Managing Energy Costs in Quick-Service Restaurants

Quick-service restaurants (QSRs) are some of the most energy-intensive buildings in the US, using an average of 81 kilowatt-hours (kWh) of electricity and 174,000 Btu of natural gas per square foot (ft2) annually. In a typical QSR, refrigeration, lighting, and cooling collectively represent about 63 percent of total energy use (Figure 1), making those systems the best targets for energy savings.

Average energy use data

Figure 1: Energy consumption by end use
Refrigeration and cooking make up more than half of the the electricity consumption in quick-service restaurants and cooking dominates gas consumption.
Pie chart showing electricity end uses: Refrigeration, 35%; Cooking, 21%; Miscellaneous, 14%; Cooling, 12%; Ventilation, 11%; and Lighting, 7%.
Pie chart showing natural gas end uses: Cooking, 71%; Water heating, 16%; and Heating 13%.
Top technology uses

In order to better manage your restaurant’s energy costs, it helps to understand how you are charged for those costs. Most utilities charge commercial buildings for their natural gas based on the amount of energy delivered. Electricity, on the other hand, can be charged based on two measures: consumption and demand.

The consumption component of the bill is based on the amount of electricity, in kWh, that the building consumes during a month. The demand component is the peak demand in kilowatts (kW) occurring within the month, or, for some utilities, during the previous 12 months. Demand charges can range from a few dollars per kilowatt per month to upwards of $20/kW per month. Because it can be a considerable percentage of your bill, care should be taken to reduce peak demand whenever possible. As you read the following energy cost management recommendations, keep in mind how each one will impact both your consumption and your demand.

The conservation measures we discuss, whether for the short term or long term, can be good investments depending on your location, facility design, and energy costs. Not only will they help you to save money on your energy bills, but they can also enhance the aesthetics, comfort, and safety of your restaurant.

Quick fixes
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The following low- or no-cost steps can have a real impact on your QSR’s bottom line. Achieving just a 20 percent reduction in energy costs will directly translate into an additional 1 percent in profit—which can be significant because restaurants tend to operate with narrow profit margins.

Turning things off

Turning things off seems simple but is often neglected. For every 1,000 kWh that you save by turning things off, you save $100 on your utility bill (assuming average electricity costs of $0.10/kWh).

Storage areas. There are a variety of ways to turn off lights and equipment in storage areas (such as walk-in coolers)—some simple, some sophisticated. Among the simplest methods is to encourage your staff to be conscious of energy use and to turn lights or equipment off in vacant rooms. A more sophisticated approach might employ occupancy sensors or timers to turn lights and equipment off during unoccupied hours.

The kitchen. Encourage your staff to use good operating habits and turn kitchen equipment off when not in use. For example, fryers sit idle more than 75 percent of the time, even in a busy QSR. You can save a lot of energy and money by turning off your backup fryer when you don’t need it. Eliminating just four hours per day of idle fryer time could save up to $150 per year. Likewise, if you turn off an idle broiler for just one hour per day you can save up to $400 per year in energy costs.

If you use high-temperature dishwashers, turning them off at night so that built-in burners or heating elements will not consume energy can save nearly $400 per year at an electricity rate of $0.10/kWh. Turning the dishwashing machine exhaust hood off can save another $200 per year. Make sure that the booster heater is shut off at night for a savings of around $50 per year—even if you turn off the dishwasher itself, the booster heater might have a separate manual switch.

One way to ensure that unused equipment is turned off is to develop simple energy-management procedures—with checklists—and to assign responsibility between shifts and at the end of the day for turning off dishwashers, exhaust fans, lights, computers, and other equipment.

Turning things down

Some equipment cannot be turned off entirely, but turning it down to minimum levels where possible can save energy.

Equipment. For equipment that you choose not to turn off entirely, such as the refrigeration system or air conditioner, set controls to minimum levels during operating hours and turn down equipment as much as possible just before closing each night. You may also consider using programmable thermostats, which can automatically adjust your HVAC system settings. For dishwashers, check that the rinse pressure is set to 15 to 25 pounds per square inch (100 to 172 kilopascals) to avoid excess water use, set the wash-tank temperature to 160° Fahrenheit (F), and set the booster heater setpoint to 180°F.

