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Long-term view for plant replacement

20 September 2017

There is constant pressure to make budgets stretch as far as possible and, where plant and equipment is concerned, this can result in the adoption of a ‘make do and mend’ strategy to avoid the purchase of new items.

While this may save on the initial outlay, how many FMs consider the impact of more maintenance combined with a reduction in efficiency that will see energy consumption spiral upwards and result in more expense?

To gain more insight into the situation, we asked a number of industry experts to comment on the whether the energy-saving benefits of new plant and equipment are factored in to justify replacing old and inefficient HVAC items.

Seeley International UK sales manager Sarah Higgs, says it is “vitally important” for FMs to understand all aspects of their HVAC equipment and the cost of running it.

“In the advancing world that we live in, it would be impossible to continually keep up with the latest and most efficient technology, however in my 20+ years of experience in building services, I have seen many sites where HVAC plant equipment has gone long past the manufacturer’s expected lifespan.

“Whilst the end user has benefited from not having a repeat capital outlay, the plant equipment will have become vastly inefficient as well as costly to maintain. By replacing old equipment with updated versions or even alternative technology, a company could see pay backs within just a few years,” Ms Higgs continues.

With manufacturers striving to improve products to offer clients more for less, she states that inverters and improved controls have “contributed heavily” to energy savings, making it easier for customers to justify replacement.

“With good site knowledge it is relatively easy to predict running costs and comparing new against old plant equipment, can make the decision process to replace a no-brainer.

"In addition to having far more efficient and cheaper systems, new equipment will provide a much improved working environment, with spaces heated, cooled and ventilated to optimum conditions and can result in increased employee productivity,” says Ms Higgs.

Engie Private Sector head of technical Luke Folwell says there are several factors that will influence plant replacement decisions:

“Previously the major contributing factors were cost of plant, size and noise. However, in more recent times energy efficiency has become one of the defining factors, as our customers become more aware of their energy usage and carbon footprint.

“This awareness has been compounded by the increasing trend in energy metering and monitoring, which allows benchmarking to take place to determine plant efficiency. Inefficient plant in general can have a detrimental effect, not only on energy bills, but also on the environment in which the plant operates,” he continues.

Plant rooms containing energy inefficient machinery will tend to generate more heat, which wastes energy. However, if the need to add additional cooling due to the wasted heat energy, overworked and inefficient HVAC equipment is factored in, it will further compound the losses.

“Our HVAC equipment suppliers are also acutely aware of the emerging energy management trend, and are now making efficiency information available for all plant - both large and small. We use this information to develop ‘pay back’ models for our customers.

“This helps us to demonstrate the ‘value’ of energy efficient plant, by not only benchmarking against plant currently fitted, but also by showing the true cost in energy savings, mapped against the time taken to recoup the initial capital investment,” Mr Folwell concludes.

Tidyco climate control director David Hithersay says 40% of the UK’s energy consumption and carbon emissions come from the way our buildings are lit, heated and used.

“Even comparatively small changes in energy performance and the way we use each building will have a significant effect in reducing total energy consumption,” he says.

Whilst there has been much debate and differing methods of regulating building energy use, making commercial properties as energy efficient as possible is an important consideration when analysing the above statistic, Mr Hithersay continues.

Energy efficiency plays an intrinsic role in the justification and proposal process for the replacement of old HVAC systems.

“Important for FMs to consider is the long-term cost saving benefits of upgrading an outdated HVAC system. Whilst there is an initial financial outlay with regards to system design and installation, energy efficiency reduces overall consumption thus, lowering expenditure over a period of time. The installation will effectively pay for itself.”

Energy-saving benefits can also add gravitas and credibility to organisational corporate social responsibility obligations and the FM industry has a duty of care towards operating in both an ethical and environmentally friendly manner.

“Exciting too, is the potential integration of Industry 4.0, smart application and IoT technology within energy-saving system design and install. Evolving at a rapid pace, efficiency gains are set to be even more substantial in the near future,” says Mr Hithersay.

Sudlows mechanical services director Gary Frith says: “In terms of data centres and critical infrastructures, the chillers and/or air conditioning plant serving these facilities are extremely power hungry due to their 24-hour operation.

"It is not always necessary to swap out older units, especially those that have been well maintained, due to the manufacturers’ new technology upgrade offerings.”

Easy wins can be achieved by simply powering down or isolating humidifiers and electric reheat coils. The most popular upgrade, involving more capital cost, is to swap out existing belt-driven or direct motor-driven centrifugal fans with the latest Electro Commutative (EC) plug fans that use less power but deliver the same amount of air through a CRAC unit.

“Significant energy savings can also be made simply by increasing chilled water temperatures. If the chiller incorporates a free-cooling coil energy, reductions can be quite dramatic as free-cooling is available at higher ambient temperatures,” he continues.

The cost of upgrades is always compared against the energy saving costs over time.

This payback period is often calculated over years but surprisingly this can be achieved within months.

