Are energy fees about to make a comeback?

Do you have the power? / Photo by ykanazawa1999 - Flickr
The Oyster Bay Beach Resort is a highrise hotel in St. Martin that promises guests white sand beaches, “breathtaking” views of the Caribbean and a “paradise found.”

But Jack Permadi says he found more than that when he stayed at the property recently. Permadi, who had traveled to the island from North Royalton, Ohio, for vacation, says the hotel asked him to pay extra for something that’s normally included in the price of a stay.

“When we checked in, we were asked to accept or reject a mandatory $12 per night utility charge for the week,” he says. “We rejected it, thinking it covered air conditioning — which we do not use.”

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But that didn’t work.

“When we checked out, we found an $84 charge, and when we objected, we were told it covered all utility costs and had to be paid by everybody,” he says.

Permadi wonders if a hotel is allowed to quote a price that excludes utilities without notifying a guest in advance.

I put that question to the Oyster Bay Resort. It didn’t respond.

Mandatory utility fees became popular in the United States about a decade ago, but most hotels dropped them after a series of lawsuits brought against them by angry customers. The most high-profile was a series of complaints against Wyndham International settled in 2006 (PDF). Various hotel guests accused the company of quoting a room rate but then adding a mandatory fee that covered energy costs, among other things.

The Oyster Bay surcharge sure brings back memories. And they aren’t good ones.

I couldn’t find any mention of the utility surcharge on its site, Permadi says it wasn’t disclosed when he booked the room, and the hotel didn’t want to talk about it, despite repeated efforts to reach it.

That makes me suspicious, to say the least.

Will energy fees start to spread again? Anything is possible. If enough guests agree to pay $12 a day for electricity and water at the Oyster Bay, then what’s to stop nearby resorts like the Colombus Hotel or the Sol from adding them, too? And then — who knows?

But should they be allowed?

I understand a hotel’s perspective on this issue. You want rates to be competitive, which is code for low. Why not quote a base rate, but then add a mandatory resort fee or energy surcharge, which will increase revenues and may even have some tax advantages, depending on where your hotel is located.

Another argument I hear often is that in the interests of “transparency” the hotel is breaking out its expenses, so guests can know how much it costs for utilities or operating a swimming pool. That’s a little bit of a stretch.

But still, as long as you disclose the fee somewhere in the booking process, it’s perfectly legal — right?

Guests don’t necessarily see it that way, though. They believe the room rate is all they’ll have to pay, except maybe taxes. They’re not really curious about the economics of running a hotel, so transparency isn’t an issue. What is an issue is paying significantly more than they thought they would for their accommodations.

Should hotels be required to quote an “all-in” price? As your consumer advocate, I think you know the answer.

But let’s try a more nuanced question: Are the hotels right — should they be permitted to quote a low base rate that doesn’t include mandatory extras, as long as they’re adequately disclosed, in order to keep their rates low?

Or should they be required by law to quote a rate that includes everything?

Permadi, for his part, isn’t that upset by the energy fee.

“We have stayed at the Oyster Bay Beach Resort before and will return in the future,” he told me. “I just find this to be a bad practice and would rather they be up front with the cost right from the start.”

Update (5/25): Just received the following email from Ricardo Perez, the hotel’s general manager:

We do not charge energy surcharge to regular paying resort guests. We do charge a $12 per day energy surcharge for a two bedroom and $7 for a studio apartment for our timeshare guests and exchangers given the high level of utility costs on the island.

We pay over 42 cents per KWH in St. Maarten and since the water is desalinated also the cost per cubic meter is very high.

In addition we would like to also clarify that we clearly state on our confirmation letter the energy surcharge is charge upon check out. We will be more than happy to supply you with a copy or our standard confirmation letter.

57 thoughts on “Are energy fees about to make a comeback?

    1. Yep.  I don’t have a problem with a breakout of fees, as long as the total price is fully disclosed.   But DO NOT call it a mandatory extra, as it is obviously not a matter of choice! 

  1. “If enough guest agree to pay $12 a day for electricity and water at the Oyster Bay”

    Except it sounds like the OP tried rejection when given the option, and it didn’t work.

    You then discuss how hotels break out and disclose the fees.  But this fee, according to all accounts, was not disclosed.  I don’t care what rate they quote, as long as I can view an “all-in” rate *before* going through the motions of booking. 

