Cost ReductionTechnology

Lowering Energy Costs with IoT Enabled Technology

Restaurant expenses can leave little in the way of profit margins, despite waiting lines and growing revenue. Food and labor costs often take the lion’s share and, therefore, the most attention when it comes to control, leaving the cost of utilities often overlooked. There’s nothing much you can do about the rising cost of energy anyway…right? Fortunately, the rise in technology has delivered a possible avenue for reducing this “fixed” cost: IoT-Enabled Energy Management.

For those of you, like myself, who know their way around a computer keyboard but need an IT staff on hand to delve into the inner workings, IoT-Enabled Energy Management sounds a little bit like Star Wars. I envision C-3PO and his sporadic attempt to control the unseen.

So, in order to learn just what this term entails, I pulled a few of my IT-genius friends aside from their multi-screens and computer jive and asked them to give me a rundown on just what IoT-Enabled Energy Management is and how it can help a restaurant create a better profit margin. It turns out that this “fixed” cost is not so fixed after all. And, to motivate you further, a 20 percent reduction in energy costs translates into an additional 1 percent profit.

On average, a restaurant spends about $2.90 per square foot on electricity and another $.85 on natural gas. The highest energy users are typically equipment used in cooking and refrigeration as well as heating, cooling, and lighting.

IoT-Enabled Energy Defined

The Internet of Things (IoT) has changed the very core of how we function as a species. It has altered the way we communicate, consume and educate. Along the way it has also helped to create “smart” buildings and Energy Management Solutions. It is estimated that, by 2019, there will be 42 billion “connected things.” These connected things contain embedded technology that senses (and often interacts) with their environment.

This works by gathering information and data from appliances, equipment, computers and machines, and then transmitting said data to a cloud-based application. Here it is sorted and analyzed, returning information, alerting staff, and even taking action on measures that reduce energy costs. Let’s take a look at a typical energy management solution at work.

  • Temperature Control. The Food Safety Modernization Act (FSMA) shifted the focus from responding to foodborne illnesses to preventing them. This prompted several key regulations including an increase in monitoring and record-keeping for those in the food industries. Temperature is one of the most important critical control points making maintaining refrigeration units at a set point mandatory. Smart energy solutions include refrigeration sensors that can detect any change in temperature, alert the appropriate personnel, and record temperatures at any set time.

In addition to your coolers, a restaurant operator has immediate access and the ability to modulate, via a mobile app, the temperatures of ovens and fryers. Besides controlling the temperature of your food, it also controls the temperature in the room, gauging consumption against settings and, in turn, modifying the thermometer over a 24-hour period to regulate and control temperature and energy usage.

And all this information arrives in the form of alerts and detailed reports.

  • Sensors can also keep tab on the workings within your equipment, letting you know, for example, if air is leaking from a freezer door, a refrigerator compressor is about to go out, or the heating unit in your oven is flickering. Early awareness of potential malfunctions could very well save you time and money in repairs.
  • Smart Refrigerators. A commercial refrigerator with IoT technology offers some pretty incredible features. These new-and-improved units can monitor and control each area of the refrigerator independently. Some can even determine when food should be used by and if bacteria are present.
  • Combining sensors and controls with LED lighting, analytics and intelligence can significantly reduce lighting costs in upwards of 50 percent. Lights are operated from a centralized control point and compare energy usage with occupancy.

The most common average profit margin lies between 3 and 5 percent for a typical restaurant. If you can shave off even 1 percent in expenses by taking a look at your energy output, it may very well be worth your time.


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