Times Are Tough For Hotels: They’re Now Charging Extra For Your Room’s Electricity


Times Are Tough For Hotels: They’re Now Charging Extra For Your Room’s Electricity

by Gary Leff

When leisure travel was down, Caesars resorted to an underhanded tactic in Las Vegas: they raised resort fees, presumably hoping they could take more money from consumers than they realized they’d be spending.

Now that leisure travel in resort destinations is coming back in a big way, hotels are raising prices too by raising fees. Whether demand is low or demand is high, hotels have only Maslow’s metaphorical hammer: raise mandatory fees.

A year ago there was the Coronavirus fee. That built on top of venue fees and resort fees. Now how about energy fees?

All of them share these harms to consumers in common:

  • They are disingenuous because they are not optional, since it’s a cost that you must pay if you stay in the room that is part of the rate
  • Their only purpose is to mislead consumers, at least some hotels are honest and say they realize it’s deceptive but are forced to do it because competitors do and don’t want their rooms to look more expensive by comparison.
  • They’re drip pricing, because the room costs more than what you’re originally quoted
  • And they make comparison shopping difficult – sure, fees may get disclosed prior to confirming the booking, but the prices that are published by each hotel that you compare when you search are not the actual prices and aren’t even comparable since resort and other mandatory add-on fees vary by hotel

At some point we have to ask, what does the room rate even cover if it doesn’t come with electricity?

At least with resort fees hotels argue they’re giving you amenities that would cost more than the fee if purchased separately. But electricity? Odds on there’s no relationship between the power surcharge and the cost of power incurred by the room, in which case this one is ripe for a lawsuit like the class action settlement with British Airways, because fuel surcharges weren’t related to the cost of fuel.

Several state attorneys general were investigating hotel resort fees as a deceptive practice. That process has gone nowhere. Two years ago Washington, D.C. broke ranks and sued Marriott while several months later Nebraska sued Hilton. For those who thought they should hold back and wait on states to move forward together, since those suits were filed nothing happened with the consortium of states.

Hotel chains advertise prices that don’t include mandatory fees. The headline rate is what consumers compare when they’re searching. It’s only when they go to book that they see the price is higher than what was presented to them. That makes comparing prices difficult. And it puts hotels that are transparent, advertising the full cost of a stay, at a disadvantage.

Resort fees are unquestionably disingenuous, a mandatory fee to stay at a hotel is also called ‘the price’ and there’s no valid reason for separating it out. The same holds for any new mandatory fees hotels may come up with.

(HT: Live and Let’s Fly)

Gary Leff May 23, 2021 at 08:40AM

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