Extortionate quote for a new gas supply

by Readers Question

9:05 AM, 26th February 2014
About 7 years ago

Extortionate quote for a new gas supply

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Extortionate quote for a new gas supply

We are trying to get a gas supply to a cottage and a flat.

The flat is above, and at the back, of a shop and they are both accessed via an alleyway between two shops, and a courtyard. We own the alley way and the courtyard.

Having researched on line it seems that if you need what is described as a ‘standard’ connection the network are obliged to charge at a rate which varies between about £400 and £800.

To have a standard connection it has to be domestic, the boundary of the property must be less than 23m from the gas main and the pipe work from the boundary to the meter must be less than 40m. We are OK on all these counts.

We have used 1gas to get a quote for us – they claim to be a broker who get the best price from the various companies who are licensed to carry out gas connections. However, they are adamant that we cannot have a ‘standard’ connection and have consulted with National Grid who are the gas carrier in our area. They say that according to the regulation, because the properties are behind another property it does not count as a standard connection and therefore the only way to connect us is to extend the gas main into the courtyard and this will cost £10,500 – and that is before they have surveyed and worked out how to avoid al the other services which are already there! Extortionate quote for a new gas supply

I can find no reference to this on any of the documents and guides and I don’t know what regulations they refer to. On a previous post on Property 118 I seem to remember reading that the critical issue was to avoid being treated as a developer, but that isn’t the issue here.

Can I appeal to anyone?

Anyone got any ideas?

Thanks in advance

Mike


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Comments

Mark Alexander

9:07 AM, 26th February 2014
About 7 years ago

Hi Mike

I don't know the answer to your question but I do know a man who might.

Tony Atkins run a thread called "I am a Property Developer - Ask Me Anything" and I've been really impressed with the Q&A's so far. See >>> http://www.property118.com/i-am-a-property-developer-ask-me-anything/44690/

Good luck! 🙂
.

Mick Roberts

12:20 PM, 26th February 2014
About 7 years ago

I have bought houses in the past with no Gas supply, but next door has. And Transco £600 & 6 weeks notice to get connected.

I have just built 3 new build properties, gas on road only approx 20m away, & I’m sure we were getting daft £4000 quotes, & I know water was 4k & elec was 4k.

I then went direct to National Grid who Was £181 ALL IN. Two men, day and half work.

Please don’t ask me why the massive difference, apart from some main utilities ripping us off. When I got quoted £181, I keep mouth shut.

The impression I got was they all have their own monopoly & can charge what they like.

15:11 PM, 26th February 2014
About 7 years ago

Have you considered LPG or oil as an alternative?
.

Mike Tighe

18:48 PM, 26th February 2014
About 7 years ago

Thanks Mick - that gives me hope. Adam, yes naturally I am now busy exploring all the alternatives ! We don't have enough space for an LPG tank, but might just squeeze in one mini oil tank for the cottage but not enough space for the flat as well. Gas is so much cheaper and in my experience tenants all like it best, hence that's our first choice. Seems daft that in the middle of a town with a gas main in the street outside we cant get connected economically.

Jeremy Smith

19:39 PM, 26th February 2014
About 7 years ago

Mike,

Perhaps the cost is in the digging up of the alleyway and courtyard, and the subsequent re-laying.
Have you asked for a quote if you provide a suitable trench or ducting all the way from the entry onto the property to the point of connection?

My friend had to do that, and it then wasn't too expensive.
A couple of guys with a shovel and wheel-barrow should do the trick!
....If you need the concrete breaking up, then a breaker for £160 from screwfix should do the job, unless it's really thick !

sam

21:25 PM, 26th February 2014
About 7 years ago

Apart from national Grid, there are several engineering companies who are able to connect gas to residential properties. Some of them may even be local to you. These companies used to be listed on the National Grid web site but I think now you have to ask national Grid to get these guys to contact you. Fulcrum (national), Adroit (very helpful), Murphy, Morland all operate in the Midlands area. Get as many quotes as you can as the price could vary by as much as 2 - 3 times.

It would save you money if you dig the trench for laying the service pipe to the boundary of your land. You would also be responsible for getting permission if the pipe has to cross land that doesnt belong to you (legal cost). National Grid web site should tell you the depth you need to dig to - depending on whether it is under drive ways or not. I think 750mm is the norm.

Hopefully you wont require traffic management for the connection which can be expensive - National Grid should be able to provide you with a map of the main gas pipes around your property.

Ask how much they can offset via asset purchase (the pipe has to be owned by somebody) ~ £200 per meter installed.

If laying gas pipe for the first time, vat may not be applicable - HMRC Notice 701/19.

Hope that helps. Else talk to Scott Hardy at Adroit Utilities in Wolverhampton - the man is immensely helpful.

Good luck.

ian

9:24 AM, 27th February 2014
About 7 years ago

To save yourself a lot of exspense hassle let alone stress, why not install an electric Combi Boiler works the same as a gas combi, you will also save on the standing charge & fuel VAT on a gas metre. They plug into a standard 13A socket, can run of solar panels, do not need a gas safe plumber to insall, no annual gas cert needed. (not sure if it needs an alternative annual cert though) .

Jeremy Smith

9:28 AM, 27th February 2014
About 7 years ago

Reply to the comment left by "ian " at "27/02/2014 - 09:24":

That's ok if you don't need too much from it.

I did a little calculation once when I was going to heat my house with electric, and at the time, per Kilowatt-Hour, daytime electic was six times the price of gas - so just worth doing the calculations first !

Mike Tighe

11:00 AM, 27th February 2014
About 7 years ago

Many thanks Sam and Jeremy, some great ideas there for me to follow up.
I did originally ask 1Gas to quote both with and without us digging the trenches on our land but they only gave a quote for them to do it so I need to chase that. Luckily all the digging off the public highway is on land we own.
I thought 1Gas would be getting quotes from a range of engineering companies, (apparently they are now called Utility Infrastructure Providers, UIP's) but they only give you one final quote (who knows who they have approached or how many) so I will be looking to get a shed load more myself as you suggest. National Grid do not publish a list of UIP's any more but they will forward your request for quotes, so again you have no idea who they are contacting. Ofgem refer you to 'The lloyds Register' which lists all the UIP's in the UK so I am now working through that list to see who operates in my area (Cambridgeshire). Sadly we will need some traffic management so that is another potential cost extra to the 1Gas quote – it seems not all local authorities charge for this and you don't find out until you've accepted and paid for for your connection quote so I'm going try to find out from from the LA (if I can survive the interminable press 1, press 2, press 3...)
The VAT tip is excellent - it looks like a reduced rate now only applies to existing properties which have been empty for more than 2 years which does apply to the flat.
Ian, thanks for that suggestion, yes I have been looking at electric boiler alternatives and the simplicity of installation and maintenance is very attractive and we may have to go that route in the end but as Jeremy says electricity is SOOO much more than gas. I found this useful comparison chart here which others may like
http://www.nottenergy.com/energy_cost_comparison.
As you can see standard electricity is more than 3 times gas for the same heat output. I've also looked at the storage type electric boilers which work on Economy Seven tariffs but the cheaper rate per kilowatt is still double the price of gas, your other electricity use costs a bit more, and they rarely store enough to heat the property all day in cold weather if required - and we know how our tenants expect to be able to wander about in their undies whatever the temp outside ! It might work if we can majorly upgrade the insulation, but because of the structure (solid wall, listed building) this wont be cheap or unproblematic either ! Our experience is that you get a very high tenant turnover if the heating either doesn't work well or costs too much.
Hence, for now I'm going to battle on with getting gas in there if we can.
Mike


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