Knowle relocation project: saving energy costs - and challenging the justification to move

When the notion of relocating was first explored, the consultants made it clear to the District Council that the costs would be 'prohibitive':
Futures Forum: Knowle relocation project: "Initial findings found the cost of relocation to be prohibitive"

Despite this set-back - and following the taking on of a new set of consultants - the District Council has been determined to justify its 'aspiration to relocate':
Knowle Planning Application Meeting on 1st March, is part of our wish to move, says EDDC spin doctor | Save Our Sidmouth

These justifications have largely rested on calculations about energy costs:
Futures Forum: Knowle relocation project: "How efficiently is this building being used?"

The District Council's own scrutiny committee have questioned these calculations:
Futures Forum: Knowle relocation project: getting the figures straight

Now, in its latest calculations, there seem to be considerable discrepancies between the Department of Energy and the District Council when it comes to calculating these costs:
Futures Forum: Knowle relocation project ... the Committee on Climate Change predicts an increase in energy bills over the next 15 years of 30-45% ... the District Council predicts an increase of 400%
Futures Forum: Knowle relocation project: Predicting energy price increases over the next 20 years

COUNCIL FIGURES:

These are the figures from the District Council - which provide no references for their sources:

7: Knowle has annual energy costs of £83,900 pa compared to a predicted energy cost for Honiton/Exmouth combined of £33,700 pa. Even after repairs, Knowle energy costs would still be double those of the Honiton/Exmouth alternative.

8: Based on Dept. of Energy and Climate Change (DECC) current fuel price indices, gas has increased on average 18.8% pa between 2003 and 2013 whilst over the same period, electricity has increased on average by 11.9% pa. 

Allowing a modest 10% pa inflation rate for energy and 2% for general inflation, the total savings in running costs of Honiton/Exmouth over Knowle are of the order of £5.55m over 20 years.

Relocation Update – key decision: Agenda for Cabinet; Wednesday, 3 December 2014

And this is an explanation of those figures from the District Council:

...during year one the differential in electricity and gas costs when comparing the Knowle with proposed new office at Heathpark and a refurbishment of Exmouth Town Hall is £50,200. Using a 2% pa general increase for inflation, but with 10% pa for electricity and gas the difference progressively increases to some £366,000 by year twenty.

Running costs of alternative sites for EDDC HQ | Save Our Sidmouth

ANALYSIS: ENERGY INFLATION:

If we look at the District Council's figures on how it arrives at its energy costs in more detail:

8: Based on Dept. of Energy and Climate Change (DECC) current fuel price indices, gas has increased on average 18.8% pa between 2003 and 2013 whilst over the same period, electricity has increased on average by 11.9% pa. 

Allowing a modest 10% pa inflation rate for energy and 2% for general inflation, the total savings in running costs of Honiton/Exmouth over Knowle are of the order of £5.55m over 20 years.

These figures do not correspond with what the DECC and other government agencies have published:
Estimated impacts of energy and climate change policies on energy prices and bills (March 2013)
Energy Price - Peter Bolton report (January 2014)

Not only that, but the formula for predicting energy prices over the next years as determined by the District Council is dramatically different to that proposed by the DECC:

The Committee on Climate Change looked at overall price increases between February 2004 and January 2011 and broke the contributory factors down into more detailed categories:

Overall price increase: 
Gas 121% 
Electricity 79%

In other words, there is a huge difference between an annual increase (11.9% pa as suggested by the District Council) and an increase over a period of time (79% for 7 years as suggested by the DECC).

Moreover, the District Council has taken its annual increase and extrapolated it over 20 years using compound interest - and so a 'modest 10%' rise in electricity prices amounts to a total rise of 650%.

This is without considering any mitigation the District Council might take against rising energy prices of 10% pa over the next 20 years.

Which brings us to:

ENERGY USE AT KNOWLE:

In 2008, a Display Energy Certificate was issued giving Knowle the “more energy efficient” band C.

This was accompanied by an Advisory Report from the Energy Assessor, who set out several recommendations such as more insulation, more double-glazing and a comprehensive heating strategy.
Futures Forum: Knowle relocation project: "How efficiently is this building being used?"

Indeed, the District Council has made commitments to the band C rating:

Working towards an ideal energy certificate level for each property, rather than just reporting what level it had; to aspire to making improvements that brought each property to a minimum of level C

www.eastdevon.gov.uk/hrb_mins_300409.pdf

Central government itself is keen to promote this certification:
Improving the energy efficiency of our buildings

                        

In 2012, another such Certificate was produced [and this can be seen on the website of Savills which is marketing Knowle] – but it showed no improvement.

The question arises, therefore, as to why the vast majority of the Energy Assessor’s efficiencies have not been considered and modern sustainable technologies introduced?

The answer lies in the assessment by the consultants to the District Council in their report presented in June last year:

1.0 Executive Summary

1.1 The current total annual running cost at March 2013 base date for the Knowle Site is £431,487, with energy costs are £75,070 producing 401 tonnes of CO2.

1.3 It is estimated that if no essential works were carried out, and the Knowle site was to remain in the state of repair which it is in today, running costs at March 2015 would be £458,170, with energy costs £83,901 producing 401 tonnes of CO2. 

1.4 The total approximate cost for the carrying out of “essential priority” works at March 2013 to halt and rectify building detoriation, remedy health and safety issues and reduce energy consumption is £1,566,000 

1.5 It is anticipated that as a result of carrying out the “essential priority” works to Knowle, the revised total annual running cost at March 2015 would be £431,239, energy costs are £61,784 producing 291 tonnes of CO2.

