The ‘negative cost’ of value engineering

To many contractors, and sometimes specifiers, value engineering following an initial tender is a way of life, and has played a major part in keeping project costs down. It is a tactic regularly adopted to bring a health estate refurbishment or new build back on track, so it delivers against budget, and is completed on deadline, before the penalty clauses kick in. With an annual energy spend of more than £410 million, and as an organisation identified by the Government as key to delivering carbon reduction in line with Climate Change Act targets, the NHS (and the healthcare sector in general) is more aware than most that a significant step-change is needed to cut energy use and carbon emissions. We all know that value is the ratio of function to cost, but ‘value engineering’ is a term that is now simply synonymous with cutting back on costs. Full lifecycle costs need to be considered for all components purchased for the heating system, and this is especially relevant in the healthcare sector, as hospitals and other healthcare providers tend to remain on the same site for a considerable length of time.

Preventative maintenance

Examination of preventative maintenance techniques and true lifecycle costs of system components can actually help the healthcare provider save money further down the line – whether it be on a new build, or major refurbishment. There is an old adage, ‘Pay now or pay for it later’, and this certainly applies with regard to healthcare facility heating systems. Spare a thought for the future when requisitioning a heating system installation, refurbishment, or major repair, as if we do examine the true cost (or result) of cutting corners, we would realise that it is simply not worth it, and the consequences of using ‘shortcuts’ can be frankly catastrophic on the wear and tear of system components. Not only can such an approach prove costly, but in a healthcare setting it is imperative that system downtime is avoided at all costs. The negative results of some value engineering initiatives – such as increased energy use, higher maintenance costs, and an inability to benefit from the energysaving benefits of the de-aerators and dirt separators now available – begin to have a detrimental impact on energy-saving and cost-cutting initiatives such as carbon reduction programmes, and employee communications to educate staff on responsible energy usage.