Centrica Business Solutions has extended its two decade-long partnership with Solihull Hospital and announced plans to develop a new energy centre as it continues to decarbonise the hospital’s estate and unlock significant savings.

The energy centre, which is due to complete in spring 2026, will see the existing Combined Heat and Power (CHP) unit replaced with an energy efficient 2MW cascade heat pump system to meet the hospital’s high heating demands.

Once operational, the state-of-the-art energy centre will deliver more than 75% of Solihull Hospital’s heating requirements and reduce its carbon emissions by 1,185 tonnes each year.

Centrica Business Solutions has remained the hospital’s energy partner for the past 20 years and has been responsible for maintaining and upgrading the energy assets across the estate. Following today’s announcement, Centrica Business Solutions will continue to work closely with Solihull Hospital for up to 18 years.

The latest project follows a string of energy saving solutions the business has delivered for Solihull Hospital. This included modifications to the existing Building Management System to optimise performance and improve efficiency, with updated outstations and the introduction of time scheduling and set points; along with cavity wall insulation and the replacement of 2,500 lights with LEDs. These improvements, together with the new energy centre, will reduce the hospital’s carbon footprint by 1,812 tonnes per year, alongside delivering £62,000 in cost savings per year, based on the Trust’s current energy tariffs.

Operated by University Hospitals Birmingham NHS Foundation Trust, Solihull Hospital is an acute general hospital providing a range of outpatient and inpatient services. Centrica Business Solutions is working closely with the Trust to ensure patient disruption is minimised throughout the project. 

Phil Bryant, Head of Business Development at Centrica Business Solutions, said: “Hospitals are facing increased pressures to balance their intensive energy demands with cost and carbon savings across their large estates.

“We’ve been a proud energy partner for Solihull Hospital for 20 years and together we’ve worked to make the hospital estate more energy efficient by providing and maintaining low-carbon solutions. The new energy centre marks the next step on the hospital’s decarbonisation journey, and we look forward to seeing the results.”

Martin Richardson, Executive Director at Solihull Hospital, said: “Our partnership with Centrica Business Solutions has really helped us set a standard for sustainable healthcare. We’ve been able to maximise our savings as well as make the hospital a more comfortable place for patients and staff.

“We have plans to continue to work alongside Centrica Business Solutions for years to come, with a goal of reaching net zero in the not-too-distant future.”

The energy reduction measures were funded through, the Department for Energy Security and Net Zero (DESNZ) Public Sector Decarbonisation Scheme; encompassing Salix as the delivery body with development and procurement via the Carbon Energy Fund (CEF). CEF supports NHS Trusts and public body organisations to improve energy infrastructure and reduce overall emissions.

Paddy Hendry from the Carbon and Energy Fund (CEF) said: “We were extremely pleased to be asked by the University Hospitals Birmingham NHS Foundation Trust to lead on the Procurement and development of their continued route to net zero. This is an exceptional project to be part of, delivering sustainable Healthcare in true collaboration. The CEF managed approach embraces the project from feasibility through procurement, construction and contract and performance assurance (M&V).”

https://www.centricabusinesssolutions.com

Matthew Everett, Energy and Carbon Analyst, Salix

In an increasingly volatile world, energy markets are facing relentless pressure. Geopolitical tensions, economic uncertainty, and shifting regulatory landscapes are driving price fluctuations and supply chain disruptions. The ongoing war in Ukraine continues to impact global gas markets, while conflicts in the Middle East threaten oil and liquefied natural gas supply chains, particularly through key maritime routes. Meanwhile, political shifts in major economies, including the US and EU, are reshaping energy policies.

For organisations across all sectors, these challenges translate into rising operational costs and increased exposure to energy market volatility.

Among those most affected by the many external factors, are public sector bodies which must not only absorb rising energy costs but also work towards ambitious decarbonisation targets. In the UK, we have a legally binding target to achieve net-zero greenhouse gas emissions by 2050. The clock is ticking.