Peripheral and back rooms. Make sure that HVAC settings in areas such as stockrooms, back offices, and other peripheral rooms with intermittent and short-term occupancy are at minimum settings.

Lights. In spaces where natural lighting is available, dim the lights in proportion to the availability of sunlight. As a longer-term solution, daylighting controls are available that can perform this function for you automatically, and they can be a great choice for dining areas.

Cleaning and maintenance

Making sure that your equipment is regularly cleaned and serviced can help to prevent costly heating and cooling bills. Restaurant operators will get some of their biggest payoffs from maintenance and repairs of HVAC systems. Some simple checks can indicate problems, but regularly scheduled preventive maintenance should help to avoid costly fixes while also keeping your energy bills down. Preventive maintenance should include the following measures.

Check the economizer. Many air-conditioning systems use a dampered vent called an economizer that draws in cool outside air when it’s available to reduce the need for mechanically cooled air. If not regularly checked, the linkage on the damper can seize up or break. An economizer that’s stuck in the fully open position can add as much as 50 percent to a building’s annual energy bill by allowing hot air in during the air-conditioning season and cold air in during the heating season. Have a licensed technician check, clean, and lubricate your economizer about once a year, and repair it if necessary. If the economizer is still operating, have the technician clean and lubricate the linkage and calibrate the controls.

Check air-conditioning temperatures. With a thermometer, check the temperature of the return air going to your air conditioner and then check the temperature of the air coming out of the register nearest the air-conditioning unit. If the temperature difference is less than 14°F or more than 22°F, have a licensed technician inspect your air-conditioning unit.

Change filters. Filters should be changed monthly; they should be changed more often if you are located next to a highway or construction site where the air is much dirtier.

Check cabinet panels. On a quarterly basis (or after filters are changed), make sure the panels to your rooftop air-conditioning unit are fully attached, with all screws in place and all gaskets intact so that no air leaks out of the cabinet. Chilled air leaking out can cost as much as $100 per rooftop unit per year in wasted energy.

Clean condenser coils. Check the condenser coils quarterly for debris. At the beginning and end of the cooling season, thoroughly wash the coils.

Check for airflow. Hold your hand up to air registers to ensure that there is adequate airflow. If there is little airflow, or if dirt and dust are coming out of the register, have a technician inspect your unit and ducts.

Inspect refrigerator, freezer, and hot-food holding cabinet doors. Poorly maintained refrigerator doors can leak cool air, which means the condenser runs unnecessarily to maintain the proper temperature. The same is true for the heating element in a poorly maintained hot-food holding cabinet. Replace worn gaskets and make sure doors are properly aligned. In the case of refrigerators and freezers, also check that automatic door closers are functioning and strip curtains are not damaged. Strip curtains on walk-in refrigerators and freezers can cut outside air infiltration by as much as 75 percent and can have a payback of less than one year. One study found that adding strip curtains to the doors of a 240-ft2 walk-in refrigerator reduced energy consumption by 3,730 kWh per year—about 9 percent of total energy consumption.

Most commercial reach-in refrigerators with glass doors have heaters (sometimes called defoggers) that eliminate condensation on the inside surface of the door. In many dry climates or in non-merchandising applications, these heaters can simply be turned off, thereby saving energy with no loss of functionality. Door heaters don’t draw a tremendous amount of power, but because they’re on 24/7/365, they can chew up about $75 of electricity per year, and it costs nothing to throw the switch. The heater switch can usually be found right on the front of the refrigerator.

Repair controls. Thermostats and control systems can drift out of calibration or even fail outright. Take the time to periodically check thermostats and other controls. If necessary, contact qualified technicians to recalibrate or replace controls. Also, repair or replace broken control panels on ovens, steamers, and other appliances that feature control systems, and replace missing knobs on manually controlled appliances like ranges, griddles, and broilers. These measures will improve cooking performance, safety, and kitchen appearance, and they’ll also reduce energy use.

Inspect the water heater. There are a number of steps you can take to make your existing water heater as efficient as it can be. First, make sure it’s set to a temperature no higher than 140°F. Next, insulate the first several feet of the hot water pipe coming off the heater with inexpensive tube insulation available at most hardware stores. Older water heaters (manufactured before 2004) can often benefit from an insulating blanket wrapped around the entire tank, also available in most hardware stores. Third, if your gas water heater has a vent damper, make sure the damper motor’s switch is in the “on” position, and that it closes when the burners are off. Finally, some systems utilize a recirculation pump to ensure that hot water is quickly available at taps far from the heater. If your system uses a recirculation pump, put it on a timer so that it only functions when your kitchen is operating.

