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Carbon and cost reductions in the NHS

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Twenty-six actions to reduce carbon emissions and costs in healthcare.

Twenty-six actions to reduce carbon emissions and costs in healthcare.

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  • 1. Carbon and Cost Reduction Planfor the Portuguese NationalHealth ServiceSummary Results2011 Romeu Gaspar romeu.gaspar@thisisxy.com
  • 2. XXX – XXX & Objectives BackgroundThis initiative aims to reduce the Portuguese NHS carbon emissions and at the same time, reduce costs,improve service quality and create best practices routines Drivers Carbon Strategic Plan Benefits Carbon National targets for emissions Identification, quantification and selection of opportunities to energy efficiency reduction and climate reduce carbon emissions throughout the value chain of health facilities Cost reduction Industry targets for Supply chain Resources optimization energy efficiency and quality Energy Energy efficiency enhancement Service quality improvement Operations Operational efficiency International Waste Recycling and recovery NHS best Benchmarks (e.g. practice English NHS) Water Optimization and Reuse guidelines development Transport Sustainable Mobility National Prototype for Benchmarks (e.g. other industries Patients Production Efficiency H.U.C. Coimbra) and countriesSource: X&Y Partners
  • 3. XXX – XXX pilot project Scope of theThe pilot project was applied to three facilities in the Lisbon region: two hospitals and a primary carehealth center Portuguese National Health Service (NHS) Pilot project for Carbon Strategic Plan Primary Health Care Units (346 Health Centers) HC Health Centre deployed in an 90s building H1 Secondary Health Care Units (73 Hospitals) Hospital with approximately 600 beds and built in the 90’s H2 Hospital with approximately 400 beds and built in the 50’sSource:, X&Y Partners
  • 4. XXX – studies Case XXXThe are numerous international and national best practices that are potentially applicable to thePortuguese NHS ... National and international best practices Benchmark Supply  chain   Energy   Opera6ons   Waste   Water   Transport   Pa6ents   • Inventory • LED lighting in • Information and • Curry-Cabral • Rainwater • Carris Eco- • Baby Care management exterior facade of communications Hospital – Eco harvesting in driving program system National through Sta. Maria technology Hospital several buildings • Mobile hospital Program at Kanban • Entrajuda Communicator • Energy Pedro Hispano software-based efficiency in Hospital, Program system HUC, and HB Matosinhos Curry Cabral • Microgeneration • Sustainable • PLC systems • Vodafone • Waste • Water • The Green • Norwegian energy system International procurement • Painting management management Ambulance Telemedicine through building roofs efficiency program at strategy at Center Project in • Cisco assessment white University of Royal Stockholm Information and tools like communications Washington Children’s Ecobuy technology Medical Center Hospital, Program Australia and St. Michaels Hospital, CanadaSource: X&Y Partners
  • 5. XXX – XXX the interviews and visits to the units Results of... an applicability that was validated by several visits to the health care units and staff interviews,which have shown a considerable interest in this subject Key survey answers Sample quotations Should the NHS be an example of Maximum effort High effort Little/no effort an environmentally sustainable “Teaching people to save and organization? turn off the equipment is the 66,0% 31,4% 2,6% key energy efficiency measure that should be implemented.” 0 1-2 +2 How many energy efficiency measures do you use at home? 5,9% 11,1% 83,0% “There should be some internal Little/not competition between different How important it is to create a best Very important Important hospital departments, to important practice guideline for energy enhance the efficiencies and efficiency? reduced service costs” 70,3% 29,0% 0,7% Would you agree with waste Yes No/ Didn’t answer separation and reuse of administrative material in the hospital? 100% 0% “Changing the patients medical Yes No/ Didn’t answer record from paper to electronic Would you be willing to replace the paper based structure by a format” computerized one? 92,8% 7,2%Source: X&Y Partners interviews and site visits
  • 6. XXX – XXX identified (1/2) InitiativesIn total, 123 opportunities to reduce emissions and costs were identified, grouped into 26 initiatives... Health Care Unit Energy 6 7 8 9 10 14 NHS Commuting 23 Lighting 13 Air conditioning Transportation Ventilation Support 24 25 Staff Commuting 11 12 Medical Patients Services services 22 Water Services 20 21 26 Procurement IT and management 1 4 15 16 17 28 Suppliers Losgistics Waste 2 3 5 19 Legend:   Supply  chain   Energy   Opera6ons   Waste  &  Water   Transport   Pa6ents  