“When these comparisons are carried out it is immediately apparent whether an upgrade of existing HVAC items is cost effective or, when considered along with additional business criteria, a new installation incorporating the latest technology is better suited to a client’s needs,” Mr Frith concludes.

Camfil technical manager Peter Dyment says: “Looking at the application and maintenance of HVAC air filter systems the answer would have to be in general 'not enough effort and could do better'. A bit like the comment on my old school report.

“However energy efficiency has to be balanced against air filtration efficiency. This is a health and value for money judgement. Too often energy efficiency is not put into context. The good news is that there is now a real opportunity for accurately gauging HVAC filter performance,” he continues.

The new ISO 16890:2016 global test standard is closer aligned to real life particle stopping filtration performance, replacing the outgoing EN779:2012 European test standard in June 2018.

Eurovent, the European association of HVAC equipment manufacturers, also has an excellent energy rating system for air filters.

“Eurovent 'A+' rated filters will consume about one third the energy of an 'E' rated filter while doing exactly the same air cleaning duty. A typical budget 'E' rated F7 class bag filter could consume about £500 per year in energy through the AHU fan motor running 24/7.

"An A+ rated F7 class filter would consume about £130 per year, with a payback time of six weeks or less.

“With the new ISO 16890:2016 standard for PM1 and the ISO 10121-1:2014 for removal of traffic sourced nitrogen dioxide the current concerns about traffic air pollution damaging health in city schools and hospitals can be addressed effectively and energy efficiently,” says Mr Dyment.

The efficiency of HVAC equipment should always be questioned, says ICS Cool Energy UK sales director (sales and service) Richard Metcalfe. However, working out the ROI of HVAC equipment involves more than energy savings on a monthly basis.

“The whole lifetime cost of a piece of equipment needs to be considered, including capital investment as well as ongoing service and maintenance. Accurate load calculations are also required to ensure HVAC equipment is sized correctly according to demand in order to perform as it should and deliver on efficiency.

“The Carbon Trust’s Green Business Fund Capital Contribution Scheme is a great opportunity for end users to benefit from this way of thinking.

"This is a green energy grant designed to help small- and medium-sized companies in England, Wales, and Scotland to identify energy-saving opportunities and install energy-efficient equipment. Customers with compliant projects are currently able to receive a significant financial contribution towards selected energy-saving equipment.

“Given that HVAC equipment can be one of the most energy-intensive pieces of equipment, a more proactive and considered approach to replacing equipment is needed rather than waiting for a breakdown and simply replacing like-for-like,” Mr Metcalfe concludes.

FMs, building operators and energy managers should consider the energy-saving benefits of new HVAC equipment and not just when their old plant comes to end of life, says Glen Dimplex Heating & Ventilation head of product marketing Christian Hadley.

“With increased scrutiny on sustainable performance, thanks to schemes such as the Energy Savings Obligation Scheme, new plant and equipment can deliver cheaper running costs, greater control and reduced emissions.

“With electric heating in particular, the key to driving efficiency is in the development of intelligent controls and better integration with other devices. The potential of the IoT is driving new thinking and innovation, and improving communication and control across HVAC is high on the agenda,” he says.

The latest controls on modern electric heating appliances already offer features such as adaptive start, temperature control with presence detection and able to connect with the building management system or other appliances via wireless technology.

“This can also create opportunities for remote diagnostics and monitoring – reducing the risk of downtime and cutting business disruption during periods of planned maintenance.

“Too many organisations still base their decision on capital cost when considering investing in new HVAC equipment. Instead, work with your supplier to establish the payback period based on running costs and energy savings - and you may be pleasantly surprised,” says Mr Hadley.

With heating and hot water provision being a large, single-end user of energy, an energy-efficient service is essential to combat rising costs and comply with ever-tighter legislation, says Remeha sales director Chris Meir.

“In the many UK buildings that rely on commercial boilers, implementing a good maintenance programme optimises performance, helping keep energy costs down. But even when well maintained, 25-year-old non-condensing boilers might achieve at best only 70% gross efficiency compared with the 98% heating efficiency delivered by the latest condensing boilers.

“According to our FM clients, the prospect of considerable and immediate energy savings and a rapid return on investment are major deciding factors when replacing boilers,” he continues.

A second driver for boiler replacement is the whole life cost of existing plant. Reliability and efficiency aside, older products typically require increased maintenance due to the inevitable need for replacement of parts.

As these can become increasingly difficult to source for old models, the time and costs associated are further factors in the business case for an upgrade.

“In addition, as air quality rises up the environmental agenda, we are seeing NOx emissions become an additional factor in boiler replacement, particularly where the Clean Air Act applies.

"Upgrading older boiler plant to Class 6 ultra-low NOx condensing boiler models helps organisations meet their environmental obligations while simultaneously lowering energy costs to protect the bottom line,” Mr Meir concludes.

Hamworthy Heating national sales manager Stuart Turner asks: “Who holds the budget? That is often a problem faced when looking at the cost/value justification for replacing old, inefficient equipment.

