HOFA: 300 % Increase in Electricity Tariff Will Destroy Hospitality Business

 Olawale Ajimotokan in Abuja

The Hotel Owners Forum Abuja (HOFA) has warned that the 300 per cent increase in electricity tariff for Band A customers will spell a doom for the hospitality industry.

It issued warning at a joint briefing it held with stakeholders including Abuja Chambers of Commerce and Industry (ACCI), Federation of Tourism Association of Nigeria (FTAN), Manufacturers Association of Nigeria (MAN), National Electricity Consumer Advocacy in Nigeria (NECAN)and Association of Master Bakers and Caterers of Nigeria.

HOFA President, Mrs Funmi Kazeem, warned the escalation in electricity tariff would kill hotel business in the FCT in a matter of a month given its implication for the industry’s sustainability and growth.

She said many hotels were still haunted by the impact of COVID-19 pandemic with plummeting occupancy rates, dwindled revenues and heightened operational cost associated with enhanced health and safety protocols.

Kazeem said the increase in energy cost, places an immense strain on hospitality establishments, eroding profit margins, and hindering their ability to invest in essential upgrades, innovations and guest amenities.

 In the face of this coupled with multiple taxes and other multifaceted challenges, HOFA urges regulatory authorities to reconsider the tariff hike and explore alternative solutions that balance the need for revenue generation with the imperative of supporting economic recovery and growth.

Also, the Chairman the BOT HOFA, Chika Chejina, said all boutique hotels of 20 rooms that were hitherto billed N1million per month now pay on the average N3.5 million per month, while those of 40 rooms, previously charged N2 million monthly were now paying N7.5 million per month as electricity tariff.

He urged government to urgently interfere saying if the situation perseveres, in a couple of months, many of those hotels will close up and throw their workers into the job market.