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Annual integrated report 2011


Environmental report: UK

This year we focused on consolidating the successes of EcoNomics, our environmental management programme, and preparing for and reporting to the UK Government on our obligations under the Carbon Reduction Commitment (CRC).

Introduction

The CRC has required the reporting of energy consumption in buildings, from major electricity suppliers to bottled gas supplies, at every site within the UK portfolio. Compliance has required the compilation and audit of an evidence pack to be made available for inspection at any time during the next five years.

Risks and opportunities

The primary financial risk associated with GHG's environmental management is the impact of UK Government policy in the form of the CRC "carbon tax". Under this legislation, GHG estimates a liability in the 2012 financial year of £620 000 for the purchase of allowances to cover forecast CO2 emissions.

Reputational risk is also associated with the CRC due to the publication of the annual "League Table" of performance for participants in the scheme. This table will allow public comparisons of GHG's performance relative to competitors in the private healthcare sector.

Although we do not foresee much opportunity for brand differentiation on the basis of environmental performance, we do see opportunities in procuring innovative energy and water efficiency technologies. Also, through the review and centralisation of appropriate environmental management services, we are positioned to drive efficiency, improve performance and benefit financially.

Management framework

A formal environmental subcommittee met for the first time in October 2011. It plans to meet every quarter to steer GHG's increasingly robust approach to environmental management.

Energy usage

Overall energy consumption was estimated at 142 560 megawatt hours (MWh) for the year, which is 2 530 MWh lower than in the 2010 financial year, a reduction of just under 2%.

Our measuring and reporting activities for consumption data continue to be communicated to management at each hospital via the intranet and Green Champion network. This is augmented by automatic monitoring and reporting (AMR) meters, which provide additional electricity and gas data. Our monthly 'league table' reporting format continues to encourage competition between sites to further reduce consumption. Progress during the year has been encouraging; nine hospitals have reduced year-on-year consumption by more than 10%, with five exceeding 15%.

Last year's strategic review of energy efficient technologies led to detailed negotiations with suppliers of leading environmental technologies, which we believe can reduce electricity consumption and save costs. Implementation is anticipated in the second quarter of the 2012 financial year.

Carbon emissions

Overall carbon emissions are estimated to have reduced from 58 750 tons of CO2 to 50 830 tons of CO2 compared to the 2010 financial year. The main drivers for this performance are reduced carbon intensity of electricity supply, the influence of trading conditions, the ongoing "Big Turn Off" campaign for electricity (launched in 2009), and significantly increased general waste recycling to reduce methane generation from landfills.

In the last 12 months, core electricity consumption has reduced by 5% across GHG, while some hospitals – such as the London Independent Hospital – reduced electricity consumption by almost a third (31.5%).

Water usage

During the year, we engaged a specialist water services consultant to provide the necessary resources and expertise to review our water supply and treatment arrangements. This arrangement is already delivering financial benefits from negotiations with suppliers, and will provide recommendations for water efficiency at our clinical and administrative sites.

Waste reduction

Our move to new general waste management arrangements in May 2010 has fulfilled its promise with a recycling rate of 43% over the last 12 months. This is up from an average of 19% in the 2010 financial year. It has also significantly reduced our indirect carbon dioxide equivalent (CO2e) emissions from landfill due to reduced methane generation.

Over 11 000 litres of waste cooking oil are recycled from BMI kitchens each year, the majority of which is turned into bio-diesel for fuel. A litre of bio-diesel emits 85% less CO2 than a litre of conventional diesel.

Looking ahead

  • Maintain focus on the Big Turn Off campaign.
  • Update our environmental policy.
  • Continue to embed environmental processes and procedures in our day-to-day operations.
  • Review current arrangements for non-clinical hazardous waste management, to identify opportunities for improving both environmental and financial performance.