Reducing Restaurant Energy Costs in New York City: How Third Party Suppliers Deliver
Being a chef and restaurant owner in New York City is not for the faint of heart. From The Bronx to Manhattan, creative culinary entrepreneurs power the city’s vibrant food scene with passion, perseverance, and of course, eighteen-hour workdays. If only this were enough to power the restaurants themselves. NYC restaurant kitchens eat up energy like it’s spaghetti carbonara, and are often hit with astronomical energy bills that rival the cost of some of the most expensive kitchen appliances.
These infamous and ever fluctuating energy bills make it tough to budget, estimate overhead, maximize profits, or even make predictions about the future of the restaurant. Choosing a third party energy supplier can provide you with a competitive, stable rate, and thus help to increase your chances of financial success in the greatest city in the world.
Wholesale Energy, Wholesale Food
Ah, the NYC restaurant energy bill. You reluctantly tear it open each month with a heavy sigh, because, honestly, you don’t know what to expect. It’s always high—welcome to New York, where monthly commercial electrical costs alone are about 46% greater than the national average — and the rate seems to vary so much. Despite your consistent energy consumption, some months you don’t quite know how you’re going to fork up the money for the electric bill. So what’s going on?
If your energy rate and costs are all over the map, you are probably purchasing your energy (electricity and gas) from your utility as the plant produces it. The energy is subject to the forces of supply and demand which translates to a variable (constantly changing) price per megawatt-hour. When there’s more demand, the price goes up (and so does your stress level), and when demand is low, the price drops. It’s volatile, to say the least, but this was really the only option for consumers before energy became deregulated in New York in 1996.
Third party energy suppliers, on the other hand, purchase a bunch of energy from traders who sell energy in bulk before it is produced. This advance purchasing introduces a level of stability and foresight into the equation, and gives third party suppliers better bang for their buck. The energy is then sold to consumers, like you, at a competitive rate. Businesses have the option, when purchasing this energy, to choose a fixed rate plan. Fixed rates ensure you will always be paying the same price per megawatt, or market-based rate, allowing you to stay clear of the fluctuating industry price trends.
Think of the concept of energy supply in the same terms as food supply for your restaurant, with third party suppliers being like wholesale food suppliers, and utilities being like grocery stores. As a chef, you order your food from a wholesale food supplier, rather than buying it at the grocery store. Wholesale suppliers offer you bulk food products at competitive, consistent prices. Grocery store prices on goods such as produce and meats, on the other hand, fluctuate from week to week and sometimes even daily, depending on supply and demand. Buying five avocados from a grocery store is a lot more expensive per avocado than buying a whole box from a supplier. Because they are dealing with bulk product, wholesalers and third party energy suppliers alike can offer you more reliable and competitive rates.
Consciously Sourcing Energy and Food
Reduced and stable rates aren’t the only benefits you’ll reap from choosing a third party energy supplier for your restaurant, just as low food cost isn’t the only important variable when it comes to sourcing. Chefs know that where and how our food is sourced is also very important. You are the leaders in the massive organic, sustainable, and local food movements that have swept the nation. More than anyone, you can attest to the fact that food sourced this way is not only fresher and tastier, it is healthier for us and our environment.
These conscious choices you make when it comes to sourcing your food are similar to the choices you have with a third party energy supplier. Many of these suppliers allow you to source a percentage of your energy from renewable and sustainable sources, by purchasing renewable energy credits (RECs). By purchasing RECs, you are effectively contributing to the demand for renewable energy, while decreasing the reliance on harmful fossil fuels. Now, you’re not only reducing your carbon footprint by sourcing local food, you can further support a healthier environment by purchasing and using renewable wind, geothermal, and solar energy.
Powering Your Passion
In the cut-throat, volatile NYC restaurant industry, powering your restaurant with energy from a third party supplier can take more than a few worries off your plate. No more ripping your hair out when your monthly energy bill arrives. Not only can you save money, you also have the opportunity to help save the environment by purchasing RECs. And if you do make the switch, you won’t experience a disruption in service, as your local utility will still deliver the energy the same way as before. That way there won’t be any blackouts during dinner service and you can keep doing what you do best: feeding the Big Apple.
At Liberty Power, we know that the time and energy you put into running your New York City restaurant are valuable. Contact us to learn more about how we can power your passion with low-cost, sustainable energy.
Photo credit: Michael Browning