The First Step in the “Long Push" – How to Get Started with a Self-Funded Energy Sustainability Program

Tip #10

By Lindsey Brackett, Health Care Facilities Operational Efficiency and Solutions Expert

The self-funded approach to an energy sustainability program is often referred to as the “Long Push” because it is a multi-year, multi-phase program carefully constructed to achieve long-term outcomes. Although various financing mechanisms can be incorporated throughout the duration of the program, projects are largely funded with accepted and accumulated energy cost savings. The idea is to start with low-cost and no-cost energy projects, begin generating energy savings early on, and then use those savings to fund projects with a longer payback or higher cost. This approach enables hospitals to reduce capital renewal and deferred maintenance backlogs without siphoning funds away from other critical projects. However, it does require discipline because mid-course changes could be counter-productive and result in catastrophic effects on the desired goals.

The self-funded energy sustainability program has two primary components: (1) a multi-year, multi-phase, long-range strategic energy and infrastructure plan, and (2) a business case to make it happen.

To get started, gather all the relevant informaation and make sense of it. Become informed by digging into whatever documentation you can get your hands on; the primary target should be utility bills. Two common metrics to become familiar with are EUI (energy use intensity) and ECI (energy cost index). A third metric to understand is FCI (facility condition index), although FCI is not as commonly used when discussing energy projects.

Energy Use Intensity (kBTU/SF/year): calculated by dividing the total energy consumed in one year by the total gross floor area of the building

Energy Cost Index ($/SF/year): calculated by dividing the total annual energy cost by the total gross floor area of the building

Facility Condition Index ($/$): calculated by dividing a building’s total maintenance, repair, and replacement deficiencies by the current replacement value of the building

Identify your current rate structure, taxes, date of last rate increase, and date of next expected rate increase. Look for billing errors, inappropriate sales tax collection, improper utility rate selection, and other no-cost or low-cost opportunities to cut expenditures.

To answer the question, “How bad is it?,” enter 12 months of utility data into the EPA ENERGY STAR® Portfolio Manager®. This platform will process your hospital’s information and calculate an ENERGY STAR rating so you can see how you stack up against your peers. Take this opportunity to use the ASHE Energy to Care platform, which is user friendly and beneficial in determining your energy performance.

Next, perform a comprehensive operation and maintenance benchmarking analysis. ASHE offers an excellent benchmarking tool at ashe.org. The benchmarking process ensures that energy efficiency and sustainability objectives are aligned with hospital staffing levels and expertise. Remember, the objective is to cut BTUs and not FTEs.

Obtain as much information as you can on your existing infrastructure and planned projects. Relevant documentation includes as-built drawings and master plans. Pull information from your CMMS like work order history, recurring issues and alarms, and any unusual override patterns. Make sure you have a detailed equipment inventory and related testing reports and maintenance logs because you will need this information to develop your long-range plan.

Once you have gathered facility information, define the magnitude of the problem and identify the root cause. Establish the key performance indicators by which you will measure the organization and calculate them for your hospital. Some questions to answer include:

1. • Is the root cause on the supply side, demand side, or both?
   • Is the problem isolated or global?
   • Is your energy consumption unusually high because of a design issue, or because of deferred maintenance and failing equipment?
   • Does the issue stem from obsolete programming and rampant overrides?

Determine the primary drivers so you can fix the problem.

The final question to answer is, “What does success look like?” Common objectives include increased energy efficiency, reduced greenhouse gas emissions, reduced annual energy costs, and improved patient outcomes, occupant safety, thermal comfort, and indoor air quality. Discuss program objectives with other departments, including clinical staff and leadership, before finalizing your goals.

At this point, you have identified the problem areas, established key metrics to measure improvement, and determined the objectives that you will accomplish by implementing a self-funded energy sustainability program. You are finally ready to put all the pieces together and develop a plan.

Solutions to overcome the evident problem areas should be prioritized and phased into a long-range plan that considers budget restraints, available resources, and future infrastructure needs. Typically, the plan time frame ranges between 5 and 15 years. Start with items that require little or no cost to implement but yield a high economic benefit in their return. After your plan is developed, you can begin next step in the process: creating the business case.