Hidden Cost

Working on existing mechanical and electrical (M&E) systems such as refurbishments or on utility diversions can incur significant costs not immediately obvious from the defined scope of works. What can appear to be a relatively easy replacement or relocation of an item, even in a simple fit-out, can trigger a chain of requirements that need to be properly considered when estimating the cost and duration of the project. The scenarios below will help to illustrate this:


  • A new layout requires the addition of a few electrical circuits to a distribution board, but the distribution board is aged and has fuses for the outgoing circuits. The chances are high that the board will need to be totally replaced with a new one, with Miniature Circuit Breakers (mcb) and Residual Current Device (rcd)/mcb circuit protection. When that happens there is also a requirement to fully test all the existing outgoing circuits, and the chances are also high that some of those circuits will fail the test or be non-compliant with current code requirements. In the ‘most likely’ case there will be costs for some remedial works, in the worst case for rewiring every circuit.
  •  Older fire alarm circuit systems have conventional or analogue field devices (smoke detectors etc), most modern systems have addressable or digital devices. The two types are not interchangeable, and are also wired differently (radial circuits for conventional, ring circuits for addressable). Take note of the type of system when additions or alterations are required.
  • Allowances for the replacement of a chiller or cooling tower in a rooftop plant room should, along with the the dollar value of the new piece of equipment, consider:
    • Removal and replacement of roof framing and sheeting to create an opening for lifting out
    • Dismantling high-level pipework to create that opening for lifting out, including draining and refilling those systems
    • Hire of a high-capacity mobile crane (heavy load, high up, large pick radius), with the associated traffic control, road closures etc
    • Specialist removal of refrigerant
    • Rebuild of the concrete plinth (the new machine will be a different configuration)
    • Removal & replacement of power cabling back to the panel, with associated BWIC, fire stopping etc
    • Modifications to the Moulded Case Circuit Breaker (MCCB), and reprogramming of the building Building Maintenance System (BMS)
    • Removal and reconfigured replacement of large bore piping connections to the unit (with the drain & refill of the system/s)
    • Re-balancing and recommissioning the system
  • Utility diversions can be exceptionally  challenging, because the exact location, condition and sometimes even type of service is often unknown until potholing is carried out. If a gravity sewer needs to be relocated to make room for the new works, the new alignment is likely to be longer than the existing. This may result in the new pipeline not having sufficient gradient to flow under gravity between the new connection points, meaning you may be looking at installing a pumping station (not forgetting the associated power supplies and telemetry).
  • Fibre optics in underground conduits. Unlike electrical power cables, fibres can rarely be spliced or jointed. If you have to relocate an existing fibre, therefore, instead of just replacing the affected length you will need to allow to replace the fibre from ‘node to node’, ie from end to end, which could be several kilometres of fibre. Further, the chances of there being existing conduits firstly present along the whole route, and secondly suitable for your use, is unlikely, bringing in the cost of creating a new buried conduit route, which is orders of magnitude more expensive than the fibre that will run through it.

The scenarios above are drawn from project experience and are are not unusual in the world of M&E.

Careful Consideration

Experience has taught us that our estimates can take the above situations into account. The key is to give each situation careful consideration, linked to an understanding of just how the task will need to be carried out. The usual estimating techniques of applying rates of $/m2 area or $/m length of relocation are often inappropriate. Most tasks need an estimate based on first principles, calculating (approximately) the labour, plant and material resources that will be required. Another advantage of this approach is that having thought about the ‘knowns’, you will better understand the ‘unknowns’ and will therefore be in a position to make an informed decision as to the appropriate level of contingency rather than ‘add 40% to cover’.

Of course it is not all downside. When upgrading equipment there are usually good opportunities to improve efficiency. Therefore, consideration should always be given to ‘life-cycle costing’ (for example, a slightly more expensive replacement chiller could deliver significant long term energy savings). This needs a careful and considered approach, along with good sustainability advice.

When working with existing services give them careful consideration, be conscious of the risks, and if in doubt about the scope or your understanding please ask a M&E specialist. At WTP we have a dedicated team who specialise in M&E systems and services who can add their knowledge to your project to give your project a better more considered outcome.

For advice on the hidden cost of your M&E project contact David Quincey.

Email David