NHS can spend less on energy and more on people

A government greenhouse gas emissions survey of the public estate in 2010, found many of the country’s hospitals were amongst the worst offenders.

Things have improved since then, with healthcare estates recognising that reducing energy consumption not only cuts emissions related to energy use, but reduces fuel costs – perhaps allowing funds to be diverted to healthcare and staffing.

However, according to Jan Ponsford, Director at Virtus Consult, specialists in energy reduction strategies, there is still a lot that can be done.

Reducing energy consumption starts with understanding what energy is being used, what is being wasted and where the savings are most easily made. This is no time for guesswork or making obvious assumptions, but undertaking detailed evaluations across an entire estate.

It is easy for everyone to get behind a single big idea, like a large photo-voltaic array or a waste to energy project, but it is much harder for facilities managers to ‘sell’ the idea to senior management teams that many small changes will deliver significant savings.

Investing in new thermostatic radiator valves or installing new low-energy pumps in the air-conditioning is unlikely to attract a huge amount of attention or interest. But it’s time to recognise  that the small changes Facilities Managers can make, rather than one big headline grabbing change are the way ahead.

To reduce energy consumption, which happily cuts energy spend and carbon emissions, it is important to consider the more basics steps possible to improve the energy efficiency of existing, often old buildings.

Comprehensive evaluation is key

The evaluation of an organisation’s estate needs to be detailed, consider every aspect of the energy efficiency equation and call on every source of information from half-hourly electricity bills to waste management policies.

To establish a baseline, any evaluation also has to consider the facility’s energy spend and carbon emissions from, mechanical and electrical activities, buildings, infrastructure, land, waste, transport and workforce.

A good evaluation will typically focus on three distinct areas:

Power usage – the site survey will consider metering and sub-metering, often by department in healthcare facilities, where there can be a huge disparity in usage. It is important to monitor and benchmark performance, comparing the in-use performance of a building to its historical energy use or the energy use characteristics of similar healthcare facilities.

Initiatives – this is less strategic and more tactical, looking at heat recovery, use of renewables if relevant, including energy from waste, lighting systems, electrical equipment, voltage optimisation and improvements to the fabric of the building and surrounding environs.

Operational – the survey should consider the energy use awareness of the staff, the lifecycle maintenance, waste reduction strategies, procurement services, transport and ultimately the culture of the organisation – is there a desire to cut consumption and is everyone on board?

Once it has been established who in the organisation has the day-to-day responsibility for energy consumption, purchasing and wastage, along with operational activities, the assessment can look in detail at the policies in place and the base line information needed to make recommendations.

Baseline information and knowledge transfer

As expected the information needed starts with the buildings, their age, construction and condition, their occupancy profile and the plans to re-develop if appropriate.

A thorough inspection of the building fabric and its thermal properties, along with rooves, windows, doors, flooring etc., forms an important step of the final evaluation.

If no asset register is available for the mechanical and electrical systems, a thorough review of heating, ventilation, cooling and lighting systems is essential.

The temperature and humidity set points (and whether they change throughout the year), in different locations across the estate will be critical to the overall consumption picture and will help highlight potential changes.

From design to reality

We hear about the design of low energy buildings, but when these buildings are built and occupied, there is a gap between the predicted performance and the actual energy consumed.

Published in 2013 by CIBSE, TM54: Evaluating Operational Energy Performance of Buildings at the Design Stage, provides clear guidance on how to evaluate operational energy use more fully at the design stage.

One key consideration is accurate estimating of the operating hours and occupancy pattern of the building, which is unique in the case of healthcare facilities. It sets out how the operational energy can be estimated and covers lighting, heating, ventilation and cooling, along with the provision of hot water.

Crucially, it also asks designers to consider the consumption profile of lifts and escalators, small power loads, catering, server rooms and other plant and equipment, which can often be overlooked with current calculating methods.

