ผลกระทบจากมาตรการคว่ำบาตรรัสเซียของอังกฤษ The energy crisis is widespread in the UK: "The situation is absolutely crazy"

British pubs in crisis - 7 out of 10 could be forced to close

The energy crisis is widespread in the UK: "The situation is absolutely crazy"

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Petter J Larsson

PUBLISHED: LESS THAN 3 HOURS AGO

The energy crisis

LONDON. The price of electricity, gas and raw materials is skyrocketing.

Then seven out of ten British pubs are at risk of closure.

- I can't sleep at night, I'm waiting for a miracle, says restaurant owner Izabela Szypulska.

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 UK pubs have been hit hard by rising energy prices. If it gets really bad, many of the country's world-famous beer bars may soon have poured their last pint. For two-thirds of pubs in the UK, the bills are twice as high as last year. In a survey by trade magazine The Morning Advertiser, seven out of ten pubs state that they are at risk of closing again this winter if they do not receive financial support.

Hastings Wieloch, who runs The Kings Arms pub in Ealing, west London, sees rising electricity costs as a vicious circle.

- We have received higher everyday costs to run this pub. We have a hotel upstairs with eight bedrooms, which requires gas and electricity, and the prices have gone up, he says.

- The prices of beer have gone up because the breweries are forced to pay more to produce it. It is a vicious circle that affects everyone involved and the last to be affected is the customer and the small local communities.

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Hastings Wieloch runs a pub in West London. In order not to go backwards in the electricity crisis, a pint of beer must actually be raised to SEK 300. A vicious circle, he calls it.

Hastings Wieloch runs a pub in West London. In order not to go backwards in the electricity crisis, a pint of beer must actually be raised to SEK 300. A vicious circle, he calls it.Photo: Peter van den Berg

Several colleagues have already started to give up.

- I was at a football match with Chelsea at Stamford Bridge the other day and two of the pubs that me and my dad always used to go to before the games had closed.

Beer for SEK 300

According to the industry, a pint (roughly a pint) of beer would have to cost £25 – over SEK 300 – to break even. Hastings says it's the same at The Kings Arms. There, the pub's costs for a beer have increased by 400 percent. He wouldn't be able to raise prices that much.

- We will have to raise prices by at least 20 percent to get by, but we will have to take the rest of the hit, says Hastings.

The regular customers have a hard time as it is. Pensioner Liam Lehane, 66, bemoans prices rising everywhere.

- The bills will be even higher in October and I don't know how I will manage to pay them, says Liam.

He's sitting in his corner at The Kings Arms with his down jacket on.

- Soon I won't be able to go out and have a beer, and I'm not alone in that.

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Friends Helen King and Liam Lehane lament the rising prices in the community. "It's absurd," says King, whose expenses have risen by up to 80 percent.

Friends Helen King and Liam Lehane lament the rising prices in the community. "It's absurd," says King, whose expenses have risen by up to 80 percent. Photo: Peter van den Berg

His friend Helen King, 49, estimates her bills have increased by 70 to 80 percent.

- It's absurd, she says.

- I am having a very difficult time, but luckily I have managed to work a little more than usual so that I can bring in a little more money.

Building from the 17th century

The fact that the pub hotel is located in an old building does not make it any easier to keep costs down when autumn approaches. Many British buildings are heated with gas and poorly insulated - making the UK one of the countries in Western Europe hardest hit by the Russian gas cut.

- This is a building from the 17th century. They don't have the best insulation. People will want to put their elements on and stay warm during the winter and that will affect everyone, says Hastings.

- Right now we have been quite lucky to have had a warm and lovely summer, but the temperatures will drop. My main concern is for the elderly. They will be affected enormously. They need to be kept warm during the winter, which means more gas and higher bills.

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Visitors to The Kings Arms pub in Ealing, west London. Photo: Peter van den Berg / Peter van den Berg

Light the fire

Soon the pub's fireplace will need to be lit. Hastings is prepared to do what he can to keep costs down this fall.

- We have reduced the lighting, we have time settings on all the fridges - which is good for the climate - but we still have to think about the quality of beer and make sure it is at the right temperature for the customers. We are lucky to have a fireplace so, it will help us through the winter. You can use your resources as best you can.

