Utilities for restaurants: key facts
- The kitchen drives the bill. Cooking, extraction, refrigeration and hot water make energy most restaurants' largest utility cost.
- There is no price cap on business energy.
- Taking over premises puts you on a deemed contract until you agree your own. Read and photograph every meter on your first day.
- The copper phone network closes by 31 January 2027. Booking lines, card terminals and alarms that still rely on an analogue line need checking.
- In England, restaurants can choose their water retailer (since April 2017); in Scotland, business customers have been able to since 2008.
- Food waste must be separated under Simpler Recycling in England: from 31 March 2025 for businesses with 10 or more employees, and from 31 March 2027 for smaller ones.
What utilities does a restaurant need?
A typical restaurant needs gas and electricity for the kitchen, broadband and phones for bookings, EPOS and card payments, water and sewerage, and commercial waste collections that separate food waste and recycling.
| Area | What it uses | What to watch |
|---|---|---|
| Kitchen | Gas for ranges, ovens, grills and fryers; electricity for extraction, refrigeration (including walk-in cold rooms) and dishwashers; lots of hot water. | Equipment left on between services, failing door seals on fridges, extraction running all day. |
| Dining room and bar | Lighting, heating and air conditioning, coffee machine, glass washer, music, guest Wi-Fi. | Heating and lighting a full dining room during an empty afternoon. |
| Front of house systems | Broadband for the booking platform, EPOS, card terminals, kitchen display screens and delivery tablets; a phone line for reservations. | A single point of failure if the broadband drops during service. |
| Water and waste | Dishwashers, pot washing, prep sinks, toilets; food waste, glass, cardboard and used cooking oil. | Fats going down the drain, food waste separation rules, collection times. |
Each utility has its own contract, renewal date and supplier, which is why many restaurants lose track of them.
Why are restaurant energy bills so high?
Because a commercial kitchen concentrates a lot of heavy equipment in one room: gas burners and ovens running for hours, extraction fans pulling air out, refrigeration working round the clock, and dishwashers and water heaters producing hot water all day.
- Cooking equipment. Most restaurant kitchens are gas-led, with ranges, char grills, fryers and ovens. Burners lit at the start of a shift and left on use gas whether or not anything is cooking.
- Extraction and ventilation. The canopy fans need to run while you cook,, and the air they pull out has to be replaced, often heated in winter.
- Refrigeration. Walk-in cold rooms, under-counter fridges, reach-ins and freezers run 24 hours a day. Worn door seals and dirty condenser coils make them work harder.
- Hot water. Pass-through and undercounter dishwashers, pot wash sinks and hand basins all need hot water, heated by gas boilers or electric units.
Knowing what drives your bill helps when a broker asks whether you use more gas or electricity, and when.
How do lunch and dinner services affect a restaurant's energy use?
Most restaurants have two peaks, lunch and dinner, with afternoon prep in between and refrigeration running all night. That pattern means much of your energy is used during the day, and equipment left on in the quiet afternoon gap is a common source of waste.
- Morning: deliveries and early prep; ovens come on.
- Lunch service: the full line, extraction and dining room running.
- Afternoon: evening prep, when burners and extraction are often left on for no reason.
- Dinner service: the main peak for most restaurants.
- Overnight: refrigeration, alarm and CCTV.
If you have a half-hourly or smart meter, your supplier or broker can see when you use energy, which can affect the prices you're offered. Read more in our guide to business energy for restaurants.
What should a restaurant check on its energy contract?
Check your contract end date, whether you're on a fixed or variable deal, what the standing charges and unit rates are, and whether a broker's fee is included. Restaurants buy energy on business contracts, which have no price cap.
- Renew before the end date. If your contract ends and nothing new is agreed, you're likely to roll onto out-of-contract rates.
- VAT. Most restaurants pay 20% VAT on energy. A reduced 5% rate only applies where use is very low (under 33 kWh a day for electricity, or 145 kWh a day for gas), which a working commercial kitchen will rarely be.
