Environmental Initiatives in the Hotel Industry: Environmental Certification and the Marginal Abatement Cost Curve (MACC)

Abstract

Climate change is a pressing issue that has and will continue affecting all industries and sectors. Some industries have used the Marginal Abatement Cost Curve (MACC) as an environmental-financial communication tool to decide which environmental initiatives to implement. This tool provides information on environmental initiatives with their associated costs in the form of positive and negative abatements. It is quite possible that the MACC can be adopted by the hotel industry. Currently, the hotel industry has tried to do their part by reducing the negative impacts by implementing environmental initiatives. Many types and areas of focus of environmental initiatives are available to hotels. These include environmental initiatives that would reduce and improve energy usage and efficiency, reduce waste, reduce water usage etc. The hotel industries’ commitment to reducing its’ negative impacts on the environment is strong. Environmental certification programs are considered one way in which hotels are actively showing environmental commitment. However, only a portion of hotels is certified under such programs. There exists hotels that are not certified under these programs, yet are still implementing sets of environmental initiatives. This study sets to create industry-specific information in order to assist hotels in making decisions to adopt more environmental initiatives. In particular, the study will explore whether environmental certification programs influence the adoption rates of environmental initiatives in hotels and therefore to understand the reception of the MACC tool in the hotel industry. Study findings suggest that hotels that are environmentally certified under programs adopt more environmental initiatives than hotels that did not certify. The study notes that the level of interest for a proposed MACC in the hotel industry is low, but indicates that the possibility exists. Further, the improvement and development of environmental certification programs could assist and increase environmental initiatives adoption rates.