A central California hospital operator may address the state's burgeoning energy crisis by jointly constructing an electricity plant with the city of Fresno.
Fresno-based Community Medical Centers, which operates three hospitals in and around Fresno, is studying the possibility of building a 50-megawatt power plant jointly with the city. A report determining whether the venture is feasible is expected to be released in June, Community Medical officials say. Fresno city officials weren't available for comment.
That an 852-bed hospital system would explore such a proposal comes at a crucial time for California's approximately 475 acute-care facilities. Many of the state's major utilities began encountering shortages when buying electricity on the open market late last year, leading to rolling blackouts in much of California. Many hospital operators, including Community Medical, have been asked repeatedly in recent months to switch to backup generators to ease shortages. At the behest of the California hospitals, the California Public Utilities Commission is debating whether to exempt hospitals from future blackouts.
The timing of the electricity crisis couldn't be worse for Community Medical, which is in the midst of a $220 million expansion, consolidating two of its campuses into a single location and building a new trauma center and medical office space near downtown Fresno. In addition, the system is embarking on construction of an $80 million heart hospital (See story, above). The new construction eventually could double demand for electricity, according to Bruce Rainey, Community Medical's vice president of facilities planning. Community Medical uses 1,000 to 1,600 megawatt hours of electricity in a month-enough to power 50,000 to 80,000 homes. Community Medical spends about $3 million a year for electricity, but officials fear a recent 46% rate increase approved late last month by the utilities commission will cause the facility's overall costs to skyrocket even before the expansion is complete.
Pursuing a joint project with the city may reduce costs significantly, Community Medical Chief Executive Officer J. Philip Hinton said. If the plant were built, Community Medical would use as much as 20% of the electricity generated, with the remainder sold to local businesses and residents or other parts of the state. "We've worked with the city in the past, and this seemed to be another project we might be able to pursue," he said.