How to Reduce Average Monthly Electric Bill for Restaurant?

How to Reduce Average Monthly Electric Bill for Restaurant?

According to the National Restaurant Association’s statistics, restaurants in the UK can spend around £2,000 – £5,000 per month on energy costs. However, this amount is even bigger in larger establishments. Energy restaurant owners must monitor their energy costs effectively in the competitive market.

In this article, we will explain the main factors of the average monthly electric bill for restaurants and then provide practical tips and tricks to help you lower energy spending and boost profitability.

What is The Average Monthly Electric Bill for Restaurants?

The average monthly electric bill for restaurants often varies depending on their size and the types of equipment they use. On average, a small restaurant consumes 15,000 to 25,000 kWh of electricity per year, while medium ones can use 30,000 – 50,000 kWh. It’s worth noting that those are average amounts in the industry, as some restaurants consume much more or less than that.

Based on the average electricity amounts determined above, it is estimated that small restaurants normally pay from £2,500 – £3,500 per year on electricity, while medium ones spend £3,800 – £7,500 on electricity consumption on average.

Restaurants spend a lot of electricity on utilities, with the top spending on food, labor, equipment, and a POS system. According to the Department of Energy, the amount of energy that the food service industry uses is 2.5 times more than that of other commercial buildings. As a result, businesses in this industry have narrower profit margins as they have to reign in their utility bills.

Below are electric bills for some types of restaurants based on electricity usage per square foot:

  • With the most electricity per square foot, Fast Food Restaurants use 73.9 kWh per square foot
  • Full-service restaurants with more space for dining use average 43.5 kWh per square foot
  • Bar, Pub, or Lounges use energy-intensive equipment with an average of 26.3 kWh per square foot

What Factors Affect The Restaurant’s Energy Cost?

To effectively reduce the bills, it is important to understand the key factors that impact the energy cost in restaurants.

Internal Factors

Internal factors are utility costs that vary depending on several factors:

  • Water consumption: Low-flow faucets and efficient dishwashing systems can save the amount of used water.
  • HVAC systems: Inefficient heating, ventilation, and air conditioning systems can increase a restaurant’s average utility costs.
  • Equipment efficiency: Ovens, refrigerators, and dishwashers can impact utility costs significantly.
  • Lighting option: Energy-efficient lighting solutions, like LED, can help restaurants lower energy consumption.
  • Equipment quantity: The number of pieces of equipment in your kitchen, bar, and front of the house will decide how much energy you use for gas, electric, and water utility costs.

External Factors

  • Weather: The electricity rates change throughout the years according to weather patterns. For example, summer heat waves, frigid sub-zero days, drought, or even low winds will throw off the generation capacity with high demand.
  • Location: Electricity can be generated from coal, hydroelectricity, solar power, wind energy, or natural gas, then it is carried to your businesses through systems of overhead/underground transmission lines. Your energy bill has already included the construction, operation, and maintenance of these distribution systems.
  • Supply and demand: On the supply side, any disruption in the supply chain can impact raw material prices and put pressure on energy production costs.
What Factors Affect The Restaurant’s Energy Cost?

How to Calculate Your Restaurant Energy Costs?

The formula to calculate energy consumption is Power (kW) x Time (hours) x Efficiency.

  • Power: The amount of power the equipment uses is shown on its label or manual.
  • Time: How many hours the equipment runs per day.
  • Efficiency: How efficient the equipment’s rating is shown on the label or manual.

For example, a fridge consumes 2 kW of power for 12 hours per day, with an efficiency rating of 85%. Then, its energy consumption is 2 kW x 12 hours x 0.85 = 20.4 kWh.

How Can a Restaurant Reduce Average Electricity Bill?

Below are various practices for restaurants to reduce their average monthly electric bill, grouped into instant, long-term, and advanced strategies.

Instant Strategies

Optimise Lighting Efficiency:

  • Keep bulbs and fixtures clean to ensure maximum brightness.
  • Dim lights in areas with natural sunlight.
  • Replace traditional bulbs with Compact Fluorescent Light Bulbs.
  • Install occupancy sensors in frequently used areas.
  • Use LED lights for signs to reduce energy consumption.

Implement an “Off-Hours” Schedule:

  • Utilise programmable features to automatically shut down equipment during non-peak hours.
  • Assign a staff member to turn off cooking equipment, exhaust fans, lights, and office equipment after the last shift.
  • Display checklists near equipment to remind operators about energy-saving settings.

Regularly Change Filters:

  • Replace filters on water filtration systems and HVAC units to maintain energy efficiency.
  • Increase filter changes for HVAC systems near heavily polluted areas.

Water Conservation:

  • Fix hot water leaks to prevent unnecessary expenses.
  • Install low-flow aerators at hand sinks.
  • Switch to high-efficiency pre-rinse spray valves.

Maintain Comfortable Temperatures:

  • Apply heat-rejection window film to cool rooms with large windows and reduce air conditioning costs.
  • Install ceiling fans for improved air circulation.
  • Turn off patio heaters when the patio is not in use.
  • Ensure refrigerator and freezer doors close properly, replace worn gaskets, and repair automatic door closers.
  • Install or repair strip curtains in walk-in coolers to minimise air infiltration.
How Can a Restaurant Reduce Average Electricity Bill?

Long-term Strategies

  • Upgrade to Energy Star Equipment: Replacing outdated kitchen equipment with Energy Star-certified appliances can save overall utility costs in the long run. When ovens, water heaters, and refrigerators work efficiently, they can reduce up to 30% of gas usage.
  • Utilise High-Efficiency Equipment: High-efficiency cooking equipment like induction cookware and lightwave ovens can help restaurants save up to 15 to 30% of energy. To optimise energy usage, install energy-efficient hand dryers in the bathrooms and evaporator fan controllers in walk-in coolers. Consider smart vent hoods that use detectors to regulate exhaust fan use, as they can provide substantial energy savings.
  • Train Staff for Energy Conservation: Provide dedicated training to your staff on energy-saving practices and ensure follow-up to encourage consistent implementation. Simple actions, such as closing the kitchen steamer door and using timers, can result in significant annual energy savings per equipment.

Advanced Strategies

  • Commissioning: Energy management involves more than simple adjustments to equipment and thermostats. Consider commissioning, a process where engineers verify and document your building’s energy systems to ensure proper design, installation, and calibration.
  • Energy Management Technologies: Emerging technologies like scheduling software, web-based POS systems, and energy management software can provide real-time data analysis for your restaurant. Employing an effective energy management system will help you monitor utility consumption, detect spikes, and alert managers. It allows for prompt action, such as addressing open cooler doors or providing additional oversight and training for rising energy use patterns.
Advanced Strategies

Consult Electricity Bill Audit Service with Light Up Energy

Managing business electricity can be complex and time-consuming. At Light Up Energy, we recognise that your priority is running your business, so we offer our expertise to optimise electricity deals for you.

The average monthly electric bill for restaurants that UK businesses pay has consistently risen in the past decade. This significant expense puts pressure on businesses in the restaurant industry. Meanwhile, electricity contracts become more and more intricate with additional costs like environmental taxes and non-energy expenses. In this case, our experienced energy consultants can understand your specific needs and balance between costs and performance in your restaurant.

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Light Up Energy
Light Up Energy, founded by hospitality experts with 20+ years of experience, helps businesses save money via innovative energy management strategies.

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