest. • 2- & 3-star hotel managers looked to Super 8 and Jin Jiang as models. E118 presentation 11/17/2011
Future challenges to sustainable hotel management in China: • Rising living standards raise comfort expectations for heating/cooling. • Higher overall energy consumption and energy costs • Large hotel energy footprints will face mandated reductions • Climate change: • Southern hot zone creeping northward, requiring more energy-intense cooling than heating • Hotel building portfolios will reach emissions thresholds • Regional water shortage • Spread of drought in Northern cities • Glacier melt > water irrigation, food prices E118 presentation 11/17/2011
Conclusions: • Large-scale building environment dwarfs sustainable development in hotel sector • Few hundred buildings out of 50,000 high rises • Water use in water-scarce regions presents special challenges > water reclamation & reuse • Advancing technology hopeful but pace of change reduces payback window to 3 years for retrofits • Franchising opportunities pushing domestic owners toward foreign partnerships > influence toward sustainability E118 presentation 11/17/2011
Conclusions, continued: • Employee education in sustainable hotel management necessary & key: IHG Academies • Stakeholder education critical to shape attitudes toward sustainable hotel travel among new generation of tourists • Domestic market is yet to be captured, although some previous brand loyalty for early entrants. • Sustainability can be a differentiator, but Chinese mass market not yet ready for value proposition sustainable tourism offers if it means more $. E118 presentation 11/17/2011