How event planners can get a hold on rising energy prices

Soaring energy prices are causing an impact on which destinations planners choose to hold their events.

Hosting events in destinations with high energy prices require the consideration of multiple factors.
Hosting events in destinations with high energy prices require the consideration of multiple factors. Photo Credit: Adobe/ra2 studio

Headlines all over the world in the last few weeks have been focused on escalating energy prices, particularly in the UK, with research from Deutsche Bank showing the UK has higher energy prices, comparative to other economies in Europe. The situation is equally bleak in the US, with energy prices expected to spike before winter. 

Much of the attention has been focused on households but with energy prices showing little signs of any decrease, it begs the question of how venues - such as hotels, conference centres and meeting spaces are faring, and whether planners in other regions, such as APAC are shunning those destinations that are reporting high energy costs. 

Ian Cummings, global head at CWT Meetings & Events says that higher energy are keeping prices across Europe and the UK at a premium for the foreseeable future and into 2023: “At present, we remain with high pent-up demand, despite the increased prices of accommodation and F&B, but venues will have little choice than to pass this onto clients. Concerns remain around higher pricing, which lead to eventual cancellations due to budget constraints.”

Cummings adds that corporates [from within Asia and elsewhere] will need to make informed decisions about locations, number of attendees, measurable ROI on events and apply a rigorous approval process, if hosting events in those destinations with high energy prices. 

“The need for people to meet remains as high as it ever has been, fuelled by the great “working from home” switch in work practices post-pandemic, and therefore corporates must be prepared to encourage the power of human connections to ensure alignment, connectivity, culture and engagement,” he says.

“Location choice will be very important and there will always be areas looking to remain competitive compared to the main European capitals such as London, Paris, Milan and others. Secondary cities can often represent better value for money and therefore in the UK, the likes of Manchester, Liverpool and Birmingham should all be considered when selecting a location.”

At a recent webinar hosted by AIPC, the International Association of Convention Centres, participants discussed the impact of rising energy costs on convention centres, with some suggesting that venues should not bear the brunt of these higher energy costs. The discussion suggested that venues could consider asking for a share of the event profit, to offset the higher costs of energy from hosting the event. 

Martin Boyle, chief executive officer at The International Association of Professional Congress Organisers (IAPCO), who took part in the webinar, said: “[All event stakeholders] benefit if they work together so a shared risk model is a really interesting point. Now is as a good a time as any to have those types of conversations with PCOs and clients.”

Natalie Crampton, founder of Dubai-based agency TEC, says that taking into account rising energy prices when choosing a destination is proving to be a challenge, as many corporate clients have caps on what they are allowed to spend at events. 

“A large number of corporate client EMEA offices are in the UK and budgets given are often in GBP… they will now be getting less than ever for their money - could they now look to other destinations such as Turkey or Morocco?,” she asks. 

Crampton suggests that soaring energy prices may lead to venue expectations being revised or lowered, for example considering a four-star venue over one with five stars.

“We could potentially see companies cutting budgets, “ she adds. “For example, if they were going to send five people to an event, they may now decide to only send three.”