How to Reduce Utility Costs in Commercial Laundry Rooms

Running a commercial laundry operation is one of the most resource-intensive aspects of any business. Whether you own a hotel, hospital, laundromat, or multi-housing laundry facility, you know that water, electricity, and gas expenses make up a significant percentage of your operational costs. But where exactly is the waste happening?

Many owners assume that buying high-efficiency (HE) machines is enough to bring down costs. But efficiency ratings only tell part of the story. The real savings come from how those machines are used, how water and energy flow through your facility, and how well your staff is trained to operate within a cost-saving framework.

If you’re serious about reducing your utility costs, you must take a strategic approach. It’s not just about cutting back; it’s about eliminating waste without sacrificing service quality. This guide will walk you through specific, profit-driven strategies that will help you lower your bills while maintaining high-performance laundry operations.

1. Understanding Where Your Money Is Being Wasted

Before making any changes, you need to understand why your utility costs are high in the first place. The majority of excessive spending in commercial laundries comes from three overlooked sources:

Inefficient Washer and Dryer Usage

The common assumption is that running fewer loads saves water and energy, but cramming too many linens into a washer forces it to use more water, longer cycles, and higher rinse settings to compensate for the lack of movement inside the drum. On the flip side, underloading means a full cycle runs for only a fraction of the machine’s capacity, leading to wasted resources.

Unnecessary Water and Energy Consumption

Most facilities overuse hot water, rely on default cycle settings that are too long, and fail to take advantage of water reuse technology. Similarly, many operations run machines during peak electricity hours, when rates are highest.

Additionally, many commercial washers are programmed with default rinse cycles that may not be necessary. If detergent concentration is low enough, one rinse cycle is often sufficient instead of two or three. The problem is that most laundries use the same rinse settings for every load.

What you can do is equip machines with a conductivity sensor, which measures how much detergent remains in the water and automatically adjusts rinse cycles accordingly. This small investment can reduce water use by 15-30% per load.

Lost Heat and Poor Airflow Management

Commercial dryers and water heaters generate enormous amounts of heat, but most facilities let it escape instead of recycling it. Additionally, inefficient ducting, lint buildup, and airflow restrictions force machines to work harder and consume more energy.

If your water, electricity, and gas bills are steadily rising or consistently high, the issue is not just the price of utilities—it’s how resources are being used.

2. How to Take Control of Water Consumption

Is your laundry using more water than necessary?

Most commercial laundry rooms use significantly more water than needed per cycle, either due to poor load management, outdated cycle settings, or excessive water pressure. These inefficiencies drive up costs without improving results.

A common mistake is assuming that “more water = better cleaning.” In reality, using too much water dilutes detergent effectiveness and forces the washer to work harder, leading to longer cycles and increased heating costs.

Strategies to cut water usage without affecting quality

• Optimize Load Sizes: Overloading forces machines to use more water and detergent, while underloading wastes resources. Instead of relying on staff estimates, install weight sensors or train employees to measure loads properly. A washer should be 80-85% full for maximum efficiency.
• Install Water Pressure Regulators: Many facilities never check their water pressure, leading to excessive consumption. Installing a Pressure-Reducing Valve (PRV) ensures that water enters the machine at the optimal pressure (30-50 PSI), reducing unnecessary water waste by 5-10% per load.
• Reduce Rinse Cycles with Conductivity Sensors: Many commercial washers run multiple rinse cycles by default, even when one is enough. A conductivity sensor measures detergent residue in the water and automatically eliminates unnecessary rinses, reducing water use by 15-30% per cycle.
• Capture and Reuse Rinse Water: Instead of flushing rinse water down the drain, a rinse water reclamation system filters and stores it for reuse in the pre-wash cycle. This can cut water consumption by up to 40%, providing immediate cost savings.

To ensure your machines run at peak efficiency, read our Essential Maintenance Tips for Commercial Laundry Machines and implement a proactive maintenance schedule.

3. The Hidden Cost of Overheating Water

Why Do Most Facilities Waste Energy On Water Heating?

