Webinar Discusses How Hospitals Can Cut Costs by Managing Energy

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With the proper planning and implementation of energy management practices, hospitals can simultaneously control their costs, manage their operating risks, and reduce their impact on the environment. Although energy may only represent two or three percent of operating costs, small changes can still add materially to a hospital’s bottom line.

While the hospital environment is one of the most energy-intensive — only fast food restaurants use more energy per square foot — it is also one with numerous requirements related to patient comfort , infection control and equipment utilization. Rowan Sanders, director of marketing and communications for Veolia Energy, discussed best practices for hospitals and energy management in a Jan. 31 Becker’s Hospital Review webinar, “Optimizing Energy: Solutions for Healthcare Institutions.” In the webinar, Mr. Sanders discussed common energy management practices, the best way to approach holistic energy management planning, cogeneration, and facility operations.

So what are hospitals doing to conserve and optimize energy? In a 2010 survey, 43 percent of hospitals said they had replaced existing light fixtures with new lights. Other popular conservation practices among hospitals included the following:

• Retrofitting existing light fixtures — 40 percent.
• Installing energy-efficient motors — 34 percent.
• Installing occupancy sensors — 31 percent.
• Setting back thermostats — 22 percent.

Larger tasks such as installing energy-efficient equipment were less common among hospitals, with 20 percent or less installing energy-efficient chillers, ventilation equipment or heating equipment.

In the webinar, Mr. Sanders suggested that hospitals seek expert advice as early as possible. The healthcare environment and infrastructure demands deep, detailed expertise. For instance, air conditioning requirements differ among surgery and critical care. Also, the expertise and providers should be technology and manufacturer neutral, so that energy plans are not swayed to their benefit. Hospitals should think holistically and can utilize expert resources to develop plans at any or all of the following three levels:

• Level one: Identify opportunities for improvement, which typically takes about one month.
• Level two: Conduct feasibility studies for the specific opportunities and options identified, which can be done in approximately three months.
• Level three: Conduct an investment decision study for those specific options, including partial design work. This step typically requires approximately five to six months of effort.  

Another consideration for hospital energy management plans is cogeneration, or combined heat and power plants, which can produce energy using about 40 percent less fuel by recycling the waste heat of power generation and converting it into useful heat. These plants simultaneously produce electricity and heat. CHP plants have been proven as technology that is both cost-effective and environmentally friendly.

CHP plants also improve a hospital’s reliability since the primary source of energy becomes a new power plant, while the electric grid is still in place to serve as the hospital’s back-up energy source. The typical cost of implementing a new CHP plant ranges from $2,500 to $5,000 per kilowatt, and varies based on the complexity of the installation.  There are approximately 100 CHP plants of varying sizes serving U.S. hospitals. Texas Medical Center in Houston has the largest with 48 megawatts, serving 18 buildings on the campus. Other sizeable CHP plants include those of:

• Longwood Medical Area (Boston) — 47 megawatts.
• Loma Linda (Calif.) University Medical Center — 13 megawatts.
• St. Mary’s Hospital/Mayo Clinic (Rochester, Minn.) — 12.9 megawatts.

Finally, when it comes to facility operations, hospitals can leverage the expertise of external operators and create growth opportunities for existing technical personnel. When working with external operators, hospital leaders should ensure that incentives are established for continuous improvements in energy efficiency.  Competent technicians who work at the hospital are usually able to transfer to energy companies with growth opportunities beyond a single institution, according to Mr. Sanders.  This creates a win-win opportunity for the hospitals, their existing technical personnel, and the firm that assumes responsibility for operating and maintaining the energy infrastructure for optimal efficiency.  

Download the Webinar presentation by clicking here (pdf).

View the Webinar by clicking here (wmv). We suggest you download the video to your computer before viewing to ensure better quality. If you have problems viewing the video, which is in Windows Media Video format, you can use a program like VLC media player, free for download here.

Learn more about Veolia Energy.

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