Baystate Health: Bending the Cost Curve

Benefits/Results

  • Baystate Health’s (Baystate) ambition is for the health system to become the leader in helping create the most energy efficient, safe and effectively managed buildings in the health care industry.
  • $2.3 million has been received or committed to Baystate Health in rebates from local utility companies.
  • $1.3 million utility savings has been realized from Energy Reduction Strategies.
  • 3300 Main Street’s (one of the buildings adjacent to the hospital’s main campus) Gas & Electricity expense has decreased from $750k per year to $395k (2.59 year actual Return on Investment from an original project of 4.29 ROI).
  • Baystate will receive an additional $1.5 million from Utility Contract Rate Reductions in 2015-2017.
  • A Cogeneration Strategy (Combined Heat and Power) can reduce energy by an additional $1.5 million per year. An average cost of a Cogeneration plant is $15 million. Baystate indicates that $10 million is available between utility rebates and state grants. Cogeneration provides the potential opportunity to generate an additional $1.5 million in revenue each year for the next five to ten years

Challenge/Situation

Baystate Health realizes the importance of Leaner Energy not only for the immediate and long term health of patients, staff, and the community, but also its true potential for savings. In other words, sustainability to bend the cost curve. They believe, no matter what your story, leaner energy speaks to everyone; there are chances for large rebates, savings, and health improvements. Baystate worked to accomplish their goals faster to meet budgetary and fiscal year deadlines as well as work within the ever-changing world of health care.

Strategy/Actions

Baystate Health has made leaner energy one of its three main focus areas, in particular cogeneration. The hospital supports investment in energy reduction because it has shown to be a true savings mechanism. Originally, the Facility’s Department had funds in their operating budget to invest and showed the hospital that they could reduce their budget by investing in leaner energy. Savings were achieved, reinvestment occurred in energy reduction initiatives leading to further reduced costs. There is nowhere in health care but here where you truly see a three-year return on investment. This has kept the hospital commitment and is now allowing for the potential for Cogeneration.

To further allow for success, Baystate has completed everything in house saving money and allowing tasks to be completed quickly and efficiently. Additionally, Baystate has several community patterns that their Sustainability Committee meets weekly with; this partnership further enhances their ability to succeed in reducing energy usage.

Implementation Process

Initial Projects: Baystate performed initial benchmarking and saw numerous opportunities to improve including redoing controls, replacing boilers and pumps, retrocommissioning, lighting upgrades, and mechanical upgrades. For example, in the Operating Rooms (OR), they worked to improve the quality of air and partnered with the OR staff to show them the importance of this initiative. Not only were they able to improve communications between Facilities and Operating Room staff, but reduce the amount of energy spent as well.


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