This article was written by our expert who is surveying the industry and constantly updating the business plan for a catering business.
Energy costs represent one of the largest operational expenses for catering businesses, typically accounting for 15-25% of total monthly overhead.
Understanding these costs is crucial for new catering entrepreneurs who need to budget accurately and maintain profitability. The specific energy consumption depends heavily on your catering model, kitchen size, equipment choices, and operational patterns.
If you want to dig deeper and learn more, you can download our business plan for a catering business. Also, before launching, get all the profit, revenue, and cost breakdowns you need for complete clarity with our catering business financial forecast.
Energy costs for catering businesses vary significantly based on operational model, ranging from $500-$3,000 monthly for small operations to $5,000-$15,000 for large industrial kitchens.
The key factors determining these costs include equipment power ratings, operational hours, local electricity rates, and seasonal variations in demand.
| Catering Type | Kitchen Size | Monthly Energy Use | Average Cost | Key Cost Drivers |
|---|---|---|---|---|
| Mobile Food Truck | 50-150 sq ft | 800-1,500 kWh | $250-$470 | Generator fuel, portable equipment |
| Small Event Catering | 300-600 sq ft | 2,000-4,000 kWh | $620-$1,250 | Refrigeration, prep equipment |
| Restaurant-Based Catering | 800-1,200 sq ft | 4,500-7,500 kWh | $1,400-$2,350 | Full kitchen operation, HVAC |
| Large Event Catering | 1,500-2,500 sq ft | 8,000-12,000 kWh | $2,500-$3,750 | High-volume equipment, extended hours |
| Industrial Kitchen | 3,000-8,000 sq ft | 15,000-30,000 kWh | $4,700-$9,400 | Large-scale refrigeration, continuous operation |
| Cloud Kitchen Network | 1,000-2,000 sq ft | 6,000-10,000 kWh | $1,900-$3,100 | Multiple cooking stations, delivery focus |
| Commissary Kitchen | 2,000-5,000 sq ft | 12,000-20,000 kWh | $3,750-$6,250 | Shared facilities, high utilization rates |
What type of catering business impacts energy costs the most?
Industrial kitchens and large-scale commissary operations consume the most energy, with monthly costs ranging from $4,700 to $9,400 compared to mobile food trucks at $250-$470.
Restaurant-based catering businesses typically fall in the middle range, spending $1,400-$2,350 monthly on energy due to their full kitchen operations and HVAC requirements. These operations run standardized equipment for 8-12 hours daily, creating predictable energy consumption patterns.
Mobile food trucks have the lowest energy costs because they operate smaller, portable equipment and often rely on propane for cooking, reducing electrical consumption. However, they face unique challenges with generator fuel costs and limited power capacity during events.
Event catering businesses experience variable energy costs depending on their operational model. Small event caterers spend $620-$1,250 monthly, while large event operations can reach $2,500-$3,750 due to extended operational hours during peak seasons and the need for additional refrigeration capacity.
Cloud kitchen networks represent a growing segment with energy costs of $1,900-$3,100 monthly, driven by multiple cooking stations operating simultaneously to fulfill delivery orders across different brands.
How does kitchen size directly affect monthly energy expenses?
Kitchen size directly correlates with energy consumption, with larger facilities requiring proportionally more power for lighting, ventilation, and equipment operation.
A typical commercial catering kitchen consumes approximately 25-35 kWh per square foot annually, translating to 2-3 kWh per square foot monthly. This means a 1,000 square foot kitchen will use roughly 2,000-3,000 kWh monthly just for basic operations.
Refrigerated storage areas significantly increase these baseline calculations, adding 25 kWh per square foot annually for cold storage facilities. A 200 square foot walk-in cooler alone can add 400-500 kWh to monthly consumption.
HVAC systems scale with kitchen size and can account for 20-30% of total energy use in larger facilities. Proper ventilation becomes critical in kitchens over 1,500 square feet, where exhaust fans and air conditioning systems must work harder to maintain safe temperatures.
You'll find detailed space planning insights in our catering business plan, updated every quarter.