Repair water leaks. A cold-water leak that loses 0.2 gallons per minute will waste more than 100,000 gallons over the course of a year and cost a restaurant $700 in water alone. If a restaurant has a similarly sized hot-water leak, the cost can be as much as $1,700 for wasted water and energy every year.

Longer-term solutions
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Although the actions covered in this section require more-extensive implementation, they can dramatically increase the efficiency, comfort, and safety of your QSR. Ask your local utility’s representative for more information about initiating such projects.

Commissioning

Commissioning is a process in which engineers observe a building’s energy systems and perform a tune-up to ensure that they are operating appropriately and efficiently. Doing so can lead to reductions of 10 to 15 percent in annual energy bills. When this process is applied to an existing building that has not been commissioned before, it is called retrocommissioning; when it’s applied to a building that has been commissioned before, it is called recommissioning. Recommissioning is recommended every three to five years to maintain top levels of building performance. In QSRs, commissioning also allows you to evaluate the airflow between cooking and dining areas and to use that information for implementing air-pressure balancing measures. Commissioning usually costs between $0.05 and $0.40/ft2.

Kitchen measures

High-efficiency kitchen equipment. Cooking equipment, coolers, and dishwashers are energy hogs in a restaurant—high-efficiency cooking equipment can be 15 to 30 percent more energy efficient than standard equipment. But the benefits of purchasing energy-efficient models go beyond energy savings, because they tend to offer better performance than standard-efficiency models. For a list of Energy Star–qualified products and an online calculator that can help you determine savings for your particular upgrade, visit the commercial food service section on the Business & Government tab of the Energy Star website.

Smart vent hoods. Commercial kitchen exhaust hoods remove a lot of indoor air, forcing the ventilation system to draw outside air into the kitchen to make up for the high airflow. In climates where the kitchen makeup air is conditioned, that conditioning can account for up to one-quarter of the entire energy use of a food service establishment. Intelligent, variable-speed hood controller systems can significantly reduce energy costs in your kitchen. A photoelectric smoke or heat detector determines when and how much ventilation is needed, and then activates the exhaust fan at the proper speed—a big difference from the continuous operation of the fan in a traditional vent hood. In appropriate applications, this technology yields a one- to two-year simple payback period.

Connectionless steamers. If your QSR uses a steamer, you should know that replacing inefficient steam cookers represents a substantial opportunity for energy savings. Self-contained, or “connectionless,” steamers recirculate steam rather than continuously venting. As a result, they provide the most efficient alternative to conventional units, and they offer combined annual water and energy savings of up to $6,000 per machine.

Ice makers. The energy efficiency of new ice makers has improved considerably over the past decade. There are now many efficient models to choose from, some of which provide substantial energy savings with little or no incremental cost over less-efficient models—a win-win situation. When looking for a new ice maker, consider buying an Energy Star–qualified model to make sure you’ll see significant energy savings.

Refrigeration measures

Evaporator fan controllers in coolers. Nearly all walk-in coolers have forced-circulation evaporators that contain motorized propeller fans. These fans run continuously, despite the fact that full airflow is only necessary 50 percent of the time. Inexpensive walk-in cooler controllers are now available that slow these fans when full cooling capabilities aren’t necessary.

Demand-defrost kits. On average, timer-based defrosters (used to defrost the ice that accumulates on the evaporator coils during operation) account for about 20 percent of the total energy consumption of walk-in freezers. Demand-defrost systems, which initiate defrosts only when they are needed, can save significant amounts of energy by reducing the number of defrost cycles. Independent tests show that advanced demand-defrost controllers can reduce defrost cycles by as much as 40 percent compared to defrosters with timers—saving from $150 to $3,000 annually on energy costs depending on the size of the freezer. In addition, these controllers can help maintain the quality of products kept in the freezer because fewer defrost cycles translates into more-consistent temperatures.

