A smart approach to carbon management

Tim Pryce, public sector manager at the Carbon Trust, explores how healthcare organisations can improve their environmental performance, cut back on energy costs and prepare for the government’s Carbon Reduction Commitment.

With an increased emphasis on ‘going green’ following the launch of the NHS carbon reduction strategy: ‘Saving Carbon, Improving Health’, there has never been a more important time for the NHS to take a lead role in the sustainable development agenda.  
    
The NHS is expected to play a key role in helping to achieve the government’s objective of cutting UK carbon emissions by 80 per cent before 2050 and 34 per cent by 2020. It is currently responsible for about three per cent of total UK carbon emissions, and has an annual energy bill of over £500 million. Energy use and associated carbon emissions are already a significant cost item for hospitals, and with the increased use of specialist medical equipment, consumption is set to increase rapidly if unchecked.

Measure, monitor, reduce
The NHS Sustainable Development Unit has developed a carbon reduction strategy to help NHS Trusts to measure, monitor and reduce their carbon emissions. Using guidance from the strategy, the NHS has set itself a target of achieving a ten per cent reduction in its 2007 carbon footprint by 2015. Whilst this may seem like a daunting prospect to many NHS Trusts, by taking action to reduce their carbon emissions now, healthcare organisations can not only benefit from energy efficiency cost savings but also get ahead of the game in terms of the government’s Carbon Reduction Commitment (CRC).
    
The CRC is a mandatory scheme which targets carbon dioxide emissions from large public and private sector organisations, which use more than 6,000MWh of electricity per year. Through the scheme, healthcare organisations will be required to purchase CO2 allowances at the rate of £12 per tonne. At the end of each year, the performance of each organisation will be summarised in league tables outlining the best and worst performers in terms of carbon emissions. The revenues generated through the initial sale of credits will be recycled back to participants from government, plus or minus a bonus or penalty dependent on their place in the league table.  With healthcare organisations set to make a significant financial loss or gain dependent on their environmental performance in the scheme, carbon reduction has to be high on the agenda of every healthcare board across the UK.

Cost benefits
The increasing demand for improved environmental performance is not the only incentive for NHS Trusts to reduce their energy use. Energy efficiency also offers significant cost saving benefits which, at a time when the NHS is facing budget cuts, cannot afford to be ignored.  
    
Faced with the challenge of working in old buildings with limited funds available to modernise, combined with increasingly sophisticated but power-hungry technology, keeping energy costs down is no easy feat. The good news is that implementing a few simple techniques can help to reduce the amount of energy consumed in a hospital, and in doing so release funding for use elsewhere. Costs can be reduced significantly using simple energy saving procedures, such as setting appropriate temperatures and ensuring that heating equipment and controls are operated and managed correctly. In fact, it is possible to save up to 30 per cent on heating costs through the implementation of simple ‘low cost, or no cost’ energy saving measures, and considerably more through “invest to save” measures like building fabric and boiler upgrades, and the efficient use of space.  
    
Lighting is also important as it can account for over 20 per cent of the total energy use in a typical hospital. An effective lighting system can also reduce costs and have the added benefit of decreasing internal heat gains, thus reducing the need for air conditioning too.

Taking action
So, given forthcoming legislation and the need to maximise any opportunity to save energy and cost, what actions can the NHS take?
    
To support the move to a low-carbon NHS, the Carbon Trust has developed a simple five-step approach, which has helped many healthcare trusts to implement a workable carbon management strategy that identifies energy waste and tackles carbon emissions. The Carbon Trust’s NHS Carbon Management programme is designed specifically for Trusts – providing staff with support and guidance to integrate good carbon management into their organisation’s infrastructure and day-to-day operations at all levels. What’s more the Carbon Trust’s advice – including analysis tools, training and workshops, and expert one on one support- is free of charge.
    
Since May 2008, the Carbon Trust has helped over 82 NHS trusts, like Wrightington, Wigan & Leigh NHS Foundation Trust, produce effective carbon management plans.
    
