The sharp rise in electricity prices came as a nasty surprise to Turkish hoteliers, and could have a number of unpleasant consequences for the market in the long run. This was announced by representatives of the hotel business in the province of Antalya. In the industry, the situation is called “electroshock”.
Since January 2022, Turkey has seen a sharp increase in electricity tariffs for both private and commercial consumers. As a result, according to some data, the growth ranged from 50% to 125%, but in fact, due to the changed payment system, the growth for consumers was up to three times.
“For hotels, the cost of electricity is one of the three main items of expenditure on the All Inclusive system, along with staff and food,” explains Anna Yiit, Pine Beach Deputy General Manager. – The figures make it clear how much this additional burden for the hotel business. In our Pine Beach Hotel with 742 rooms open 12 months a year, the difference in the cost of electricity for the whole of 2022 will be 800 thousand euros more than planned in the original budget.
Hotel operators unanimously point out that electricity is one of the main items of business maintenance costs, and its multiplier increase will inevitably affect the entire economy of the industry.
Tariff increases have been announced in advance, and hotels have included these costs in contract prices. But in some cases, hoteliers could not fully insure themselves. For example, not everyone took into account that tariffs have a “stepped” structure: if a certain level of consumption is exceeded, the tariff increases significantly. All this is happening against the background of rapidly accelerating inflation, which has already led to an explosive rise in food and alcohol prices – key items of hotel spending on all-inclusive.
“Electricity will be one of the main items of expenditure in the near future, and such tariffs will not be affordable for many hoteliers. It is very important now to work on reducing the load, “said Gengiz Topchu, owner of Exotic Tour and member of the board of ALTAV, in a conversation with Yeni Alanya.
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“Unfortunately, the cost of food, alcohol and energy is showing incredible growth. Each of these points has grown by at least 60%, said Ali Orkan, president of the Konakli Association of Tour Operators and a member of the ALTID board. – If we consider the average for the season and occupancy, the 4-star facility with 80-100 rooms will have an average of 100 thousand Turkish lira energy consumption in the summer months. Similarly, the monthly energy cost of the facility for 300 5-star rooms will be at least 500 thousand Turkish lira. We look forward to the support of our government, private producers and energy distribution companies.”
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According to Anna Yiit, the increase in energy tariffs was another negative news for the whole market after the sharp rise in wage funds. The collapse of the Turkish lira has led to the need to sharply increase wages by at least 50-60%, which has become a very serious burden for hoteliers and has already led to a shortage of staff in the market.
Hotels are now considering all options, but are doing their best to reduce the impact of increased costs on the cost of living. Speaking of our hotel, we are working hard to increase occupancy. In this case, the prices for accommodation for tourists may remain at the same level, “says Anna Yiit.
She also reminded that a turnover tax for hotels in the tourism promotion fund had been introduced in Turkey since last year. It also significantly reduced the income of hoteliers. Turkey’s tourism sector is also outraged by the salary, which is the lowest in the Turkish list of professions.