    And if anyone ever tries this, I’ll dispute the charge to my credit card.

  2. If the fee is mandatory, why are the guests offered the opportunity to accept or reject it? And if they choose to reject it, why does the resort get to charge them anyway? This makes no sense…

  3. Just another resort to avoid.

    It’s no different than the mandatory “resort” fee; it just has a different name. I don’t think hotels should be allowed to “unbundle.”

    What’s next? Charging $2 a roll for toilet paper?

      1. And these people come here to read Chris’s column, too.  Now that it’s out there, it’s coming…

    1. I think they will charge $5 a roll for the toilet paper and include paper towels (which most people in hotels don’t use) just to justify the higher rate.  That’s what they seem to do with resort fees…add in some extra things most people don’t use.

  4. I am a strong advocate for the total cost being presented at the time of booking.  If they break it later, or on the confirmation fine, but they still need to show the total up front so people can make an honest comparison between properties.
    I wonder why the Bay Beach Resort presented this fee as optional, when the clearly charged it anyway.

  5. Most people on here will realize that I normally don’t have a big issue with ala carte pricing as long as its disclosed. However, I do have an issue will mandatory fees that are added on after the fact. I’m not even a fan of hotels hiding the taxes since a number of localities (Orlando) take every opportunity to stick it to non-locals.

    There’s no way in my book that this is right.

  6. Much as we hate paying any kind of surcharge, it’s all over the map. Airlines do it without hesitation. Heck even UPS and FedEx have a fuel surcharge. It’s hard to understand your hospital bill, phone bill, cable bill, hotel bill, parking bill, etc. Why am I not surprised a resort in St. Maarten has one, too? The only problem I have with Oyster Bay’s energy surcharge is if was not disclosed properly when you were booking the room. I could not find it in their website (fee section). It would be good if all vendors quote an all inclusive rate (like the DOT forces airlines to do), but that solution is too easy.

    1. Hospital bills are in a whole different league. I’ve never encountered anything as hard to decipher. It seems like everybody who sticks their head into the room ends up sending a separate bill, they itemize in code, and even if you know exactly what they’re charging you for it’s impossible to say whether it’s legitimate or not. (Were those medications actually given? Was the procedure done in this way to incur Charge A or the very similar way which would be Charge B?) They’ve got you completely over the barrel.

      1. Several years ago, I went to a specialist and evetually was charged what I thought was an exhorbitant rate for what was maybe 35 minutes of consultation. I actually took the time to learn all of their “secret codes” and what they meant. Now, this wasn’t nearly as complicated as a several-day stay in the hospital, but it did involve some deciphering. It’s amazing how quickly the hospital backed off once I presented them with a detailed description – in their own terminology – of what I thought the bill should be. Most people won’t go to the trouble – this was the first and so far, only time I’ve done this – and the hospital knows it. Guranteed that your cable company, dentist office, insurance company, etc. all take advantage of complex contract clauses and confusing language to get more money than they deserve from their customers.

  7. In my opinion, anything that is mandatory such as fuel or electricity (except for taxes) should be included in the price. Not putting these items in the price is clearly deceptive pricing. 

  8. This is a cost of doing business….it should be in the rate, period.  And if a hotel were to charge for toilet paper, as another poster said they might…there is a solution.  Shit on the floor, and wipe your arse on the (for now) complimentary towels.  My cousin had been thinking of staying at the Oyster Bay….no longer.  Their silence on the issue says 1000X more than the charge itself.  

  9. If it is mandatory, it needs to be included in the room rate.  This goes for so called “resort fees” too

  10. It’s a sign that this category Hotel which are desperate for cash are on the brink of bankruptcy. So you can anticipate the cut on personnel and the probable level of service. So avoid absolutely this kind hotel who practice theses added fees and extra charges which you cannot avoid in any circumstance, so why these fees and extra are separated? The only reason is for the search engine to compare rate. Now it’s the responsibility of the search engine to include these extra and fees to prove the reliability and accuracy of the comparison.

  11. Sounds to me like he would have a case for a credit card dispute over an unauthorized charge.  They asked him to approve it.  He declined.  They charged him anyway.  Pretty cut and dried to me.

