In practice: Oxford University Hospitals’ money-saving CHP retrofit

Oxford University Hospitals benefited from a finance procurement system that partnered the Trust with companies that could replace aging heat and power infrastructure with a combined heat and power system that would generate massive economic savings.


The Challenge

The Oxford University Hospital campuses of Churchill and John Radcliffe were suffering from aging infrastructure. The overall campus uses the same power annually as a small town, but constant leaks and breakdowns in the boiler system meant the hospitals were having to source even more energy to satisfy patient needs.

Despite the old infrastructure performing well above expectations, the leaks led to numerous cases of shutting down operation services to issue repairs. These repairs subsequently impacted the treatments that could be offered to patients. Lighting hadn’t been upgraded since 1974 and was also starting to impact the patient services that could be carried out.

With the NHS impacted by a lack of funding, Oxford University Hospitals would potentially have to drain a budget set aside for staffing and equipment purposes, unless trustees and managers could unlock some other form of capital.

The Solution

On 10 November, the £14.8m Oxford University Hospitals NHS Foundation Trust Energy Project was officially opened by Oxford East MP, Anneliese Dodds. After two-and-a-half years of work, the project was able to remove and replace 30 and 40-year-old boilers at the Churchill and John Radcliffe Hospitals with a combined heat and power (CHP) engine and new combi boilers. More than 6,400 light fittings were changed in this timeframe.

The project was funded and facilitated through the Carbon & Energy Fund (CEF), which was established by Greg Barker in 2011 to project manage energy infrastructure upgrades for the NHS and public sector. CEF reached out to Aviva to provide investment into the project, which was designed and implemented by Vital Energi.

The old boilers, generators, pipework and infrastructure have been removed and replaced without shutting down any part of the hospitals or disrupting clinical care.

NHS staff at Oxford University Hospitals refer to the new energy centre as the “heart of the hospital”. In fact, the energy centre is shared by both hospitals, and is connected via a 2.2km energy link. The link includes High Voltage cabling and district heating pipework which enables the heat to be transported from the CHP system at the John Radcliffe hospital the Churchill site.

The Benefits

The new energy and heating infrastructure will reduce carbon emissions at the Trust by around 10,000 tonnes annually, this is the equivalent to the carbon emissions of 4,000 households.

The new system and subsequent savings have been guaranteed, through the project, for 25 years. The aforementioned carbon reduction equates to more than one third of the emissions generated at the Trust.

For the first time in decades, the hospitals will go into the winter months with reliable heat and power. Time spent on maintenance repairs and backlog admin will be reduced as a result, and some staff will be able to carry out specific bedside support because of the improved lighting systems.

The 6,407 new LED light fittings require hardly any maintenance and have a lifespan of 3-5 years longer than the older versions. The retrofit has negated the need to order 3,000 replacement bulbs each year. The new lights offer efficiency improvements between 50% to 90%.

The Costs

This £14.8m project will be paid over a 25-year payback period from the annual savings generated through the improvements, rather than the capital budget. Guaranteed savings of £460,000 each year have already been secured and Vital Energi will reimburse the Trust on any difference in savings if they aren’t met.

The official opening of the project also coincided with the day that the Trust received its first month’s energy usage figures – excluding private, but onsite estates. In October 2016, the energy bill for the two hospitals was £484,175. However, in October 2017 the same bill came to £252,832 – an energy spend reduction of £231,343 in the first full service month of the CHP engine. This equates to daily savings of £7,462.

The wards at Oxford University Hospitals previously cost around £1.2m to power annually. By shaving one-third off from these costs, the Trust could fund around 13 new nurses as a result.

The new CHP generator and boilers will save the hospitals £11m in back-log maintenance, which can again be redeployed across staff and other jobs.

The Future

Oxford University Hospitals will spend much of the next year monitoring the new system. Vital Energi will also work with the Trust to provide continuous efficiency improvements to the system. In fact, both will keep a form of dialogue over other energy-related areas that could be explored.

Aviva is already working with numerous other NHS Trusts, including NHS Tayside in Dundee and NHS Grampian in near Aberdeen. Around eight other projects are currently in motion at different NHS institutions in areas such as York and Scarborough.

Matt Mace

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