  • 7. XXX – XXX identified (2/2) Initiatives... covering the whole infrastructure and value chain of the health units: 1 Green purchasing implementation processes and systems 13B Use of more efficient lighting technologies 2 Optimizing medical consumables utilization 14 Optimizing the use of electrical equipment 3 Optimizing administrative consumables utilization 15 Staff training and awareness for resource reduction and optimization 4 Optimization of Stock Management 16 Hardware and software efficiency improvement 5 Reducing meals environmental impact Targets follow-up procedure creation 17 6 Cogeneration / trigeneration installation and operation Targets follow-up procedure implementation 7 Use of renewable energy to produce thermal energy 18 Processes dematerialization 8 Use of renewable energy for electricity generation Biomedical waste reduction and triage optimization 19 9 Optimization of electric bills Urban waste reduction and triage optimization 10 Improving buildings thermal efficiency 20 Water collection and reuse 11A Improving climate control systems 21 Water consumption reduction 11B Improvements to existing HVAC systems 22 Staff commuting optimization 11C Replacement of existing HVAC systems for more efficient technologies 23 Business travel and equipment transport optimization 11D Improvements to existing ventilation systems 24 Patients transport optimization between health care units 12 Passive ventilation systems adoption 25 Patient’s own vehicle use reduction Complementary Diagnostic and Therapeutic Exams request optimization and 13A Lighting control systems improvement 26 capacity maximization Legend:   Supply  chain   Energy   Opera6ons   Waste  &  Water   Transport   Pa6ents  
  • 8. XXX – XXX Methodology ValuationEach one of these initiatives was individually valuated, both from an economical and environmentalperspective, and then combined into different evolution scenarios Valuation Methodology Combine initiatives into different 3 evolution scenarios, e.g: quick wins, max envir. benefits, max econ. benefits, Valuate the economical and 2 environmental benefits of each initiative with a DCF1 model and GHG2 protocol Define input parameters and 1 confidence intervals for each initiative Iniciative 1 Iniciative 2 Iniciative N(1): Discounted Cash Flow valuation(2): Greenhouse Gas Protocol, a standard methodology to calculate carbon emissions
  • 9. XXX – XXX Environmental and economic initiatives rankingThe results show that about 95% of these initiatives result in actual reductions of emissions, and that70% are financially viable Illustrative Without CO2 red. With CO2 reduction 4   26   15   1   2   18   Economic benefits Ranking 6   Viable 16   23   9   17   13   21   10   25   19   20   Inviable 7   5   8   22   24   Emission reduction RankingSource: X&Y Partners
  • 10. XXX – XXX selected for each health unit pilot InitiativesFor each of the pilot units, the evolution scenario which better combines economical andenvironmental benefits was selected for implementation 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Hospital 1 H1 ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   Hospital 2 H2 ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   Health Centre HC ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   ✔   Legend:   Supply  chain   Energy   Opera6ons   Waste  &  Water   Transport   Pa6ents  
  • 11. XXX – XXX examples – Supply chain InitiativesIn supply chain, green purchasing and inventory management optimization are two of the mostrelevant initiatives Green purchasing implementation processes 1 4 Stock Management optimization and systems 1.  Adopt environmental sustainability criteria 1.  Optimise stock levels in selecting suppliers and procurement 2.  Optimizing the layout of central and decisions advanced warehouses 2.  Green procurement model creation that 3.  Reduce number of available references allows economic and environmental costs and suppliers for each type of materials analysis throughout the life cycle of and consumables equipment and consumables 4.  Incorporate criteria for environmental 3.  Implement a staff satisfaction tracking impact assessment of packaging solutions system on procurement, in order to 5.  Implement advanced processes and understand whether the equipment meets systems for receipt, storage, distribution the service demands and needs and selectionSource: X&Y Partners
  • 12. XXX – XXX examples – Energy InitiativesAt the energy level, the initiatives discussed include both structural projects, such as cogeneration, andsimple measures such as lighting improvement Cogeneration / trigeneration installation and 6 13 Lighting systems improvement operation 1.  Installation of a trigeneration unit for 1.  Installing on/off switches, dimmers and simultaneous production of electricity, hot timers water (for heating, sanitary warm water 2.  Cleaning and maintenance procedures and steam) and cold water (for cooling) optimization, to ensure that current from the combustion of natural gas. The systems work efficiently system can be configured to produce more 3.  Inefficient lighting progressive replacement electricity than is needed for the hospital, by new technologies (e.g. electronic generating scale economies and ballasts, recent CFL technology, LED) additional revenues from the sale of electricity to the national grid 4.  Upgrading the centralized technical management system 5.  Architectural review for better use of sunlight (e.g. skylights, natural light entries)Source: X&Y Partners
