Energy costs are the third largest expense in your restaurant after food and labor. Yet most restaurateurs overlook them entirely in break-even calculations. This oversight can mean the difference between thinking you're profitable and discovering you've been hemorrhaging cash for months.
Why energy costs are crucial for your break-even
Energy costs typically account for 3-8% of your total revenue. For a restaurant with €500,000 annual revenue, this means €15,000 to €40,000 per year on gas and electricity. If you don't include this in your break-even calculation, you'll be off by thousands of euros.
⚠️ Note:
Energy costs are variable and increase every year. Calculate with current rates, not what you paid last year.
What counts as energy costs in hospitality
Energy costs consist of multiple components that you need to include:
- Electricity: lighting, cooling, dishwasher, register, music
- Gas: cooking, heating, hot water
- Water: kitchen, sanitary, cleaning
- Fixed costs: connection fees, grid management costs
💡 Example:
Restaurant with 80 seats, open 6 days a week:
- Electricity: €2,800/month
- Gas: €1,200/month
- Water: €400/month
- Fixed costs: €150/month
Total energy costs: €4,550/month = €54,600/year
The energy costs formula for break-even
Your break-even calculation now becomes:
Break-even point = (Fixed costs + Energy costs) / (Average check - Variable costs per guest)
Energy costs are semi-variable: part is fixed (connection, base consumption), part increases with more guests (more cooking, more dishwashing). It's the kind of thing you only learn after closing your first month at a loss - watching your electricity meter spin faster during busy nights while your gas bill stays frustratingly high even on slow days.
💡 Example calculation:
Bistro with these figures per month:
- Rent + staff: €18,000
- Energy costs: €3,500
- Average check: €32
- Food cost per guest: €9.60 (30%)
- Variable costs per guest: €11.60
Break-even = (€18,000 + €3,500) / (€32 - €11.60) = €21,500 / €20.40 = 1,054 guests/month
Distribution of fixed vs. variable energy consumption
Not all energy costs increase proportionally with your number of guests. Make a distinction between:
- Fixed energy costs (70%): cooling always running, lighting, basic heating
- Variable energy costs (30%): more cooking with more guests, extra dishwashing
💡 Practical example:
Energy costs €3,500/month at 1,200 guests:
- Fixed part: €2,450 (stays the same)
- Variable part: €1,050 (€0.88 per guest)
At 1,500 guests this becomes: €2,450 + (1,500 × €0.88) = €3,770 total
Include seasonal fluctuations
Energy costs vary by season. Heating costs are 2-3 times higher in winter than in summer. Calculate with a weighted average over the entire year.
Calculate your break-even for:
- Summer months: lower energy costs, possibly more guests
- Winter months: higher energy costs, possibly fewer guests
- Annual average: for your general business plan
Energy savings as profit improvement
Every euro you save on energy goes directly to your profit. Small adjustments have a big impact on your break-even point.
💡 Impact of energy savings:
If you save €500/month on energy:
- Break-even drops by: €500 / €20.40 = 25 guests/month
- That's almost 1 guest per day less needed
- Annual profit increases by €6,000
How do you calculate energy costs in your break-even? (step by step)
Gather your energy bills from the past year
Get all your gas, electricity and water bills from the last 12 months. Add up the total amount and divide by 12 for your average monthly costs. Don't forget to include fixed connection fees.
Split fixed and variable consumption
Approximately 70% of your energy costs are fixed (cooling, lighting, basic heating) and 30% variable (extra cooking, dishwashing with more guests). Calculate the variable part per guest by dividing the variable costs by your average number of guests per month.
Adjust your break-even formula
Add the fixed energy costs to your other fixed costs (rent, staff). Add the variable energy costs per guest to your other variable costs (food cost, disposables). Now calculate your new break-even point with these complete figures.
✨ Pro tip
Track your kWh per guest served for 3 consecutive months - anything above €2.80 per guest signals equipment inefficiency. You'll spot energy leaks before they destroy your margins.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
Should I see energy costs as fixed or variable costs?
Energy costs are semi-variable. Approximately 70% is fixed (cooling, lighting) and 30% variable (more cooking with more guests). Split this in your calculation for an accurate break-even point.
How do I forecast energy costs for a new restaurant?
Calculate with €3-6 per m² per month for an average restaurant. A space of 200m² would then come to €600-1,200/month. Check similar establishments in your area for a better estimate.
What if my energy costs suddenly increase?
Recalculate your break-even point immediately and check if your menu prices still make sense. An increase of €500/month in energy costs means you need 25-30 extra guests per month to earn the same.
Can I lower energy costs without sacrificing comfort?
Yes, through smart equipment and good insulation. LED lighting, efficient cooling and timer switches can save 20-30% without guests noticing.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
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