NHS hospital trusts face a 200% increase in energy bills

Hospitals and trusts across the UK could be charged an additional £2 million per month for energy bills in the winter, due to national fuel costs surges

NHS hospital trusts across the UK are to expect extremely high increases in energy bills over the winter of 2022 due to fuel cost surges and have been warned that patient care will require a serious reduction in order to cope.

According to an investigation conducted in The BMJ, numerous hospital trusts in England are worried they will have to make stark choices on staffing levels, waiting times and care provided to be able to continue operating.

The energy costs have been predicted to have increased to three times higher than a year ago, during the height of the COVID-19 pandemic.

Which hospitals have been estimated to be affected most?

Nottingham University Hospitals NHS Trust has been most affected so far, as it had budgeted for a 214% increase in electricity and gas costs for 2022-23, as an extreme case of fuel costs.

Other examples include that of Great Ormond Street Hospital for Children NHS Foundation Trust in London, which said that it expected a combined gas and electricity bill of around £650,000 a month in January and February 2023 – which is an extreme increase from the £350,000 paid in the same months this year.

Sheffield Children’s NHS Foundation Trust also highlighted the expectance of its total energy bill for 2022-23 to be almost 130% higher than in 2021-22.

The last example was Leeds Teaching Hospitals NHS Trust, whose director of estates and facilities Craige Richardson stated that the trust expected to be paying an extra £2 million a month for electricity and gas combined.

One trust expected to be paying an extra £2 million a month for electricity and gas combined

These dates are for January and February 2023, when compared with January and February 2022 – indicating a drastic rise of around 110%.

Overall, the trusts interviewed stated their expectance for their energy bills to double at least.

Facing “eye watering” rises in energy bills

The investigation comes as energy regulator Ofgem announced on 26 August that the price of the domestic electricity and gas price cap (per unit) would be rising by 80% from October for England, Scotland and Wales.

Energy bills for non-domestic customers are not subject to the cap and are, therefore, even more, vulnerable to surging wholesale prices.

In May of this year, NHS England estimated rising energy prices would cost the NHS £485m more in 2022-23 than had been budgeted for when NHS planning guidance was issued last December.

How will the NHS deal with the estimated £485 million rise?

As energy prices have continued to rise – and will have almost tripled for domestic consumers in the year to October 2022, almost doubling since April alone, and are predicted to rise again by 50% next year – patients are expected to suffer with accessibility to NHS services.

However, to try cope with current estimates of energy bill increases, the NHS in England has set aside £1.5 billion from its existing budget to cover this increase.

This funding is also to deal with other, potential inflationary pressures on the NHS such as fuel costs for ambulance services, private finance initiative contracts, and local authority care prices.

“A failure to properly compensate the NHS for inflation will only heighten pressure on our health service as we move towards a winter that we know will be particularly challenging this year.”

Rory Deighton, senior acute lead at the NHS Confederation, told The BMJ: “This isn’t an abstract problem, as the gap in funding from rising inflation will either have to be made up by fewer staff being employed, longer waiting times for care, or other areas of patient care being cut back.

“The new prime minister must provide a top-up in this autumn’s budget or any emergency budget they hold to make up the shortfall. The NHS needs at least £3.4bn to make up for inflation during this year alone, and that is before we face a winter of even higher wholesale energy prices.

“A failure to properly compensate the NHS for inflation will only heighten pressure on our health service as we move towards a winter that we know will be particularly challenging this year.”