ESTATES & FACILITIES XXXX
St George’s goes greener
Eric Munro, joint director of estates and facilities at St George’s Healthcare NHS Trust and St George’s University of London; and Mike Chessum, head of Energy Construction Services at British Gas, discuss how a new Energy Performance Contract is expected to save the trust more than £1m a year. David Stevenson reports.
a rich history dating back to the opening of the original St George’s Hospital on Hyde Park Corner in 1733.
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With nearly 8,000 dedicated staff caring for patients, the trust is one of the largest healthcare providers in south-west London, serving a population of 1.3 million.
As well as delivering high-quality care, the trust has committed itself to a programme of carbon reduction and was one of 10 trusts to launch the NHS Carbon Management Scheme with the Carbon Trust in 2006. In the last five years it has reduced its carbon emissions by 20%.
However, the trust has taken its commitment to sustainability a step further after entering an Energy Performance Contract (EPC) with British Gas, which is expected to save the trust more than £1m a year in energy costs through the installation of low-carbon technologies across the site.
LEEF
The hospital has benefited from an initial loan agreement with Amber Green, the infrastructure specialist that manages the London Energy Efficiency Fund (LEEF). However, the initial £12.5m capital outlay of the project is expected to be recuperated through savings made to the hospital’s energy bills, which British Gas guarantees as part of the contract.
Eric Munro, joint director of estates and 40 | national health executive Sep/Oct 14
he hospitals and health centres that make up St George’s Healthcare NHS Trust have
facilities at St George’s Healthcare NHS Trust and St George’s University of London, told NHE: “This is an 18-month programme that will get all the energy conservation measures (ECM) up and running. These include new energy-efficient combined heat and power boilers, a combined heat and power plant, new chillers and lots of new mechanical and electric equipment.
“With all of this new kit, we expect to be making 12% kilowatt hour savings on our current energy bills across the hospital and university. Based on current energy prices, the savings we make will be approximately £1.1m per annum, and the capital investment cost is £12.5m – so we expect to pay it back in about 10 years.”
Mike Chessum, head of energy construction services at British Gas, said that the company was awarded the contract in August 2013, following a competitive OJEU tender. Since then, the company has reviewed the St George’s estate and put in place a bespoke plan to help reduce energy costs and carbon emissions, while contract and funding negotiations were finalised.
Munro told us that LEEF, which was launched in 2011, and is funded through £50m of public investment from the European Regional Development Fund, the Mayor of London and London Waste and Recycling Board and matched with up to £50m additional funding from RBS, has been vital to securing the contract.
“To be honest, I believe LEEF is vital because we [St George’s], like other trusts, are under
pressure to grow as a hospital,” he said. “We don’t have the most generous of capital plans and those really need to be ploughed into services for patients. So, it is very difficult for me to go to the board and say: ‘It would be a really good idea to give me £12m to spend on new kit’, when we have wards to refurbish and additional patient services to deliver.
“Whereas with LEEF it is a no-brainer for me to go to the board and say: ‘Let me borrow £12.5m and I’ll pay it back in 10 years’. The NHS prioritises quality of patient care, but they aren’t going to see health benefits from this investment. What this means is the water is still going to be hot and the lights are still going to come on. That’s why LEEF is so important, especially when the NHS has constrained capital – this allows us to do a spend-to-save.”
Implementation
The St George’s agreement is the second largest EPC delivered through Essentia’s procurement framework, and the project will be delivered by British Gas and London-based partner Breathe Energy using the best available technology.
“We are now going to build-out the project, which means we’re guaranteeing that we will save them more than £1m per annum for 15 years,” said Chessum. “It is going to save 6,000 tonnes of carbon, which is the equivalent of taking 3,000 cars off the road. It also means we save the trust about 25% of their energy consumption, which is the biggest we’ve done on a percentage basis.”
British Gas has been able to make this startling
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