Wrightington, Wigan & Leigh employs around 4,200 staff, serving patients across Wigan and Leigh. In 2004/05, the Trust spent approximately £1 million on energy, emitting more than 17,000 tonnes of carbon dioxide. By 2007/08, this figure had risen to more than £1.5million and it was anticipated that it would double to £3.2million by 2008/09. Eager to slow the snowballing energy costs, the Trust joined the Carbon Trust’s NHS Carbon Management programme.
    
By engaging in the programme, the Trust has now mitigated the effects of rising energy prices and limited the increase in its energy costs, as well as cutting carbon emissions. Overall, the Trust expects to save in the region of £380,000 on its energy bill over five years, and reduce carbon dioxide emissions by approximately 4,000 tonnes over the same period.

Support from the top
To implement long term carbon reduction there is a need for board level and senior management support. Achieving energy and carbon savings in hospitals requires strong leadership from the front, ideally by the chief executive plus an ‘energy champion’ at board level. By demonstrating a strong commitment to the organisation’s energy policy at the top, staff lower down the chain will be empowered to take action on energy saving initiatives throughout the hospital. To be accepted onto the scheme, NHS Trusts need to show this top level commitment, and to nominate a team committed to driving the programme forward. All members of the team will need to work across organisational boundaries to promote and implement carbon reduction projects.
    
The Carbon Trust team helps participating Trusts to work through the five-step process below, guiding Trusts through an analysis of their carbon footprint and the opportunities to manage their carbon emissions better.  

• Step one focuses on mobilising the Trust by identifying key members of the carbon management team.
• Step two helps develop an understanding of what drives the carbon management process, gathering information on current emission levels and trends.
• Step three identifies opportunities for reducing emissions and assessing their impact.
• Step four is to produce a board approved carbon management plan with timetables, funding and targets
• Step five is the implementation of that plan to reduce carbon emissions across the organisations operational activities.

On average, the programme requires a minimum commitment of two days a week from a team leader for the programme’s ten month duration, plus a commitment to the process at board level.

Financial support
Whilst there are many quick, low-cost ways of reducing emissions, assistance is also at hand when it comes to introducing new energy efficient equipment. The government, in partnership with Salix, the Carbon Trust’s public sector funding body, is providing £51.5 million in interest-free loans to help healthcare organisations replace old equipment with modern energy efficiency equipment.
    
Interest-free Energy Efficiency Loans are available for either 100 or 50 per cent of the cost of around 80 different types of energy efficiency equipment, including building insulation, boiler and lighting upgrades, improved cooling systems and IT energy efficiency improvements. The loans are designed to pay for themselves through the savings in energy – essentially providing free funding to tackle climate change. With the imminent CRC demanding carbon reduction from April 2010, the loans scheme plays a vital part in helping the public sector to comply with this.
    
Internal energy wastage is not the only area that healthcare Trusts can look to reduce carbon emissions. For example, by reviewing procurement procedures hidden energy and cost savings can be revealed. Trusts need to evaluate the real lifecycle cost of equipment and new build, taking into account maintenance, disposal and lifetime energy costs. By assessing the whole life cost of purchases in this way, Trusts have greater long term control over equipment, materials and overall running costs. At a time when reducing emissions is of paramount importance, Trusts will also need to start asking questions of their suppliers. It is important to understand if new and existing suppliers have a carbon management strategy in place and are actively measuring the carbon footprint of their products and services.  
    
Ultimately, managing NHS Trust carbon emissions will enable health organisations to cut back on their energy costs and prepare for legislation which could be costly if the appropriate steps haven’t been taken.  

For more information
NHS Trusts can find more information about the Carbon Trust’s NHS Carbon Management programme and interest free Carbon Trust loans by calling 0800 085 2005 or visiting carbontrust.co.uk/carbon/PublicSector/public-sector-loans.htm