Posted on 26 July 2022
Gas boilers – communal or individual?
It’s a good idea to understand what type of heater you have in your home, so you can use it in the most efficient way possible and keep costs down where you can. Most of our homes are heated with gas boilers. Many of these are for individuals, who source their own supplier. But some are communal heating systems.
What is a communal heating system?
These are systems that produce heat in centralised, shared gas boilers and distribute it to multiple homes. We buy the gas for these boilers ourselves, and recharge to customers in these homes. We don’t add any additional costs and don’t make a profit from the energy we provide.
As a housing association, we’re obliged by the Government to source our gas supply commercially, as opposed to each individual choosing their own gas supply. Commercial gas is not subject to the Ofgem price cap.
Our gas supplier
Over the past few years, as a result of customer consultation, we have been buying our communal gas supply on short term contracts. Our latest contract was with Gazprom, which ended at the end of April. Even though this company has since left the market and are in danger of going into administration, both staff and customers expressed concerns about dealing with Russian affiliated businesses. Our new gas contract is with Corona which will be in place until 30 April 2023.
At the start of 2022, our aim was to secure a new gas contract when the Nordstream 2 pipeline was complete, which would have greatly reduced costs. However, with the war in Ukraine, the new pipeline, which runs from Russia to Germany, is not in use. The prices have instead increased as a result.
Following advice from market experts and specialist advisors, we feel it’s vital that we secure a longer-term deal, rather than repeated one year contracts, so that the costs are more stable.
We’re going through the process of securing a long-term contract for potentially three to five years to secure best value. Our energy broker, Inspired Energy, will help us to purchase energy at the right time of year, when the price is at its lowest. This will help to keep your costs down.
How is the gas bill divided?
For newer blocks of flats (built after 2008), each home has a heat meter which measures the amount of heat energy used, and we use Switch2 to provide individual energy bills to our customers. In blocks of flats built before 2008, customers pay their share of energy through their service charge.
Each year we review the tariff for customers based on the market costs we’re charged by the utility companies and our service providers. The new tariff is calculated to reflect any change in price and then we pass on this cost to our customers. We do not mark up or make any profit from this supply of gas.
Over time we aim to replace these communal gas boilers with more energy efficient alternatives to reduce carbon dioxide (CO2) emissions.
Gas boilers for individual homes
If you live in a house or flat where you have your own heating source, your energy bills will come directly to you from your utility provider. Don’t forget to check whether your provider has any grants or benefits to help reduce your energy costs. Many are offering additional help during this cost-of-living crisis.
Other types of heating
If you live in one of our homes, it’s very likely you have a gas boiler, whether that’s an individual one or a communal one. However, you may also have:
- An electric storage heater
- An air source heat pump
- An electric boiler
- Solar photovoltaic (PV) panels
Each type of heating system is different, but can be made more efficient and cheaper to run with some care and attention. Make sure to find out which one you have, and how you can use it to reduce your bills.