Return on Investment

D107 · August 2006

hosts are karen gibbs and geoff colvin. Rukeyser is now on CNBC. Review I saw was not very complimentary.

I haven't seen any media coverage of mod-con boilers. I think the wall needs to set up a media squad of people that TV and radio stations can call for such interviews. Maybe heatinghelp.com should send out a mass emailing to all media outlets about itself. (can be done relatively inexpensively these days.)

I have found even This Old House not at the cutting edge in heating. When they had a segment on CO detectors I don't believe I saw the two units recommended on the wall,(CO Experts and NSI I think) just the standard consumer models. I wonder if Dan has had any contact with Richard Trethewey, the show's heating/plumbing guy. The show could do so much to promote heating economy. I have seen them do shows on insulation, cellulose, foam etc.

David

Ted_9 · August 2006

Customers

I was just thinking, I love it when someone says they want to figure the R.O.I. on a new heating system. Do they ever figure out what the R.O.I. on a new or used car? I love it, a new car is alway a loss, but they'll spend 3 or 4 times more, easily.

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Keith_8 · August 2006

personal finances

I don't think consumers will ever look at the HVAC Systems as a status symbol the way they look at their Auto's. If we could get them out of the basement and on the highway's we might have a shot.

That being said the finacial aspect of today's technology can no longer be ignored. From my vantage point the consumer is plenty aware they need to do something to curtail their energy expenses. You can only compensate with the thermostat so much.

How people chose to spend their money is a fasinating subject. My wife mentioned to me early this week that our electric bill last month was $200. We have been in the house for 8 years and the prevoius highest ever was $150.

My secratary told me their bill last month was $400. How is that possible? No one is home during the day except a cat and a dog. they keep it at 72*, 24 hours a day. Why? They like it to be cold when they walk in the house was the answer. Can you say programmable thermostat? The husband is aware they exist.

I installed (2) new 330 oil tanks for them last year. The house is about 2100 square feet. They asked my opinion on sizing the tanks. (1) 330 is perfect. MY opinion is why pay the oil comany to store their oil in your basement. On top of that you are paying for the extra tank and material. Doesn't make sense, they lock into a price for the year. You don't get a break in price because the oil comapany visits your house 4 times a year instead of 7.

My point is they are responcible people who chose to spend their hard earned money differently than me.

We all place value on items based on our personal perspective.

Keith

Dave Yates (PAH) · August 2006

ROI on its way to being a hot button

Two weeks ago while we were on vacation, I fielded a phone call interview from an educational TV program regarding ROI and HVAC systems. Can't recall the program's title right now, but they are the replacement for Louis Rukeyser's Wall Street Week (according to the interviewer). He was unaware of the newer condensing boilers and their ultra-high efficiency: we spent about 15 minutes on that subject alone. We also discussed radiant heating as an investment in comfort, well-being and long-term savings. I gave him the link for this site, RB's web site and he'd already been to the RPA's site.

We utilize ROI on our bids for high efficiency equipment so that consumers can decide if they want to invest in the higher priced boilers, furnaces or A/C units. On average, the ROI for high eff units equals or exceeds anything the stock market can offer the typical investor. As fuel costs rise, those ROI's simply get better. As an added advantage, they're tax-free ROI's, which enhances their return if you factor that into the equation. While I don't add that to the ROI we show in our quotes, it is mentioned so that the consumer can wrap their thoughts around that too. The majority of our customers have chosen the high eff models - even though we've given them a menu-like quote that includes the lower eff models. It's their money & their decision to make.

I also tried to impress on him that the term "pay back" is one consumers should forget and discard from their thinking. Stessing ROI puts consumers in a whole new mind set. Home Power Magazine had a very good article on hybrid vehicles with a detailed accounting of pollutant levels for each model. The demand for hybrid vehicles, in spite of the higher costs, has sent a message to US vehicle mfgrs and gotten their attention. We talked about that too.

