Posted By: davidfreeboroughI was responding to neelpeel's "horses for courses" analogy.

Sorry if I misunderstood your remark.

Also my apologies to the original poster, the thread is utterly hijacked.

My basic point is really in response to your suggestion that thinking of payback is biasing a decision against the use of green improvements. It may be, but in practice I can see no way to think about the matter without considering how much money i have to come up with now and how much return I will get and for how long. That also seems important for assessing the 'eco benefit', but mostly it would be irresponsible of me to think about it any other way. And yes, it seems likely that I will not proceed with many possible eco improvements for that reason.
But if I can have any 'long term financial mathematical jiggery pokery' argument, I might think about it again.

To put it another way:

Posted By: davidfreeboroughWhy do we insist on using "payback" to justify not investing in carbon reduction?

Because if the payback does not work, I cannot do it...simple as that.

Peter

Posted By: davidfreeboroughThat said, I'm sure there are people who leave money in a savings account for years on end, earning less than the rate of inflation after tax,

Yes

Posted By: davidfreeboroughwho would be better off investing some of that money in green technology.

Only if they know they will never need the money for anything else. But I suspect most people who do that are keeping in mind the possibility of needing to use the cash for some emergency.

Posted By: davidfreeboroughWhen presented with a payback period the idea wouldn't even occur to them.

I don't know why you say that?

Posted By: davidfreeboroughWhen presented with a guaranteed tax free rate of return

Guaranteed?
What if they need to sell the house?
What if another energy technology becomes available that is less expensive, removing the benefit of the original investment?

It is just too simplistic, and therefore impractical, to say 'ignore payback'.

Peter

Posted By: Peter Clark

Posted By: davidfreeboroughWhen presented with a payback period the idea wouldn't even occur to them.

I don't know why you say that?

Thinking a bit more about this, I realise that one reason I consider payback when evaluating spending on eco improvements, is that I don't know, or trust, another way to do it. This may be related to my background and character. Basically I don't trust banks and financial advisers, this is based on personal experience over the last 30 odd years.

If you say to me, spend 400 pounds now on cavity wall insulation and you will save about 200 pounds a year in heating bills, I will immediately be interested, although i will look for any possible negatives, or ways in which I would not be up in two years.

If you say to me, INVEST 400 pounds now in cavity wall insulation and you will have a guaranteed, tax free rate of return of (whatever it is), I would ignore you, because nothing is guaranteed, especially financial payback, and I don't trust people who use that kind of language. If you pressed me to reconsider, i would want to know three things, how much up front, how much saved per year for how many years, (ie payback time) and how can it go wrong.

probably just me, but maybe not!

Peter

We are cross posting!

David, I hope you will not become annoyed by my responses, I think this is important.

Posted By: davidfreeboroughI'm not saying ignore payback. I'm saying that green technology should not be looked at solely in terms of payback and it should not be looked at in isolation. We need to look at how best to utilise all of our capital.

If I do not ignore payback, then I consider it. When I consider it, I see that it is overwhelmingly important in the decision about whether or not to spend on this or that. In many cases I see that it is not in my immediate interests to spend on this eco improvement. Of course, I understand that it may be in my long term interests for everyone to spend on that eco improvement, but it is difficult to justify my personal expenditure on that basis.

Posted By: davidfreeboroughOr put another way, why decide the size of your house & then expect each additional expenditure to produce a payback?

Because i have to have a house, but I do not need to buy insulation for it.

Posted By: davidfreeboroughDo you expect each square metre in your house to produce a payback?

Not financially, but in other ways.

Posted By: davidfreeboroughWhy not build something a little smaller & use the money saved to buy insulation?

Practicality, i did not build my house i bought it from a limited supply of pre existing houses. I might have taken the smaler house option if it was available, but it was not. In any case it never occurred to me at the time.

I feel that what you are saying makes some theoretical sense, but is difficult to put into practice.


Peter

Posted By: davidfreeborougha payback calculation makes assumptions about all the factors/risks you are concerned about, it just hides or ignores them.

All calculations make assumptions.

I have already indicated that I think looking at it as an investment with a rate of return, to compare to other investments, assumes that you do not need access to the cash for anything else. But that assumption conflicts with the primary purpose of having cash available, albeit earning low interest - to cover emergencies of one sort or another.

It also assumes that you will continue to occupy the house and therefore have access to the financial returns.

What factors is the payback approach hiding or ignoring?

Posted By: davidfreeboroughMy theoretical approach probably reflects the fact that I'm an engineer planning a new build who hasn't found a plot yet!

fascinating David, our respective situations re housing provision seem to explain the approach we take to thinking about the issue. I have some numeracy in my background, but as I said, i already have a house.
Not sure where that leaves the general debate about this.

Peter

Posted By: davidfreeboroughThe main one is that it considers the product in isolation.

