Easing the throttle in drive to work leaner

With the new coalition government facing a tough task to balance the books, and despite recent promises that it will protect spending on healthcare as far as is practicably possible, it is surely inevitable that NHS Trusts will find themselves facing severe budgetary constraints over coming months, and, in the process, forced to look at every possible avenue to find new ways of cutting costs and identify areas where savings can be made without affecting patient care. Hospitals are, of course, extremely energy-intensive buildings, with a constant demand for lighting, heating, and electricity. As a result, their energy expenditure amounts to some £400 million per year across the UK, so improving energy efficiency could help them achieve some of the savings that will undoubtedly be required. The National Health Service (NHS) alone has an annual carbon footprint of 18 million tonnes of carbon dioxide (CO2), while since 1990 its CO2 output has risen by 40 per cent. To reduce this will be a mammoth task. However even a one per cent change in electricity consumption can have a significant impact on running costs, and savings of even this, seemingly relatively small, magnitude could help render any cutbacks less drastic. By far the biggest consumers of electricity within buildings are pumps and fans, especially those used within heating, ventilation, and air conditioning (HVAC) systems. Fans and pumps are controlled by motors, so if these can be made to run in a more efficient manner, energy and CO2 savings can be made. These savings will enable hospitals to make significant inroads to meet cost reduction requirements and new environmental obligations that came into force in April this year with the introduction of the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme.

CRC’s ‘stick and carrot’ approach

The scheme, which aims, via a ”stick and carrot” approach, to encourage organisations to actively look at ways of reducing their carbon footprint, covers large organisations in both the public and private sectors which have at least one electricity meter measured on the half- hourly market. Organisations will have to report back on their energy usage, and will be required to reduce it, or face financial penalties. Hospitals that consume more than 6 GWh/year and use a half-hourly meter must register for the CRC Energy Efficiency Scheme. Although neutral to the exchequer, the scheme will have cash flow implications for qualifying organisations. An energy saving of some five percent will be needed to cover the average cost of administration within an organisation. Hospitals that qualify for the scheme will be allocated an agreed number of carbon allowances, which will decrease over time. Organisations that can successfully reduce their emissions will be able to sell their allowances to other organisations that have not met their targets. The cost of carbon allowance will be paid back to participating organisations. However, payment will be based upon a league table of energy performance. With HVAC being the biggest drain on a hospital’s running cost, any saving here can have a massive impact.