Factories are among the most energy-intensive commercial premises in the UK due to constant machinery operation, industrial heating, lighting, compressed air systems, refrigeration, and ventilation. Energy consumption varies widely depending on manufacturing type, automation levels, production hours, building size and equipment used. Knowing typical monthly energy costs helps factory operators reduce overheads, negotiate better tariffs and plan energy efficiency strategies.
Typical factory energy usage
Factories use both electricity and gas. Electricity drives motors, machinery, compressors, refrigeration, conveyors, robotics and lighting. Gas is used for process heating, boilers, hot water systems and space heating.
Typical monthly factory energy consumption ranges
| Factory type | Electricity (kWh/month) | Gas (kWh/month) |
|---|---|---|
| Small workshop (light assembly) | 10,000–20,000 | 4,000–8,000 |
| Medium manufacturing facility | 25,000–50,000 | 12,000–30,000 |
| Large industrial factory | 60,000–120,000+ | 35,000–70,000+ |
Heavy manufacturing (metalworking, food processing, plastics, chemical plants) and factories with process heating or kilns typically consume energy at the top end of these ranges.
Estimated monthly energy cost for a UK factory
A medium factory generally spends between £7,790 and £16,000 per month on energy, combining electricity and gas. Usage depends greatly on equipment type, production hours and heating requirements.
| Factory size | Electricity cost | Gas cost | Total monthly energy cost |
|---|---|---|---|
| Small | £2,660–£5,300 | £360–£720 | £3,020–£6,020 |
| Medium | £6,650–£13,300 | £1,140–£2,700 | £7,790–£16,000 |
| Large | £15,900–£31,800+ | £3,150–£6,300+ | £19,050–£38,100+ |
These estimates include standing charges and reflect typical factory operating hours (often 6 days per week, or 24/7 for larger facilities).
Which factory activities use the most energy?
| Process or equipment type | Electricity (kWh/month) | Gas (kWh/month) |
|---|---|---|
| Space heating | 500–2,000 | 3,000–20,000 |
| Motors, conveyors, robotics | 2,000–12,000 | N/A |
| Compressed air systems | 1,000–8,000 | N/A |
| Process heating, ovens, furnaces | 1,200–10,000 | 1,000–35,000 |
| Refrigeration and chillers | 800–8,000 | N/A |
| Ventilation, extractor fans, HVAC | 1,000–7,000 | 200–600 |
| Lighting for manufacturing floors | 800–5,000 | N/A |
| Office, canteen, welfare areas | 300–1,000 | 200–500 |
Compressed air machinery alone can represent up to 30% of a factory’s electricity bill, depending on industrial type.
Main energy cost drivers
Operating hours
Factories operating 24/7 or running three-shift production can use 40% more energy than standard daytime-only facilities.
Compressed air leakage
Air compressors waste energy if not maintained. A single 6 mm air leak can waste £1,500 to £2,000 annually in electricity.
Process heating
Kilns, injection moulding, metal casting and food processing require large amounts of gas and electricity for thermal processes.
Poor insulation
Many factories have high ceilings, large floor space and poor insulation, making space heating expensive, especially in winter.
Automation and robotics
High levels of automation increase electricity demand but often improve efficiency per unit of production.
Seasonal impact on factory energy bills
| Season | Typical energy impact | Main reason |
|---|---|---|
| Winter | +25% to +50% | High gas consumption for heating |
| Summer | +10% to +20% | More air conditioning and ventilation use |
| Mild seasons | Baseline | Heating and cooling less dominant |
Factories with large shutter doors and uninsulated warehouse units experience the highest seasonal variations.
How to reduce factory energy costs
| Strategy | Typical saving potential | Notes |
|---|---|---|
| Maintain and optimise compressors | 15–30% | Fixing leaks and pressure settings saves significant energy |
| Install LED lighting and sensors | 10–20% | Particularly effective in large manufacturing halls |
| Use heat recovery systems | 10–25% | Utilises wasted heat from machinery or ovens |
| Upgrade building insulation | 15–35% | Reduces winter heating demand |
| Use smart process scheduling | 5–15% | Avoids peak-time energy waste |
| Switch to fixed or flexible business tariffs | 8–15% | Helps protect against price volatility |
Why energy management matters in factories
Energy is often one of the top three overheads in manufacturing businesses. Energy costs represent 10% to 30% of total operational expenses, rising to 40% for energy-intensive sectors such as metal casting, food processing or plastics. Efficient energy use supports cost control, sustainability goals and competitive pricing.
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FAQ
A medium manufacturing facility generally spends between £7,790 and £16,000 per month on energy, combining electricity and gas. Usage depends greatly on equipment type, production hours and heating requirements.
A small light manufacturing or assembly factory typically uses between 10,000 and 20,000 kWh of electricity per month. At an average rate of 26p per kWh, this results in an electricity bill of around £2,600 to £5,300, excluding standing charges and gas usage.
It depends on production type. Factories involved in food processing, plastics, metalworking or drying processes usually spend more on gas due to heavy use of boilers, ovens and furnaces. Facilities focused on automation, robotics and machinery tend to spend more on electricity.
Compressed air systems, process heating (furnaces, kilns, ovens), motors, HVAC, and industrial refrigeration are among the biggest energy consumers. Compressed air alone can account for up to 30% of electricity costs if not efficiently maintained.
In winter, factories can see energy bills rise by 25% to 50%, mainly due to increased gas usage for heating. Warehouses, workshops and production halls with large shutter doors and poor insulation experience the greatest increase.
Yes. Lower-cost improvements such as repairing compressor leaks, installing LED lighting, adding insulation, using smart timers and improving heat recovery can reduce energy costs by 10% to 25% without replacing major equipment.
Energy typically accounts for 10% to 30% of operating costs in manufacturing businesses. In energy-intensive industries such as plastics, chemicals, metal casting and food processing, this can rise to 40%.
Large factories with heavy manufacturing processes usually consume between 60,000 and 120,000+ kWh of electricity, and 35,000 to 70,000+ kWh of gas each month. This often results in energy costs exceeding £19,000 per month.
Compressed air systems are inefficient by nature, and leaks, poor maintenance and high-pressure settings can waste up to 30% of total energy used. A single small leak can cost £1,500 to £2,000 per year in wasted electricity.
Factories with consistent, high and predictable usage often benefit from fixed-rate tariffs. Those with seasonal or fluctuating demand may find flexible tariffs more cost-effective. Many suppliers now offer manufacturing-specific contracts with energy optimisation options.