Legal & General’s Gresham Street building in London is the first in their extensive estate to benefit from the implementation of Synapsys Solutions’ SIP Billing solution.
An automated tenant billing system, SIP Billing has been developed in response for a system which is cost effective, complies with the Heat Network (Metering & Billing) Regulations 2014 and provides a framework which encourages engagement with tenants.
Legal and General’s main challenge was to introduce a simplified and automated billing solution which included a fair measurement of each tenants heating and cooling energy costs rather than apportionment based on the square metre footage which is let by the tenants.
Although the process of apportioning energy based on square metre footage has been common in the past, most tenant leases state that energy costs should be invoiced on a ‘fair’ and ‘reasonable’ basis. The previous method used by Legal and General apportioned costs based on a percentage of floor area, as is the norm in the property sector.
A fairer way of doing this is to measure actual consumption for each tenant. However, apportionment of energy costs based on actual consumption has previously only been possible by manually reading lots of meters, processing data on spreadsheets and producing calculations which are used to manually produce invoices – a process which is both time consuming and costly to perform.
The introduction of the Heat Network (Metering & Billing) Regulations 2014 cemented the requirement for an accurate billing process, as they require commercial and domestic property landlords of multi let properties where heating, cooling or hot water is supplied to tenants through a district or communal heating network, to provide detailed information about those networks to a central body.
The Regulations take into account the fact that the largest share of CO2 emissions from UK buildings comes from space and water heating. The main aim therefore is to allow users of heating, cooling and hot water supplies, to be fully aware of their level of consumption and be incentivised to reduce that consumption. But the requirements of the regulations can only be met if landlords are able to not only monitor the energy usage cost effectively, and do so in a manner which allows for accurate billing of each utility, on a tenant by tenant basis.
Working alongside consultant, Hoare Lee, Synapsys Solutions provided SIPe data loggers to acquire data from a variety of tenant area sources within the Gresham Street building which included heat meters; lighting; FCU and small power tenant sub meters; chiller meters and other incoming meters.
For the apportionment of heating, the data loggers acquire half hourly meter readings from all of the tenant area heat meters before feeding the information into the SIP Billing solution for the calculation of total consumption on a tenant by tenant basis. This is then applied as a percentage to the half hourly total consumption which is acquired from the main gas or bulk meter.
The same principle is applied to the cooling demand at Gresham Street, with SIPe thermal loggers acquiring usage data at the tenant level before feeding the information into the SIP Billing solution to calculate tenant demand based on a percentage of the overall chiller usage.
Matt Gardner of Synapsys Solutions says: “The ability to acquire accurate, half hourly meter readings from each tenant at Gresham Street and then apportion this figure as a percentage of the total energy consumed by the building ensures that each tenant only pays for their actual usage, rather than their expected usage based on the area which they let. As well as meeting the requirement for a fair and reasonable billing process, it also provides greater clarity of energy consumption to each tenant, thus meeting the requirements of the Heat Network (Metering & Billing) Regulations.
“The additional benefit of the solution, is that the SIPe data loggers can be configured to share data with the BMS and export information to data analytics partners. This effectively provides a means to introduce energy monitoring dashboards which provide both the building operator and the tenant with total visibility of energy consumption, anomalies and trends.”
SIP Billing provides a very cost effective and flexible solution for Legal and General which includes the ability to automatically apportion air handling costs and landlord/common area electrical consumption based on the tenant’s access to shared services. The system can also be configured to generate tenant billing reports for direct electrical sub-meters and provides an easy way for the landlord to view, administer and make adjustments to the system, run comparisons and set up dual tariffs for tenants where there is a requirement.
It also provides greater visibility for tenants, allowing them to access their own dashboard in order to view and compare their energy usage on an ongoing basis.
Debbie Hobbs, head of sustainability for LGIM Real Assets said: “Gresham Street is the first building in our portfolio to benefit from the installation of SIP Billing and it has revolutionised the way in which we approach tenant billing. The ability to automatically apportion and invoice energy costs, based on actual demand ensures that occupiers only pay for the energy which they consume. This not only meets the requirements of the Heat Network (Metering & Billing) Regulations but it also provides greater visibility for our occupiers which will help us have more meaningful dialogues with our occupiers. This initiative is just one of the ways that we are looking at to improve energy efficiencies and forms an important part of our wider sustainability strategy.”
The success of the Gresham Street project means that Legal and General now have plans to roll out the SIP Billing solution to other buildings in its portfolio.