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12 March, 2012  ▪  Anna Kalenska

To Heat or Not to Heat (Centrally)

Given the low quality of utility services, particularly heating, many Ukrainians are switching to autonomous heating. The Ukrainian Week has found, however, that this kind of independence is not always justified

A cold span in February once again exposed the catastrophic condition of our utilities sector. Fortunately, there were no man-made catastrophes like the one in Alchevsk in winter 2006 when the city’s heating systems were completely frozen and around 60,000 residents were forced to use individual electric heaters for over two weeks. Nevertheless, hundreds of local emergencies occurred in various regions over the past month and thousands of Ukrainians were left without heat in very low temperatures.

Centralised heating systems in Ukraine reached the end of their serviceable life a long time ago. They fall short of consumers’ demands and are too energy-intensive. The prospects for overhauling them are mostly illusory as doing so would require, according to various estimates, at least UAH 100 billion across the country. As a result, we have merely tepid radiators and unjustifiably high heating tariffs.

As is often the case in Ukraine, a number of average citizens are solving the heating problem on their own without waiting for the government to take action. Individual gas boilers have become popular. They secure desired temperatures inside homes and ensure a constant supply of hot water regardless of the season, something centralised systems are unable to provide. Remarkably, municipal authorities in many cities believe the solution to the problem lies in switching to autonomous systems.

TWO WAYS

In 2007, virtually all residents of Zorynsk in Perevalsk District, Luhansk Region, switched to independent heating, both in detached houses and in five- and even nine-story buildings. A centralised system was nonexistent in the city – inside temperatures dropped to +3° in wintertime. “We had a decentralisation programme ready,” says Deputy Head of the Perevalsk District State Administration Halyna Solona. “And at the same time we offered no-interest loans. Money was disbursed from the regional budget to install boilers for underprivileged citizens.” Petro Kravchuk from Brianka, Luhansk Region, used such a loan when he installed his own autonomous heating system, “I've already paid it off and I've had heating for six years now. We used to freeze. Hot water has been cut off in our city since 1989.”

People in Transcarpathia also decided to not wait for the government to find money to upgrade outdated systems and started switching to autonomous heating in 2003. All government institutions already have it by now. Vasyl Romanets, head of the Directorate for the Utility and Housing Services in Zakarpattia Region, says that the region will save over UAH 14 million after completely abandoning centralised heating. No special difficulties were encountered during the transition, but Romanets admits that issues did arise when some residents refused to participate. “The implementation of the new system has its own advantages and shortcomings. But the thing is that it is people’s choice. No-one forces them into it. They calculated that it was better for them,” he explains.

In contrast, Ivano-Frankivsk rejected the idea after a thorough analysis. The local heating company, Ukrteplokomunenerho, carried out a special study to find out which heating system was economically more sound. Five versions were evaluated: reconstructing the existing system, decentralising it on the level of residential blocks, replacing boiler stations with boiler rooms on rooftops, installing individual heating systems in every apartment and partially decentralising the entire network. The study took into account the interests of the consumers, the municipal authorities, heat-supplying companies and investors. The study found that the reconstruction of the centralised heating system would require $36.2 million and would save 30 per cent of natural gas per year. Boiler stations servicing separate residential blocks are more efficient, but also require much bigger investments. Rooftop boiling rooms and complete or partial decentralisation are cost-inefficient and will never pay off. The results were sent to the European Bank for Reconstruction and Development which analysed them and signed an agreement to issue a loan to reconstruct the centralised heating system in Ivano-Frankivsk.

DO IT YOURSELF

Yehor Yershov, who lives in Boyarka, decided to install an autonomous heating system in his two-bedroom flat, because he was involved in the business and knew all the nuances: “First, it is cost-efficient. We used to pay UAH 400-450 per month and now pay around just UAH 150. Second, we are not tied to any dates when heating is scheduled to be turned on or off or to the outside temperature, accidents in the heating main and promises, which are often broken. We can turn heating on whenever we need it. This is especially important to me, because I live on the ground floor.” Considering the cost of pipes, radiators, the boiler and documentation, his total expenses amounted to around UAH 30,000. Installation takes 2-3 days, but collecting all the permits is a much lengthier process.