  • 13. XXX – XXX examples – Operations InitiativesIn operations, the behavioral changes and increased use of information and communicationtechnologies will bring relevant environmental and economic benefits 15 Staff training and awareness 16 Processes dematerialization 1.  Information availability on consumed 1.  Reducing duplication of records in digital resources costs and physical form 2.  Ongoing reducing opportunities 2.  Standards and processes optimization in identification order to minimize the requirements that 3.  Staff training and awareness to resources compel the creation of paper copies optimization 3.  Improving the interoperability between 4.  Standards and "environmental champion" existing applications in order to reduce the figure creation, at departmental level, unit need for manual data copies or central government 4.  Medical prescription and clinical record 5.  Inclusion of results in the Annual Report (or platforms roll-out a Sustainability Report creation) 6.  Positive discrimination for the units or services with better performanceSource: X&Y Partners
  • 14. XXX – XXX examples – Water & Waste InitiativesThe environmental and economic benefits of water and waste initiatives are more modest, but theinvestment needed is also much smaller 15 Water consumption reduction 16 Waste reduction and triage optimization 1.  Operating procedures and maintenance 1.  Raising awareness among staff of the optimization in order to promptly identify proper separation of hazardous and not and solve water leakages hazardous medical waste 2.  Limiters flow installation in toilets, faucets 2.  Raising awareness among staff to the and showers proper waste separation between subject 3.  Faucets timers or sensors usage and not subject to incineration 4.  Use of water efficient medical equipment 3.  Waste processing costs communication and/or allocation to each department 4.  Municipal solid waste processing implementation and/or optimization, giving priority to paper and paperboard 5.  Implementation of collection processes for obsolete equipmentSource: X&Y Partners
  • 15. XXX – XXX examples – Transport and Patients InitiativesFinally, hospital centralization creates opportunities for travel and transport optimization betweenunits, and for diagnostic capacity maximization 15 Business travel and equipment transport 16 Procedure request optimization and capacity optimization maximization 1.  Routes optimization 1.  Staff awareness to each diagnostic exam 2.  Staff training and awareness for eco- costs driving 2.  More stringent approval procedures for 3.  Transport selection according to medical exams with the highest cost environmental and economic criteria 3.  Capacity maximization through 4.  Vehicle fleet maintenance optimization agreements with other NHS and private units 5.  Use of teleconferencing (audio and/or video link), when applicable 6.  Fleet gradual replacement for more efficient vehiclesSource: X&Y Partners
  • 16. XXX – XXXresults for carbon emissions ExpectedIn total, the financially viable initiatives will allow, by 2020, a reduction in carbon emissions between13 and 20% Emissions expected trend compared to baseline1 Key Data 45000 Baseline +6% (2009-2020) 40000 H1 H1 Recommended Scenario 35000 -15% (2009-2020) 30000 tCO2 / year 25000 Baseline +8% (2009-2020) H2 20000 Recommended Scenario 15000 H2 -20% (2009-2020) 10000 Baseline 5000 HC +10% (2009-2020) HC 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Recommended Scenario -13% (2009-2020)(1): Emissions expected trend without reduction initiatives implementation Baseline Recommended scenario
  • 17. XXX – XXXcost reductions and required investment ExpectedThe direct costs reductions associated with these environmental benefits are substantial,: 7.1 M€/yearand 4.4 M€/year in the hospitals and 174 k€/year in the health center Cost reductions achieved and the required investments Key Data 15 Cost reduction H1 10 7,1M€/year (average) H1 5 Investment 0 6,3M€ Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 -5 15   H2 Cost reductionM€ / year 10   4,4M€/year (average) 5   H2 0   Investment Year  1   Year  2   Year  3   Year  4   Year  5   Year  6   Year  7   Year  8   Year  9   Year  10   Year  11   6,6M€ -­‐5   1 HC 0.5 Cost reduction 174k€/year (average) HC 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Investment -0.5 137k€ CapEx (investment Direct cost reductions (for Legend costs) Health Care Units)
  • 18. XXX – XXX Applicability and impact of funding mechanismsThe required equity capital investment can be lowered by using various types of funding, with smallimpact on savings Types of funding Financing Impact State Incentives ESCO models Investment reduction -21% H1 Private partnership model, in which the Savings reduction National incentives programs for -0,6% private operator supports the energy efficiency, renewable energy investment cost and receives part of and administrative modernization the savings obtained Investment reduction -35% Examples Examples H2 Savings reduction •  Solar PV installation under •  Trigeneration plant installation -4% mini power system legislation in health care units for energy •  Implementing energy efficiency sale under market value measures under the Energy •  Private investment in thermal Investment reduction Efficiency Fund and Green efficiency improvements, -41% HC Procurement Plan yielding part of the savings Savings reduction obtained -2%Source: X&Y Partners
  • 19. XXX – XXX