Driving me nuts that I can't think of the name of the show he was working for. It's a female host and her name rhymes with some investment term and used for the show's title. They say the memory's the second thing to go(g)!

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Dave Yates (PAH) · August 2006

not it

I must have left my notes at the office - can't find them here, which is driving me nuts (a really short trip!). It was a woman's name used in a three-word title that rhymed. According to the interviewer, it's not shown on all PBS networks & not on either of the two PBS stations we get in our area. However, he rattled off a long list of areas where the show is aired. He was calling from NYC and had spoken with Larry Drake at the RPA prior to contacting me. We were on the beach and finding something to scribble notes on was a challenge. I'll find it or I'll get the number from my phone pad at work and call him again. I suggested he contact Dan and RB too and to post here if he wanted additional feed-back. Slipped my mind till I saw the post on ROI.

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Unknown · August 2006

agreed

Agreed that gettin the media will helps promoting the engery savings but Richard Tretheway is at the bottom of my list. Have ya seen his segament on heating? He call boilers "furance" and one other show installing spirovent is the cure all for air removal on heating system that had new "furnace" installed with pump on return and steel expanison tank!...

Brad White_104 · August 2006

Ted

I love it when a car salesman says a certain car is a "great investment". I tell him it is a "depreciating asset", then ask if I drive it home and keep it for a month, how much more could I sell it for?

Not sure if I get the gist of what you are saying regarding the heating system side though. Are you saying that there is no ROI on a heating system? There certainly is when comparing one system with another, all things being equal.

(The fuel savings of a more efficient system in current dollars amortized against the additional capital cost plus finance costs of the difference to a less efficient, less expensive system.)

Not a challenge, just curious what you are saying.

Of course the twist is when you sell a job on that intangible, comfort!

Robert O'Brien · August 2006

my favorite

part of that Spirovent episode is when he said it should cost $150 installed! Huh?

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Unknown · August 2006

yeah

Yeah, its 150 installed, not incudling the draining of the system, refillling the system, taking the air out on the 1st fill, and redraining the exp tank and adding air into it... There's other things I don't agree with Richard on plumbings too...

Leo · August 2006

I doubt Richard Trethewey's the guy

I doubt Richard Trethewey's the guy to promote fuel savings. His company is the rep company for Viessman, it would take a guy with no bias for any brand. The FEW shows I have seen he tends to switch oil to gas again another possible bias. He has name recognition but given his business and sponsors there is just too much conflict of interest.

Leo

Steamhead (in transit) · August 2006

And

he advocates ripping out steam systems. Maybe it's because he wants to sell more Viessmans, but that still puts him at the bottom of my list.

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Brad White_104 · August 2006

Raymond -are you sure it was Rich?

I have known Rich Trethewey personally for over 20 years. Even back then he was extolling the "virtues of pumping away" and would correct anyone listening as to what a boiler was and what a furnace was.... I do not think Rich was the guy you saw saying those things... Even Norm -oh for crying out loud, that Tim Allen-inspired character Bob Vila knows better

Unknown · August 2006

yes, Brad

Yes Brad, it was him on the TOH programs calling the boilers "furance" and on the spirovent segment, it was on "ask TOH" program...

Brad White_104 · August 2006

Must have been a

momentary lapse

I cannot defend what I have not seen so will take your word for it. I just know Rich and what he is about.

Ted_9 · August 2006

yes

Your right. I was just saying I meet alot of people who want a full break down and talk about R.O.I. No one thinks of R.O.I. on that plasma screen ($3 to 10,000) or that car etc etc. At least there is a R.O.I. on a heating system.

Regarding calling a boiler a furnace: Anyone with a heating company in N.E. knows that lots or even more people call their boiler a furnace. Its something their parents and grandparents said, so they just repeat it.

Re: This Old House; I find it hard to beleive that Rich would say that, but remember, this is a short T.V. show, how long can you talk about pumping away.

Disclaimer: I do not speak for This Old House or Rich Trethewey or the people of N.E. The above comments are my own opinion.

