Heat with calculation: Ukrainians will be obliged to install IHS
24 October 19:02
ANALYSIS FROM 
As centralized heating and hot water may not be available in most Ukrainians’ apartments this winter, and as district heating companies will be forced to cut costs due to gas shortages, MPs are proposing an alternative – mandatory installation of individual heating stations in buildings connected to district heating systems. This is stated in the bill submitted to the Verkhovna Rada, which has already been supported by the government. However, experts have many questions. What exactly are the experts’ concerns?
Energy efficiency by law
The draft law “On Amendments to Certain Laws of Ukraine on Supporting the Development of Efficient and Sustainable District Heating” is aimed at creating conditions for the modernization and efficient operation of district heating systems through IHS.
An individual heating point is a compact automated complex that is installed directly in a building and regulates the supply of heat and hot water for this particular facility. It receives the heat carrier from the central network and transfers heat through heat exchangers to the heating and hot water supply systems of the building, MinRegion explained.
IHS will provide buildings with stable heating and hot water, allow flexible regulation of heat consumption and reduce residents’ bills.
Modern IHS will allow people to receive better services and pay less, and hromadas to make the heat supply system more sustainable and energy efficient. We are talking about the large-scale introduction of technologies that change the quality of life of Ukrainians. Energy efficiency should become an integral part of a comprehensive approach to infrastructure development,” said Oleksiy Kuleba, Vice Prime Minister for Reconstruction of Ukraine, Minister of Communities and Territories Development.
“IHS will become mandatory for all buildings connected to district heating and will be serviced by heat transportation organizations – district heating companies. This will reduce losses, optimize consumption and improve the quality of services for people.
The draft law also envisages improving the tariff setting procedure so that the cost of installing IHS is included in the tariff for heat transportation. Additionally, the following will be developed: a procedure for the installation and maintenance of IHS, a standard contract for consumers, rules for determining the technical feasibility of their installation and preparation of facilities for the heating season.
Expensive, but profitable and payback
The idea of installing IHS in apartment buildings is a very good one, as the bill can be reduced by 20-30%. But the implementation of this project, according to Oleh Popenko, chairman of the Union of Consumers of Public Utilities, is wrong. “We should not entrust district heating companies with the purchase, installation, and maintenance of IHS.
First, they don’t have the money for it. Secondly, district heating companies are not interested in this at all, because after the installation of IHS, their sales will decrease. The example of Poland is relevant here, where IHS was installed by management companies. The government developed a special loan program with a low interest rate. And by saving heat, the loan was quickly repaid. That is, if we paid UAH 2000 before installing the IHS, we paid UAH 1200-1300 afterwards. And this saved money was used to pay for the IHS. In two or three years, the loan was already closed,” said
[Kommersant] Oleg Popenko told [Komersant].
“If you do the math, installing an IHS for the whole building is much more profitable than individual heating – a boiler in each apartment. Even if there are problems with electricity, you can buy a generator for the IHS. It is much more difficult to run a boiler in an apartment without electricity.
The IHS for an apartment building will cost UAH 1.5-2 million, and there will always be a backup source of heat – electricity and centralized heating. This is very profitable. But it will take a long time to implement this project, and the law has not yet been adopted and it is unclear where to get the funding,” emphasizes Popenko.
However, according to the expert, there is no need to wait for the law to be adopted – residents can organize themselves and install IHS at their own expense.
Those who have installed IHS have not yet felt the savings
There are already apartment buildings in Ukraine that have installed IHS. However, they have faced a new problem: they are not always able to save money. The reason is that the water supply is too “cold” and the IHS cannot operate in an optimal, economical mode.
We installed an IHS in our 16-storey residential building back in 2020 in Kryvyi Rih, and paid 50% of the cost under the energy saving program. We installed a heat exchanger, frequency converter, buffer motors, and Siemens electronics. However, if the parameters of the heat carrier during the heating period are lower than the return flow temperature of 50°C or 60°C, it is impossible to build an economical temperature schedule depending on the outside air temperature. If the average heat carrier parameters were at least 70°C during the heating season, then it would be possible to build an economical schedule of heat carrier parameters for the heating system,” says local resident Serhiy Volynets.
Heat supply companies fear they will not be able to withstand the financial burden
Employees of the district heating company are not happy about the fact that they will now have to pay for the installation of IHS. After all, this will require including the new costs in the tariff for heat transportation, and the country has a moratorium on tariff increases. Failure to do so will force heat supply organizations to accumulate new losses, which will further worsen their already critical financial situation. In addition, the debts of the population to the heating companies have not disappeared.
The transfer of the intra-building network to the balance sheet of a heat supply organization creates a “gray area” of responsibility. In the event of a malfunction, we risk a classic situation where the service provider and the residents will shift responsibility to each other. The key point that cannot be ignored is that reforms and modernization cannot be carried out against the backdrop of enormous systemic debts. Until the state fulfills its obligations to compensate for the difference in tariffs, any new financial burden imposed on heating companies is a direct path to the collapse of the industry,” said Dmytro Kravchenko, head of the operational dispatch service of the Odesa City Heat Supply Company.
“The draft law is still in the Verkhovna Rada, and passions are already boiling over. And the idea seems to be good, but the implementation, as always, can fail.
Author – Alla Dunina
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