Circulating Hot Water (CHW) – Billing Changeover A Case Study

Many buildings have Circulating (Bulk) Hot Water solutions, where the hot water supply to each apartment comes from a centralised hot water plant and not from a heater in the apartment itself.

Quite often the hot water supply has a meter and the cost of the energy used to heat the water (either gas or electricity) is billed by an energy retailer, whilst the water used is paid for by the Owners Corporation and charged to owners on a Lot Liability basis. Although a common methodology, this isn’t the fairest distribution of the cost of the water and why should the Owners Corporation pay for something that is often being used by someone other than the lot owner?

There is a solution to this and the case study below show how moving to Energy On made a huge difference to one building.

Background

This older building in inner Melbourne was nearing the end of their second contract term with their Embedded Network Operator and was out of contract with a major retailer for their hot water billing. The OC Committee was committed to ensuring that their utility solutions began driving value to their building and not to the operators of the service. With several months to run with the embedded network, the focus was on the hot water.

Challenge

The primary focus of the changeover was to reduce the cost to owners of the hot water supply. With a retailer billing the energy, and no charge for water, there was little incentive on the part of residents to change their usage behaviours. This was costing the Owners Corporation tens of thousands of dollars annually. How could a solution be found that met the OC’s desire to reduce their costs but at the same time did not penalise the occupiers?

Approach

Working with the committee, Energy On designed a hot water recovery model that would provide benefit to the OC in the recovery of water and energy while ensuring zero financial impact to residents.

Result

Applying the model as briefed, the OC decided to forego the potential to make a surplus income on the hot water service. Every resident would find their monthly bills to be 10% lower for the supply of gas and water than they were previously paying for gas alone. Every resident benefited, and the OC removed thousands of dollars in cost per annum.

If your circulating hot water solution isn’t meeting your needs, have a chat to Energy On about how we can fix it for you.