FINANCIAL VIABILITY OF ENERGY RETROFITTING PROJECTS IN SINGAPORE �S HOTEL FACILITIES

Abstract

Today, as the Earth is showing signs of deterioration with erratic climate change, it is a warning to all that that the Earth has limited resources and these resources may run out one day. Therefore, conserving energy and energy efficiency in buildings is imperative. ESCos are widely known to aid building owners to save energy cost; however, one persistent problem is the building owners’ reluctance in engaging ESCos due to their lack of trust, credibility and knowledge in ESCos. This research paper aims to serve as a guide to hotel owners to decide whether ESCos are effective to them. The focus of this research paper will be towards the hotel industry due to them being the highest consumers of energy.

The research methodology to this paper involves various literature review, interviews, data collection and experiments are conducted to achieve the objectives. One of the limitations is that there are very few literature reviews of ESCos in Singapore or in the hotel context. To supplement this research gap, interviews and data collections were conducted with one of the largest hostels in Singapore to which is indicative of hotel owners’ perspective and concerns. Next, an energy auditing model is developed to allow better understanding for hotel owners and to guide their decision making process. To determine the effectiveness of the model, it will be compared to the financial returns of various scenarios.

The key findings of the three scenarios’ evaluation show that the engagement of an ESCo to manage energy efficiency in the building will incur the least costs and will be the most beneficial to the hotel. This is largely due to the ESCos’ field of knowledge and resources, and absorption of risks from the building owner to the ESCo.

Finally, with this model, hotel owners are able to make better decisions and understand more about the energy auditing process. This will significantly reduce the event of building owners’ not trusting the ESCo. This research hope to contribute to the green buildings industry in Singapore by addressing the hotel owners’ concerns. Energy efficiency should not end here, as it can be improved in addressing the concerns in other industries as well.