Energy efficiency: how the NHS loses out – and what networks could do

Joanne Wade, chief executive of the Association for the Conservation of Energy (ACE), says the NHS’s local management structure is raising its energy costs.

In New Power‘s July issue, Wade talks about energy efficiency programmes that can be easily replicated: “Street lighting is a good example – it is well understood, the benefits are easy to see, it has a compelling story.”

Wade told New Power that the best way to make big energy efficiency gains is to upgrade one complex site and then copy the format to similar sites. Housing Associations are using this model and Wade says:  “The next one is probably thermal efficiency of hospitals. The Department of Health is really interested in managing that bill – it doesn’t take much saving to have another nurse. But it’s very difficult to standardise work on hospital buildings. They are very different ages… and they are in different local health structures. So you could standardise contractually, with monitoring and verification protocols, but you can’t very easily group projects in the same way.”

Do organisational structures such as local health commissioning areas present a barrier? Wade says yes. It means a national programme is probably impossible. She says it might work regionally: “Within those areas you will have a number of community health clinics and at that level you can probably aggregate… they could be the same contractually with the same arrangement for shared savings.” The problem is getting a production line of projects, and a big enough total portfolio, within the NHS’s local management structure.

A role for network companies.

Meanwhile, Wade says distribution network operators have been overlooked in the energy efficiency drive. She wants them to consider investing in local projects as an  alternative to network reinforcement, in the same way they are looking at storage. ”We don’t seem to be systematic about thinking about reducing demand as an alternative for investing in the system,” she says – for both gas and electricity. “If you deliver the thermal efficiency of a hundred homes by 20%, what does that do to peak gas demand?”

 

From Seeing the light: Is energy efficiency ready to become an investor asset class? published in the July issue of New Power.

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