As director of development at Bernhard, Rob Guthrie has repeatedly seen his firm’s institutional clients postpone their energy infrastructure investments due to rising costs, tighter margins and competing budget needs.
“As we continued to see interesting projects to improve aging infrastructure sent to the capital queue, we realized that in these cases we were selling parts to a car and the customer needed a fully assembled vehicle,” Guthrie said. “We needed a global solution for our institutional clients, not just a la carte options.”
In 2014, the New Orleans-based engineering and contracting company began offering Energy-as-a-Service (EaaS) solutions. It is a subscription-based energy supply business model in which customers – typically from the healthcare, higher education, government, commercial and industrial sectors – partner with a service provider for a recurring fee to manage their energy portfolio needs, including project financing, implementation and long-term asset management. The benefits are capital upgrades, infrastructure stability and reduced operating costs. EaaS also helps businesses achieve efficient and reliable energy with reductions in carbon, gas, and electricity consumption.
In eight years, Bernhard’s EaaS portfolio of partnerships and agreements with institutional clients has grown to $1 billion with Louisiana-based clients such as Ochsner Health, LCMC Health, Tulane University and Our Lady of the Lake and Water Campus. Other EaaS customers include AT&T Stadium in Arlington, Texas, University of Arkansas at Little Rock, Eastern University of New Mexico, University of Arkansas for Medical Sciences, Eastern Medical Center ‘Alabama and Midland Health in Texas.
Guidehouse Insights, a national marketing intelligence firm covering the global energy industry, estimates that the EaaS market is expected to grow 32.1% annually between 2022 and 2030, reaching $66 billion by 2030. North America is expected to be the largest market for EaaS, accounting for 42% of total market value.
Ochsner Health, LCMC Health on board
In 2017, Ochsner Health partnered with Bernhard at the Jefferson Highway Health System’s flagship campus to complete a comprehensive energy asset concession project, costing $52 million over a 15-year agreement.
The company’s new power plant was connected to the existing main power plant on South Campus to create a neighborhood loop serving 1.88 million square feet. Additionally, the North Campus plant was upgraded with pumping and piping modifications. Within the hospital, Bernhard provided retro-commissioning, upgrades to the building automation system, improved controls in operating rooms, and replacement of air-handling units, reducing demand on the central utility plant. The project has annual energy savings of $2.6 million. Since 2017, Ochsner has entered into EaaS partnerships at its Baptist campus ($32 million) and at Ochsner Medical Complex – The Grove in Baton Rouge ($15 million).
To date, Ochsner has avoided approximately 21% of carbon emissions associated with building utility consumption at Ochsner Medical Center and Ochsner Medical Complex – High Grove through Energy-as-a-Service projects implemented at each site. These savings represent more than 45,000 tonnes of CO2.
“We know that a climate-resilient community is a healthier community,” said Warner Thomas, president and CEO of Ochsner Health. “More sustainable care reduces costs, improves health outcomes and restores the environment. Our future climate-smart strategies will aim to procure less carbon-intensive supplies, improve building performance, expand electric vehicle charging infrastructure and increase investment in local manufacturing. This year, Ochsner was instrumental in establishing Safe Source Direct, a personal protective equipment manufacturing facility that will manufacture PPE right here in Louisiana, create more than 2,000 new jobs and reduce carbon emissions from traditional long-distance shipping routes.
Last month, LCMC Health announced its “LCMC Health Green” project, partnering with Bernhard as part of a 15-year agreement to provide EaaS solutions at seven of its regional facilities. The EaaS agreement is the largest of its kind in U.S. healthcare history, transferring the operating and maintenance risk of the chilled water system from LCMC Health to Bernhard and enabling upgrades to infrastructure at Children’s Hospital of New Orleans, Touro Infirmary, Woldenberg Village, East Jefferson General Hospital, West Jefferson Medical Center, Audubon Retirement Village and University Medical Center.
Bernhard is providing $88 million in infrastructure improvements to LCMC Health, including upgrades to chilled water, tower water, heating water and steam systems, as well as air handling units, building controls and electrical infrastructure. Bernhard will also install three new heat pump chiller heaters, upgrade procedure rooms, install LED lighting, and facilitate the retro-commissioning of building automation systems. These upgrades are expected to save $8 million annually in utility costs. The project is also expected to result in an estimated 26% reduction in utility carbon emissions.
“This partnership with Bernhard allows LCMC Health to invest in patient care and support community outcomes while focusing on improving the efficiency and sustainability of our hospitals and facilities,” said Scott Landry. , Senior Vice President of Facilities and Support Services, LCMC Health. “The upgrades that are being carried out as part of the LCMC Health Green project will not only improve cost savings for the system, but will also benefit the community as a whole through reductions in fuel consumption. carbon, gas and electricity.”
Bernhard and Tulane reach 30-year deal
In January, Bernhard and Tulane University announced a 30-year EaaS partnership that includes large-scale campus infrastructure upgrades and construction of a 1-megawatt solar power generation facility that will produce 10 % of the university’s total electricity needs.
“The unique combination of distributed generation and energy efficiency strategies will reduce the university’s power grid peak demand by nearly 50 percent,” Guthrie said.
The RISE (Renew, Innovate, Sustain, Engage) project addresses capital renewal, sustainability, and energy optimization priorities on Tulane campuses and accelerates the delivery of campus upgrades that will increase the resiliency and reliability of critical infrastructure, Tulane President Michael Fitts said.
“This partnership is a major step forward in Tulane’s ongoing commitment to environmental sustainability. Through this, we will significantly reduce our greenhouse gas emissions as we move toward a carbon-neutral future that also fully supports our critical research and education missions,” said Fitts. “By increasing efficiency, building resilience and researching alternative energy sources, Bernhard’s partnership with Tulane is also expected to achieve the goal of a 30% reduction in greenhouse gases by 2025. , as outlined in Tulane’s climate action plan.”