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August 20, 2018

Most hospitals are 'energy hogs.' Here's how 3 organizations tamed their energy costs—and saved millions.

Daily Briefing

    Editor's note: This popular story from the Daily Briefing's archives was republished on Nov. 28, 2018.

    Hospitals are "energy hogs," Kaiser Health News (KHN) reports, and the cost of all of that electricity can add millions of dollars to their annual expenses. Here's how three progressive organizations cut their energy costs by eliminating unnecessary space, becoming more energy-efficient, and embracing alternative energy sources.

    Infographic: Here are 10 ways to go green—and cash in on sustainability

    Just how much energy do hospitals use?

    Almost 10% of greenhouse gas emissions in the United States come from the health care sector, according to KHN. A paper from researchers at Northeastern University and Yale estimates one-third of those emissions come from hospitals.

    In fact, a typical hospital uses five times the energy of a "fancy hotel," according to KHN, in part because they have an around-the-clock need for heat, lighting, and water.

    This high energy use can eat at a hospital's bottom line, according to KHN. Energy use comprises 51% of hospital facilities spending, so the energy required to run modern hospital facilities can add millions of dollars to a system's annual bill.

    How some hospitals are going green

    With financial savings in mind, several hospitals are making eco-friendly facilities renovations to lower energy costs while keeping up with the constant demand for care.

    For Boston Medical Center, becoming energy efficient meant reducing facility space—even as the organization increased patient capacity, KHN reports. When the hospital set about launching a redesign in 2011, Bob Biggio, who was hired to oversee the facilities, proposed detecting and eliminating unused areas of the facility. "A square foot you never have to build is most efficient of all," he said. 

    The reduction lowered power consumption by 42% in comparison to a 2011 baseline. Further, despite the downsizing, the hospital increased its patient capacity by 20%.

    A report released by Bay Area Council Economic Institute suggests ways for hospitals to improve energy efficiency, including conducting regular energy audits of hospital facilities to reduce energy waste, replacing old lighting and windows, and turning off air conditioners in areas that are not being used.

    Implementing such adjustments resulted in big savings, KHN reports. For instance, Theda Clark Medical Center in Wisconsin reduced its energy costs by 30% by making changes that included retrofitting lights, insulating pipes, and removing lights from vending machines.

    Other systems are exploring different ways to reduce their energy costs. Jeff Thompson, the former CEO of Gunderson Health System in Wisconsin, convinced the system's C-suite to invest in alternative sources of energy—including wind, wood chips, and cow manure. The system reported a 95% drop in greenhouse gas emissions and cost savings of $1 million to $3 million a year, KHN reports.

    Thompson said, "There are multiple examples—at Gundersen and other places—where, if we're thoughtful, we can improve the local economy, lower the cost of health care and decrease the pollution that is making people sick" (Appleby, Kaiser Health News, 8/16; Bay Area Council Economic Institute, Building a Climate Smart Health Care System for Ca.)

    Learn about 10 easy opportunities to go green—and improve your bottom line

    Download this infographic to learn about 10 easy opportunities to go green—and improve your bottom line.

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