Of all commercial buildings, restaurants use the highest amount of energy per square metre. In fact, UK Power and the Family Hospitality Group estimate that anywhere between 5 to 15% of a restaurant’s total expenditure can be taken up by energy alone!
Considering that the average profit margin of a full-service restaurant is usually less than 10% of gross revenue – energy consumption suddenly becomes a BIG financial concern.
In keeping with our industry focus series, where we have previously talked about energy management in hotels, supermarkets, and office buildings, this article spotlights how restaurants can work on bringing down their energy costs.
Energy Efficiency in Restaurants
In addition to energy-intensive equipment, rising costs of wages and stock are also a problem that prevent restaurants from leveraging their energy savings potential fully.
According to Mark Chapman of the Hospitality Sector Carbon Reduction Forum, members like Nando’s, The Restaurant Group, Whitbread and Marston’s are looking at new energy management technologies to help cut their consumption and lower their energy bills.
“It seems mad to send waitstaff home an hour early to save £7.20 when at the same time everything is still on in the kitchen and costing way more,” one member remarked.
So energy managers, you need to understand that your restaurant owners and facility manager customers are trying to prepare high-quality meals at the lowest possible operating costs. So what’s making the cost of preparing those meals so darn expensive?
Well, most commercial kitchen appliances, like industrial dishwashers, fryers and ovens, are highly energy intensive. The average electric deep fryer, for instance, uses more than 11,000 kWh of energy annually. And most fryers sit idle for up to 75% of the time, even in fast food (QSR) restaurants. That translates to $1,000 in electricity every year just to not fry stuff!
Let’s take a closer look at how that energy is used in a typical full-service restaurant.
How Do Restaurants and Pubs Use Energy?
According to a study published in the International Journal of Low-Carbon Technologies, here’s what electricity consumption by function looks like in the average commercial kitchen in the UK:
It’s clear that the biggest challenge preventing energy efficiency in restaurants is energy used in food preparation and cooking, especially if food services are to contribute to national and international targets (80% reduction in GHGs by 2050 for the UK) and meet regulatory requirements.
You can find the full results of the study here.
Remember when we mentioned the whole thing about tiny profit margins?
Well, the good news is, achieving just a 20% reduction in energy costs will directly translate into an additional 1% profit for your restaurant – and your average savings potential is probably even higher than that!
Keep reading to learn how to make it happen…
3 Steps to Cut Your Restaurant Energy Bill Instantly
1. Maintenance Check
Equipment in poor condition will continue to waste energy. Take the time to understand how your equipment works, and make sure it is well maintained before investing in energy management solutions. Here are the most important systems to check to make sure they are in good working order:
HVAC units are simply not designed for restaurants. Our energy manager community is constantly telling us about how even brand new HVAC units don’t cool enough in kitchens, or blow very hot or freezing cold air directly on customers.
Regular cleaning of ventilation systems can increase efficiency by as much as 50% compared with systems that are not maintained. Energy consumption can increase by up to 60% if regular maintenance is not undertaken. Dirty or faulty fans, air ducts and components directly affect system efficiency and will increase running costs and risk of breakdown.
If you air condition your kitchen, cross-drafts and misaligned appliances can allow heat and smoke to create hot, uncomfortable working conditions AND drive your energy bill through the roof! Try pushing each appliance as far back against the wall as possible to close the air gap and maximise hood overhang. Also, check the following parts of your HVAC system:
- Duct Connections
- Discharge Registers (Condition and Location)
- Air Damper Setting
Like supermarkets, restaurants have a very hard time keeping things cold and food storage can be a major energy sucker. Check to make sure all door seals are working properly, and remove any ice buildup. Additionally, have a look at these novel cooling technologies that might also be useful for your establishment.
2. Get A Virtual Energy Audit
Quick fixes like maintenance checks can only take you so far – to make meaningful savings that impact your profit margin, you will need to bring in an energy services company (ESCO) to examine your building and fine-tune its energy performance. That could mean the difference between making a profitable year or not. But if you aren’t quite ready to pay for a full on-site energy audit yet, there is an easier, cheaper intermediate step…
Enter Energy Grader – a virtual energy audit platform that not only shows if you are paying too much for your energy, but also calculates the energy savings potential of your restaurant.
By anonymously comparing the electricity consumption of your property with data from similar establishments in your area, you will immediately understand how much your facility can save.
After crunching some data from existing Energy Grader reports, our Product Team discovered that on average, restaurants can generate up to 30% in potential energy savings – and that’s just for electricity! (Don’t forget about gas and thermal sources – water heating is definitely among the biggest energy vampires in restaurants. More about those here.)
According to one Energy Grader report, a 160 m2 fast food restaurant in Spain could achieve an average savings of € 7,660 per year.
To find out the savings potential of your establishment, try Energy Grader for free:
3. Invest Strategically in Energy Efficiency
Once you are armed with your personalised savings potential data, it’s time to take the plunge into more substantial investments. Still you might have questions:
- Will the lower energy, water or gas costs compensate for the price of new, top-of-the-line equipment?
- Can I afford a retrofit? When will it pay for itself?
If you find yourself asking these questions, it’s time to call in an energy pro to do the math for you – but it helps to know the right questions to ask them. Plus, you’ll want to make sure that they themselves are equipped with the right tools to help you generate the energy management plan that’s right for your establishment.
Restaurants that invest strategically in energy-saving measures can cut costs anywhere from 10 to 30% without sacrificing service, quality, style or comfort – while making significant contributions to their triple bottom line (people, planet and profit). Take the example of one Burger King franchise that saved over € 5,500 annually thanks to a minimal investment that paid for itself in less than 6 months!
Plus, data-driven energy management solutions can optimise and maximise that savings potential using data-driven aM&T technology.
Still, a number of roadblocks prevent smaller establishments to find enough resources to invest. To learn how to overcome these and build energy management directly into your restaurant business, have a look at our latest guide: