01/02/08
Auckland District Health Board
Auckland District Health Board will derive significant financial, risk management, and energy security benefits from its energy outsourcing partnership with Energy for Industry.
Boot partnership
ADHB selected Energy for Industry as its preferred energy partner to develop and operate a cogneration energy centre at the expanded Auckland City Hospital. Under a BOOT partnership agreement, Energy for Industry is responsible for supplying baseload heat (4.4 MW), electricity (3.4 MW net) and standby power (2.8 MW) to NZ's largest hospital.
Cogeneration
The cogeneration plant comprises two 1.8 MW V20 gas and one 1.8 MW V16 diesel engine generators. All three engines were manufactured in Germany by Deutz AG. The gas engines are equipped with heat recovery exchangers. The recovered thermal energy is used for space and domestic hot water heating which can be supplemented by heat produced from ADHB's existing gas fired boilers.
Energy for Industry's strategic approach to the partnership not only met ADHB's immediate requirements, but also offered future-proofing and protected the DHB contractually from the financial and operational risk of the project.
In addition, ADHB avoided capital expenditure of $2.5 million on upgrading the emergency power system for the hospital. This money will now be used by ADHB for core hospital business.
Profit share
The Board also enjoys a profit share arrangement with Energy for Industry that incentivises both parties to optimise their operations.
In addition to these advantages, it was possible to negotiate special gas and electricity lines deals which reduced operating costs and delivers improved site electricity security from the gas-fuelled generators on site. And, there are environmental benefits from improved fuel efficiency and reduced carbon dioxide emissions through cogeneration.
Environmental benefits
The environmental benefits delivered by the project include reduced reliance on centralised electricity generation and transmission, and a consequent reduction in greenhouse gas emissions:
- Compared with generating electricity from thermal power plants, the cogeneration of heat and electricity on-site improves the overall conversion of gas to electricity and heat by 50%; from 50% overall efficiency to 77%.
- This equates to a reduction in CO2 emissions of 200,000 tonnes over the life of the plant
The benefits from the cogeneration solution resulted in the ADHB converting the hospital's heat supply from coal to gas, which contributed to an improvement in the air quality for Auckland city.
"We run hospitals, not energy plants,” says Paul Jepsen, ADHB Facilities Manager, "by involving Energy for Industry, we can get on with our core business while leveraging their breadth of skills and resources as specialist managers of energy plant and utilities. Energy outsourcing makes for good business in our case."
The success of the project was recognised at the 2006 EECA EnergyWise Awards where Energy for Industry won the Energy Supplier Award.
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