LED display case lighting. Light-emitting diodes (LEDs) have become increasingly attractive options for use in refrigerated display cases. The efficiency of LEDs improves in cold operating environments, unlike linear fluorescent systems, where the output drops in low temperatures. LEDs are also directional in nature, allowing for less wasted light. Because of these benefits, LED light strips are over 40 percent more efficient than the fluorescent systems typically used. LEDs can also be tied to occupancy sensors so that the cases are only illuminated when customers are present. The use of LEDs also reduces case compressor loads in a number of ways: The cases use lower-wattage lamps, so there is less heat to dissipate; the heat sink for an LED can be positioned to allow at least some of the heat to be dissipated outside the case (with fluorescent lighting, most of the waste heat must be offset with additional cooling inside the case); and when LEDs are used with occupancy sensors, they will spend less time in “on” mode and therefore contribute less to the cooling load. LEDs also provide even light distribution, can be dimmed, have a very long lifetime, and have been shown to appeal to customers.

Lighting measures

Upgrade old linear fluorescent lighting. If your facility uses T12 fluorescent lamps or commodity-grade T8 lamps, relamping with high-performance T8 lamps and electronic ballasts can reduce your lighting energy consumption by 35 percent or more. Adding specular reflectors, new lenses, and occupancy sensors or timers can double the savings. Paybacks of one to three years are common. LED troffers, but not tubular LED lamps, have also become a viable alternative to linear fluorescent lamps. The US Department of Energy (DOE) published its Exploratory Study: Recessed Troffer Lighting (PDF) in March 2013, which reported on the results of its testing of LED troffers and tubular LED products installed in a mock office space. DOE researchers concluded that LED troffers can compete with fluorescent fixtures both in efficacy and other lighting quality factors, including glare, light distribution, visual appearance, and color quality. The only caveat was that some of the products flicker when dimmed. This could be a compatibility issue—it’s important to make sure that LEDs are compatible with the dimming products they’re paired with.

Tubular LED T8 products were not rated as highly. There was no efficacy benefit to the LEDs, and the color quality varied widely among the products tested. In addition, the LED tubes produced glare and an uneven light-distribution pattern. Concerns arose about safety with the tubular LED products as well—a safety inspection showed that more than half of the products would not have passed for a variety of reasons: labeling issues, poor installation instructions, poor mounting or construction, and other complications.

Switch to CFLs or LEDs. Replacing incandescent bulbs with compact fluorescent lamps (CFLs) or LEDs not only saves energy, but the bulbs also last much longer, so they save on maintenance. CFLs are now available in 2,700-kelvin models that produce a warm color tone similar to that of incandescent lamps. You can also adjust their light intensity by installing dimmable ballasts. Just be sure to use CFLs in appropriate ballasts, especially if dimmers are in the circuit. LED replacement bulbs in a wide range of form factors found in QSRs (A-lamps, PAR lamps, MR16s, and others) are also becoming more affordable. They are more efficient, last longer, and are easier to dim than CFLs, but they’re still more expensive, and care must be taken to ensure compatibility between the LEDs and any dimming controls. Look for Energy Star–rated products, and use the DOE’s Lighting Facts database to find LEDs that will meet your needs.

Use LED recessed downlights. In the dining room, recessed downlighting fixtures equipped with white LEDs can save considerable energy compared with an incandescent or CFL light source. LED downlights are also fully dimmable and, according to many, provide superior light quality. LED products are also available that mimic the dimming properties of incandescents, which emit a warmer glow as they dim.

Use LED signage. Replace incandescent exit signs, exterior signs, colored accent lights, downlights, and menu boards with LED versions. LEDs direct light very effectively and come in many colors, which make them a good candidate for restaurant applications. Although their initial costs are high, the lamps can last 5 to 10 years, so you’ll also save on maintenance costs.

  • Exit signs. These signs must be lit both day and night, which can take a bite out of a restaurant’s budget. A single LED exit sign saves on the order of $45 per year and will shine brightly for 5 to 10 years, which can significantly reduce material and labor costs compared to standard incandescent models.
  • Open signs. LEDs are the best choice for replacing neon “open” signs—they use 80 percent less energy than neon but have about the same initial cost.

