Energy Policy 39(2011)7389-7398 Contents lists available at SciVerse ScienceDirect Energy Policy ELSEVIER journal homepage:www.elsevier.com/locate/enpol Success factors of energy performance contracting(EPC)for sustainable building energy efficiency retrofit(BEER)of hotel buildings in China Pengpeng Xu*,Edwin Hon-Wan Chan,Queena Kun Qian Department of Building and Real Estate,The Hong Kong Polytechnic University.Hong Kong SAR,PR China ARTICLE INFO ABSTRACT Article history: Hotel building is a type of high-energy-consuming building and most existing hotel buildings need Received 25 March 2011 energy efficiency improvement in China.Energy performance contracting (EPC)is considered a Accepted 1 September 2011 win-win mechanism to organize building energy efficiency retrofit (BEER)project.However,EPC Available online 16 September 2011 mechanism has been introduced into China relatively recently and many EPCs have not been successful Keywords: in building energy efficiency retrofit projects.This research aims to develop a set of critical success Energy performance contracting (EPC) factors(CSFs)of EPC for sustainable energy efficiency retrofit(BEER)of hotel buildings in China.Semi- Critical success factor(CSF) structured interviews and a questionnaire survey with practitioners and other professionals were Building energy efficiency retrofit conducted.The findings reveal the relative importance of the 21 number of identified success factors.In order to explore the underlying relationship among the identified critical success factors(CSFs),factor analysis method was adopted for further investigation,which leads to grouping the 21 identified CSFs into six clusters.These are (1)project organization process,(2)EPC project financing for hotel retrofit. (3)knowledge and innovation of EPC,sustainable development(SD),and M&V,(4)implementation of sustainable development strategy.(5)contractual arrangement,and (6)external economic environ- ment.Finally,several relevant policies were proposed to implement EPC successfully in sustainable BEER in hotel buildings. 2011 Elsevier Ltd.All rights reserved. 1.Introduction (Deng and Burnett,2000).Surveys in 2006 shows that hotels in Beijing have electric consumption of 100-200 kWh/(m2a)(Xue, For the past decades,building energy consumption in China 2007).whilst the range is 55-144.3 kWh/(m2a)for Chongqing has been increasing at more than 10%each year.In 2004,building (Zhou et al,2008).Nine starred hotels in Shanghai show an average energy consumption alone constituted 20.7%national energy energy consumption of 750 kWh/(m2a)(Xue,2007).Hotel buildings consumption and this will be increased to 33%by 2010 (Jiang in general with high energy consumption have a large potential for and Yang.2006;Liang et al.,2007:Chan et al.,2009).Building energy efficiency improvement. energy consumption in large-scale public buildings and commer- Building Energy Efficiency Retrofit(BEER)provides excellent cial buildings,such as offices,hotels,retails,hospitals,and opportunities to reduce energy consumption in buildings as well schools,is up to 70-300 kWh/m2,which is 3-8 times of common as encouraging implementations of other sustainability such as public buildings and 5-15 times of that in urban residential environment protection,rational resources use,and occupants' buildings (THUBERC,2007).Hotel building is one type of large- healthcare.Building Energy Efficiency Retrofit (BEER)is a process scale public/commercial building and its main energy consuming to reduce building operation energy use by certain approaches of systems are heating.ventilation and air conditioning (HVAC). building envelope and mechanical systems improvement,whilst lighting,hot water provision,electricity (lifts,etc.).and cooking. keeping building indoor environment and comfort (Shanghai There is a lack of statistical data about detail energy consumption in Construction and Transportation Commission,2008).BEER has China and hotel energy consumption varies in from one building to significant benefits to society,owners and occupants of buildings. another.Varying occupancy rates throughout the year and varied They include (i)improving environment by reduction of CO2 personal preferences of guests for indoor environment will lead to emission;(ii)saving money on utility bills and reducing main- different operating schedules of building services systems and tenance cost;(iii)creating jobs and career opportunities;and therefore different energy consumption situations in hotel buildings (iv)enhancing comfort,safety and productivity in workplace and community spaces.The process also modernizes buildings and brings operations in line with best practices,which will upgrade *Corresponding author.Tel:+852 6157946;fax:+852 27645131. staff credentials with new knowledge.Sustainable development E-mail address:xupp.cn@gmail.com (P.Xu). as a concept has been gaining increasing popularity across various 0301-4215/S-see front matter 2011 Elsevier Ltd.All rights reserved. doi:10.1016j.enpol..2011.09.001Success factors of energy performance contracting (EPC) for sustainable building energy efficiency retrofit (BEER) of hotel buildings in China Pengpeng Xu n , Edwin Hon-Wan Chan, Queena Kun Qian Department of Building and Real Estate, The Hong Kong Polytechnic University, Hong Kong SAR, PR China article info Article history: Received 25 March 2011 Accepted 1 September 2011 Available online 16 September 2011 Keywords: Energy performance contracting (EPC) Critical success factor (CSF) Building energy efficiency retrofit abstract Hotel building is a type of high-energy-consuming building and most existing hotel buildings need energy efficiency improvement in China. Energy performance contracting (EPC) is considered a winwin mechanism to organize building energy efficiency retrofit (BEER) project. However, EPC mechanism has been introduced into China relatively recently and many EPCs have not been successful in building energy efficiency retrofit projects. This research aims to develop a set of critical success factors (CSFs) of EPC for sustainable energy efficiency retrofit (BEER) of hotel buildings in China. Semi￾structured interviews and a questionnaire survey with practitioners and other professionals were conducted. The findings reveal the relative importance of the 21 number of identified success factors. In order to explore the underlying relationship among the identified critical success factors (CSFs), factor analysis method was adopted for further investigation, which leads to grouping the 21 identified CSFs into six clusters. These are (1) project organization process, (2) EPC project financing for hotel retrofit, (3) knowledge and innovation of EPC, sustainable development (SD), and M&V, (4) implementation of sustainable development strategy, (5) contractual arrangement, and (6) external economic environ￾ment. Finally, several relevant policies were proposed to implement EPC successfully in sustainable BEER in hotel buildings. & 2011 Elsevier Ltd. All rights reserved. 1. Introduction For the past decades, building energy consumption in China has been increasing at more than 10% each year. In 2004, building energy consumption alone constituted 20.7% national energy consumption and this will be increased to 33% by 2010 (Jiang and Yang, 2006; Liang et al., 2007; Chan et al., 2009). Building energy consumption in large-scale public buildings and commer￾cial buildings, such as offices, hotels, retails, hospitals, and schools, is up to 70–300 kWh/m2 , which is 3–8 times of common public buildings and 515 times of that in urban residential buildings (THUBERC, 2007). Hotel building is one type of large￾scale public/commercial building and its main energy consuming systems are heating, ventilation and air conditioning (HVAC), lighting, hot water provision, electricity (lifts, etc.), and cooking. There is a lack of statistical data about detail energy consumption in China and hotel energy consumption varies in from one building to another. Varying occupancy rates throughout the year and varied personal preferences of guests for indoor environment will lead to different operating schedules of building services systems and therefore different energy consumption situations in hotel buildings (Deng and Burnett, 2000). Surveys in 2006 shows that hotels in Beijing have electric consumption of 100–200 kWh/(m2 a) (Xue, 2007), whilst the range is 55144.3 kWh/(m2 a) for Chongqing (Zhou et al., 2008). Nine starred hotels in Shanghai show an average energy consumption of 750 kWh/(m2 a) (Xue, 2007). Hotel buildings in general with high energy consumption have a large potential for energy efficiency improvement. Building Energy Efficiency Retrofit (BEER) provides excellent opportunities to reduce energy consumption in buildings as well as encouraging implementations of other sustainability such as environment protection, rational resources use, and occupants’ healthcare. Building Energy Efficiency Retrofit (BEER) is a process to reduce building operation energy use by certain approaches of building envelope and mechanical systems improvement, whilst keeping building indoor environment and comfort (Shanghai Construction and Transportation Commission, 2008). BEER has significant benefits to society, owners and occupants of buildings. They include (i) improving environment by reduction of CO2 emission; (ii) saving money on utility bills and reducing main￾tenance cost; (iii) creating jobs and career opportunities; and (iv) enhancing comfort, safety and productivity in workplace and community spaces. The process also modernizes buildings and brings operations in line with best practices, which will upgrade staff credentials with new knowledge. Sustainable development as a concept has been gaining increasing popularity across various Contents lists available at SciVerse ScienceDirect journal homepage: www.elsevier.com/locate/enpol Energy Policy 0301-4215/$ - see front matter & 2011 Elsevier Ltd. All rights reserved. doi:10.1016/j.enpol.2011.09.001 n Corresponding author. Tel.: þ852 6157946; fax: þ852 27645131. E-mail address: xupp.cn@gmail.com (P. Xu). Energy Policy 39 (2011) 7389–7398