Providence Health & Services, a Seattle-based healthcare system serving the Pacific Northwest and Southern California, leveraged their 2004 ENERGY STAR Partner of the Year Award for Excellence in Energy Management to further embed energy management into their corporate structure by establishing a corporate Office of Energy Management. Their energy savings has increased from $700,000 in 2003, to $2.3 million in 2005 and a projected $3.4 million for 2006.
Originally, energy management at Providence was a facility level responsibility. Facility managers rarely had time to focus on energy management, and Chief Operating Officers considered energy a cost of doing business and therefore didn’t push for efforts to be energy efficient.
Everything changed in 1995, when the system’s President challenged Providence to save energy as a way to uphold their core value to stewardship. An Energy Management Program was put in place to “increase energy efficiency and reduce waste of natural resources at all facilities”. In 1998, Providence joined the ENERGY STAR Program to learn best practices and utilize ENERGY STAR’s free tools and resources, such as the ENERGY STAR Building Manual which serves as the backbone of their Energy Management Program. Richard Beam, Utilities Program Director, helped set goals, track progress in Portfolio Manager, and promote the program with each facility manager. Some of Providence’s many improvement projects included:
Saving $700,000 in 2003 and winning the ENERGY STAR Partner of the Year award was a turning point for Providence. CEOs from across the system contacted Richard Beam to learn how to increase their savings. Richard Beam leveraged the award to articulate the value of taking the program to the next level, and Providence decision makers across the system agreed.
Providence re-affirmed their commitment to energy management by establishing a corporate-wide Office of Energy Management. The office is headed by Richard Beam, who was promoted to the newly created position of Director of Energy Management Services. Providence approved a new Strategic Energy Management Business Plan, and established a funding mechanism for energy efficiency projects.
Providence also approved additional funds for expanding energy consumption tracking and analysis. To increase the number of facilities benchmarked and the efficiency of tracking energy data in Portfolio Manager, Providence leveraged their existing relationship with Advantage IQ (formerly Avista Advantage) to perform automated benchmarking of the system’s hospitals, medical offices, and a warehouse. Advantage IQ centrally compiles Providence’s energy bills more than 60 utilities and downloads this data directly into Portfolio Manager on a monthly basis. Providence now benchmarks 71 eligible facilities, compared to 17 facilities in 2003.
Under the new Office of Energy Management, Providence completed the installation of a new central utility plant at Providence Portland Medical Center. After the first year of operation with the new plant, the facility earned the ENERGY STAR. Providence also completed construction of and opened the doors in June 2006 to Providence Newberg Medical Center, the nation’s first “LEED Gold” hospital. The new hospital includes many energy-efficient features such as occupancy sensors, daylight controls, centralized lighting control systems, daylighting, boilers operating at 95% efficiency, and utilization of 100% outside air. Providence’s design team utilized EQuest and DOE-2 energy modeling software, along with the ENERGY STAR Target Finder tool to rate the energy efficiency of the design plans to ensure the design was energy efficient. The facility is powered by 100% renewable energy from a Washington State wind farm.
Additionally, Richard Beam made the business case to hire a new staff member to support Providence’s energy management initiatives, including facilitating coordination with ENERGY STAR, Advantage IQ, and other programs and vendors. In 2006, Richard Beam hired a full-time team member, Joanne Sparks, who now helps him and supports the system-wide priority of stewardship.
Internally, Providence tracks and communicates to its staff the company’s annual energy savings in order to show how facility operations can make a positive contribution to the bottom line and the mission of the system, rather than be viewed as just another cost.
Providence also invests in trainings, newsletters, articles, forums, energy fairs, and facility open houses so that staff can share in the excitement, pride, and continuous improvement of the company’s commitment to energy management and environmental stewardship. Richard Beam and his team are in the process of creating an energy management Web site which will be released in 2007.
Providence’s commitment to continuous improvement has resulted in a significant increase in energy savings since 2003. In 2005, Providence saved $2.3 million in energy costs, and in 2006 they expect to save $3.4 million. Additionally, Providence demonstrates a significant return on investment in energy efficiency with a 1:4 ratio of dollars spent to dollars saved.
Providence Health & Services has been recognized by the EPA for its astoundingly positive results. Currently, six hospitals and three medical office buildings have earned the ENERGY STAR for superior energy performance.
“Energy is not the cost of doing business. It’s not overhead. It can be controlled and it does bring value to the corporate bottom line. To do energy management right, you need to make it a bonafide program within the organization. Get your energy management plan in writing and establish financial and other goals. As someone who has found immense value in EPA’s ENERGY STAR program, I have to say ‘join it.’ Use their free tools. Set yearly targets in Portfolio Manager (EPA’s rating system) and shoot for earning the ENERGY STAR in all your facilities. Providence is not there yet, but it’s a standard of excellence we aim for every day we walk into work.”
- Richard Beam, Director of Energy Management Services, Providence Health & Services