How Will You Keep Zero Carbon Retrofit Costs Under Control?

Friday, July 23, 2021

Construction-related projects have a track record of cost escalation. It’s estimated that 69% of projects exceed their original budget and only a third of them come within 10% of the projected cost.

When you think about the complexity of net zero carbon retrofits it’s easy to see why cost control must be a priority from the outset.

There are many reasons for budget overruns. Often it’s because the budget forecast itself is inaccurate and based on flawed assumptions. The issue for net zero carbon retrofits is that until there’s a comprehensive assessment of asset condition and detailed evaluation of different retrofit options involving specialist subcontractor partners, there’s a lot of guesswork in any budget estimate.

More assumptions about asset condition and more reliance on ‘one size fits all’ solutions adds up to escalating uncertainty over the final cost. It also means more likelihood of missing opportunities for cost savings and efficiencies.

The Cost of Poor Communication

Poor communication is another major cause of cost overruns. This includes subcontractors not being clearly briefed on project requirements and inefficient data gathering while projects are in progress. The procurement process has to minimise these risks and focus on long-term partnerships that invest in exemplary and open communication.

The converse of this is that excellent communication has a positive benefit. This is how minor improvement opportunities are captured and put into practice. Over the course of a substantial net zero carbon retrofit programme, these savings will add up to a significant bonus. The cost of poor communication is always much higher and less certain than the value of investing in excellent communications from the outset of the project.

Failing to appreciate the value of efficient supply chain management and clear communication with subcontractors is one of the biggest reasons why projects are delivered late and over budget. Zero carbon retrofit of social housing stock is a complex and multifaceted task. This makes supply chains and procurement absolutely fundamental to risk management and cost control.

Osborne’s approach to zero carbon retrofits is to provide a hub of property services and supply chain management expertise. Around this, we form partnerships of specialist providers needed to ensure efficient and cost-effective delivery of these complex programmes.

For more information on Osborne’s partnership approach visit our net zero carbon retrofit resource centre or contact Nick Davidge ([email protected]).