The UK has huge talent in designing buildings to achieve PassivHaus and Breeam certification, but there remain basic improvements possible on older buildings that will consistently deliver greater energy efficiency and relatively short pay-back periods.

There is more to the energy efficiency story on healthcare estates than just capital projects and new buildings.

Annual savings, payback and funding

The problem for many hospital management teams and their facilities managers is the investment required to make the necessary changes against the estimated pay back time. When more money is required for clinical activities, spending on energy reduction can become piecemeal and ineffective.

Even a typical small Trust estate is capable of reducing energy consumption by as much 18%, with a reduction in energy spend as high as 24%.

A comprehensive evaluation combined with a committed implementation plan using the right specialist contractors ensures it is possible to achieve guaranteed savings and payback periods of under 5 years.

This not only cuts consumption and reduces carbon emissions, but saves millions of pounds over the period, which can be better invested in improvements to medical facilities and patient care.

How energy efficiency and carbon reduction improvements will be funded is the real stumbling block for NHS Energy Managers and Facilities Managers; not what changes need to be made.

Funding options are assessed on a project specific basis, considering building type, usage, location, Trust requirements and preferences. The energy saving measures being considered will also impact the potential funding solutions.

The options usually fall into a number of categories, with the simplest perhaps the Trust capital funding the improvements. Borrowing directly from the Green Investment Bank or SALIX, which offers interest and fee free loans, are popular choices, with energy-cost savings used to pay the loan.

Salix requires NHS programmes to payback within 5 years and less than £120 per tonne of CO2 over the lifetime of the project. Salix funding covers over 100 energy efficient technologies including boilers, combined heat and power, LED and lighting upgrades, and heat recovery.

Financing the improvements is possible through a third-parties, which could include ‘off-balance sheet’ options like an Energy Services Company (ESCo) agreement, a Short Term Operating Reserve (STOR) arrangement, a Special Purchase Vehicles or Programme Partnership Arrangements.

For Trust managers it is all about building the Business Case for the whole project, considering:

  • Procurement and Application process with indicative timescales
  • Compliant initiatives
  • Levels of funding (initiatives attract differing levels of funding)
  • Risks
  • Interest levels
  • Payback periods
  • Any restrictions on using different types of financing together
  • Potential contractual or legal issues
  • Any significant dates such as when a particular fund closes

Experience dictates that the best funding solution is the one that presents the least risk for all stakeholders, whilst providing the best value. It also has to meet the Trusts’ needs and satisfy legal and statutory requirements.

Implementation follows evaluation

Starting with the evaluation and the baseline information, the process to implementation of the various simple changes will typically take 6-9 months.

Once the business case has been made, a tender process will follow to select the contractors experienced in delivering similar projects and guaranteeing the predicted savings and payback period.

Ideally, the project will be managed by the consultants that initially undertook the evaluation, as they will understand the organisation’s objectives, economic drivers, operational structure, existing knowledge and experience – all beneficial to the successful delivery of the project.

Energy efficiency projects within the healthcare sector, rarely have an end point as a lot of monitoring and verification is required to ensure targets are hit. In the fight to cut energy consumption, continual improvement through new and more affordable technologies is crucial.

Experience is critical to outcomes

Hospitals are complex buildings with unique energy requirements. They are occupied every minute of the day, by a lot of people, many of whom are unwell and potentially at risk from poor environmental conditions.

This situation requires control of the buildings’ thermal environment and indoor air quality, especially those spaces used for treatment and convalescence, which can require large amounts of energy.

The value lies in balancing the time taken for the expected savings to cover the initial expenditure on implementing the changes. This requires a more nuanced and experienced approach, but the savings can be immediate and significant.

 

Virtus Consult is an award-winning multi-disciplinary construction and management consultancy, formed in 2006. It provides project, cost, construction and energy related consultancy services to a range of clients, of all shapes and sizes, operating within all sectors of industry and commerce.