    1. I stayed at a JW Marriott once that charged me a non-disclosed fee and even added some extras like Internet that I didn’t use and a second room for one night. I disputed my bill at the front desk and they would not budget on the charges, and said I have to sign a copy for them or I can’t leave (This was in a remote location and I was using their airport transfer service, there was no longer time to arrange for a taxi as my flight was going to leave).  So I simply wrote, not signed, my name and wrote the words “Under Protest” next to my name and crossed off the bogus charges.   
      When I got my statement, they charged my card the additional fees anyway.  I e-mailed and called the hotel and never heard back.  I e-mailed Marriott and they simply forwarded my information to the hotel who never responded.  Then I disputed it, they countered showing another copy of the bill, with a clearly forged version of my signature.  The credit card company sided with the hotel stating that had my signature authorizing the charges.  The hotel then proceeded to charge my credit card an additional $200 out of the blue. I again lost the dispute.
      I finally ended up sending certified letter with copies of everything to Bill Marriott directly at the corporate headquarters and someone in the office reached out to me.  She contacted the hotel, and stated they must refund the bogus charges. After the GM sent a rude e-mail to the corporate office and myself, Marriott corporate forced a refunded the bogus charges, as well as all of the legitimate charges in full.  It was a nightmare, but I got more than my money back. 
      The moral, disputing doesn’t always work, and even big name hotels can have dirty business practices.

    1. I think some take it as give a total, but give a breakdown of each of the charges.  That would be fine, provided the total is clearly stated.

      1. Exactly.  If a hotel wants to show a $80 rate on their website, and the break it out as $50 base rate/$10 utility surcharge/$10 for internet/$10 for parking, frankly, I couldn’t care less, because I’ll know I’m going to be charged the $80.  What DOES bother me is when said hotel advertises a $50 rate on its website, then tacks on a $30 mandatory “resort” fee buried in the fine print. 

        If a charge is mandatory, it should be in the base rate, period.  How they choose to break down that base rate is up to them.

  12. If a hotel doesn’t disclose “mandatory extras” when quoting a room rate to make it appear lower, the room rate isn’t actually low. As a consumer, I assume the cost of electricity, etc, is included in the room rate.  It’s a cost of doing business.

  13. One price for me, or forget you!  I don’t need surprise charges.  I don’t need $125.00 per day extra (for services) on top of the room charge for all inclusive resorts.  I should not have to read the fine print to find out what I will be additionally charged for.  Wise up resorts, or you are on your way out!

  14. This is bogus in every way, shape and form.  If he’s given the option to refuse it, he shouldn’t have to pay it on the way out.

    This is just another example of tourists and travelers not being looked on as people but as a point of increased revenue stream.  We’re being fee’ed to death and no one cares.

    The next time I go to buy a car will there be fees for tires, keys, windows? What’s next?

  15. If the fee isn’t disclosed at booking, it isn’t so much an example of un-bundling as it is an example of outright misrepresentation.

    Un-bundling in and of itself is fine in theory when it is disclosed, but the problem in practice is transparency.

    I can easily compare the (often meaningless) base rates at dozens of hotels in 30-seconds flat.

    But if I want to include taxes, resort fees, parking, internet, etc., I need to drill individually into the weeds of each hotel’s terms and sift through information that is generally not formatted or presented consistently.

    That 30-second search easily becomes a 30+ minute human-error-prone process that requires building a spreadsheet.

    And then what happens if the parking and internet fees increase between the date you book and the date you arrive?

  16. The fact that they are going to charge mandatory fees for utilities is absurd. When I book a hotel room I expect that the price I’m quoted includes all amenities available in the room, not just the square footage of the room, then I have to pay extra for the electricity and water that I use.

  17. You have stopped offering all of “facts”. Where was this reservation made? How was it paid for? Who  confirmed the reservation?  Please remember that you are dealing with an international reservation. If the reservation were made through a US wholesaler, they would have the responsibility of A) advising of the fee, or B) I get them refunded if not noted. We have resort fees in many vacation destinations, Key West, Las Vegas, Hawaii to name a few. It’s legal, but I hate that it is not included in your daily rate. There are no laws about disclosing rates when you are dealing with an international destination on your own. Again….get an ASTA traval agent that you can talk with one on one. There is another major trick to have these feed refunded, but again, only your travel agent will tell you. $86.00 against my $0.00 fee, as I get a commission direct from the hotel; how travelers waste their money.

