Modern energy tech could save public sector £375m

23 September 2019

Adopting modern energy technology could help the public sector save more than £375m every year, according to a report.

Research by Centrica Business Solutions said that savings achieved by features such as modern power generators, LED light fittings and solar panels would be worth more than £5.6bn over the typical 15-year energy contract.

The annual public sector energy bill is an estimated £3.4bn while the NHS alone spends £1.1bn annually on energy, said the Powering Britain’s Public Sector report.

Centrica recommended the government simplify procurement frameworks and adopt a stable long-term regulatory environment.

The government’s Clean Growth Strategy has introduced a voluntary target across the public sector and higher education of achieving a 30% cut in emissions by 2020-21.

If healthcare facilities, universities and defence sites were to adopt green technology such as solar panels and combined heat and power units it could also support 25,000 jobs, the report found.

If half of these public sector organisations updated their energy infrastructure they could reduce emissions by 8% and save 660,000 tonnes of carbon each year.

The carbon reduction savings could be doubled if around 20% green gas – a type of gas created from biodegradable material – could be injected into the fuel mix.

The government’s 2015 financial settlement for the NHS to 2020-21 requires savings of almost £22bn to be found by 2020.

That will require in practice a saving of 2-3% every year, with £14.9bn of savings to be delivered locally.

The report found that hospital energy use currently accounts for around one third of energy use within the public sector, with an annual energy bill totalling £1.2bn.

As hospitals consume large volumes of energy in the form of heat and power, use of facilities 24 hours a day seven days a week means any energy changes deliver large savings.

The report estimated the NHS has a total annual savings opportunity of £187m, enough to pay the salaries of more than 5,800 nurses.

Iain Conn, Centrica Group chief executive, said: “Government bodies have two very clear challenges: to operate more cost effectively and more sustainably. New energy technologies, adopted aggressively, have the potential to unlock both.”

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