Fair billing of heat consumption – is it possible?

Grzegorz Michalski

This is another in a series of articles in which we show you the potential of the Nexo application. In the previous ones, we described how it supports users in saving energy, including the possibility of designing schedules. Rational management of energy consumption, both thermal and electrical, helps to reduce costs. These are significant advantages that distinguish Nexo and encourage its installation.

One building and one heat meter

Speaking of savings, mentioning how heat energy is billed is essential. Billing the heat supplier based on the heat meter reading is relatively easy in public buildings. The problem arises in the case of multi-family residential or office buildings, where there is usually one heat meter for the entire building. 

How do you determine how much energy has been used in a particular room, and how do you fairly divide the costs between the different premises occupied by different people or companies? In addition, the energy consumption in common areas such as corridors and stairwells must be taken into account. 

Cost allocators and metered billing

The solutions commonly used by administrators do not ensure a fair allocation of costs in line with actual consumption. The simplest solution is to allocate costs based on the area of occupied premises. Each tenant, regardless of consumption, pays the same per square meter. This is not an incentive to save.

A second popular solution is heat cost allocators (HCA – Heat Cost Allocators) – devices mounted on radiators that count the units needed for heat cost accounting. This solution encourages savings because the less heat we consume, the fewer units will be charged. However, it is not an ideal solution. If our neighbor is very economical and has turned down the radiators, our bills will be overestimated because we “give away” part of the heat to colder rooms and warm up our neighbor through the walls. Premises adjacent to passageways and those on the top floor also need more heat to maintain thermal comfort. 

How do we share heating costs fairly in these situations? 

The concept of thermal comfort – a new approach to accounting for heat consumption

One could, for example, install separate heat meters for each flat. However, this is challenging because there are often several heating risers in one flat, which are shared by several floors. Installing a heat meter at each radiator, on the other hand, is not only technically difficult but also not very financially viable.

Can we do something about this?

A concept for solving this problem has been proposed by Veolia, one of the leading companies in the energy sector. What about billing heat based on thermal comfort, i.e., the temperature maintained in a particular room? This will encourage saving because even the neighbor next door will not do so at our expense if they decide to save too. 

The participants of the recently concluded XXX jubilee scientific and technical symposium “Spring meeting of heating engineers” could see how the concept of thermal comfort works in practice. 

Veolia presented its proposed innovative approach there and, using the example of a project to implement Nexo in one of the buildings of a housing cooperative in Łódź, showed the technical feasibility of its implementation soon, subject, of course, to the consent of the cooperative and the residents.

Nexo is proving to be an excellent tool for implementing this concept. It provides the operation of the thermostatic heads on the premises, collects the necessary data, and enables its presentation in an accessible form. Collecting data from terminal equipment is just a sample of Nexo’s capabilities. To share costs, it is necessary to have information about the building’s energy consumption. Nexo’s modular architecture allows various devices like heat meters to be connected and read. The data is read in real-time, just as the room temperature is monitored in real-time. With this data (and the corresponding algorithms), users receive a real-time forecast of heating costs. This approach allows monitoring of how temperature control in the flat affects savings.

Using an appropriate architecture, Nexo makes it possible to implement many ideas from the IoT area. We will be describing them for you.