Energy Resilience Bank Helps Four Hospitals Advance Vital Infrastructure Projects
TRENTON (March 16, 2017) – Taking steps to help keep critical infrastructures operational during outages, the Board of the New Jersey Economic Development Authority (EDA) today granted preliminary approval under the Energy Resilience Bank (ERB) to support the installation of new combined heat and power (CHP) systems at three New Jersey hospitals. The EDA also announced it had closed on ERB funding related to the construction of a CHP project at St. Peter’s University Hospital (SPUH) in New Brunswick. The SPUH project is the first project to receive final funding approval from the ERB.
Created by the Christie Administration in the aftermath of Superstorm Sandy, the ERB is the first public infrastructure bank in the nation to focus on energy resilience. Administered by the EDA, the ERB is utilizing $200 million from New Jersey’s second Community Development Block Grant-Disaster Recovery (CDBG-DR) allocation to support the development of distributed energy resources (DER) at critical facilities throughout the state that will enable them to remain operational during future outages.
“Today’s Board action will help ensure that these hospitals, which provide critical care to some of New Jersey’s most vulnerable populations, have access to the funding required to create CHP systems that will operate independently of the electrical grid in times of storms, natural disasters, or other emergency situations,” EDA Chief Executive Officer Melissa Orsen said.
The intent of the ERB is to finance the installation or upgrading of commercially available and cost effective resilient energy technologies at critical facilities, with a focus on effective DER technologies, including CHP and fuel cells, which are designed to start up and function in “island” mode, disconnected and isolated from the grid during a power outage or other event. As an added benefit, these technologies typically provide cleaner and more efficient power than more traditional forms of electricity generation.
The EDA provided preliminary approval today for three CHP projects, including RWJBarnabas Health – Newark Beth Israel Medical Center (NBI), Trinitas Regional Medical Center (Trinitas) in Elizabeth, and Hunterdon Medical Center (HMC) in Flemington.
NBI is a regional care teaching hospital that provides comprehensive health care to local communities including Newark, East Orange, Irvington and Hillside. The hospital has approximately 25,000 admissions and 300,000 outpatients annually, as well as roughly 80,000 emergency room patients each year. It is one of two hospitals in New Jersey where heart transplants are performed and the only hospital in the state certified to perform lung transplants. During Superstorm Sandy, NBI was on emergency power for a day and a half, resulting in the suspension of all outpatient services during that time. As approved, $15.2 million of ERB funds will be reserved for the NBI CHP project, comprised of approximately $11.2 million as a grant and $4 million as a low-interest loan. An additional $580,000 will be provided in the form of a loan from the Public Service Electric & Gas (PSE&G) Hospital Efficiency Program, which will cover the gap between the ERB funding and the project’s total estimated costs.
Trinitas serves the City of Elizabeth, the fourth-largest city in New Jersey, as well as surrounding communities. Trinitas serves approximately 17,000 inpatients and 400,000 outpatients annually, and sees approximately 70,000 emergency patients each year. Superstorm Sandy resulted in downed power poles and lines and major power outages throughout Elizabeth, and the hospital suffered direct damage to its buildings. Trinitas plans to use the ERB funding to develop a new CHP system on its Williamson Street campus. As approved, $9.6 million of ERB funds will be reserved for the project, approximately $6.6 million as a grant and $3 million as a low-interest loan. An additional $520,000 will be provided in the form of a loan from the PSE&G Hospital Efficiency Program, which will cover the gap between the ERB funding and the project’s total estimated costs.
HMC, Hunterdon County’s only hospital, is a community acute-care teaching facility that provides inpatient and outpatient care with a full range of community health preventive, diagnostic and therapeutic services. HMC admits approximately 8,600 patients and 292,000 outpatients, and sees more than 34,000 patients in its emergency room annually. During Superstorm Sandy, HMC sustained extensive damage to its roof, which subsequently caused water damage throughout the building. Preliminary approval was given today for approximately $5.1 million of ERB funds to be reserved for the project as a grant and $5.8 million as a low-interest loan. These funds will cover the entire estimated cost of the project.
Consistent with ERB and HUD CDBG-DR program requirements, all three projects will install new approximately two-megawatt CHP systems, constructed above minimum base flood elevations, and that will be interconnected within the facilities with the necessary blackstart and islanding system controls to be able to operate independently from the grid in case of a power outage or other emergency.
Today’s approval will allow these three projects to advance to the next phase of the ERB program review, which includes an environmental review by the New Jersey Department of Environmental Protection. The EDA’s authorization to proceed allows the hospitals to make the necessary financial commitments to finalize engineering and design of the project, with the understanding that any material changes to the project’s scope or budget will be brought back to the Board for reconsideration.
At today’s meeting, Orsen noted that the February 28 closing on funding from the ERB will enable SPUH to begin construction on its CHP project. The acute care, 478 bed teaching hospital provides a broad array of services to the community and treats more than 30,000 inpatients and over 200,000 outpatients annually. The not-for-profit organization suffered direct physical damage from Superstorm Sandy and had to enact emergency protective measures to guard the health and safety of its patients and employees. More information about the project can be found on the EDA’s website.
EDA Board meetings are typically held at 10 a.m. on the second Tuesday of each month at 36 West State Street in Trenton. The Board meeting schedule, as well as Board agendas and minutes, are available at www.njeda.com. All Board actions will take effect at the expiration of the statutory period for the Governor’s review and consideration of the meeting minutes.