Date : June 18, 2005

Venue : Hotel Mandovi, Goa

Organized by: Integrated Research and Action for Development (IRADe)
Sponsored by: The Ministry of Environment and Forest, Government of India

Background Note ;

Scientists expect global warming to trigger increasingly frequent and violent storms, heat waves, flooding, tornadoes, and cyclones. It is believed that the economic costs of global warming threatens to double to $150 billion a year in 10 years, hitting insurers with $30-40 billion in claims. The substantial losses are in nature both ecologic and economic.

122 countries signed the “Kyoto Protocol” in 1997 to form an alliance and structure in the fight against climate change. The Protocol defines three flexible tools under which greenhouse gases can be reduced – the Clean Development Mechanism CDM) and Emission Trading (ET) are two of them. The tools recognize the principle of emission reductions at minimum cost across national boundaries. In 2003 alone, CDM projects made up 70 Mt of the 93 Mt in C02 traded around the world, according to a Point Carbon Report.

India is currently the world leader in development of CDM projects. Due to the effective operation of the Indian Designated National Authority for approval of CDM projects, more than 46 project proposals with an emission reduction potential of over 35 million t CO2 have got official host country approval. Almost 100 Project Idea notes and large numbers of PDD’s are floating in India. The wide range of possible project types and sizes in India allows international buyers to find the project of their choice or to define a broad portfolio to reduced risks. There is a large potential for renewable energy generation from agriculture wastes, hydro and wind. Thermal electricity generation and industry offer countless opportunities to improve energy efficiency, for example, regarding coal-fired power plants and of the transmission and distribution system.

Tourism is one of India’s most important and fastest growing industries. Although India’s share of global international tourism is relatively small in volume (about 0.40 per cent), however the year 2003 saw tourism in India emerging as a major sector of the Indian economy. International tourist arrivals in the year 2003 grew at 15.3 per cent over that of the previous year. The foreign exchange earnings registered an impressive growth of 15.7 per cent. In absolute terms, the foreign exchange earnings increased from Rs. 14,195 crores to Rs. 16,429 crores.

Climate change will impact upon tourism, which in turn impacts (through growing GHG emissions and associated environmental changes) on the climate.

Hotel industry is an integral part of the tourism sector. Overall, the Indian hotel industry has shown an impressive 25.5 per cent rise in sales during 2003-04 as against a 4.3 per cent increase registered during 2002-03. Correspondingly, the industry’s net profit has surged by 226 per cent in comparison to a 15 per cent dip during 2002-03. For 2003-04, Indian Hotels Company (IHCL) - the owners of the Taj group of hotels - profits stood at Rs 61 crores. EIH, which owns the Oberoi group, had a net profit of Rs 52.4 crore; the figures for ITC Hotels and Taj GVK are at Rs 20.2 crore and Rs 12.7 crore respectively.

The hotel industry is one of the major energy intensive industries having various effects on the environment; for example, CO2 emissions are generated by energy consumption in the entire life cycle of a hotel. Apart from the environmental effects, the trend in rising energy costs is a threat to the profitability as it forms a substantial part of the operating costs. The operation stage of a hotel accounts for the majority of energy consumption. The construction of a hotel will remarkably affect the overall energy efficiency of the building, equipment and appliances of the hotel. Electricity accounts for more than 50% of the total energy utilization and is used for heating, ventilation and air conditioning (HVAC), lighting system etc. Fuels such as LPG, diesel, furnace oil, LDO and natural gas account for the remaining energy consumption. These are mainly used for water heating, steam generation for laundry and cooking, food preparation and emergency power generation. The hotel industry offers reductions of greenhouse gases with energy efficiency, fuel switching and CHP technology interventions

Most of the hotels in India are professionally managed and they understand their resource (energy, water) consumption, wastewater generation, greenhouse gas (GHG) emissions and their financial performance. The hotel managements work to minimize the adverse environmental impact, prolong the system and equipment life span, and optimize the use of natural resources.

The above indicators are related to. Almost all big and small hotels are trying to pursue the best practices to enhance their energy and environment performance. These hotels are also exploring and implementing energy efficiency and environmental improvement projects including reduction of GHG emissions. There is an opportunity, as most of these efforts could become potential CDM projects. It is evident that there is a need to accelerate interactions between the climate change (particularly CDM) and environment friendly work being undertaken by the hotel industry. The workshop will address the following issues:

From the perspective of hotel industry, what are the main issues of concern in regard to the CDM?
What kind of support and facilitation is needed for CDM projects to succeed or be implemented in the hotel industry?

The Workshop aims to bring together the stakeholders from the hotel industry, various policy makers and the climate change experts for exploring and promoting CDM potential specific to hotel industry.