- Broker fees. For business energy contracts signed from 1 October 2024, any broker fee must be shown in the contract's principal terms, so you can see what you're paying for the service.
- Microbusiness protections. If you have fewer than 10 employees and turnover or a balance sheet of no more than EUR 2 million, or you use less than 100,000 kWh of electricity or 293,000 kWh of gas a year, you'll usually count as a microbusiness. Suppliers then can't back-bill you for more than 12 months.
- Complaints. If a complaint with your supplier isn't resolved after 8 weeks, you can usually take it to the Energy Ombudsman.
More detail: business energy for restaurants.
What does a restaurant need from its phones and broadband?
A restaurant's broadband carries its booking system, EPOS, card payments, kitchen screens and delivery-platform tablets, so it needs to be reliable during service. With analogue phone lines closing by 31 January 2027, check how your reservations line, card terminals and alarm connect.
- Reservations. Many guests still ring to book or change a table. A digital (VoIP) service can ring several handsets or divert to a mobile when you're closed.
- EPOS and card payments. Pay-at-table terminals, the till and kitchen screens depend on the network. A 4G or 5G backup keeps payments going if the main line fails.
- Delivery tablets. If you take orders through delivery platforms, each tablet needs a steady connection.
- Guest Wi-Fi. Keep it on a separate network from your tills and card machines.
- The copper switch-off. Openreach stopped selling new analogue lines in September 2023 and the deadline for the switch-off is 31 January 2027. Older card terminals and alarms may need checking.
For more detail, read phones and broadband for restaurants.
How do restaurant water rates work?
Restaurant water bills are usually made up of water supply, wastewater (sewerage) and surface water drainage charges. In England, most businesses can choose their water retailer (since April 2017), and in Scotland business customers have been able to since 2008. The local water company still owns the pipes.
- Fats, oils and grease (FOG). Grease poured or washed down sinks sets hard in drains and sewers and causes blockages. Most restaurant kitchens fit a grease trap or grease removal unit and have it emptied or serviced regularly. Used cooking oil should go to a licensed collector, never down the drain.
- Leaks and running fixtures. A pre-rinse spray left on or a running toilet costs money. Compare meter readings at close and before opening.
- Surface water drainage. This charge is based on the area of your site that drains to the public sewer.
- Wales. Only very large users can switch water retailer, so most Welsh restaurants stay with their regional water company.
We don't currently offer water quotes.
What are the food waste and recycling rules for restaurants?
In England, Simpler Recycling requires businesses to separate food waste, dry recycling and general waste: from 31 March 2025 for businesses with 10 or more employees, and from 31 March 2027 for those with fewer than 10. Wales has required workplace recycling separation since 6 April 2024, and Scotland has its own rules.
It's your employee count, not your number of covers, that decides which date applies. Typical restaurant waste streams:
- Food waste from prep and plate scrapings, usually the heaviest stream.
- Glass from wine, beer and soft drinks.
- Cardboard and packaging from deliveries.
- Used cooking oil, collected separately by a licensed collector.
- General waste that can't be recycled.
Whatever the rules where you trade, you must use a registered waste carrier and keep waste transfer notes as part of your duty of care.
How do you set up utilities for a new restaurant?
Find out who supplies each utility, read and photograph every meter on the day you get the keys, tell the suppliers you've moved in, and agree an energy contract quickly. Until you do, you'll usually be on a deemed contract, which is typically more expensive.
- Find the meters and the suppliers. Ask the agent, landlord or outgoing operator for supplier names and meter numbers (MPAN for electricity, MPRN for gas).
- Read every meter on day one. Take dated photos of the electricity, gas and water meters so you're not billed for the previous occupier's use.
- Contact each supplier. Give them your business details, the date you took over and the readings.
- Get energy quotes early. Comparing before opening avoids doing it under the pressure of service.
- Order broadband in good time. New lines can take a while, and bookings and card payments need to work from the first service.
- Check the kitchen is ready. A new kitchen fit-out may need a larger gas or electricity supply. Raise capacity early with your fit-out contractor.
