The lights are going out all over Europe, to paraphrase Sir Edward Grey’s World War I lament. In Berlin, the Victory Column and the Berlin Cathedral remain unlit at night. In Athens, the Greek parliament is flicking the switch at dusk, and in Paris – the very city of light itself – the Eiffel Tower’s glow is now dimmed when the last visitor leaves.
And yet switching off the lights to save energy isn’t much use to Britain’s cultural industries. “Cinemas need to be lit and heated to welcome customers,” says Phil Clapp, chief executive of the UK Cinema Association. “We can’t turn off the lights or the projector.”
In 2021, energy costs for the average cinema were 20 per cent of money out; it is now 35 per cent or more. Energy is now the largest single expense, overtaking staffing. “For the average ticket, studios already take around 50 per cent,” says Clapp, “but we can’t load the costs onto ticket price if we are going to get customers struggling themselves.”
The same is true for theatres, which also face soaring production budgets – up at least 30 per cent in terms of timber, metal and build costs alone. According to the Society of London Theatre and UK Theatre, theatres are facing an average cost increase of 600 per cent after last week’s energy cap with the Albert Hall staring down an increased energy bill of £1 million between October and February despite the government’s intervention. Although management are planning to turn off the heating when possible, Craig Hassall, the chief executive, said there was little leeway when electricity and lighting is intrinsic to most modern shows.
Salford’s Lowry has two theatres, a drama studio, the Pier Eight Restaurant and an art gallery. “The normal instruments of control when you have a building the size of five football fields are just nibbling at the edges,” The Lowry’s CEO Julia Fawcett tells me. “We switched to LED lighting, which cost us £1 million, but I know other theatres haven’t and the cost involved, particularly in Victorian theatres, is high at a time like this. Short-term solutions only deal with this year’s problem. It would be helpful if we had a proper intervention on capital and infrastructure.”
Lighting is even integral to a theatre’s marketing – with street display banners acting as more than simply naming the show. “They add to the vibrancy of the street,” he explains.
Owen Calvert-Lyons, artistic director and chief executive of Theatre Royal Bury St Edmunds, points out that lighting drives a theatre’s marketing. Indeed, a 2015 report by the Building Research Establishment’s Future Cities Research programme said that a diverse city centre lit by the social glow of cinemas, shops, restaurants and theatres reduced violent crime.
These theatres, cinemas, pubs, clubs and music venues have been struggling to recover from the Covid pandemic since autumn 2021 – in some cases unsuccessfully, like the UK’s Cineworld chain, the world’s second largest, which filed for bankruptcy in the US at the start of September. Whilst the government’s business energy price cap offered some relief, it still means energy costs for businesses are twice what they were in October 2021.
“We have already cut back the workforce – this is the workforce that worked so hard above and beyond during the pandemic and have already been pared down from previous cost efficiencies,” says Owen Calvert-Lyons, artistic director and chief executive of Theatre Royal Bury St Edmunds, which saw its energy bill soar by £47,000 in August. “There is no slack in the system. The alarm is real and immediate.”
The Society of London Theatre and Theatre UK surveyed British theatres over cost increases this winter and found that while most felt certain of surviving the year – although around 10 per cent of UK theatres thought their immediate future was at risk – the majority worried that cost pressures would mean they would be forced to increase ticket prices, food and drink prices, make redundancies, scale back production costs and delay theatre renovations or capital projects.
Stuart Murphy, CEO of the English National Opera, sums up the concern that “the arts industry continues to face long-term challenges as we preserve and maintain historic buildings such as ours, the London Coliseum. Our energy costs are still likely to significantly increase this coming year against an economic landscape which may see our loyal audience members having to make financial cuts, and therefore being able to come to the ENO less regularly.”
Large venues are also struggling with de facto monopoly suppliers. “Two things energy companies are worried about is taking on new customers and them going bust leaving a huge unpaid bill - and then those companies who have fixed their energy losing them money on fixed deals,” explains Society of London Theatre and Theatre UK president Eleanor Lloyd. “They don’t want to do any more deals in case of getting it wrong, so theatres are stuck with their previous supplier. We have had members quoted a 1,000 per cent increase in their energy bill before the cap. No-one could have budgeted for that.”
As cinemas, theatres and arts centres have widened their offering to include food, they face a combination of price hikes that have hit the likes of Picturehouse, Everyman and independents like Lake District based Zeffirellis, which offers films, a vegetarian restaurant and live jazz, particularly hard.
In July, for instance, hospitality supply chain software supplier Fourth estimated that food costs for the sector had increased by 40 per cent compared to 2019 due to inflation and supply chain disruption. Dairy products saw the biggest price hikes at 40 per cent, followed by grains (35 per cent), meat (35 per cent), fish (25 per cent) and fruit and vegetables (20 per cent).
And whilst the cap on wholesale prices restricts some increases, there is no cap on operational costs and surcharges or on the cost of LPG, the gas used by smaller community venues. Cross Hands Hall and Cinema in Llanelli, an Art Deco cinema founded 90 years ago by the Miners' Welfare Institute and reopened in 1996 is a small independent cinema and community hall run as a charity by volunteers. The cinema was shut until November 2021 by the pandemic and has struggled to get audiences back in, according to treasurer Geoff Dawkins.
“Our electricity is fixed until next summer but as our gas is LPG and we pay by the litre that’s been going up and up,” he explains. “We’re paying double now what we were this time last year and the winter fuel costs to heat the large hall are going to make it a struggle. We’re barely breaking even at the moment.” The cinema set up a GoFundMe page to raise £2,000 to cover the shortfall for the short term – “but that’s a sticking plaster,” says Dawkins.
As venues close – 30 per cent of the nightclubs open in 2019 closed for good during the pandemic and “spiralling energy prices have already forced music venues up and down the country to close or curtail their programming and this will begin again as soon as this latest support is removed,” warns Jon Collins, CEO of Live, which represents live music groups as diverse as the Association of British Orchestras and the Association for Electronic Music - the government needs to pay attention to the cultural importance as well as the economic value in keeping these lights on. In 2019, the nation simply going out for the night generated around 15 per cent of UK GDP.
Grey’s ‘lights out’ quote ends with a wildly inaccurate forecast – “we shall not see them lit again in our lifetime.” For some businesses the lights will go out – forecasts vary, but casualties seem certain. The question Grey should have asked was – what will the world look like when they’re switched back on? Cinemas are dependent on big films coming from Hollywood and there’s a backlog of blockbusters queuing up for their special effects after the pandemic downtime. Theatres, meanwhile, are spending today for productions staged two years from now.
“The UK’s creative, cultural and entertainment venues have never faced a tsunami like this,” says Michael Kill, the CEO of the Night Time Industries Association. “The free market is broken. We need a golden quarter delivering heavy spending between now and January or… well, the reserves are all spent. And what can we do then except hand back the keys?”