calendar 05.03. 2018

Heat contracting: why is it good?

Most owners of residential or commercial properties have long since realised that a modern and more efficient heating system makes sense. After all, heating costs are by no means a trivial thing, on the contrary they are a cost driver. But how do you afford a new, efficient heating system?

Heat transition in buildings

80 % of all heating systems are more than 10 years old.

Progress is being made with the energy transition. Even though politicians are sometimes showing weakness when it comes to implementation, support from the public remains strong. Germans still want a change to a sustainable, efficient and future-proof energy supply.
Alongside the many citizens who are committed to green energy supplies, countless companies are now working on solutions that are advancing the energy transition on the technology side and above all also making it more cost-effective.
The heat transition in buildings is particularly important. In Germany, the building sector accounts for more than 40 per cent of the total energy consumed. And here – it’s hard to believe – 8 out of 10 heating systems are more than 10 years old and so they are not state-of-the-art and are inefficient – in short: they waste energy.

Is a modern heating system the answer?

Most owners of residential or commercial properties have long since realised that a modern and more efficient heating system makes sense – after all, heating costs are by no means a trivial thing, on the contrary they are a cost driver (so-called “second rent”). Not to mention the beneficial effects on the climate. Therefore, the real question is how owners and landlords can afford to invest in a new, efficient heating system as the cost can be considerable if you have to pay the whole thing yourself.

Heat contracting – efficient and cost-effective

Here heat contracting could be a solution that not only promotes energy efficiency in a building but is also cost-effective. Today, owners and landlords can count on companies in the energy-efficiency business who, as specialised service providers (contractors), offer far more than just taking over the cost of investing. When it comes to efficient heat supply, they take care of all relevant points such as:

  • Status analysis
  • Ideas and design for a new or improved heating system
  • Application for, investment in, implementation and control of new heating system
  • Fuel purchase at reasonable bulk prices
  • Maintenance and emergency service
  • Billing

Full programme or “light” version?

Whether full or modular contracting is the right answer depends on an owner’s personal expectations and the range of services he wants.

The full heat contracting programme covers everything from leasing, engineering to control of the system. However, there are also less complex, more modular versions of contracting agreements.
For example, with a streamlined version, i.e. supply and operation contracting, the service provider only offers the supply of energy, i.e. operation, maintenance, administration and, if necessary, modernisation of the energy-generating system as well as optimisation of the cost of purchasing energy. This model is a good option if the property owner – the contractee – does not want to operate an existing heating system himself and is looking for a cost-effective alternative.



Efficiency – what does it depend on?

Which version is the most efficient depends on the number of units in a building or the number of square metres to be heated. It is particularly easy to achieve full exploit energy efficiency potential if contracting is carried out on a large scale, for example for a whole district.

Contracting: advantages for everybody

With the full contracting model, the new heating system becomes the property of the investor for the duration of the contract between the contractor and the building owner. The investment in the heating system and the cost of operating and servicing the system are reflected in the price charged for the heat.
For the property owner, this means that his building can have a new and efficient heating system without him actually having to put his hand in his pocket. The contractor also handles the purchase of fuel, operation of the heating system and billing so the property owner doesn’t have to worry about a thing.
The tenant also benefits from this model as the contracting solution must not involve any disadvantages for the tenant. On the contrary, the whole heating costs that the tenant is charged are generally lower despite the fact that the investment costs are passed on. This is because a modern and efficient heating system reduces costs and therefore the “second rent”.
So heat contracting can be a win-win-win situation for all those involved – for landlord, tenant, service provider and the climate.