Use smart lighting design and LEDs in parking lots. Parking lot light levels may depend on local ordinances, but can generally be fairly low. Many parking lots are designed with far more lighting than most experts recommend. Not only is overlighting costly, it can be dangerous to drivers if their eyes cannot adjust quickly enough in the transition from highly lit to dark areas. LEDs are becoming a popular choice for parking lots because they function well in the cooler conditions that are typically found at night, provide a more even light distribution, and create less light pollution. The DOE’s Better Buildings Alliance has published specifications for LED parking lot lighting and parking structures; it estimates that employing LEDs can cut energy use by 40 percent or more. A 2012 DOE case study, Walmart Parking Lot Goes LED (PDF), illustrates many of the benefits of using LEDs to light parking lots and shows savings of more than 50 percent. More examples can be found at the DOE’s Federal Energy Management Program website, which offers an Outdoor Solid-State Lighting Case Studies page with lots of links.

Controls can also help to reduce parking lot lighting energy use—see, for example, two studies from the DOE on the use of occupancy sensors in parking lots and garages: Use of Occupancy Sensors in LED Parking Lot and Garage Applications: Early Experiences (PDF) and Demonstration Assessment of LED Parking Structure Lighting (PDF).

Water heater measures

High-efficiency water heaters. When replacement time comes around, upgrade your tank water heater—whether gas-fired or electric-powered—to a high-efficiency model. Though high-efficiency models often cost a little more up front, they can save hundreds of dollars per year in fuel expenses.

Tankless water heaters. High-efficiency tankless water heaters, also known as instantaneous or on-demand water heaters, heat water only when it’s needed and can save significant amounts of money and take up less space than traditional models. Tankless water heaters also have very long lifetimes—20 years (compare that to traditional water heaters’ 6 to 10 years). Their reduced energy costs go a long way toward offsetting the higher purchase price, which can run from $1,000 to about $2,000, depending on output capacity. Tankless water heaters do have one drawback: They maintain temperature at the cost of pressure, so they may provide hot water more slowly than conventional tank water heaters. This can reduce the performance of flow-dependent equipment. The good news is that this problem can be solved by right-sizing the unit and ensuring proper installation, or, in some cases, by plumbing multiple tankless units in parallel to provide the desired pressure and flow rate.

Dishwashing measures

Water-efficient dishwashers. High-efficiency dishwashers are distinguished by their low water consumption per rack for conveyer or door-type dishwashers (this may not apply to under-counter units). Reduce the amount of water heating that’s necessary by purchasing or renting a dishwasher that’s certified by the National Sanitation Foundation (NSF) to have a water consumption rating of less than 1 gallon per rack (this rating is available on the NSF website).

Low-flow prerinse spray valves. Installing low-flow sprayers is one of the easiest and most cost-effective methods of saving hot water in a commercial kitchen; it can reduce the amount of hot water required to wash dishes by 50 percent or more without compromising cleanliness or slowing down the dishwashing process. The Food Service Technology Center (FSTC) offers a free Pre-Rinse Spray Valve and Water Cost Calculator that can help estimate cost savings from installing a low-flow valve.

HVAC measures

Optimize makeup air. Kitchen ventilation systems represent one of the largest uses of energy in a commercial food service facility. A recent FSTC design guide, Improving Commercial Kitchen Ventilation System Performance: Optimizing Makeup Air (PDF), presents strategies for minimizing the impact that the introduction of makeup air will have on hood performance and energy consumption. A commercial kitchen ventilation system that is designed using the guide is not only likely to improve safety and comfort, it will also save a good deal of energy.

High-efficiency HVAC units. A highly efficient packaged air-conditioning/heating unit can reduce cooling energy consumption by 10 percent or more over a standard-efficiency commercial packaged unit. Select equipment that has multiple levels of capacity (compressor stages) with good part-load efficiency.

Demand-controlled ventilation. If your restaurant has large swings in occupancy, energy can be saved by decreasing the amount of ventilation supplied by the HVAC system during low-occupancy hours. A demand-controlled ventilation system senses the level of carbon dioxide in the return air stream, uses it as an indicator of occupancy, and decreases supply air when carbon dioxide levels are low.

Reflective building roof coating. If the roof needs recoating or painting, consider white or some other highly reflective color to minimize the amount of heat the building absorbs. Cool roofs can often reduce peak cooling demand by 15 to 20 percent. For a list of suitable reflective roof-coating products, see the Energy Star Roof Products page.

Content last reviewed: 
04/18/2017
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