- Arrange water and waste. Confirm your water retailer, get a grease trap serviced or installed, and set up separate food waste collections.
Leased premises, landlord-supplied utilities and multi-site groups
If your landlord supplies your energy or water, you may not be able to choose your own supplier, so check the lease first. Multi-site restaurant groups can often line up contract end dates and manage sites together, but each site still needs its own meters and readings.
Leased premises
Restaurants in shopping centres, food halls, hotels and mixed-use buildings sometimes get utilities through the landlord, who re-charges them through the service charge or a sub-meter. Before you sign a lease, ask:
- Are the electricity and gas supplies in your name or the landlord's?
- Is there a sub-meter, and how is your share calculated?
- Can you choose your own supplier, broadband provider and waste contractor?
Multi-site groups
If you run several restaurants, contracts often end at different times because each site was opened or acquired separately. Bringing end dates into line makes renewals easier, and a single list of meters and renewal dates shows any sites on deemed or out-of-contract rates. Larger groups may no longer count as microbusinesses, so the protections that apply can differ.
Related guides for food and drink businesses: utilities for cafes and utilities for pubs.
How do restaurant utility quotes through Business Utilities Hub work?
Tick energy, phones and broadband, or both, and fill in one short form. With your consent, we pass your details to the business energy brokers and telecoms providers we work with, who contact you with quotes. It's free and there's no obligation.
- Choose what you need on the form.
- Tell us about your restaurant: name, contact details, postcode and, for energy, when your current contract ends.
- A broker or provider gets in touch.
- You decide. You don't have to accept any quote.
We are not a supplier or broker and we don't give advice. We may be paid by the brokers and providers we introduce you to. Energy suppliers can only work with brokers who belong to a redress scheme for small business contracts, and every energy broker we work with is in an Ofgem-approved complaints scheme.
Related guides
Utilities for restaurants: frequently asked questions
What is usually a restaurant's biggest utility cost?
For most restaurants it's energy. Cooking equipment, extraction, round-the-clock refrigeration and hot water all add up across two services a day.
Is there a price cap on restaurant energy?
No. The Ofgem price cap only applies to household energy. A restaurant pays the prices set out in its business energy contract, so the renewal date matters.
Can I get energy and broadband quotes for my restaurant at the same time?
Yes. Tick both on our form and we'll pass your details to an energy broker and a telecoms provider, so you only fill in your details once.
What should I do with the meters when I take over a restaurant?
Read and photograph every gas, electricity and water meter on the day you get the keys, then give those readings to each supplier with the date you took over.
What is a deemed contract?
It's the arrangement a supplier puts you on when you start using energy at a site without agreeing a contract, for example after taking over premises. Deemed rates are usually higher than agreed contract rates, so it's worth getting quotes quickly.
Does the 2027 phone line switch-off affect restaurants?
Yes. Analogue phone lines are being replaced with digital services, with a deadline of 31 January 2027. Check your reservations line, older card terminals and alarms.
Can a restaurant choose its water supplier?
In England, most businesses can choose their water retailer, and in Scotland business customers have been able to since 2008. In Wales, only very large users can switch.
Does my restaurant need a grease trap?
Most commercial kitchens fit a grease trap or grease removal unit because fats, oils and grease washed down sinks can block drains and sewers. Keep it serviced regularly.
When do restaurants in England have to separate food waste?
Under Simpler Recycling, businesses with 10 or more employees have had to separate food waste, dry recycling and general waste since 31 March 2025. Businesses with fewer than 10 employees must do so from 31 March 2027.
Can I choose my own utility suppliers if I lease my restaurant?
Often, but check your lease first. In some shopping centres, food halls and mixed-use buildings the landlord supplies energy or water and re-charges you, which can limit your choice.
Is Business Utilities Hub a supplier or broker?
No. We publish guides and, with your consent, pass your details to business energy brokers and telecoms providers we work with. We may be paid for the introduction, and the service is free to you.