Energy efficiency and saving money

Energy is the third largest cost for most food or beverage manufacturers, after materials and labour. Energy is easier to manage. 

You can optimise your energy use without harming your business through:

  • efficiency
  • monitoring
  • timing your loads to manage peak demand and coincide with lower energy tariffs.

As energy costs increase, investing time in reducing energy use will prove worthwhile.

Reasons for and costs of energy in your business

All businesses differ in how they use energy. Your business energy costs depend on: 

  • how much energy you use
  • whether you use electricity, natural gas, or another form of energy
  • when you use energy.

You should review your energy costs regularly, even if only to check that you’re on the best tariff.

A useful way of tracking your energy savings progress is by working out the cost of energy you use compared to what you produce. You can do this by dividing your energy costs by the volume of your product. 

For example, if your energy bill is $5,000 and you produce 20,000 cakes, your energy costs you 25 cents per cake ($5,000 divided by 20,000 cakes = $0.25 per cake).

Many services powered by gas or other fuels can now be electrified, which is a first step towards decarbonisation.

These graphs show how cake and pastry processors use energy and where there might be savings opportunities. 

This graph shows how the energy use of small to medium cake and pastry manufacturers typically breaks down between different energy types. It is a pie chart.  The sections of the chart are labelled electricity 32%, other 68%.
This graph shows how the energy use of small to medium cake and pastry manufacturers typically breaks down between different activities. It is a pie chart.  The sections of the chart are labelled production/baking 29%, transport 20%, freezing/chilling 20%, washing/sterilising 17%, packaging 8%.

Measuring and valuing energy

The easiest way to understand your energy use and costs is through your bills. However, they probably don’t show when you used energy or what you used it on. 

There are metering and monitoring tools available to give you that data in real time. Sub-metering can be easily ‘clipped on’ to a particular process or piece of equipment to tell you how much energy it is using. These tools can generate reports and highlight irregularities which help to identify equipment which is operating inefficiently or needs maintenance. You can apply for an Energy Efficient Communities Food and Beverage Manufacturing Business (EEC) grant to purchase, hire and install energy meters, or to digitally connect energy meters and process sensors. 

Energy audits

An energy audit can give you immediate savings through:

  • reviewing the energy tariffs you pay
  • identifying equipment maintenance needs
  • identifying potential low-cost interventions.

An independent expert audit, to the Australian Standard, is likely to cost $5,000 to $10,000 depending on the complexity of your business. The audit might compare your business against similar businesses. It should provide you with an action plan, prioritise tasks according to impact, and show you the costs and benefits. 

The plan might also include suggestions for:

  • on-site generation and storage
  • demand management
  • use of waste
  • decarbonisation. 

Audits are of most value when they are based on good quality data, so before you start, consider improving how you measure your energy. At the very least you’ll need to locate your energy bills from the last full year.

You can apply for an EEC grant to carry out an energy audit at your cake and pastry processing business.

Opportunities for improvement

You can apply for an EEC grant to carry out these activities, except for the ones noted as not eligible:

  • review your tariffs, consumption and bills (not eligible for EEC grant)
  • carry out routine equipment maintenance including seals, filters, settings (not eligible for EEC grant)
  • install or upgrade metering
  • implement a monitoring program 
  • commission an energy audit
  • check your electricity distribution board and modernise if required so that you can upgrade to use electrically-powered equipment  
  • install power factor correction or voltage optimisation equipment. 

Small businesses can use the Small Business Energy Check - external site  to compare their energy spend with similar businesses in the same sector and region. Small businesses in NSW, QLD, SA, TAS and ACT can also compare energy plans from different retailers at Energy Made Easy - external site .

If you’ve got a sense of your position and you’ve captured the easiest opportunities you might:

  • install or replace a component to help an existing system run more efficiently
  • replace existing equipment with more efficient equipment
  • reconfigure a process to optimise energy use.

Likely opportunities for cake and pastry processors

Optimise process heating

  • Audit performance 
  • Optimise controls and timers 
  • Schedule and carry out routine maintenance, check and replace oven seals (not eligible for EEC grant)
  • Optimise equipment insulation 
  • Use recovered heat from oven exhausts to heat water 
  • Replace ovens with higher efficiency units 

Keep cool rooms cool

  • Repair seals (not eligible for EEC grant)
  • Insulate refrigerant piping 
  • Improve sequencing of chillers
  • Reconfigure processes and equipment to reduce cooling loads; for example, pre-cool product before freezing 

Optimise fridges and freezers

  • Audit performance 
  • Optimise controls and timers 
  • Schedule and carry out routine maintenance (not eligible for EEC grant)
  • Recover waste heat 
  • Replace low efficiency fridges and freezers with high efficiency equipment 

Find and fix compressed air leaks

Most processors use compressed air to run tools, valves and other services. Air systems can use as much as 20% of site energy. Audit your system to find leaks and assess the need for upgrades or alternatives.

  • Fix leaks (not eligible for EEC grant)
  • Replace a compressor with a more efficient unit
  • Replace air-powered equipment with electrically powered equipment 


  • Install a metering, monitoring and control system. Invest $25,000 and save $5,000 to $10,000 per annum.
  • Install heat recovery to refrigeration plant. Invest $20,000 and save $6500 in LPG gas costs for hot water used in washing and sterilising.
  • Automate conveyor belts with pressure switches. Invest $2,000 to $10,000 and save more than $500 per annum.

Remember that since the smallest EEC Food and Beverage Manufacturing Business grant is $10,000, you may need to choose several activities so that the total reaches the minimum spend. The maximum EEC Food and Beverage Manufacturing Business grant amount is $25,000. If you would like to carry out a larger project you will need to contribute to the costs.

Biscuits on a production line

Biscuits on a production line.