Carbon Reduction Commitment
(CRC)
Impact on the NHS
Robert Banks
Head of Estates
Sandwell & West Birmingham Hospitals NHS Trust
Wednesday 7 October 2009
1
Presentation Summary
 Brief overview of Sandwell & West Birmingham Hospitals NHS Trust
 Carbon reduction in the NHS
 Brief overview of CRC in the NHS context
 Implications of CRC on our Trust
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Brief Overview of SWBH
 One of the largest Teaching Trust’s in the UK, Budget
£340 million,6,500 staff, catchment population 500,000
 Three Sites:

City Hospital in Birmingham
Victorian Wards/Ageing Estate 1890’s
Circa 550 Beds
90,000m²
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
Birmingham Treatment Centre (BTC)
£35 million PFI
12,500m²
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
Sandwell General Hospital in West Bromwich
Circa 500 Beds
Majority of Estates late 60’s early 70’s
60,000m²
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
Rowley Regis Community Hospital in Rowley
Regis
New in 1994
Long stay rehab
8,000m²
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Energy Budget 2009/10
Annual Budget
Sandwell
£
City
£
Electricity
784,000
500,000
Gas
635,000
954,000
Water
215,000
325,000
163,4000
1779,000
Overall energy budget for SWBH per year = £3413,000
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SWBH Gas Consumption Profile
2002 to 2008
Sandwell Gas Consumption Degree Day Corrected
8000
7000
6000
Kwh/degree day
5000
4000
3000
2000
1000
0
2002
2003
2004
2005
2006
2007
2008
Year
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SWBH Electricity Consumption
2002 to 2008
Sandwell Annual Electricity Consumption
9000000
8000000
7000000
6000000
Kwh
5000000
4000000
3000000
2000000
1000000
0
2002
2003
2004
2005
2006
2007
2008
Year
Wednesday 7 October 2009
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Visualisation of Trusts CO2
Emissions
 The Trust currently emits almost 20,000
Tonnes of CO2 per year as a result of its
energy usage alone. This would be
enough to fill 20,000 Hot Air Balloons
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Carbon Reduction in the NHS
Why should the NHS lead?

Opportunities for immediate health co-benefits
Physical activity and obesity, CHD, diabetes, air pollution ,
transport trauma, mental health, fuel poverty, improving diet

Potentially big savings (cost, tax, reputation…)
and need for energy resilience and robustness
flu, but also floods, fuel, heatwaves
Greater added value for the NHS

Willingness and commitment of NHS organisations
health being (the) core business objective of the NHS

Special responsibility and opportunity to lead by example
Excellence already exists in the NHS but not systematically
implemented
Need for visible investments

The law: 80% reductions from1990 baseline by 2050.
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NHS England-Carbon Emissions
 20 million tonnes CO2/year
- heating, cooling and lighting
- power equipment
- procurement of goods/services
- waste to landfill
- patient, staff visitor travel
 25% of total public sector carbon emissions
 3.2% of total carbon emissions in England
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Carbon reduction produces
benefits that improve health

Individual benefit
 Physical activity, mental health, trauma, air pollution, food and
agriculture…

