This document summarizes the results of a carbon and cost reduction initiative for the Portuguese National Health Service. The initiative aimed to reduce carbon emissions and costs while improving quality and creating best practices. A pilot project was conducted at three facilities, where 123 opportunities across 26 initiatives were identified to reduce emissions and costs. These included LED lighting, energy management systems, waste separation, water harvesting, and replacing paper records with electronic formats. Staff interviews found support for sustainability measures and indicated energy efficiency is important for setting best practices.
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Carbon and cost reductions in the NHS
1. Carbon and Cost Reduction Plan
for the Portuguese National
Health Service
Summary Results
2011
Romeu Gaspar
romeu.gaspar@thisisxy.com
2. XXX – XXX & Objectives
Background
This 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 countries
Source: X&Y Partners
3. XXX – XXX pilot project
Scope of the
The pilot project was applied to three facilities in the Lisbon region: two hospitals and a primary care
health 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 90's 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’s
Source:, X&Y Partners
4. XXX – studies
Case XXX
The are numerous international and national best practices that are potentially applicable to the
Portuguese 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. Michael's
Hospital,
Canada
Source: 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)
Initiatives
In 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
Valuation
Each one of these initiatives was individually valuated, both from an economical and environmental
perspective, 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 ranking
The results show that about 95% of these initiatives result in actual reductions of emissions, and that
70% 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 Ranking
Source: X&Y Partners
10. XXX – XXX selected for each health unit pilot
Initiatives
For each of the pilot units, the evolution scenario which better combines economical and
environmental 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
Initiatives
In supply chain, green purchasing and inventory management optimization are two of the most
relevant 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 selection
Source: X&Y Partners
12. XXX – XXX examples – Energy
Initiatives
At the energy level, the initiatives discussed include both structural projects, such as cogeneration, and
simple 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
Initiatives
In operations, the behavioral changes and increased use of information and communication
technologies 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 performance
Source: X&Y Partners
14. XXX – XXX examples – Water & Waste
Initiatives
The environmental and economic benefits of water and waste initiatives are more modest, but the
investment 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 equipment
Source: X&Y Partners
15. XXX – XXX examples – Transport and Patients
Initiatives
Finally, hospital centralization creates opportunities for travel and transport optimization between
units, 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 vehicles
Source: X&Y Partners
16. XXX – XXXresults for carbon emissions
Expected
In total, the financially viable initiatives will allow, by 2020, a reduction in carbon emissions between
13 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
Expected
The direct costs reductions associated with these environmental benefits are substantial,: 7.1 M€/year
and 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 reduction
M€ / 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 mechanisms
The required equity capital investment can be lowered by using various types of funding, with small
impact 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