The UK public sector manages the largest property portfolio in the country with more than 300,000 individual properties. However, most public sector buildings still rely on burning fossil fuels for heating, contributing to approximately 2% of the UK’s total greenhouse gas emissions. Meeting these targets is no small task, but dedicated funding mechanisms exist to support the transition.

At Salix, we support the public sector in securing government funding to deliver ambitious decarbonisation projects, ensuring that financial barriers do not stand in the way of meaningful progress. We’re proud of the strides we’ve made in our mission to help save the planet, working across the public sector and housing. Yet, the scale of the challenge remains vast, and the need for coordinated action is greater than ever.

The government aims to cut greenhouse gas emissions from public sector buildings by 75% by 2037 compared to 2017 levels. Achieving this requires significant investment in energy efficiency upgrades, low-carbon heating, and renewable technologies – all while operating within severe financial constraints.

Inflation has exacerbated these demands, with 76% of councils expressing concern over the impact of rising costs on project deliverability within the restrictions of national schemes, according to a 2024 report by the Local Government Association.

With the energy market prone to uncertainty, it is critical for public sector bodies to have effective procurement strategies to achieve their decarbonisation goals. Well-structured procurement approaches may ensure energy is secured at favourable rates while also facilitating the adoption of low-carbon technologies, energy efficiency and fabric improvements, consultant support services and contractor implementation.

However, procurement may be another hurdle that the public sector must face. Unlike private businesses, and with good reason, public sector organisations operate within rigid procurement frameworks. While these frameworks promote transparency, fairness, and accountability, there can also be, challenges such as complex compliance requirements, lengthy approval processes and restricted supplier options. Procurement policy is often price-driven; for instance, public sector procurement requires a value-for-money approach, which could, some argue, compromise on quality.

Decarbonisation adds further complexity due to the evolving technology landscape, market uncertainties, limited expertise within procurement teams, and the need for integrated solutions that take a whole building approach. Sustainability teams, where they exist, at times may be under-resourced and lack the expertise to navigate complex decarbonisation projects.

This challenge is reflected in a 2024 Local Government Association survey, which found that 60% of councils have been deterred from applying for government grants due to the substantial time and resources required for applications. Decarbonisation efforts remain fragmented, with nine in ten councils stating they lack a sufficient financing plan to reach net zero by 2050. The longer these projects are delayed, the more emissions continue to accumulate rather than decline.

We believe that targeted funding mechanisms like the Public Sector Decarbonisation Scheme play a crucial role in supporting the public sector, ensuring they have the financial resources required to deliver their decarbonisation projects. The scheme provides grant funding for heat decarbonisation and energy efficiency measures for public sector buildings and has already allocated £2.5 billion in grant funding, excluding the current Phase 4 of the scheme.

For more information on the schemes, visit our website here. To learn about the impact of our work on local communities, check out our news area here.

The ongoing energy crisis, combined with a lack of expertise, limited resources, rigid procurement frameworks, and unpredictable funding, makes decarbonisation an even greater challenge for the public sector.

Initiatives like the Public Sector Decarbonisation Scheme provide crucial financial support in meeting the net zero targets. The high demand for Public Sector Decarbonisation Scheme funding highlights its necessity, with applications often exceeding available resources.

Beyond enabling immediate carbon reductions, the Public Sector Decarbonisation Scheme funding drives long-term impact – stimulating demand for contractors, consultants, and technical expertise while strengthening the low-carbon economy. By investing in decarbonisation today, the public sector can drive immediate carbon reductions while building the skills and supply chains essential for a more resilient energy future – leading by example in the transition to net zero.

To discover more about our work at Salix, click here.

This article appeared in the March 2025 issue of Energy Manager magazine. Subscribe here.

With net-zero deadlines fast approaching, the UK public sector faces a paradox: big targets with small budgets. Despite bold goals, much of the sector remains unaware of key tools that could transform the electrification journey. The recent Vattenfall Networks seminar revealed an astounding gap in awareness—of the attendees, only one of 15 had heard of IDNOs. Yet IDNOs might just be the accelerant needed to bring the Public Sector’s green ambitions to life.