Exactly. These things are more complex than you think

For example, hot2000 has an "upgrade improvement payback calculator" mode where you can put in improvements to your house (insulation, windows, etc) as well as their cost and it will perform a whole year simulation and then tell you how long that improvement will take to payback in energy savings. I had some fun playing around with this. For example, changing the old windows (single glazed plus external storm windows) to new ones had a projected payback of between 70 and 100 years for double glazed - for triple glazed it was even longer (more expensive and lower solar gains). So windows look like a loser to spend $$ on. But changing the windows would fix a lot of the sources of air leakage. Once this was factored in, payback was much faster (10-15 years or so if I recall correctly [had to make some assumptions about the airleakage improvement just the windows would make]). For the drainwater heat recovery, payback for me is dismal because the cost of hotwater heating is very low thanks to my GSHP - probably around $70 a year. If the recovery unit recovers 40% of this and costs $500 then payback is around 20 years. However, me spending $200 on insulating the transition between the 30" basement wall and the triple brick ground floor structure would pay back in 2 years and I could put the other $300 into other airtightness measures which would also not only payback quickly but would improve winter interior air quality through raising humidity levels. It's all very complicated! Certain comfort improvements are essentially priceless too!

Paul in Montreal.

Posted By: Peter ClarkI am conscious of this, but how does me thinking about payback ignore it, and how would me thinking about buying insulation as an investment include it? I suspect I need to do both, but I don't know how to do the latter.

Assuming you know how much the insulation costs and you can estimate the amount of energy you'll save, you can work out how much money you'll save each year. This sum of money expressed as a percentage of the money spent on insulation needs to be higher than your mortgage interest rate to make the investment worthwhile. Otherwise you'd be better off paying off part of your mortgage (assuming there are no penalties for doing so).

Thanks for the formating tip.

David

Posted By: Peter ClarkAfter cavity wall insulation has been purchased, the most I can expect to save on space heating is about 300 a year, but for that to be higher than my say 5% MIR I would have to pay less than 6K for the insulation measures.

I'm paying about £780 a year for gas, so that gives a bit more room for manoeuvre. Especially when you look at different scenarios for fuel price and mortgage interest rate trends.

In addition, investing in one area may allow savings to be made elsewhere. For example, additional insulation may allow a cheaper heating system.

All this is glossed over by looking at payback on a single product.

David

Without wanting to de-derail the thread by taking it back to waste water since looking at the original link, I've been thinking thus...

1.8m of 54mm copper tube
2m of 42mm copper tube
2 off 54/42/22 tees (branch 22) or standard 54/54/54 tees and some reducers
2 off 40mm compression waste fittings and a few elbows to get the waste water spinning and swirling a bit to increase heat transfer and creat a film of hot waste water around the whole of the pipe surface. Should get around the 42mm copper ok with 40mm compression waste fittings - they have a fairly large tolerance (I think??!).

To make... 42 slides inside the 54, 100mm sticking out each end, tees go over and solder the 42 to the 54 making a watertight jacket around the 42 for mains pressure water entering cold and leaving the jacket warmer via the 22 branches, contraflow style (up!). Waste goes down the 42, transfering the heat to the 54mm jacket around it. In theory.

£100 and some time. Only downsides I can see are possible expansion problems weakening the soldered joints over time - worth a gamble though.
Who's going to be first trying it?

Posted By: andy500Without wanting to de-derail the thread by taking it back to waste water" alt="" src="http:///forum114/extensions/Vanillacons/smilies/standard/devil.gif" >since looking at the original link, I've been thinking thus...

1.8m of 54mm copper tube
2m of 42mm copper tube
2 off 54/42/22 tees (branch 22) or standard 54/54/54 tees and some reducers
2 off 40mm compression waste fittings and a few elbows to get the waste water spinning and swirling a bit to increase heat transfer and creat a film of hot waste water around the whole of the pipe surface. Should get around the 42mm copper ok with 40mm compression waste fittings - they have a fairly large tolerance (I think??!).

To make... 42 slides inside the 54, 100mm sticking out each end, tees go over and solder the 42 to the 54 making a watertight jacket around the 42 for mains pressure water entering cold and leaving the jacket warmer via the 22 branches, contraflow style (up!). Waste goes down the 42, transfering the heat to the 54mm jacket around it. In theory.

£100 and some time. Only downsides I can see are possible expansion problems weakening the soldered joints over time - worth a gamble though.
Who's going to be first trying it?

Watch out for the water regulations - as I understand it you need double isolation between foul and clean water, and your system won't do that. Of course, no-one is likely to know until you come to sell your house and it shows up in the survey (maybe).

If you use a shower save to heat the incoming water to your condensing boiler, wont that effect boiler efficiency?

I've just started building an extension to an end of terrace house and there is a 150mm sewer pipe running under the garden where the extension will be built. The pipe takes the sewage from 6 houses and is 1m deep, I was thinking of splitting the mains water at the road and coiling the hot water pipe around the sewer pipe to pre heat the hot water. I expect the sewer line to be at least 5 degrees hotter than the ground around it, about 15 degrees or so. The client is considering installing a GSHP using the sewer heat to give him a good COP and delivering the heat through a Fiwihex radiator.

I would appreciate your comments on this and would like to know if there are any small 2-3 kw GS Heat Pumps available.

30kWh that's great! thanks Mike. I'm hoping we'll only need 5-7kWh when the house is finished. The pipe is in the clients property for over 20 metres so we have a good chance.

I hope that they dont freeze the sewer pipe solid