If you want to go it alone in terms of heating, you need to obtain the consent of your neighbours. Then you must write to your housing and utility office saying you are rejecting the use of centralised heating. Next you must prepare documentation for your stand-alone system. Only after that will specialists decide whether your flat can be cut off from the heating main. The ultimate permit is issued by a commission in a local government that represents about a dozen different agencies. The complicated permit procedure is, generally speaking, justified, because a consumer disrupts the centralised network by switching to autonomous heating. However, many residents eventually refuse to pursue it at some stage, due to bribes common in the undertaking.

THE PRICE OF INDEPENDENCE

Centralised heating systems in Europe allow consumers to choose their comfort level according to their needs and financial ability. “In order to reach this level, a lot of money was invested in insulating buildings and heating mains, installing heating control systems in apartments and optimising boiler stations and their capacities,” explains Oleksandr Kuznets, chairman of the board in the Association of Energy Efficient Technology Engineers. He believes that cost efficiency and environmental and technological safety should be considered as factors in the decision-making process on heating and hot-water supply in Ukraine just as is the case in Europe. “Centralised systems are more environment-friendly, because the emissions of large thermal power stations are filtered and taken outside the city limits,” he argues. They have the additional advantage of being able to use different types of fuel, even such exotic ones as household wastes. In contrast, autonomous boiler stations normally use natural gas.

However, centralised energy supply systems in Ukraine are in an urgent need of an upgrade. We have over 360 municipal heat-supplying enterprises. They take the worst hits when energy prices rise, because the annual consumption of fuel equivalent in this sector is 8.7-10.4 million tons and electricity 1.4-1.7 billion kWt/hr. The situation is aggravated by the critically low energy efficiency of the old equipment. Boiler stations waste 8-10 per cent of the heat they produce. The losses rise to 13-20 per cent in heating mains and 25-40 per cent on the consumer end.

TEMPORARY BENEFITS

Ukrainian scientists have calculated that individual heating systems are beneficial in two- to three-story buildings, while centralised supply is better for anything that is higher. Yershov saves UAH 1,800 in one heating season, but he had to shell out UAH 30,000 to install his system. According to Ukrteplokomunenerho, he will recoup his investment in 16.7 years. If the price of natural gas for the population rises to what heat-producing companies now pay for it, individual heating systems will be unprofitable. In all developed countries wholesale prices of natural gas are lower than retail prices. In Ukraine, it is the other way around. Ukrainian citizens currently pay UAH 726 per 1,000 cubic metres and heat-producing enterprises almost twice as much (UAH 1,309). That is the reason why autonomous heating systems are – so far – more appealing than centralised ones.

Ukrteplokomunenehro President Arseniy Blashchuk believes that these advantages are superficial and have, in fact, a number of disadvantages. First, what is good for the independent heat consumers puts a heavier burden on their neighbours. Most buildings are designed to use heat from a heating main. When some of its residents are cut off, centralised heat is distributed among a smaller number of flats and becomes more expensive to their inhabitants.

Moreover, gas supply systems in buildings are designed only for cooking food. If a gas boiler is installed, it will consume gas that would otherwise go to a cooker. The pressure of gas is thus reduced, Blashchuk explains, and if everyone switches to individual heating, their boilers will simply not work. Therefore, the cost of this transition needs to include the cost of replacing gas pipes and electricity lines. Another issue has to do with heating general-purpose rooms, especially cellars though which water and sewage pipes run. “There have been a number of cases in new buildings that have individual boilers in flats when water pipes froze because of low temperatures in the cellar,” Blashchuk says. He also points to the explosion hazard posed by autonomous systems. If ventilation is inadequate, there is also a risk of poisoning with the products of burning.

Consequently, those who are inclined to install an autonomous heating system are advised to first do simple math and see if it is at all advantageous, considering also that gas prices for the population may rise in the future.

PRICING THE CHANGE

How much you will have to pay for heating your flat depends on the number of rooms, whether it is a corner flat and how many radiators it has. A two-bedroom flat typically has four radiators, which will cost UAH 1,200. There is a separate pipe running from the boiler to each radiator, so the header device will cost UAH 350. Piping will cost UAH 50 per metre, and dismantling of old pipes UAH 200-400, or UAH 70 per metre. The biggest budget items will be the boiler (Ukrainian-made boilers costing from UAH 3,000 and foreign-made units starting at UAH 6,000) and installation (UAH 850). Hooking up to the gas supply system will require additional expenses. A total of about UAH 30,000 will be spent on an individual heating system for a two-bedroom flat, not counting bribes to permit-issuing agencies.


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