Short-Term Rental Industry Test Sustainability as a Standard

25.08.2023 - 14:00 / skift.com / Srividya Kalyanaraman

The short-term rental industry can be sustainable, but not without support and structure. As it currently stands, there are few institutional incentives and considerable regulatory obstacles to make sustainability a universal priority.

Some destinations are testing the waters, however, by instituting standards for sustainability. Think accreditation.

Global travel and tourism’s contributions to the global greenhouse gas emissions stand at  11 percent as of 2021 and that number is predicted to double by 2050. And, accommodations, which includes short-term rentals, account for roughly 10 percent of the total annual emissions of the tourism sector or 264 million metric tonnes of CO2-equivalent direct and controllable emissions, according to industry estimates. 

The United Nations World Tourism Organization announced its One Planet Vision in 2020 with lofty goals such as supporting wildlife conservation efforts through tourism, engaging the tourism sector in carbon removal, and accelerating the decarbonization of tourism operations. 

Lofty goals aside, the travel and tourism sector is barely grappling with containing the damage. 

So where do short-term rentals stand on this?

“At the moment, vacation rentals associations are busy fighting regulatory frameworks to actively think about sustainability initiatives,” said Simon Lehmann, co-founder and CEO of AJL Atelier, a consulting firm specializing in the private accommodation and vacation rental industry.  

Lehmann said that his firm offers consulting services to property owners and managers on sustainability and there is considerable interest among travelers to support sustainable stays. However, the incentives and infrastructure continue to be misaligned.

“We still don’t have many institutional owners, and there is an over reliance on individual property owners, who bear the cost of making the property more sustainable,” Lehmann said. “While more online travel agencies now say that consumers prefer sustainable properties, unfortunately, price is still a key determinant.”

In certain European markets such as Denmark, Italy and Spain, it’s common for guests to pay for the electricity consumed. But that’s more an exception rather than a rule. Even so, Lehmann noted that Europe is in the forefront of a lot of such initiatives and awareness.

The market for sustainable tourism will grow by $336 billion by 2027 — and 38 percent of the total market share growth will be from Europe, according to data from London-based market research firm TechNavio. The initiatives are specifically led by France, Germany, where governments develop different policies at the national level to encourage sustainable tourism. For instance, in April 2022, the French government banned