Repair vs. Replace: When to Fix Aging Equipment and When to Throw In the Towel

The decision whether to repair or replace is a difficult one that every building owner must eventually face when aging HVAC equipment breaks down. The first question, understandably, is always, “how much”, and any decent HVAC contractor can quote a price for repairs or for a new piece of equipment, but the true cost is never quite that simple. A choice made solely on the cost of repair vs. replacement is an uninformed one that can cost a bundle down the line.

When the equipment in question is newer-to-middle-aged, relatively energy-efficient, and properly maintained, repair is usually the better option, especially when detailed records have been kept. For an older unit nearing the end of its life cycle, however, the decision-making process is far more involved, because the difference between repair costs and purchase price is only one or many factors that go into determining actual value. The key is to determine whether the cost of new equipment sufficiently offsets the price of repair.

As HVAC equipment ages, it breaks down more frequently, and maintenance and repair costs increase, and frequent downtime cuts into productivity and profit. Some parts and components such as compressors, control boards, drives and coils can be quite costly to purchase and labor-intensive to replace, and can be harder to find as time goes on. Utility costs are another important consideration, as older units can be huge energy hogs and most new equipment is far more efficient, often to the tune of tens of thousands of dollars per year, and sometimes into the hundreds of thousands.

Decision makers should also calculate the value of new warranties, manufacturer rebates, and energy incentive programs like PSE&G’s Hospital Efficiency Program and Direct Install and New Jersey’s Clean Energy SmartStart Buildings and Direct Install (through which a PJM client recently paid only 30% on an RTU replacement) when deciding whether to repair or replace. PJM can help owners and facility managers weigh the value of repair vs. equipment replacement and make an educated choice.

About PJM

PJM Mechanical Contractors, Inc. is a multi-faceted mechanical contractor providing construction and installation, service and maintenance, and design/build services in a comprehensive range of mechanical disciplines that include HVAC, plumbing, controls, refrigeration, custom metal fabrication, piping, fire protection, and backflow preventer testing. PJM primarily serves clients in pharmaceuticals, manufacturing, healthcare, institutional, and other various commercial and industrial sectors.

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