    1. Where do you see in your hotel reservation system that this place charges $12/night for energy surcharge? It’s not in my GDS or Travelport’s Hotel System (which also uses Utell/Pegasus). What are you using to book rooms? How can a TA have avoided the same problem for this particular property? I would have not known this charge myself had I simply booked it in GDS.

  18. The Hyatt Regency Newport (Rhode Island) has a mandatory “resort fee” that varies with the season.  The “resort fee” does not appear in any major search engine, only after you check availability on their web site.  I can’t understand how they justify the fee difference at different times of the year.  The entire practice of hidden, mandatory fees is unethical and disgusting.

    Resort fee of $20 per room, per night October – April and $35 May –
    September includes high speed wireless Internet access in guest room,
    overnight self parking, Hyatt shuttle van transportation to/from
    downtown Newport, All-electric Hyatt water shuttle to/from downtown
    Newport, 2 free bottled waters per guest room per night, 24 hour access
    to Fitness Center, Unlimited local phone calls and on property resort

    1. Do they have an outdoor pool?  The schedule matches up with the pretty standard Memorial Day to Labor Day pool season.

      1. Joe: Yes they have an outdoor pool but it’s not mentioned in the description of the services covered by the fee.  I suspect the real reason is “just because we can get away with it during our high-season” than that the outdoor pool is open.

        An business (not just hotels/resorts) that has any hidden but mandatory fees should be called-out, shamed and disputed with management at check-in and check-out if you can not avoid staying there.  Anyone arranging conventions or meetings should negotiate the fees away or find somewhere else to hold it.

        1. I was just guessing that “on property resort activities” would include the pool. I totally agree with you on the problem of hidden fees. However, pools do require extensive maintenance and groundskeeping costs go way up over the summer. I can see why the fees are higher then, though I’m also quite sure it’s also a way to make a little extra profit off of each guest.

  19. I don’t understand. If they were asked to accept or reject the fee, then they rejected it, it’s clearly wrong to charge them the fee.  This story has nothing to do with the general question of whether such fees are appropriate.

  20. Nobody is paying attention to the fact that they are dealing with a hotel in a forien country and their rules apply, not what we believe is fair. If you book with a US tour company, than the complaints can become valid.

    1. I don’t follow what you’re trying to say.  Since it’s a foreign country they somehow lose their right to complain about bad business practices?  They were given the supposed choice of accepting or rejecting this fee but charged it even though they said “no thanks.” That seems pretty universal regardless what country we’re talking about.

  21. Ridiculous, borders on fraud.  If it’s not disclosed to me prior to checkin, I’ll not pay it.  And if it’s stupid, like charging for electricity, I’ll refuse to pay when I check out.  I did have a go-round with a San Francisco hotel a couple of years ago, couldn’t get the manager to back down until I told her that she either removed it from my bill or I would dispute the entire charge with American Express. She seemed to grasp that concept.  Hotels do what they can to increase profits, betting that many people won’t notice the extra charge(s) after they get home.  Sad how ethics, values and morals or no longer part of life.

  22. The $12 per night energy surcharge in NOT in GDS

    The only thing mentioned with the room rate is the 20% tax rate.
    There is no mention of extra charges.
    So how can anyone (even a travel agent) know that this surcharge applies when they book a room (or suite)? This is definitely a gotcha.

  23. hey airlines do it.

    Hotel could offer the choice, power or not, hot water or not. Would you like some toilet paper/tissues with your room ?

    Sheets, blankets ? TV ? Cable ?

    They don’t have to be mandatory.

    This has all come about because enough people insist on the lowest price, without checking what that includes because they are either stupid or lazy or both.

    Stupid ?

    They don’t realise that $60 + $40 in extras = $100 or lazy, as they don’t read what’s included, they just assume.

  24. It is one thing if the charge were truly optional. There are hotels without electricity (I have had that option in Guatemala), and if Mr. Permadi had that option, and the hotel could simply turn off the electricity for the room, that might possibly be O.K., even if it fell short of normal expectations. Most people may expect to use some type of electricity in a hotel, but if all he was looking for was a hotel in which to crash at night, and he intended to spend all the rest of his time elsewhere, why bother paying for electricity? But if the hotel gave no option, then it really is not an extra.