Hot water is one of the largest expenses in a commercial laundry. Many facilities default to washing at 90°C (194°F), believing it’s necessary for cleanliness. However, modern detergents and chemical boosters achieve the same results at 40-60°C (104-140°F).

High-ROI strategies to cut heating costs

• Lower Default Wash Temperatures: Unless required for sanitation regulations, 90°C washes are excessive. Lowering temperatures to 40-60°C reduces heating costs by 30-50%.
• Install an On-Demand Water Heater: Traditional water heaters continuously reheat stored water, even when no laundry is being washed. A tankless, on-demand system only heats water when needed, eliminating standby energy loss.
• Use Ozone or UV Laundry Systems: Ozone-infused wash water sanitizes linens at cold temperatures, reducing hot water usage by up to 75% while improving fabric lifespan.
• Schedule Wash Loads During Off-Peak Hours: Many utility companies charge higher rates during peak periods (typically 2 PM–8 PM). Running hot water cycles at night or early morning can significantly reduce gas and electricity costs.

By switching to a lower temperature standard and adopting on-demand heating, laundry businesses can save thousands annually while maintaining sanitation standards.

4. Drying Costs: The Overlooked Profit Drain

Why are your commercial dryers wasting money?

Most laundry operations over-dry linens due to improper airflow, clogged ducts, and poorly optimized drying cycles. The biggest cost driver is heat loss, which forces dryers to run longer and consume excessive electricity or gas.

Fixing airflow and heat management

• Lint Buildup Increases Energy Use by Up to 30%: Even daily lint trap cleaning isn’t enough. Lint accumulates inside exhaust ducts, restricting airflow and forcing longer drying times. Schedule monthly professional duct cleaning to maintain efficiency.
• Improve Exhaust Duct Design: Long or twisted exhaust ducts trap heat and slow down drying efficiency. Ensure that ducts are under 25 feet in length with minimal bends for maximum airflow efficiency.
• Install a Heat Recovery System: Dryers expel heated air outside, wasting the energy used to heat it. A heat exchanger captures this heat and reuses it to pre-warm incoming air, reducing energy consumption by 20-30% per load.
• Switch to Gas Dryers (If Using Electric): Gas-powered dryers are significantly more efficient than electric models, cutting energy costs by 50% or more in high-volume facilities.

If you’re evaluating whether a gas or electric dryer is the better fit for your business, check out our in-depth comparison: Gas vs. Electric Commercial Dryers: Which Is Better for Your Business? to make an informed decision.

5. Maximizing Long-Term Savings Through Staff Accountability

Why Employee Habits Matter More Than Equipment

Even with the best commercial laundry equipment and infrastructure, untrained staff can unknowingly waste resources. Employees may use excessive detergent, overload machines, or ignore maintenance issues, leading to higher costs.

Creating a cost-conscious culture

• Track and Set Utility KPIs: Establish water use per kg of laundry, cost per load, and electricity per cycle as benchmarks for performance.
• Implement Mandatory Utility Efficiency Training: Ensure staff understands how to load machines properly, reduce drying times, and follow energy-saving protocols.
• Provide Incentives for Efficiency: Reward staff for achieving monthly utility reduction goals. Small bonuses or recognition programs encourage long-term cost-saving behavior.

Staff accountability programs can reduce resource waste by up to 20%, ensuring long-term profitability and efficiency.

Treat Utility Costs Like a Business Investment

Lowering utility costs isn’t about cutting corners—it’s about strategic business optimization. By eliminating water waste, optimizing heating, managing airflow, and training employees, you can reduce operational costs without sacrificing quality. Implement these strategies, and your laundry operation will run leaner, more efficiently, and more profitably.

At ACE Laundry, we specialize in supplying high-performance Commercial Laundry Equipment designed to help businesses cut utility costs while maximizing output. Our carefully selected range of energy-efficient washers, dryers, and finishing equipment ensures that you get top-tier performance with reduced water, electricity, and gas consumption.

If you’re looking to upgrade your equipment or optimize your laundry operation, our team can help you find the best solutions for your specific needs. Contact ACE Laundry today to discover how our commercial laundry equipment can improve efficiency and lower your utility costs.