What are typical daily and monthly operational hours for catering kitchens?
Most catering operations run 8-14 hours daily, with significant variations based on business model and seasonal demand patterns.
Restaurant-based catering typically operates 10-12 hours daily, 6 days per week, totaling 240-288 operational hours monthly. These businesses maintain consistent schedules aligned with their dining service, creating predictable energy consumption patterns.
Event catering businesses show the most variation, operating 6-8 hours on regular days but extending to 16-18 hours during major events. Peak wedding and corporate event seasons can push monthly operational hours from 150 to over 350 hours.
Industrial and commissary kitchens often operate 12-16 hours daily, sometimes running two shifts to maximize facility utilization. These operations can reach 300-400 hours monthly, significantly impacting energy costs through extended equipment runtime.
Mobile food trucks typically operate 6-10 hours per event day, but their monthly hours vary dramatically based on booking frequency, ranging from 80 hours for part-time operations to 200+ hours for busy trucks.
Which kitchen equipment consumes the most energy and what are their power ratings?
Commercial refrigeration systems and high-heat cooking equipment represent the largest energy consumers in catering operations.
| Equipment Type | Power Rating | Monthly Consumption (150 hrs) | Daily Cost | Typical Usage Pattern |
|---|---|---|---|---|
| Walk-in Cooler/Freezer | 3-8 kW | 2,160-5,760 kWh | $21.60-$57.60 | Continuous 24/7 operation |
| Combi-Steam Oven | 5-15 kW | 750-2,250 kWh | $23.40-$70.20 | 6-8 hours daily operation |
| Induction Cooktop | 3-7 kW | 450-1,050 kWh | $14.04-$32.76 | Peak cooking periods |
| Commercial Dishwasher | 4-9 kW | 600-1,350 kWh | $18.72-$42.12 | Post-meal cleanup periods |
| Ventilation System | 2-12 kW | 300-1,800 kWh | $9.36-$56.16 | During all cooking operations |
| Food Processor/Mixer | 1-5 kW | 150-750 kWh | $4.68-$23.40 | Prep periods, 2-4 hours daily |
| Hot Holding Equipment | 2-6 kW | 300-900 kWh | $9.36-$28.08 | Service periods, 4-8 hours daily |
This is one of the strategies explained in our catering business plan.
How much energy does each major appliance consume monthly on average?
Energy consumption varies significantly based on appliance type, usage patterns, and operational efficiency of catering equipment.
Refrigeration systems dominate monthly consumption, with walk-in coolers using 2,160-5,760 kWh monthly due to continuous operation. A typical 8x10 foot walk-in cooler consumes approximately 3,000-4,000 kWh monthly, costing $930-$1,250 at standard commercial rates.
High-heat cooking equipment shows variable consumption based on operational intensity. Combi-steam ovens, essential for large catering operations, consume 750-2,250 kWh monthly when operated 6-8 hours daily. Gas-powered alternatives can reduce electrical consumption by 60-70% but introduce separate gas costs.
Support equipment like dishwashers and ventilation systems contribute 600-1,800 kWh monthly each. Ventilation systems must operate whenever cooking occurs, making them significant consumers in busy catering kitchens that operate extended hours.
Smaller equipment including food processors, mixers, and hot holding units typically consume 150-900 kWh monthly each, but their cumulative impact becomes substantial in well-equipped catering facilities with multiple units.
What are current commercial electricity rates and additional fees?
Commercial electricity rates in 2025 vary significantly by region, with most catering businesses facing rates between $0.08-$0.25 per kWh plus demand charges.
In Thailand, commercial operations pay base service charges of ฿312.24 monthly plus energy charges ranging from ฿3.11-3.18 per kWh depending on voltage level. Demand charges add ฿224.30-332.71 per kW of peak usage, significantly impacting facilities with high-power equipment.
United States commercial rates typically range from $0.10-$0.20 per kWh, with additional demand charges of $10-$25 per kW in many regions. Peak demand periods usually occur during afternoon hours when HVAC systems work hardest to maintain kitchen temperatures.
