Jan 22, 2019 Last Updated 4:27 PM, Jan 21, 2019

Protect your housing stock – and your bottom line

Published in Housing
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Recent news has revealed that the Government has pledged to invest £2bn in building social housing properties over the next 10 years. Whilst this will certainly help mitigate the shortfall of social housing available within the UK, other steps must be taken to ensure current properties remain in peak condition and don’t become a cost burden on providers.

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Top of the agenda for many social housing providers is value for money. Recent research Sentinel conducted showed that 61% of providers are under pressure to reduce lifetime costs of heating systems without compromising quality. Maintaining tenant satisfaction is also a key priority. The National Housing Federation has stated that 23% of social housing residents are unable to keep their living rooms warm – a serious statistic that simply can’t be ignored. Combining this with the fact that 55% of direct maintenance costs are heating system-related, there is clear room for improvement here. That said, with further maintenance budget reduction in the pipeline – an estimated 16% in real terms from 2016 to 2020 – providers face an increasingly difficult job managing the balance between being profitable and providing a duty of care.

Here, Craig Mitchell, Sales Director for Social Housing at Sentinel – provider of water treatment solutions and filters for the social housing sector – speaks to PSBJ about how providers can get the best value for money and helping tenants to keep their houses warm by increasing the efficiency of reliable heating provisions.

What impact does not maintaining heating systems have?

Unsatisfied customers, extensive repair costs and potentially dangerous boilers are just some of the outcomes from not properly maintaining a heating system. During research we conducted last year, we discovered that there are over 3.3 million unplanned call-backs every year for heating system failures within the social housing sector, accounting for 55% of maintenance costs.

But it’s not just the call-out costs for repairing boilers that social housing providers need to be worried about. The boiler is the most expensive component of a heating installation, with a projected lifespan of 14.5 years. Within the social housing sector, a high percentage of boilers are being written off after just seven to nine years, with the housing providers subsequently paying for this shortfall.

With this in mind, social housing providers need to assess how to get maximum efficiency from boilers and extend the lifespan of systems across their property portfolios. What many don’t realise is that there is a very simple solution to this – improved water treatment.

Why is water treatment important and what does the process involve?

Water treatment is important because corrosion is almost inevitable when untreated water comes into contact with metal. It creates an environment in which components, including pumps, radiators and heat exchangers, are likely to fail or breakdown. Best practice water treatment comprises three basic steps: clean, protect and maintain.

Cleaning removes contaminants such as corrosion debris, residual flux or greases from circulating water and prepares the system for inhibitor protection. Protection with inhibitor prevents corrosion (and limescale deposits in systems in hard water areas), and maintenance is an annual process of checking inhibitor levels and topping up if necessary.

Protecting the system with chemical inhibitors prolongs a boiler’s service life and, by optimising the water chemistry, maintains the system’s efficiency and overall long-term effectiveness. This minimises corrosion and limescale deposition and prevents all the problems of untreated water such as breakdowns, early repairs, parts replacements and loss of boiler warranty, ticking all the boxes for social housing providers looking to improve heating provisions across their portfolio.

In addition to water treatment, a powerful magnetic filter can also be installed as filters are good insurance against unexpected corrosion or debris problems, capturing residual corrosion particles and removing them from circulating water. Such issues can arise when a heating system hasn’t been thoroughly flushed after cleaning or where the concentration of inhibitor in a system has been diluted by water top-up, perhaps after a leak or change of radiator, and not replenished to the correct level.

How can this impact my bottom line?

Our research has shown that not using any form of water treatment to adequately protect heating systems was leading to approximately 45% of boilers failing at around the 10-year mark for one provider. If a social housing provider had a portfolio of 1000 properties, each with a boiler with a projected 15-year lifespan, installation costs would total an average of £172 per unit, per year. If 45% of these units were replaced early at 10 years, that left a five-year period where 450 units out of every 1000 would have the £172 cost counted twice on their asset line.

Talking in real cost terms, this sets the true cost for that 15-year period higher than budgeted at £197.80 per unit, per year, across the total portfolio of 1000 properties, which presents a hidden cost of £387,000 per thousand units, to be footed by local authorities and housing associations.

Having spoken to the housing provider, we discovered that it was estimated that 90% of these failures were due to poor water quality, something that can easily be resolved. Added to this, research and testing conducted with major boiler manufacturers show that 87% of call-outs each year are to systems without correct water treatment – which can be easily remedied through effective maintenance of heating systems.

Will this work in real life?

When the theory is put into practice, the results are clear. A recent study conducted with a council in the South West of England showed that 28% of systems in social housing had their inhibitor removed or diluted to inadequate levels after just 12 months, exposing them to the risks of poor water quality. This meant that within a year, almost a third of the systems weren’t protected any longer. Given that a simple visual test at each annual service can determine if an inhibitor addition or top-up is necessary to protect the longevity of the system, it’s no longer reasonable for poor water treatment to be the cause of huge overheads as is currently the case for so many.

When comparing the costs of the replacement and maintenance of an unprotected heating system to that of using treatment protection, the financial benefits for social housing providers are clear to see. A full system can be cleaned, protected and maintained for less than £13 a year, creating better value for money for social housing providers and fewer boiler breakdowns for residents, therefore, reducing maintenance costs and complaints.

Government investment in social housing is a positive step forward, both for the sector and the public that need more affordable housing, but there are steps that can be taken to reduce overheads significantly in the meantime. By investing a small amount in the ongoing maintenance of your heating systems, you can not only safeguard the wellbeing of residents within your properties but also experience significant long-term cost benefits.

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