TCO and Energy-Efficient Appliance Considerations

Posted by Patrick Maness +


Numbers can be tricky, even deceptive.

If you turn on any news program, you’ll hear a flurry of statistics and numbers. When people debate, they rattle off numbers, one after another. The reason for this is that numbers are persuasive. It’s fair to say that most of us think that a number is a final, indisputable fact, and there’s no reason to argue against it.

But often times, numbers conceal a larger story.

This is especially important for the consumer. And if you’re in the market to buy some commercial kitchen appliances and equipment, beware of being deceived by the sticker price.

This is because a piece of equipment that you want to last between five to fifteen years will consume a lot of energy and probably need some maintenance. Just how much maintenance it will need, and how much electricity and water it will use during its lifetime, contribute to a total lifetime cost that just isn't reflected by the sticker price.

These factors, namely repair and energy consumption, add up to what is known as the total cost of ownership — or more simply, TCO.

What makes up the TCO?

TCO is a broad term and often means different things for different appliances and organizations. Nonetheless, there are a few key factors companies and organizations look at when defining TCO.

When calculating the TCO, you look beyond the cost of equipment and installation toward maintenance, energy consumption and water use. But you can drill down even further. For example, different fryers are more efficient at using oil, so cost of oil might be a factor. Another important consideration are the potential rebates for using energy-efficient devices.

Many energy-efficient appliances have a higher sticker price. Likewise, higher-quality, longer-lasting machines tend to be more expensive than the models you replace every three or four years.

To arrive at a more substantial cost comparison, you’ll often have to crunch a lot of numbers to identify the TOC for various pieces. This involves making many educated estimations. One of the most difficult variables to predict is the likelihood of breakdowns, potential repairs or the lifespan of a product.

Why it’s important

When many consumers hear that a $15 light bulb will save them $60 in energy costs over the next ten years, they’re not too enticed. That's because it’s just not that much in short-term savings. But in industrial kitchens, where energy-efficient refrigerators might save you thousands of dollars, a lot more money is at stake.

This is why calculating the TCO in a school cafeteria is so important. After all, preparing and keeping thousands of meals each day requires a lot of resources and utilities. This is a situation, clearly, where more energy-efficient equipment has the potential to save a lot of money.

And though the scale may be different, this is also the case for any industrial or restaurant kitchen.

Read other articles in this series:

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