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Hotels and Casinos
Strategic Markets
Key Resources
- The CHP for Mid-Size to Large Hotels Fact Sheet summarizes the economic and environmental benefits of using CHP to provide electricity and heat for mid-size to large hotels. Download a PDF version (4 pp, 259K) to print and share.
- The CHP for Resort Hotels and Casinos Fact Sheet outlines the reliability, economic, and environmental benefits CHP systems can provide to large casinos. Download a PDF version (4 pp, 334K) to print and share.
- CHP in Hotels and Casinos—Market Analysis Report (PDF) (66 pp, 1.2 MB) describes the vast technical and economic potential for CHP in the hospitality industry by analyzing lodging industry energy consumption estimates, industry growth projections, and energy price trends. In November, 2007, EPA published an Addendum (PDF) (19 pp, 206K) to this report with updated market information.
The Embassy Suites Hotel in San Luis Obispo, California, is a 196 guest room hotel with meeting rooms, a pool, restaurant, and lounge. The Embassy Suites entered into a contract with PowerHouse Energy to install, own, and operate an 85-kW CHP system reciprocating engine on site at the hotel in 2005.
The contract will provide guaranteed cost savings while the CHP system provides roughly 40 percent of the hotel's electricity needs and more than 75 percent of its average thermal demand.
Harrah's Rio All-Suite
Hotel & Casino
Located in Las Vegas, Nevada, the Rio All-Suite Hotel & Casino includes more than 2,500 suites and 15 restaurants, as well as theaters, lounges, and gaming rooms.
The Rio installed a 4.9 MW CHP system in 2004 that generates 40 percent of the electricity and 60 percent of the hot water for the hotel, reducing the Rio's energy costs by $1.5 million annually.
Learn more about the Rio's experience with CHP (PDF) (8 pp, 191K) by downloading the hotel and casino's presentation from the 2006 CHP Opportunities for Las Vegas Casinos Workshop.
Hotels and casinos represent an excellent but underutilized market for combined heat and power (CHP). Of the nearly 48,000 hotels in the United States, about 10,000 have the energy characteristics suitable for current CHP technology. More than 1,000 of these sites are likely to meet a simple payback on their investment within five years or less.
Installing CHP systems in hotels and casinos generates a number of benefits, which include:
- Reducing operating costs.
- Ensuring hot water is available for guests at all times.
- Providing reliable electricity for gaming venues, even during utility blackouts.
- Improving energy efficiency and overall environmental performance.
- Reducing future cost uncertainties by creating a hedge against fluctuating energy prices.
CHP utilization in the hotel and casino industry makes good business sense. Energy represents one of the few cost elements within a hotel's control. Three-quarters of the industry's total energy use is devoted to heating water and guest rooms, air conditioning, and lighting—all of which can be supplied cost effectively by CHP.
For large casinos, CHP technology significantly reduces the risk of a catastrophic utility blackout that can cost casinos more than $1 million a day in lost revenue.
Differently sized hotels and casinos require different CHP applications:
- Hotels with 100 to 300 rooms: Could utilize a 60 to 250 kilowatt (kW) CHP system based on reciprocating engines, microturbines, or fuel cells, which would supply hot water for customers, space heating, and laundry needs.
- Hotels with 300 to 500 rooms: Could install larger CHP systems of 250 to 380 kW and incorporate absorption chillers to supply the facility's air conditioning needs.
- Resort hotels and casinos with more than 500 rooms: Could support CHP systems of 1 to 10 megawatts (MW) run by reciprocating engines or gas turbines. These systems can provide all of the facility's heating and cooling needs, in addition to a large portion of the electricity loads, and can be configured to operate in the event of a utility outage.
Large casinos face somewhat different design complexities and drivers compared to more standard hotel applications. For example, because most casinos allow smoking on the casino floor, indoor air quality and equipment performance must be considered when engineering a CHP system design.
Additionally, because of the trend towards huge mixed-use resort facilities that include gaming, restaurants, entertainment, spas, shops, and more, resort hotels and casinos have more in common with a small university than with a small business hotel, from an energy standpoint. The larger and more diverse energy load brought about by the addition of these multiple uses and expanded facilities can also be met reliably and cost effectively by CHP.
Additional Resources
In September 2006, EPA's CHP Partnership hosted approximately 40 casino managers, Nevada policymakers, and other stakeholders for a workshop titled, CHP Opportunities for Las Vegas Casinos in Las Vegas. Presentations from this workshop are listed below:
- Combined Heat and Power and the Optimal Portfolio for Nevada (PDF), (11 pp, 154K), Carl Linvill (Director, Nevada Office of Energy) describes utility energy plans in Nevada and the Southwest and how CHP plays an important roll in stabilizing fuel prices and business risks for the region's energy future.
- CHP 101: Applications and Benefits of Combined Heat and Power (PDF), (24 pp, 651K), Bruce Hedman (Chairman, U.S. Combined Heat & Power Association) outlines the basics of CHP and cites specific examples where CHP reliability kept companies from losing power during the Northeast blackout of 2003. He also estimates industry-wide electricity and thermal use for hotels, casinos, and resorts and lists the benefits the industry could realize if CHP were more widely implemented.
- Why CHP Now? Identifying Opportunities and Realizing Benefits (PDF), (12 pp, 187K), Kim Crossman (Team Leader, EPA CHP Partnership) lists the environmental benefits generated by CHP and cites Nevada laws and incentives that positively impact CHP development. She also discusses the need to identify opportunities for CHP and reviews issues such as costs and planning.
- CHP Opportunities for Las Vegas Casinos: Rio All-Suite Hotel & Casino (PDF), (8 pp, 204K), Eric Dominguez (Director Energy Services, Harrah's Rio) describes the 4.9 MW CHP system that was installed at the Rio All-Suite Hotel & Casino, including benefits and lessons learned.
- Technical/Economic Case Study of the Seneca Niagara Falls Casino/Resort 6 MW CHP Facility (PDF), (22 pp, 1.2 MB), Frank DiCola (President, DCO Energy LLC) presents a case study of the CHP system at the Seneca Niagara Falls Casino, New York. The presentation includes a discussion of the process for considering CHP and determining appropriate sizing based on the electricity and thermal load profiles of the casino, in addition to cost information.
- Streamlining CHP in Nevada (PDF), (15 pp, 132K), Ted Bronson (President, Power Equipment Associates) outlines the important steps of implementing a CHP project and supplies advice on how to streamline the process.
- Combined Heat and Power: Natural Gas Opportunities for Las Vegas (PDF), (14 pp, 555K), Brian O'Donnell (Supervisor/Key Account Management, Southwest Gas Corporation) discusses natural gas supply and prices, as well as how Southwest Gas can provide natural gas to CHP customers in Nevada.
- CHP Opportunities: Interface with Nevada Power (PDF), (12 pp, 55K), Larry Holmes (Manager, Customer Strategy and Programs, Nevada Power) addresses issues that must be considered when connecting a distributed generation source (like CHP) to the Nevada power grid. He provides a description of the interconnection requirements and standby rate structure in Nevada.