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As one of the leading utility consultancies in the UK, Business Cost Consultants is regularly quoted in news and trade press. Below you will find recent press coverage on Business Cost Consultants. Please email us if you would like to find out more about the content of these stories or if you would like to discuss how Business Cost Consultants could help your organisation in similar ways.
Energy Watch
Friday, August 01, 2008
Housing Association Building & Maintenance
Donald Maclean offers advice on how housing associations can reduce their costs and cut consumption by monitoring their energy use more closely.
Energy costs have been in the headlines a lot recently. For most housing associations utility costs will feature highly in the concerns of their tenants, as well as their own operating costs because gas and electricity prices have risen significantly over the last four years. So what can be done to minimise this burden?
In our experience, many organisations do not check their utility bills thoroughly enough, assuming they are accurate if the bill is close to previous invoices. However, we deal with many hundreds of bills each week and our highly trained staff spot errors on around 30% of the bills we check on our clients’ behalf.
Busy housing association officers and managers rarely have time to scrutinise gas and electricity in any great detail. Also very few organisations have the in-house expertise to track energy costs and be in a position to know when is a good time to purchase energy contracts.
A key way for housing associations to save energy is monitoring and targeting. This can be done in-house by installing data loggers on to your utility meters, which will show you exactly how your energy and water is being used in detail. You will then be able to note how your usage successfully drops when energy saving measures are introduced. This can be applied to meters of any size; from domestic up to district heating. It is also possible to submeter areas or floors within large buildings.
If your stock of housing and offices within your association uses a large amount of energy and water, it is prudent to ask an independent utilities consultant to track and manage energy consumption on your behalf. They will be able to work closely with you to identify any consumption anomalies or inefficiencies, which will also help improve your environmental policy. Generally, any fees will be more than covered by the actual savings achieved by reducing the consumption.
A consumption monitoring system, in conjunction with expert analysis, can help housing associations quickly spot problems such as undetected gas or water leaks which if left unchecked can be dangerous and expensive. This alert system will be very useful for the
maintenance team, who will be able to respond to utility issues very quickly.
Efficiency gains
An advantage of the consumption monitoring system, which will appeal to the finance teams within a housing association is that by accurately monitoring the usage through the meters, then passing that data to the supplier, you will not have any estimated bills. The data can be sent to the supplier automatically, which also speeds up the process. The ability to accurately profile usage, will also help you to forecast your future expenditure.
For the management, a wide range of reports can be produced from the system tailored towards the needs of the organisation.
Because the data can be manipulated easily, these reports could be:
- daily, weekly, monthly utility expenditure for each unit or block;
- usage and expenditure for this winter, compared with last winter;
- gas usage compared to the outside temperature.
The reporting options are vast.
Once you have an accurate record of your energy consumption history, you will be in a better position to obtain competitive quotes from utility suppliers. Prior to the New Electricity Trading Arrangements (NETA) and a sufficient capacity of electricity and UK gas reserves, energy prices in the UK were fairly stable. However, from 2004, when the UK became a net importer of gas there have been significant jumps and prices are thought to continue to rise for the foreseeable future.
When putting out tenders for supply contracts it helps to have the details of your electricity profile for at least one year, know how to present the data in order to appeal to suppliers, know which suppliers are likely to be competitive for your type of profile when you choose to go to the energy markets and, most importantly, when is the best time of the year to fix your price. These are complex tasks, which require some expertise. Utility consultants can also advise on cutting energy consumption and reducing carbon emissions. For example, if an organisation spends over £50,000 per annum on its energy, it is entitled to apply for an energy survey, which will be funded by the Carbon Trust. A trained energy conservation specialist will carry out a survey of the organisation’s sites and produce a report detailing measures to cut energy consumption. The consultant’s time is given in proportion to the amount spent on energy. Savings of 10 to 20% as a result of implementing those recommendations are not uncommon.
Simple steps
There are several steps that your organisation could take almost immediately – often at no or low cost – to improve energy efficiency and cut your energy bills. Simply switching off
equipment when you are not using it is one such measure. According to the Carbon Trust an average of £6,000 per year is wasted by organisations through leaving equipment such as computers and lights on over weekends and bank holidays. It is important to make everyone in the organisation aware of the need to conserve energy where possible. By closely checking bills, accurately monitoring consumption, and better managing their energy efficiency, housing associations will not only save money and improve their administration but they will improve their environmental impact by cutting carbon emissions.
Donald Maclean is managing director of Business Cost Consultants.
CASE STUDY: New Gorbals Housing Association
Glasgow-based New Gorbals Housing Association manages 1,150 socially rented units consisting of high rise, maisonettes and new build properties as well as providing factoring services for 1,300 owners.
Business Cost Consultants has been working with the association since 2004 when it initially helped the organisation tender for gas and electricity supplies. As a result of our initial audit, we identified and implemented savings of more than 20% of their total spend on utilities (gas, electric, water and telecommunications). In 2007 savings of £44,504 were identified across all utilities. Those figures do not take into account the considerable savings in staff time provided by the comprehensive management service that includes checking bills, resolving billing errors, monitoring energy consumption and processing and vetting supply contracts.
The implementation of smart data loggers which will help the organisation reduce energy and water consumption even further, and help reduce its carbon footprint, are currently being investigated. Smart data loggers have helped our other clients, such as Rangers and Celtic
Football Clubs.
Mary Reilly, finance manager, New Gorbals Housing Association said: “Business Cost Consultants have provided an invaluable service in not only helping us put out tenders for utility suppliers but also constantly keeping an eye on energy usage and costs, sorting
out any queries with suppliers quickly and efficiently. We rely on their expert knowledge of the utility markets to give us best advice on choice of supplier.”
She added: “We want to get the lowest costs for our tenants and customers and we are obliged to obtain best value for money. Business Cost Consultants has definitely helped us keep costs down. Also as they work on a contingency basis there are no direct costs, they only take a percentage of whatever savings they achieve.”
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