Better Buildings Partners Diagnose Sustainable Financing Strategies at CleanMed
The CleanMed conference and exposition is a significant annual event for those advancing sustainability within the healthcare sector. Influential healthcare stakeholders convene with vendors of cleaner and safer products and services to propel forward a stronger commitment towards sustainable operations and a healthy working environment. This year, Better Buildings Challenge partners Jon Utech, Office for a Healthy Environment Senior Director (Cleveland Clinic), Jim Prince, Energy Management Manager (Ascension Health), and Erin Richmond, Better Buildings Healthcare Subject Matter Expert (JDM Associates), were invited to Indianapolis to speak on successful financing mechanisms for sustainability in healthcare.
Close to 50 attendees attended their session Green Revolving Funds and Dedicated Capital Pools: Best Practices in Financing Sustainability which explained how Cleveland Clinic and Ascension Health have both overcome the financial barriers hindering dedicated capital for energy efficiency improvements. With tight operating budgets, competing priorities for capital, and the relatively small portion of operating expenses dedicated to energy efficiency, there are challenges to investing in equipment with a high initial cost. Erin Richmond presented the Better Buildings Financing Navigator, an online tool which cuts through the complexities of the numerous financing options in the market and guides partners towards the right financing solutions for their specific energy efficiency needs. Partners can connect directly with Better Buildings Financial Allies dedicated to financing their projects.
Jon Utech described how Cleveland Clinic established the $7.5 million Green Revolving Fund, one of the largest such funds in the healthcare industry, to finance and implement sustainability initiatives. Projects financed through a Green Revolving Fund must reduce resource use and a portion of the tracked savings must be replenished back into the fund to provide capital for future projects. These funds are an innovative way for organizations, particularly nonprofits, to establish long-term funding for energy efficiency capital expenditure projects.
Jim Prince shared how Ascension Health has combined savings from energy efficiency capital expenditure projects with the savings from operational improvements to establish the Energy Conservation Capital Pool. Hospitals present proposals for energy-saving projects to earn funding from the Pool, which frees maintenance departments from having to compete with other critical hospital supplies and infrastructure cap-ex projects. Proposals are reviewed by Ascension’s Facilities Resource Group and Preferred Engineering Consulting Firms with consideration focused on lifecycle costs and simple payback periods. Selected projects are managed and tracked by regional entities. Success is measured by tracking utility usage in ENERGY STAR Portfolio Manager and performance-based Monthly Measurement & Verification scorecards.
The session concluded with an open discussion on the barriers audience members face to financing sustainability initiatives in hospitals and the successful strategies for building the business case to assist in implementing energy performance improvements.
For more information about what Better Buildings partners are doing to advance energy efficiency in their sector, check out the Better Buildings Solution Center.