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D107 · August 2006

ROI

As a homeowner I'd say though I have great interest in economizing, insulating, efficiency, but I'm conservative with the idea of mod cons since even some wallies have some doubts about longterm ROI. A recent thread 'wall mounted etc' did re-assure me a bit on parts, HX longevity etc. though I think direct venting is still an issue--for which the cure I believe is putting the PVC ducts up the chimney. It certainly seems possible that fuel prices could double on a regular basis which makes a good case for a mod/con and higher ROI.

Some people claim to beat the system by getting a new car every 3-4 yrs, so that, given their resale $$ they never have to pay alot for the next car AND they keep the car on full warranty so there's no repair bills. (I'm currently having a hell of a time trying to unload my 25 yr old Weil McLain, even throwing in my 17-yr old direct HWH.)

On the side point about This Old House, in general the show I think has done a world of good in helping people better understand their homes, and Richard T along with them to some extent in some plumbing and heating matters, but I think there are some big gaps on the heating. Perhaps Brad, Dan or others might approach the show and see if a solid segment on steam and hot water heating could be done. It's easy for a show to get a little too comfortable with itself and there certainly are time limitations.

David

Dave Yates (PAH) · August 2006

Richard T

He's done more to place our trades in a favorable spotlight with consumers than anyone else in the industry. Before he went on TV, plumbers had a much worse image that was reinforced repeatedly in the media. My hat's off to him for that and, besides which, he's fun to be around. His wife and Lois sat together at the last ISH-US and they had a blast. Very nice folks. He's entitled to an opinion that differs from mine anytime he likes. So what if he promotes Viessmann, that's part of his job as a rep. I've seen him with other boilers too. As for the steam vs hot water thing - so what. A difference of opinions doesn't mean anyone has to be denigrated - debate the merits, not the person.

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Ted_9 · August 2006

Heating

"He's done more to place our trades in a favorable spotlight with consumers than anyone else in the industry."

I agree and he does this every day.

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Leo · August 2006

Dave

Dave,
I would rather see a guy like you promoting savings. You are in the trenches, walking the walk and taking the time to come here and share with others. You aren't in front of a camera reading a script. Years ago there was a nasty debate here on the Wall about Viessman, Richard came on and basically recited Viessman Literature. When debated he went away never to return. In front of the camera he has done well promoting certain forms of heating in particular radiant. But I still stand by what I said, too much conflict of interest.

Leo

Dave Yates (PAH) · August 2006

Leo

I fully respect your right to hold a different opinion. I see another side, which is ok too. However, I'd rather see points made without the personal rancor.

We all do our share of promoting savings. I've tried to take full advantage of every opportunity that's come along to promote hydronics, radiant especially and the move to high eff products. Solar too. We (the collective we) bear a responsibility to get out the message(s). Hell, our elected officials, for the most part, owe their allegiance to fossil fuel interests, so we can't rely on them to move the public will - it's going to alter only if enough of us can sway public opinions and perceptions. Rich has had a powerful voice in that regard. People see him installing radiant and I've had more than a few customers who wanted radiant specifically because they saw him installing it on TOH. How tough is it to sway their opinion regarding whose boiler and whose radiant products we'll be installing? It's a cake-walk! I'm now in their home & it's now going to be me they believe if I follow a few simple rules of sales-engagement.

Don't forget, Rich is in the trenches every day too. Trenches that might differ from yours and mine, but his roots are in our day-to-day trenches and he too fought the same battles. I respect that very much. I don't doubt he has responsibilities that might dictate certain efforts. We all do. Gotta put food on the table.

As Red would say: We're all in this together.

BTW - I prefer working without a script on camera. Kinda like walking a high-wire act - it keeps me focused and feeling alive. Watts let me do their Scalding - Danger Lurks without a script. Every Contractors' Corner episode was off the cuff too. We're about to tackle a very interesting project that will be on DVD and available for training purposes and trade schools with work books for the students.

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