‘It’s just not sustainable’: Rising energy costs may force hotels to close for the winter

Irish hoteliers could be forced to close in winter as energy bills skyrocket by tens of thousands of euros.

Business owners have said their investment and expansion plans could be shelved in the face of the “triple strike” of soaring electricity, gas and oil prices.

Craft shops, food companies and hoteliers are “deeply concerned” about the future as a very long and harsh winter looms.

The manager of the 131-room Kingsley Hotel in Cork, Fergal Harte, revealed gas and electricity bills have risen by 360 per cent.

“We have a large spa and health club, we have a thermal suite and luckily we have a very good occupancy rate in the winter,” said Mr. Harte.

“But all of this means that we are a 24/7 operation with significant energy demands.

“We have done everything we can to reduce our energy consumption – we have a green energy team here at the hotel – and we invest in energy-saving systems.

“But none of this can be achieved overnight.

“It also requires investment and this is where we need the government to help us.”

Darren Madden, who runs the popular Clew Bay Hotel in Westport, Co Mayo, said his gas bills have increased by a staggering 1,100 percent in less than two years.

He warned that some businesses may now find it easier to shut down operations during the energy-intensive winter months rather than deal with staggering bills.

“We feel it in the prices we’re paying for everything right now,” he said.

“It’s really hurting companies that are big energy consumers because the prices of oil, gas and electricity for commercial heating are huge right now.

“I’ve been trying to set an annual price contract for our gas and since what I did last September I’ve seen my bill go up 11 times – it’s just not sustainable.

“I don’t know where it’s going – it’s a huge, huge problem,” he added.

Mr Madden, chairman of the Mayo branch of the Irish Hotel Federation, said the government faces major challenges in the 2023 budget.

“Some businesses will come under pressure, which may make them consider whether it’s easier to close for the winter and cut those costs than stay open and try to pay big (energy) bills,” he said.

Mr Madden said the challenge for the Government is to help these companies stay open to keep their workers in employment.

Rob Horgan, owner of Velo Coffee, said Irish businesses are not only concerned about rising electricity and gas prices, but are also being hit by rising distribution costs due to the rise in petrol and diesel prices.

“We’re one of the lucky few, having just signed an electricity contract in the weeks leading up to Russia’s invasion of Ukraine and the spike in energy prices,” he said.

“But we still saw that the costs went up by about 35 percent.

“Our concern is what will happen in the future if we terminate this contract.

“Companies expect electricity costs to double and even triple.”

Mr Horgan said that while the main focus has been on gas and electricity prices, the impact of petrol and diesel costs could be just as severe for Irish businesses.

“I would estimate that our diesel bill went from around €1,200 to over €2,500,” he said.

Velo Coffee expanded dramatically during the Covid-19 pandemic as the world rediscovered its love for quality coffee and sales soared.

The company now employs 21 people, has 20 coffee brands and exports to 47 countries.

But Mr Horgan said the spiraling energy crisis has forced them to adapt.

Elmarie Mahon, chief executive of cork ceramics company Charlie Mahon Ceramics, said they were also dealing with “significant” increases in their energy bills.

Ms Mahon said it was a worrying time for small Irish businesses.

“We have three ovens, they’re all electric and they’re on all the time,” she said.

“Our courier service closed, so we had to look for a new company.

“We recently had an order for three records to be shipped to Texas and the delivery charge was €157.”

She added, “There are many concerns about what the future will bring.”

https://www.independent.ie/irish-news/news/its-just-not-sustainable-surging-energy-costs-may-force-hotels-to-close-for-winter-41977761.html ‘It’s just not sustainable’: Rising energy costs may force hotels to close for the winter

Fry Electronics Team

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