1.6 This represents a saving as at March 2015 base date of £26,929 overall, with energy cost reducing by £22,117 and carbon reducing by 110 tonnes.

1.7 In terms of energy / carbon savings this represents very poor value on the money spent.

This is potentially due to:-

 The floor area of Knowle of 7,722m2, when EDDC requires a maximum functioning area of 4,225 m2 reducing to 3,352 for their Work Smart initiative.

 The nature of the structure and fabric of the Knowle building.

 The current inefficient electrical night storage heaters requiring replacement.

 Some of the “essential priority” works needing to be carried out for health and safety reasons.

Knowle Energy Use and Maintenance Cost Analysis Report 

A savings of £22,000 in the first year does not sound that much.

However, if we were to apply the same formula as suggested by the District Council - and imagine an increase of 10% every year for 20 years - this figure would represent total savings of £1.8 million.

This would cover the 'essential priority' works 
- but for the whole site at Knowle, which currently houses 400 staff, and yet it seems that only 250 need housing...

Which brings us to:

ANALYSIS: HONITON/EXMOUTH:

If we look at the District Council's figures for the different locations in more detail:

7: Knowle has annual energy costs of £83,900 pa compared to a predicted energy cost for Honiton/Exmouth combined of £33,700 pa. Even after repairs, Knowle energy costs would still be double those of the Honiton/Exmouth alternative.

This is not comparing like with like.

The District Council says it will need 250 desk-bound staff:

h. A new HQ in Honiton can be restricted in size and cost to a 170 desk equivalent scale with an improved Exmouth Town Hall for 80 EDDC staff

Relocation Update – key decision: Agenda for Cabinet; Wednesday, 3 December 2014
Trinitymatters.co.uk website of Cllr Ian Thomas EDDC - Honiton & Exmouth it is, as Skypark no longer viable option for new EDDC HQ?...

And yet until February 2012, the figure was 400 staff - with a job advertisement for the Relocation Manager stating that they:

"...will facilitate the district council office move from its current offices to a new building for approximately 400 staff.”

‘Vital to get it right if council HQ moves’ - News - Exmouth Journal
www.eastdevon.gov.uk/relocation_project_manager_(jan_12)-3.pdf
Relocation Manager - a Freedom of Information request to East Devon District Council - WhatDoTheyKnow

Of course, the proposal to have more staff working from home will account for much of this discrepency:
Futures Forum: Knowle relocation project: hot-desking: latest

But rather than relocating to another part of the District, a solution might be to relocate the staff at Knowle to the modern 1980s building - but the District Council has dismissed this proposal:

The 70s/80s office blocks are not large enough to accommodate even a reduced size of Council workforce which means that their refurbishment would be only part of a solution. 

EDDC Office Accommodation - Cabinet: 17 July 2013

On the other hand, the District has said it needs about 40% of the office floor space at Knowle:

The Knowle provides an overall floor area of 7,722 m2; whilst the assessment for the size of the new HQ to provide Council services advises a requirement for an overall area of 3,352 m2.

Costs of relocating EDDC HQ vs refurbishing Knowle - a Freedom of Information request to East Devon District Council - WhatDoTheyKnow
EDDC Office Accommodation Knowle Energy Use and Maintenance Cost Analysis Report: June 2013

On closer analysis, the 1980s building would in fact cover that area - 42%, to be exact - which would be enough for the necessary 250 desk-bound staff:

If their new build proposal is for 3352m2 (page 98) they could manage with the same space at the Knowle.

Futures Forum: Alternatives for Knowle

This is contrary to 'official statistics', but in a very clear and detailed analysis of this option, these statistics are challenged:
Floorspace old and modern at EDDC Knowle
Futures Forum: "A truly green alternative to EDDC's proposal"

To reiterate, if the proposed 250 staff needing desks were housed in the 1980s building at Knowle, which occupies more than 40% of the office floor space at Knowle  
– then, still using the official figures, the energy costs for Knowle would also decrease to 40% of what they are now.

In cost terms, therefore, 40% of the District Council's estimate of the annual energy costs of £83,900 pa comes to £33,560 - compared to a predicted energy cost for Honiton/Exmouth combined of £33,700 pa.

However, if we factor in the 'essential priority' works giving savings of £22,000 and bring down the annual energy costs from £83,900 to £71,900 - and then we account for only 40% of the office floor space, this brings the annual energy costs for the 1980s building at Knowle to £28,760.

Compared to the original energy costs for Knowle at £83,900 pa, this makes a total savings of £55,140 in the first year.

And if the formula of a 10% annual increase over 20 years is applied, this amounts to a saving of over £3.8 million.

Of course, these figures are wildly speculative - but no less so than the District Council's own claim that the total savings in running costs of Honiton/Exmouth over Knowle are of the order of £5.55m over 20 years - but only if we assume that this does not take into account: 

a) the energy costs for 250 staff using 40% of the office floor space at Knowle; and

b) any mitigation the District Council might take against rising energy prices of 10% pa over the next 20 years.

We are now back to the proposals made by the Energy Assessor back in 2008:
Futures Forum: Knowle relocation project: "How efficiently is this building being used?"

See also:
Futures Forum: Knowle relocation project: comparing the Sidmouth and Honiton/Exmouth options
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