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Business News of Tuesday, 10 December 2019

Source: 3news.com

High cost of utilities drowning hotels – Pres of Ghana Hotels Assoc.


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High cost of utilities is impacting negatively on hotel business in the country, President of the Ghana Hotels Association, Dr Edward Ackah-Nyamike Jnr, has said.

The development, he stated, has resulted in high operational cost for the industry.

The Public Utilities Regulatory Commission (PURC) on September 30, 2019 announced a 5.94% increment in electricity and 2.22% for water across board.

The increment was necessitated by the Ghana Cedi-US dollar exchange rate, inflation, price of crude and natural gas, fuel mix, power purchase cost and electricity cost.

“This is a sector that uses a lot of services. We are talking about plumbing, painting, and electricians,” Ackah-Nyamike Jnr said on Travel Pass on 3FM hosted by Francis Doku on Sundays.

Dr Ackah-Nyameike also cited regulatory and licences fees paid by hotel owners which add up to the cost, saying “all these come at a cost… when you put all these things together – salaries that we need to pay to our workers and then the almighty utilities – electricity, result in high operational cost”.

He added: “I have always wondered why electricity for business must be more expensive than electricity for domestic use. There are certain countries where the reverse is the case because it is logical that when you are doing business you will necessarily have to use electricity.

“In the domestic environment you can control the use of electricity. You can switch off the light as and when you wish so if you want to control cost you can switch your light off. But you can’t do that in the hotel business. So all these factors put together contribute to the high operational cost,” he stated.

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