European markets generally see higher rates, often $0.15-$0.30 per kWh, but with more sophisticated time-of-use pricing that allows catering businesses to reduce costs by shifting non-critical operations to off-peak hours.
Additional fees include connection charges, meter fees, and regulatory surcharges that can add 15-25% to base electricity costs. These fixed costs particularly impact smaller catering operations where they represent a larger percentage of total energy expenses.
How do seasonal variations affect catering energy usage?
Seasonal demand fluctuations can increase energy consumption by 25-50% during peak catering periods, primarily driven by extended operational hours and increased cooling requirements.
Summer months create dual pressures through higher ambient temperatures requiring more refrigeration power and peak wedding/event season increasing operational hours. Air conditioning costs can rise 40-60% during hot months, while refrigeration systems work 20-30% harder to maintain proper temperatures.
Holiday seasons, particularly November through January, see dramatic increases in catering demand. Many event caterers report 200-300% increases in operational hours during these periods, directly translating to proportional energy cost increases.
Spring and fall typically represent moderate energy usage periods, with outdoor events reducing kitchen heat loads and moderate temperatures minimizing HVAC requirements. These seasons often provide opportunities for equipment maintenance and energy efficiency improvements.
We cover this exact topic in the catering business plan.
How do gas appliances impact overall monthly energy costs?
Gas appliances can reduce electrical consumption by 40-60% for cooking operations but introduce separate fuel costs and infrastructure requirements.
Commercial gas rates typically range from $8-$15 per thousand cubic feet (MCF), with high-volume cooking operations consuming 5-15 MCF monthly. A busy catering kitchen using gas for cooking, water heating, and space heating might spend $400-$1,800 monthly on natural gas.
Gas cooking equipment operates with 40-50% thermal efficiency compared to 85-95% for electric induction systems. However, gas provides instant heat control and continues operating during power outages, making it preferred for many professional catering operations.
Infrastructure costs for gas include monthly service charges ($25-$75), demand charges based on peak usage, and potential pipeline capacity fees. New catering facilities may face $5,000-$25,000 in gas line installation costs depending on location and capacity requirements.
Hybrid approaches combining gas cooking with electric refrigeration and support equipment offer operational flexibility while managing energy costs. Many successful catering operations report optimal cost control using gas for high-heat cooking and electricity for precision temperature control.
What portion of energy costs comes from refrigeration and cold storage?
Refrigeration typically accounts for 30-45% of total energy consumption in catering operations, making it the single largest energy expense category.
Walk-in coolers and freezers operate continuously, consuming 2,000-6,000 kWh monthly depending on size and efficiency. A typical catering operation with a 8x10 walk-in cooler and 6x8 freezer can expect monthly refrigeration costs of $800-$1,500.
Reach-in refrigerators and prep coolers add another 200-800 kWh monthly per unit, with busy catering kitchens operating 4-8 units simultaneously. These smaller units often have lower per-cubic-foot efficiency than larger walk-in systems.
Ice machines represent an often-overlooked refrigeration cost, consuming 300-1,200 kWh monthly depending on production capacity. High-volume catering operations producing 500-1,000 pounds of ice daily can see ice machine costs of $200-$600 monthly.
Modern energy-efficient refrigeration systems can reduce consumption by 20-40% through improved insulation, variable-speed compressors, and smart controls that optimize defrost cycles and maintain precise temperatures.
How do peak and off-peak electricity rates affect catering operations?
Time-of-use pricing can reduce energy costs by 20-35% for catering businesses that can shift non-critical operations to off-peak periods.
Peak rates typically apply during 8:00 AM to 8:00 PM on weekdays, when electricity demand is highest. Off-peak rates, often 30-50% lower, apply during nighttime hours and weekends when grid demand decreases.
Catering operations can benefit by scheduling energy-intensive prep work, dishwashing, and equipment cleaning during off-peak hours. Prep work for next-day events can often be shifted to late evening hours when rates drop significantly.