. Earlier this week, the British government presented a support plan for the country's companies. This means that the energy bills from October and six months onwards will have a cost ceiling where the state will contribute the difference. Together with a similar ceiling for British household bills, the total support package is estimated to be worth the equivalent of SEK 1,800 billion, writes the BBC.

- They must resolve the situation. Not only the big problem with oil and gas, but also how they are going to get food products in, which due to Brexit there is a big shortage of at the moment, says Hastings.

"Not powerful enough"

According to the independent analysis company Cornwall Insight, the price cap could save business owners 45 percent of electricity bills, according to the BBC. But industry representatives are critical that the support is only valid for six months - and is not enough. At The Kings Arms, owners estimate the government's plan could reduce the overall cost increase from 400 per cent to 300 per cent.

- The government has clearly shown that they see that small businesses and various households are having a hard time, says Hastings.

- But for us, these measures will not be powerful enough for us to be able to return to normal. If you look at the costs from breweries and other supplies, we will still be in a position where prices have to rise, while our customers still have less money to spend. The fact that it only applies for six months means an uncertainty that we don't know how to plan around.

On Friday, Finance Minister Kwasi Kwarteng promised the government would prevent alcohol prices from continuing to rise in line with inflation. Among other things, planned increases in alcohol taxes would be scrapped. But that doesn't change anything for the prices today. Hastings believes it will take some time before the support causes the suppliers' prices to drop.

- I think many will use the high costs as a reason not to lower their prices. We will probably be affected throughout the winter. Hopefully everyone makes it through it, but it's going to be a tough winter.

"It's getting hard to cope"

A little further down the street is Kanenas Coffee. They capped their gas, electricity and water costs for three years from 2020 and have not been hit by the increased charges – yet. 

- I'm pretty sure it will be tough when that contract is over, says owner Roberta Amerini.

- It will be difficult for any company to cope, but as a business with food, we use everything very much; water to keep clean and tidy, electricity and gas to cook, so it will be very difficult with all the extra costs. In the long run it won't be sustainable, that's for sure.

Can't pay the bills

Eight years ago, Izabela Szypulska and her husband Pino put all their savings into opening a Neapolitan restaurant in Ealing. It quickly became a success.

- It has become like a local meeting place. Yesterday a man came here who had lost his partner. He cried and we took care of him. Someone else came here wondering how to find a one-room apartment and someone could help him with that, says Izabela.

- We put everything we had into this and now it's going backwards, now we can't even pay the bills. To remove this – I can't imagine it.

Izabela Szypulska worries that her Neapolitan restaurant will survive the fall.Photo: Peter van den Berg / Peter van den Berg

With the increased energy prices, she does not know if L'oro di Napoli will survive the autumn.

- We have big problems. It has hit us hard because everything here is powered by electricity. We start preparing our products early in the morning and our lights, air conditioning and ovens are powered only by electricity, says Izabela.

Two months ago, the restaurant's electricity bills were £1,800 a month. Now they have increased to 2,400 pounds - and it is expected to get worse in the autumn. And here, too, the combination of Brexit and rising energy costs has caused the price of Italian-imported food and drink as well as wood for the oven to skyrocket. Izabela is thinking of starting to close during the day on certain days, but then the staff will get fewer hours and risk quitting.

- And it is difficult to get new staff because there is none. Many Poles and Italians want to come here and work but they can't because they won't get a visa after Brexit. Everything is connected, says Izabela.

- When you have 20 people to take care of, and salaries increase and electricity bills rise, then you don't sleep at night.

"Waiting for a miracle"

A mother and her son come in and ask if L'oro di Napoli can sponsor an event for children in the area. Izabela offers them 15 pizzas. She does not mention that it is actually she who would need outside support.

- Now I'm waiting for some kind of miracle. I look at my expenses and wonder what I have to do to survive until next month and what I can do to cut down on expenses, she says.

L'oro di Napoli is forced to raise prices to cover the increased costs. But even so, it does not cover the losses they are now making. Photo: Peter van den Berg

But there aren't many more parts of the business to cut back on. She has tried everywhere.

They have added a pound, about 12 kroner, to the pizza prices. More would not go.

- People have known for years how much a margherita costs, I can't go from £7.50 to £10.50. "The costs have gone up by a lot more than a pound so I don't know how to piece this together," she says.

- Many businesses around us are closing down. My rent has also increased significantly. I have no answers. I just know that the situation is absolutely crazy, for me and many others.