    (I have seen other people accuse hotels of imposing a “mandatory” parking charge. But those parking charges apply only if you’ve chosen to bring a car with you. I don’t drive, and I generally walk to hotels, usually from the closest public transportation location, and I resent hotels that have “free” parking because that means I’m subsidizing an expensive amenity for others that I am denied.)

  25. It would seem to me that water and electric are a part of running a hotel or resort or anything else for that matter.  Why on earth should they be extra?

  26. I don’t get it.

    I once had to travel to Arizona on business. It was right around the time when lodging rates started to go down a bit because their peak tourist season is in the winter.  I suppose one could go golfing in 110 degree heat and save money on lodging and greens fees, but that seems a little bit off the rocket to me.

    However, I did check out of my company assigned hotel and had to check in someplace else when my trip was extended.  I had some strange things happen, including the exact same Avis operator for all three times that I called – to extend my rental or to exchange for a new car (I didn’t like the handling of the full size car and got a compact).  However, I managed to find a decent “extended-stay” hotel to stay for one night, although the hotel said one night max because they were full.  I told someone I was working with about the place, and he asked what it was like.  It was about $60/night in late winter, but he said they went as low as $28/night in the summer. He indicated the reason was just in case his A/C flaked out and he needed an emergency place to stay until it could get fixed.

    They had no “energy surcharge”, and I’m pretty sure that their energy use per occupied room shot straight up during the summer when their rates (and demand) were the lowest.

  27. A similar thing happened to us at a Sleep Inn in Ellenwood, FL a few weeks ago. Only $2.99/night for a “Green Initiative” fee. When we said no, we weren’t told about it and didn’t agree to pay it, the clerk refused to remove the charge.  There was a typed letter sitting on the front counter, next to all the brochures and stuff, that actually did say something about the fee but it wasn’t pointed out to us and we didn’t read it.  I mean, really, who reads junk on the counter of a hotel after a long drive late at night. 
    Plus nothing about it when we booked the room on the web site.

    It took a letter to the management company who apologized and refunded the charge. But, really, “green initiative” fee. All costs should be built in to the cost of the room. This tacking on of additional fees is false advertising and I hope it doesn’t take another Class Action Lawsuit to stop this.

  28. Please post my full response to you.


    My name is Ricardo Perez and I am the General Manager at
    Oyster Bay Beach Resort.  While we were
    not able to find any reservations under the name of Mr. Permadi.  I would appreciate if you would publish this
    response since your article includes many incorrect statements.


    First of all we do not charge energy surcharge to regular
    paying resort guests.  We do charge a $12
    per day energy surcharge for a two bedroom and $7 for a studio apartment for
    our timeshare guests and exchangers given the high level of utility costs on
    the island.  We pay over 42 cents per KWH
    in St. Maarten and since the water is desalinated also the cost per cubic meter
    is very high.


    In addition we would like to also clarify that we clearly
    state on our confirmation letter the energy surcharge is charge upon check
    out.  We will be more than happy to
    supply you with a copy or our standard confirmation letter.


    I hope you publish this clarification as prominently as you
    did the original erroneous article. 
    Please feel free to contact me at 721-520-4319 or at [email protected].




    Ricardo Perez

    General Manager


    Ricardo Perez


    General Manager

    Oyster Bay Beach Resort

    Emerald Merit Road # 10

    Oyster Pond, St. Maarten

    Netherlands Antilles

    Tel # 1-721-543-6040 ext 3801

    Fax# 1-305-468-3930

    e-mail: [email protected]



    1. Well, I still absolutely disagree with this practice. Presumably you are aware of the utility costs since you run this facility. A good management team would be able to price appropriately. If it isn’t possible to get bookings at an inclusive rate, perhaps you should reconsider your operational strategy rather than resort to deceptive pricing.

      I travel extensively and I NEVER stay with properties that have fees that cover items appropriately included in the room rate.

      1. I believe he just said they do not charge this with the HOTEL RATE. They charge it to the time share guests and exchangers. Well that sounds pretty fair considering the high cost of electricity in the island.

        1.  I don’t own a timeshare but I have had several people try to sell me one, and they all have annual fees, etc. that are inclusive (supposedly) so that your timeshare cost covers all required maintenance, utilities, and incidental ownership costs.

          I reiterate my main point, which is if you can’t figure out how to price your product clearly up front and be profitable, maybe you shouldn’t be in business.

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