Equipment with thermal mass, such as combi ovens and steam kettles, can be preheated during off-peak periods and maintain temperature into peak hours. This strategy can reduce peak-period consumption by 15-25% for well-planned operations.
Demand response programs in some markets offer additional incentives for reducing consumption during grid stress periods. Participating catering businesses can earn $200-$1,000 annually while supporting grid stability.
What energy-efficient equipment and renewable options reduce costs?
Energy-efficient catering equipment can reduce consumption by 25-50% compared to standard models, with payback periods typically ranging from 2-5 years.
1. **Induction Cooking Systems**: Use 40-50% less energy than gas ranges while providing precise temperature control and faster heating2. **Energy Star Refrigeration**: Reduces consumption by 20-30% through improved compressors and insulation3. **LED Lighting**: Consumes 75% less energy than traditional fluorescent systems with 10x longer lifespan4. **Variable Speed Kitchen Ventilation**: Adjusts fan speeds based on cooking activity, reducing energy use by 30-60%5. **Heat Recovery Systems**: Capture waste heat from cooking equipment to preheat water or provide space heating6. **Smart Controls**: Optimize equipment operation schedules and reduce standby consumption by 15-25%7. **High-Efficiency Dishwashers**: Use 25-40% less hot water and electricity while maintaining sanitation standardsSolar panel systems can offset 20-60% of catering facility energy consumption, with typical installations costing $15,000-$75,000 before incentives. Payback periods range from 4-8 years depending on local solar resources and electricity rates.
It's a key part of what we outline in the catering business plan.
What operational changes can optimize energy consumption without affecting service quality?
Strategic operational adjustments can reduce energy consumption by 15-30% while maintaining or improving service quality through better planning and equipment management.
Equipment scheduling optimization includes preheating ovens only when needed, maintaining refrigeration units through regular coil cleaning (11% energy savings), and using programmable thermostats to reduce HVAC consumption during non-operational hours.
Menu engineering can significantly impact energy costs by grouping items that use similar cooking methods, reducing the number of different appliances operating simultaneously. Cold menu items and no-cook preparations can reduce kitchen heat loads during peak summer months.
Staff training on energy-conscious practices includes proper loading of dishwashers, keeping refrigerator doors closed, and turning off unnecessary lighting and equipment. These behavioral changes typically reduce consumption by 8-15% without capital investment.
Preventive maintenance programs ensure equipment operates at peak efficiency. Regular cleaning of refrigeration coils, calibration of cooking equipment, and replacement of worn gaskets can maintain manufacturer-specified energy performance throughout equipment lifespan.
Conclusion
Energy costs represent a significant operational expense for catering businesses, typically ranging from $250 monthly for small mobile operations to over $9,000 for large industrial kitchens. Understanding the key cost drivers—equipment power ratings, operational hours, refrigeration requirements, and local utility rates—enables new catering entrepreneurs to budget accurately and identify optimization opportunities.
Strategic equipment selection, operational scheduling, and energy management practices can reduce monthly energy costs by 25-35% without compromising service quality. The investment in energy-efficient equipment and renewable energy systems often pays for itself within 3-5 years while reducing long-term operational risks from rising energy costs.
This article is for informational purposes only and should not be considered financial advice. Readers are encouraged to consult with a qualified professional before making any investment decisions. We accept no liability for any actions taken based on the information provided.
Understanding energy costs is just one component of successful catering business planning.
Proper financial forecasting and operational planning help ensure your catering venture achieves sustainable profitability from day one.
Sources
- Caterboss - Types of Catering Services
- Wikipedia - Mobile Catering
- Plato Hire - Event Generator Requirements
- Industry Kitchens - Energy Efficient Catering Equipment
- Sustainweb - Energy Efficiency in Commercial Kitchens
- PEA Thailand - Electricity Tariffs
- Good Energy - Time of Use Electricity Rates
- The Rail - Energy Efficiency Strategies for Restaurants
- PowerKnot - Commercial Kitchen Equipment Energy Consumption
- Green Design Consulting - Energy Efficiency in Refrigerated Warehouses