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Al Neuner, vice president of facility operations at Geisinger Health System in Danville, Pa., discusses an infrastructure renewal program that grew from $10 million in savings from energy reduction programs. The hospital lowered its energy costs to $1.69 per square foot during a time when most are spending $4 to $6. For its efforts, the system won a 2014 Facility Maintenance Decisions Achievement Award.
vice president of facility operations
Geisinger Health System - Danville, Pa.
1. How did you decide on the energy-reduction programs as one solution to the health system's budget challenges?
Energy reduction is one of the few ways to get a return on investment from the physical assets themselves. It's much better to provide savings or implied revenue than just be considered an overhead cost.
2. What was the timeline for the projects? Briefly describe the more significant projects that took place.
Timelines varied by project, but on average were about 18 months. The more significant projects were as follows: Cogeneration - Installation of a 5 megawatt combustion turbine with 800 horsepower heat recovery boiler; chilled water storage - construction of an 8,000-ton, hour-chilled water storage tank; steam turbine chiller - installed steam turbine chiller to take advantage of excess waste heat of the cogeneration unit during summer months.
3. Describe your role in the specification, planning and execution of the projects.
I was the project manager for the co-generation project as well as the steam turbine chiller. I was the administrative liaison for the chilled water storage, which was part of a chilled water plant expansion project.
4. Why did you decide to use the savings from the energy-reduction projects to fund an infrastructural renewal program?
The biggest issue for most facilities departments is obtaining sufficient capital to replace infrastructure equipment within acceptable ages, efficiency, and reliability. By philosophically reapplying energy savings to replace infrastructure components of the existing building assets, we not only establish an ongoing funding stream, but also assure that our facilities are maintained at peak operating efficiency and high reliability.
5. What kinds of projects did the infrastructure renewal program consist of?
Infrastructure projects are any projects that upgrade or replace building/campus components. They can range from reroofing projects, interior finish upgrades, chiller replacements, boiler upgrades, air-handler units replacements, electrical upgrades, and centralized uninterruptible power supply units. The only limitation for our definition of "routine infrastructure replacement" is that the projects be less than $500,000. Projects over $500,000 are identified as major infrastructure and compete for capital funding with clinical programs. Routine infrastructure projects under $500,000 are assigned annually based on money per square foot allotment, which is currently $1.55 per square foot.
6. What lessons did your department learn from the overall process, from energy reduction projects to infrastructure renewal?
This is a hard question to be profound on. I think what we've learned is that proactive management of our energy use and resultant costs as well as prudent funding of infrastructure renewal builds a lot of pride within the department and respect from the outside. The facilities department is no longer just overhead, but a valued partner in the success of the business.