Numerous arguments advocate the greater use of kegged wines. From cost and consistency to sustainability and value, the case for wine on tap seems logical. But there are obstacles to the category’s growth. Is it the future of wine drinking? Yes and no.
History of Wine on Tap in America
While kegs are traditionally associated with beer, Americans started to put wine in stainless steel cylinders as long as 30 years ago, says Bruce Schneider, co-founder of Gotham Project and a pioneer of the tap-wine industry.
“It was the lowest-quality wine at the lowest prices,” he says. “It started about 10 years earlier in Europe, also with cheap and cheerful wines.”
In 2010, Schneider and Charles Bieler launched Gotham Project with Riesling from New York’s Finger Lakes region. Quickly, the category gained traction.
“Early on, we were growing at over 100 percent per year, struggling to keep up with demand,” says Schneider. “Over the past three years, we have enjoyed steady and solid growth in the 15–20 percent per year range.” Since January 1st of this year, Gotham Project has been the keg wine supplier for Danny Meyer’s trendy burger chain Shake Shack.
“Wine on tap is not a fad. It is not a trend. It is part of the broader mandate of sustainability that defines the age in which we live.” —Kareem Massoud, winemaker, Paumanok Vineyards
A company on the West Coast, Free Flow Wines, launched in 2009 and aspired to improve the quality of restaurant wines sold by the glass through kegs, says Heather Clauss, the company’s vice president of sales and marketing. Free Flow Wines Founders Jordan Kivelstadt and Dan Donahoe had observed winemakers’ frustrations with by-the-glass programs.
Often, by-the-glass selections frequently don’t show their best face to the consumer. Reasons range from inexperienced servers who pour corked wines, bottles that sit open too long and wines that incur heat damage from improper storage. A keg eliminates many of these concerns.
But to entice wineries to put their year’s labor into a silver barrel was only half the battle. Distributors, restaurants, bars and wine drinkers all needed to be convinced.
Why Wine on Tap Is Great
At their best, wines on tap are fresh and bright, and can be enjoyed in the same condition as when they were kegged. Of course, some wines are suited to the format better than others. Namely, wines intended for early consumption within one or two years.
“The youthful style that is so popular today accounts for 75% of all wines sold, making it perfect for kegs,” says Schneider.
Stainless steel (already a popular winemaking vessel) provides a completely inert environment, so the wine inside doesn’t age. Kegged wines also require less sulfur dioxide for preservation. That’s great news for bright, aromatic whites like Riesling, or fruity reds like Grenache. If a wine requires a little wood or tank aging before serving, it’s done prior to kegging.
“Since we’re not paying for the winery’s cost in bottles, corks, labeling…I can serve the same glass of wine for $12 that might have been $15 or $16 if we were poured it from a bottle.” —Nora O’Malley, co-founder, Lois, New York City
But consistent quality and freshness aren’t the only selling points. Kareem Massoud, winemaker of Paumanok Vineyards on New York’s Long Island, finds the green aspect of kegged wine most compelling.
“Wine on tap is not a fad,” he says. “It is not a trend. It is part of the broader mandate of sustainability that defines the age in which we live.”
Most wine bottles are thrown away or recycled, and along with them items like labels, boxes, tape, the cork and capsule, says Massoud. So, if a 20-liter keg replaces 26.67 bottles of wine, the demand for those materials is reduced, too.
“The steel keg can be reused dozens, hundreds, perhaps thousands of times,” says Massoud.
Nora O’Malley is co-founder of Lois, a New York City wine bar with a full-tap operation.
“Since we’re not paying for the winery’s cost in bottles, corks, labeling…I can serve the same glass of wine for $12 that might have been $15 or $16 if we were poured it from a bottle,” she says.
Her customers can sample wines easily to find a glass they’ll enjoy.
“They love the eco-aspect, the novelty, and the more relaxed vibe compared to ordering from a bottle list,” says O’Malley. “If someone’s not wine literate, lists can make them uneasy about ordering blind.
Once tapped, wine stays fresh up to three months.
As far as the logistics of the kegs themselves, O’Malley said “they’re returned, washed, and refilled or else recycled.” She pointed to companies like Free Flow, which has helped ease obstacles for smaller wine producers who previously found the barrier to entry too high, e.g., buying kegs, coordinating pick-up, and cleaning. “Free Flow Wines has recently expanded to cover both coasts, so I only see this category growing.”
The growth of tapped wines have increased the boutique and premium selections available.
“We offer everything from familiar brands to higher-end wines, including Matthiasson, Tablas Creek and Au Bon Climat,” says Clauss. “As the category grows and more flagship accounts are demanding better wines in keg, we are seeing the premiumization of the wines we are putting in keg.” Clauss estimates some 4,700 locations in the U.S. now offer wines on tap.
Challenges to Growth
According to Clauss, the biggest challenge to a tapped wine program is the cost of the equipment.
“Until now, it’s been a large capital investment for operators to get wine taps,” says Clauss. Her company has begun a monthly leasing plan to ease startup costs. “We believe this will help grow the number of taps out there.”
It’s often expensive and difficult to retrofit an existing space, especially in cities with small or historical bar footprints, which makes tapped wines better suited to new build-outs.
The other obvious challenge to kegs ruling the market: the unsuitability of serving fine, aged wines from them. Don’t expect to ever order a glass of Grand Cru Burgundy from a tap.
Those limitations have not stopped the segment’s growth, however. As integration grows, expect the choices in your glass to follow.