Is The Care Home Industry Haemorrhaging Money On Energy Bills?

The intense and almost round-the-clock demand for energy and water in the care sector is putting a strain on care home owners that are facing a challenging economic climate and increasingly tight budgets.

Cutting costs and managing outgoings has become more important than ever. But often it is difficult to understand just where savings can be made, and even more time-consuming to analyse the market and assess current energy packages with suppliers.

Arming care home owners with practical knowledge to implement energy solutions to reduce their energy usage is key, as well as ensuring they are getting the best deal from their energy supplier.

Sourcing expert support to lower energy bills

Enlisting the expertise of a utility management specialist can take the strain off care home owners. They can decode the energy and water markets, explain the differences between tariffs, and let businesses know the best time to purchase their energy.

When choosing a specialist, find out which energy suppliers they are connected to and what commission they get. The more supplier partnerships the broker has with the ‘Big 6’ and smaller energy providers, the better, and remember that an independent broker is more likely to maximise sales, instead of negotiating the best deal, if they’re being paid by a supplier. Good brokers will also be signed up to the Utilities Intermediaries Association (UIA) – the main trade body for energy brokers which aims to improve the professional image of the sector.

How to reduce energy usage

In environments like care homes where demand on utilities is exceptional, ongoing savings can be made through lighting efficiencies and renewable energy. Inefficient care homes will leak money so energy efficient measures should be considered to help reduce energy bills.

Lighting can account for up to 30% of total energy usage and significant savings can be made by swapping to LEDs and compact fluorescent lamps (CFL) with payback times tending to be very short. Additionally, many care homes find even efficient lights can be very wasteful.

Modern lighting responds well to daylight or movement sensors providing further savings on lighting costs.

Using solar technologies is another solution, as care homes require a lot of hot water throughout the day and electricity usage is also at its highest during the day. Solar PV or thermal technologies can be installed in unused roof space. A major advantage of this method is care homes can still benefit from incentive schemes. Wind power can also be an effective method for care homes that have land around them.

Case study

A leading Scottish care home group, which has six homes providing high quality care for both adults with learning disabilities and older people, implemented a strategic programme of energy efficiency measures after completing a detailed review of four of its properties. The audit led to significant cost savings for the care home chain, including switching to biomass fuel.

A spokesperson for the care home in Dundee said the audit identified savings that would reduce the company’s energy bills and release funds for capital investment in its care home stock. “The review looked at our heating and lighting systems, plumbing and insulation and identified the potential for additional savings by switching to biomass.

“There will obviously be a cost attached to implementing these measures but, with the exception of the biomass, the reduction in energy bills will give an estimated payback of just 12 months. That will leave us with a long term saving that we can plough back into improving our properties, something that will be extremely important if we are to sustain our position as a leading provider in the sector.”

The first step to ensure care homes are equipped to maximise their energy efficiency is to enlist the help of an expert to carry out an energy audit. The expert can then make recommendations for bespoke energy efficient measures. Becoming more energy efficient and identifying ways to cut costs in the longer term will help prepare care homes for when rising energy costs can be a problem, especially during harsh winters.

Lucia Harney-Dey is I&C Development Director at Orchard Energy

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