"The initial cost to replace old boilers are perceived as high, but gas (cost) savings are considerable and make an impact right from the date of the installation.”

With energy overheads typically accounting for up to 95% of the total costs over the product lifecycle, it is possible to achieve savings of as much as 35% on heating bills by using modern, efficient boilers and the right control strategy.

Costs that are not considered include call-outs when an old boiler fails or the non-quantifiable risk of system failure due to a breakdown, particularly for facilities such as care homes or hospitals, Mr Turner continues.

“Any equipment has got a limited life span. If not being replaced, costs for more extensive servicing and replacement parts all add up. The task we all face is communicating these benefits to the end user and getting beyond the initial outlay costs to look at the long term.

“In large organisations or leased buildings, the capital expenditure often comes out of a different budget to the gas bills. Getting the message across to the right people is a challenge we should be taking on,” says Mr Turner.

Without doubt, the energy saving benefits of new plant and equipment is a key consideration, says Encore Cistern technical director David Davis:

“The compelling argument from a business perspective in replacing old and inefficient HVAC items with energy saving new equipment is that it a) helps save the planet and/or b) saves money by performing better and being more efficient.”

Most businesses are now acutely aware of their environmental responsibilities and saving energy is as equally important as financial considerations.

Invariably the two go hand in hand. Technology has moved on significantly in recent times with more energy saving benefits than ever before, making a lot of existing equipment look antiquated.

Most new plant and equipment has more than one benefit, making it an attractive proposition, Mr Davis continues.

Modern day air conditioning units use less power and the condensate they generate is being recycled in many ways, such as to flush toilets.

In this example, it is a free water source that until now has been drained to waste, so there are clear reasons why this type of new equipment outweighs the traditional option.

“Also, the best energy efficient equipment allows businesses to quantify the savings they are making. Once it is known that a product saves ‘x’ litres of water, a business has a strong financial argument that will then resonate at board level and is then more easily justified,” says Mr Davis.

Condair UK sales manager Dave Marshall-George says: “As humidification specialists, we are often approached by FMs looking to reduce the energy and maintenance costs associated to their humidifiers.”

These typically focus on updating electrode boiler type humidifiers with relatively high consumption and regularly need to have their steam cylinders replaced when they fill up with scale.

Gas-fired steam humidifiers offer an alternative to electric steam systems and have energy costs two thirds lower. These can be cleaned rather than replaced, reducing the cost of consumables.

“The humidity control offered by gas-fired humidifiers is reliable and hygienic, with capacities ranging from 40 to 240kg/hr. They can even be connected to an existing steam lance inside the duct, when replacing an electric steam humidifier,” he continues.

The initial purchase and install cost of a typical 180kg/h gas-fired humidification system, payback when replacing an equivalent electrode boiler humidifier can be paid back in around two years, due to an annual saving on energy and maintenance costs of approximately 55%.

“This significant saving makes gas-fired humidifiers an attractive alternative to the traditional electrode boiler type system,” Mr Marshall-George concludes.

Thoughts on Installation of more efficient HVAC equipment to achieve energy consumption improvements are provided by Uponor head of specialist projects James Griffiths, who says operations costs savings must also be integrated into financial business cases.

Combining this with length of service life and performance quality over the system’s lifecycle will ensure a clear and measurable payback period and an indication of other savings.

“Much harder to quantify but still relevant to the business case for an HVAC upgrade is the human element of comfort, wellbeing and productivity,” he continues.

“By investing in a new HVAC system, an end user can provide a significantly improved work and/or customer environment. This can have significant business value for both corporate and customer-facing organisations.

“All HVAC technologies have a finite lifecycle, usually significantly less than the lifecycle of the building.

"As the UK moves towards increased adoption of thermally active buildings systems, including heating and cooling from renewable energy sources, the need for HVAC replacement will be reduced because buildings will be designed with energy-efficient integrated heating and cooling that lasts for the whole life span of the structure,” says Mr Griffiths.

Myson UK marketing manager Andrew Lowery says consideration for all aspects of a HVAC system should be included in the design, including a variety of heat delivery options and taking into account the building’s size, construction, level of insulation and number of external doors and windows to create an effective heat loss calculation.

“Once the total heat required is known, we can then consider the best options for delivering it. A number of other factors should influence the composition of the total solution, including long term running costs, the pattern of usage by building occupants and whether the project is a new build or a refurbishment,” he says.

Describing the increasingly frequent combination of underfloor heating with radiators, this could also include LST radiators, fan convectors and electric heating options. With open spaces more suited to underfloor heating, small rooms work better with radiators, while retail spaces can be well-served with fan factors, he continues.

“Controlling the system well and ensuring that all the products work well together to create a total solution is essential.

"It is more effective to source underfloor, radiators, fan convectors and heating controls from a single manufacturer, so that you can not only be confident that all the products will work effectively together, but so that you can access unbiased advice and expert technical support on creating the best total solution,” says Mr Lowery.

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