As councils and NHS trusts strive to meet net-zero targets, many are only just discovering the role that Independent Network Operators (IDNOs) could play in their journey. According to the UK Government’s Net Zero Strategy: Build Back Greener, the public sector is expected to lead by example, transitioning to sustainable energy solutions across all infrastructure projects. However, with government funding spread thin, reaching these ambitious targets demands creative, cost-effective solutions, like IDNOs. Brent Council’s Francesca Campagnoli captured the current knowledge gap perfectly: “This was all completely new to me”. With so much at stake, the public sector’s introduction to IDNOs is long overdue.

The knowledge gap

This lack of familiarity with IDNOs isn’t just surprising—it’s a barrier. The Public Sector Decarbonisation Scheme (PSDS), which has allocated over £1 billion to assist public bodies in reducing emissions, has been crucial but still leaves funding gaps. Jacob Kupferberg, from Brent London Borough Council, highlighted these challenges: “The two main obstacles are governance and funding”. Limited resources and complex bureaucratic processes slow down decarbonisation efforts, while public scrutiny adds pressure to perform efficiently.

IDNOs like Vattenfall Networks are designed to bridge some of these gaps, offering a lifeline through both funding and project acceleration. Their Asset Adoption Value (AAV) payments, a concept new to most public sector organisations, can significantly reduce upfront infrastructure costs.  By reducing initial project expenses, AAV payments ease budgetary pressures, helping councils and trusts improve the economics of their electrification projects.

Suzanna Lashford, Head of Business Development at Vattenfall Networks, explained the rationale: “The public sector is under pressure to deliver ambitious net-zero goals with limited budgets. IDNOs can be the key to unlocking these projects, giving councils and NHS trusts the financial support to move forward with electrification”. With increasing emphasis on decentralisation and local accountability, as noted in the government’s Ten Point Plan for a Green Industrial Revolution, partnerships with IDNOs align with these goals by offering flexible, localised solutions.

From theory to practice: beyond funding

IDNOs offer more than just funding. They bring a streamlined, end-to-end approach to grid connections, which many organisations discovered could fast-track their projects. Francesca observed, “If IDNOs have priority on highway permits, it means they can perform grid connections more efficiently”. For councils managing time-sensitive projects, this competitive edge is a game-changer, particularly in urban regeneration or infrastructure-heavy initiatives where delays are common.

Severine Turgis from Central London Community Healthcare NHS Trust emphasised how IDNOs simplify project delivery: “Knowing that they [IDNOs] help with applications and follow through on commitments gives me confidence when I pitch the idea to my directors”. This full-cycle support fills critical resource and expertise gaps, allowing public sector teams to focus on the bigger picture of decarbonisation without being weighed down by logistical barriers.

For many, learning about IDNOs was eye-opening. Joy Olokpa, Carbon Zero Program Manager at Hammersmith and Fulham Council, valued IDNOs’ comprehensive support, noting that they could “relieve some of the burden on us by managing every step”. The Public Accounts Committee recently pointed to the need for better infrastructure management within the public sector, emphasising that streamlined processes and external expertise could enhance project efficiency. IDNOs, with their holistic approach, seem well-suited to meet these recommendations.

A call to action for the public sector

If public sector organisations are serious about meeting net-zero goals, IDNOs need to be part of the conversation. This starts with educating key stakeholders—energy managers, sustainability directors, and facilities teams—on the advantages IDNOs offer. The UK public sector is at a critical crossroads, balancing ambitious net-zero targets with tight budgets and limited awareness of key solutions. IDNOs present a promising path forward, offering both financial and operational support that can help councils and NHS trusts navigate the challenges ahead. It’s time for the public sector to recognize the value of IDNOs, unlocking a partnership that could prove vital to achieving a sustainable future.

www.vattenfall.com

This article appeared in the March 2025 issue of Energy Manager magazine. Subscribe here.