Benefits for health care system
 Congruent with policy direction for many health care systems:
care closer to home, empowered, self care, chronic disease
management
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Virtuous Cycle - e.g. for transport
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Saving Carbon,
Improving Health:
NHS Carbon Reduction
Strategy
Launched February 2009
- CEO NHS
- Permanent Secretary DH
- RCP
- Academy of Med RC
- BMA
- Carbon Trust
- Environment Agency
- FPH
- HPA
- Monitor
- RCM
- RCN
- Sustainable Development Commission
- UNISON
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Incentives for NHS trusts
 CRS is a strategy by the NHS for the NHS
 Moral as well as a legal imperative
 Increasingly also a financial imperative
 Carbon reduction commitment
 Actions required are sensible in their own right, carbon reduction is
just another reason.
- reducing building energy use
- Reducing car journeys
- Using telephone and video conferencing
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Carbon Footprint in NHS England
c. 20 million tonnes carbon dioxide eq p.a.
Procurement:
supply chain
activities of
companies
producing goods
and services = 59%
59%
Figure 1a - 2004 NHS England Carbon/CO2 Emissions
Primary Sector Breakdown
Travel: patients, staff,
visitors = 18%
18%
Travel
Energy: heating,
Building
energy use
lighting,
hot
water,
Procurement
ventilation,
cooling = 22%
22%
`
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Wednesday 7 October 2009
0.13
0.1
0.22
Waste products and
recycling
Other procurement
0.72 0.63
0.53 0.39 0.36
0.32
Water & Sanitation
Information and
Communication
Construction
Food and Catering
Manufactured fuels/
chemicals/ gases
Other manufactured
products
0.98 0.97
NHS Freight transport
Paper products
Business services
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
Medical
Instruments/equipment
Pharmaceuticals
CO2 Emissions (MtCO2)
Procurement
Figure 4: 2004 NHS England CO2Breakdown
emissions - 11.07MtCO2
procurement sub-sector breakdown
4.06
1.66
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NHS England CO2 baseline to 2020 with Climate Change targets
25.00
20.00
NHS England
10% target from 2007
NHS England forecast
2007 baseline
15.00
Mt CO2
Carbon Reduction Strategy Target
10% target from 2007
1990 baseline
26% target from 1990 baseline
Climate Change Act Target
10.00
26% target from 1990 baseline
64% target from 1990 baseline
80% target from 1990 baseline
64% target from 1990 baseline
5.00
Reference: Carbon
Reduction Strategy for
England, NHS SDU,
Jan 2009
80% target from 1990 baseline
0.00
1990
1995
2000
2005
2010
2015
2020
2025
2030
2035
2040
2045
2050
www.sdu.nhs.uk
Year
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Brief Overview of CRC in NHS Context
 The CRC is a mandatory cap and trade scheme in the UK that will
apply to large non energy-intensive organisations in the public and
private sectors.
 It is anticipated that the scheme will have reduced carbon emissions
by 1.2 million tonnes of carbon per year by 2020.
 The Government is committed to cutting UK carbon emissions by
80% by 2050 compared to 1990 levels.
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 The CRC legislation requires the Trust to purchase and surrender a
carbon allowance on an annual basis.
 Monitor performance against a set of three pre-set reduction
metrics.
 There are an estimated 5000 UK organisations that are captured by
the CRC legislation
 At the end of each year a league table will be published ranking the
organisations on their performance against these metrics.
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Table 1 below details how allowances will be awarded -
Ranking
Organisation
Allowance Return
1
Best
Allowance back
+10%yr 1 up to +50%yr 5
2500
Average
Allowance back
No bonus
5000
Worst
Allowance back
-10%yr 1 up to -50%yr 5
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CRC Implications to our Trust
 Table 2 identifies the carbon allowance that we will be required to
purchase in order to comply with the legislation.
 This figure will fluctuate annually in line with our CO2 footprint in
each compliance year.
 Each compliance year will be compared against our base year or
footprint year.
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Estimated cost of CRC for the Trust
Table 2
Total Energy Use
(kWhs)
Carbon Output
(tonnes)
Carbon Cost
(£12/tonneCO2)
Elec
15,595,277
8,375
£100,503
Gas
23,133,055
4,280
£51,355
Total
38,728,332
12,655
£151,859
Fuel
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 As an organisation that is participating in the European Union Emissions
Trading Scheme (EU ETS) we are allowed to deduct the CO2 emissions
already declared in this scheme. The previous figures are therefore net of
these deductions.
 The Co2 emissions within EU ETS are circa 8,500 tonnes, therefore giving a
total CO2 footprint for the Trust of circa 21,000 tonnes.
 Based on this historical information, the likely cost is £151,859 x 2 =
£303,718 payable April 2011 (double purchase to cover 2010/2011
emissions and forecast 2011/2012 emissions).
 The allowance back for 2010/11 will be determined by our performance and
recycled back to participants in October 2011.
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 In addition to having to fund all our allowance up front, there is also a
possibility of not getting back all of our allowance due to poor energy
performance. As shown in Table 1 the worst performing organisations will
receive their allowance back minus 10% in the first year rising to allowance
minus 50% in year five.
 In financial terms based on Table 2, this could result in a worst case
scenario of circa £15k in Year 1 rising to £75k in Year 5.
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What should Trusts measure/monitor
 Procurement: too complicated, leave alone for the short term at least
 Energy
 Buildings: gas, electricity consumption.
 Transport
 Business miles weighted by engine size
 Patient transport and vehicle fleets
 Patient journeys.
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Energy
 Good housekeeping
 Education
 Sub metering of utilities
 Energy saving schemes
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Next steps (1)
 Develop Sustainability Strategy
- November 2009
 Sustainability, ‘Listening into Action’ event 22nd Nov 2009
 Compile an evidence pack
 Install Half Hourly meters
 Obtain Carbon Trust Standard
 Measure current performance
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Next steps (2)
 Set challenging measurable targets
 Develop ‘Action Plans’ to achieve targets
 Monitor progress against targets, with key milestones
 Review
 Report
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Thank you
Questions
???
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