Hotel operators are likely to look at alternative ways of power generation, such as installing solar panels, in the wake of electricity price hikes proposed by Belco last week.

Commercial users face an average increase of 15 per cent on their monthly electricity bill, with the largest commercial users seeing a rise of between 8 per cent and more than 20 per cent, according to the utility company.

For hotels, the cost of electricity accounts for a significant part of operating expenses. And while hotels can reduce electricity usage to some degree, they also have obligations to ensure public areas are well lit and guest facilities, such as heating and air conditioning, are maintained at appropriate levels.

Responding to news of the proposed increase in electricity prices, Stephen Todd, vice president of the Bermuda Hotel Association (BHA), said: “The concern that we have is this represents a significant increase to the overall expense that each of our members would incur.

“They would have to look to see if they can reduce electricity consumption.”

Mr Todd said hotels already have plans and programmes in place to minimise operating costs. He added that hotels would probably look at alternative methods of sourcing electricity, such as solar energy.

“That may be a consideration, although it would come at an initial cost.”

Mr Todd said the BHA was still in the process of assessing the likely impact of the proposed hike in electricity rates.

Belco’s proposed changes to the base rate, which were announced last Wednesday, have been submitted to the Energy Commission, which has the final say on whether or not to permit the new rates.

The utility firm also wants to increase facility charges by one fifth.

Mr Todd said hotel operators are continuing to work to attract more guests to their properties, and would therefore be cautious about countering additional operating expenses by increasing room rates.

Other businesses on the Island with high electricity usage are thought to have similar concerns about the impact of the proposed hike in electricity prices.

The MarketPlace supermarket chain, which operates from eight locations across the Island, estimates it would face paying at least an additional half-a-million dollars for electricity each year if the proposed new rates become a reality.