Friday, December 18, 2009

Residential Sprinklers - What's a life worth these days?

... The cost-per-life-saved for residential sprinkler systems is estimated at between $2-$36 million (in US dollars) according to reports from New Zealand and Canada.

Cost per life saved in $ CAD (Canadian Housing Information Centre)

According to a recent WMUR-TV report, the New Hampshire State Building Code Review Board has voted to require sprinkler systems in new residential construction starting in 2012.

Most fire safety officials laud the use of sprinkler systems for their ability to save lives, reduce injuries to building occupants and firefighters, and reduce the costs of fire damage. There's not much debate about whether sprinkler systems save lives and reduce property damage. They do.

The debate comes in when officials try to figure out if the savings are enough to offset the estimated $1.00 to $1.50 per square foot that sprinklers will add to the cost of constructing a new home. With the average square footage of new construction in New England running at around 2200 square feet, sprinklers could easily mean a $2500 to $3000 increase in cost.

That's where the analysis starts to get interesting and the squeamish head for the exits. Just how much is a life worth anyway? People say you can't put a value on a human life, but I say heck, engineers and safety officials have to do it all the time. Vehicle designers, transportation system planners, and of course, medical professionals are all too familiar with this gruesome mortality math. To start, I found this encouraging table from the US Fire Administration that shows that NH has the lowest fire death rate in the country, at 4.6 deaths per year per million. Regardless of where you stand on the sprinkler issue, that's good news.

Next, I did some quick googling and the first sources on cost-per-life-saved for residential sprinkler systems that I found were outside the US. (I wonder if this says something about our collective squeamishness here in the US).

This report from New Zealand estimates the cost per life saved at around $2-$5 million dollars (I did a currency conversion from the numbers in the report). Another report from Canada put the cost per life at a whopping $36 million. Still another report from the UK puts the number at around $1 to $2 million. Finally, the only US report I could find in my quick google search, from the Pennsylvania builders Association, puts the cost at over $80 million per life saved. Obviously, there's plenty of room for fudging the numbers and some of the groups producing these estimates have a vested interest in inflating the numbers to avoid new regulations, but at least you can get an idea of the order of magnitude.

Soooo, What say you? Are you worth $2 million? or maybe $5? How about $80. Just some food for thought...

To be fair, advocates of these mandates point out that they not only save lives and reduce injuries, but they also can protect property by reducing the severity of fires. The economics might be a bit tenuous, but I can't really blame the folks that have to run into burning buildings for advocating for more fire-safety equipment. These regulations would almost certainly make the outcomes they witness in their day-to-day jobs a lot less horrific.

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  1. Maybe the PA HBA should rethink it's position. In doing so they should consider the death as being their child instead of mine. The truth is there is $7 Billion in fire damage each year in single-family homes - the PA HBA does not want to lose the rebuild market. Factoring just fire deaths distorts the true economic picture.

  2. Jim - You stated that there is no doubt that sprinkler systems reduce property damage, but what additional property damage comes from drenching the property in water? The overall frame of the structure may be saved, but surely everything that got wet would have to be replaced as well.

  3. Marc,

    Thanks for the comment.

    My understanding is that the systems are designed now so that the water damage is very limited. The heads are only activated by high heat, so water only flows if flames are hitting the head directly. Also, unlike smoke alarms, activation of one head doesn't cause the others to activate.

    I'm sure there could be cases where water damage occurs and is greater than the fire would have been, but I think that's exceedingly rare with modern systems.

    In cold climates like New Hampshire, one concern is the potential cost of damage from frozen pipes. Most other plumbing in the house can be run on inside walls and is more protected from freezing, but plumbing for sprinklers has to run in the ceiling and although it's on the inside of the insulation, it's probably slightly more vulnerable to freezing than other plumbing.

  4. In response to anonymous on the property damage reductions, that's a good point.

    Based on my read of it, I think the New Zealand study that I referenced incorporated the economic value of reduced property damage and even reduced injury (rather than death) when they did their computations.

    This analysis can get complicated fast and I'm sure some will argue that the error signal is greater than the valid data. Personally, I'm not quite so skeptical. IMO, this type of analysis should at least be part of the decision-making process.

  5. Perhaps the reason you can't find the numbers inside the US is that Canada and New Zealand don't have multi-million dollar lobbying organizations dedicated to ramming residential sprinklers down our throats.

    Look up the Form 990 filings for the various home-sprinkler lobbying groups, it's interesting reading. The president of one was paid around $400,000 in 2008. One reports no paid officers or directors, but paid over a million dollars in salaries and benefits.


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