Hotel industry prepares for LPG price hike

Hotel industry prepares for LPG price hike

Suherdjoko, The Jakarta Post, Semarang

The government's plan to raise the price of liquid petroleum gas
(LPG) by up to 44 percent in January next year comes as a severe
blow, hotel industry figures say.

To cushion the impact of the LPG price increase, hotels are
putting into place cost-saving measures.

Hotel Ciputra public relations manager Julia SKB explained
here on Monday the hotel used gas for cooking, laundry and
heating water continuously.

She said hot water was not something a hotel could cut back on
as guests expected it.

The same goes for kitchen and laundry activities, she added.

The hotel kitchen has turned to electric rice cookers, ovens
and microwave ovens, said Julia.

The 200-room hotel, with tariffs ranging from Rp 400,000
(US$40.00) to Rp 2 million, uses up to 6,333 kilograms of LPG per
month.

Public relations manager of the Grand Candi Hotel in Semarang
Yosie Indra Susilo said the five-star hotel required 6,500 kg of
LPG per month.

"We have been economizing in the laundry division. That's all
we can do. We have formed an energy saving team since October,
the task of which is to reduce costs," said Yosie.

To save electricity, hotel employees are
asked to take the stairs rather than the elevator if they are
only going up one floor or down two.

Prior to the price of LPG going up, hotels have been burdened
since October with a 400 percent increase in peak load
electricity tariffs from 5 p.m. to 10 p.m. called the Max Plus
electricity service.

Yosie hopes the 209-room hotel, which charges from Rp 880,000
to Rp 5 million a night, can reduce its costs by up to 20 percent
due to the energy conservation measures.

"Like it or not, we have to save in every field," said Yosie.

Hotel Ciputra employees are required to turn off all lights in
vacant rooms and can only use the elevator to go to floors above
the first floor.

People in the middle- to high-income bracket are also
rethinking their energy usage because of the planned LPG price
increase.
"We designed our kitchen around a gas stove. So we're a bit
confused," said Saraswati from Jatingaleh, here.

The wholesale price of a 12-kilogram tank of LPG is Rp 51,000
and the retail price between Rp 55,000 to Rp 58,000.

However, the price could surge to between Rp 75,000 to Rp
80,000 per tank.

"We have used a gas stove since we were newlyweds because its
cheaper and more convenient. I still remember when gas was
Rp 9,000 per tank, then it increased to Rp 18,000, then Rp
26,000.

"It later surged to Rp 35,000, and now the price stands at Rp
55,000," she said.

Saraswati said she would still use LPG to cook, even though
she would aim to reduce her total household expenditure.