Healthcare Renewable Energy Initiative
A Partnership of Practice Greenhealth and Citi
Practice Greenhealth assists healthcare organizations in their efforts to reduce energy consumption and transition to cleaner, more environmentally sustainable forms of energy. While cleaner forms of energy are desirable, many hospitals and health systems are challenged by the up-front costs to implement onsite renewable energy options. And many of the tax breaks are set up to benefit for-profit entities, whereas the vast majority of hospitals are non-profit organizations and are notable to benefit from these tax benefits—making many of these programs unfeasible. Now, Practice Greenhealth, in partnership with Citi, is introducing the Healthcare Renewable Energy Initiative (HREI), an offering of transparent and flexible financing options for health systems planning to green their energy sources.
The HREI involves two phases:
- An independent engineering firm will conduct a thorough analysis of the potential feasibility of renewable energy alternatives for the healthcare organization, based on an analysis of the physical plant and existing energy use patterns.
- If the engineering assessment indicates potential feasibility, Citi will work with the organization to assess, finance and implement the most cost-effective structure that enables it to purchase green energy. In most cases, the most cost-effective structure to achieve these goals is a Power Purchase Agreement (PPA).
This initiative will be piloted in New Jersey and Massachusetts, where current state subsidies enable hospitals to utilize solar power to save money, hedge energy costs, and reduce their carbon footprint. Scalability to other states will continue to be assessed.
Practice Greenhealth and Citi believe that working to promote environmental and social sustainability is good business practice. As a global corporate citizen, Citi views sustainability issues from both a risk and an opportunity perspective. Citi looks for opportunities to make sustainable investments and develop products and services with positive environmental and social impact.
The HREI is a superior alternative for hospitals because it provides:
- Reliable execution
- Low-cost financing
- Transparency
- Flexibility on transaction structure and technology
- Two trusted partners in Practice Greenhealth and Citi, both with longstanding track records of serving the leading health systems, in both green initiatives and financing
The Healthcare Renewable Energy Initiative provides an executable and cost-effective financing program for renewable projects
- Combine tax credits, tax equity, and debt to result in the lowest overall cost of power
- Long-term cost savings and hedge against grid prices
- Access to Citi capital
- Standard documentation
Why structure with a PPA?
- Reduce the cost of power
- More flexible terms and conditions
- No upfront cost to hospital
- Hospital retains ownership option
Learn more about the Healthcare Renewable Energy Initiative, and how your healthcare organization can participate.
