Industries We Serve

Solar and Battery Storage for Healthcare Facilities

Hospitals and healthcare facilities are strong solar hosts because they consume power around the clock, so every kilowatt-hour an array produces is used on site. Solar plus battery storage cuts energy and demand costs and adds a layer of resilience, but it complements the code-required emergency generators under NFPA 99 and NFPA 110; it does not replace them.

Ferrius Energy engineers and builds solar, carports, and storage for hospitals, medical office buildings, ambulatory surgery centers, and long-term care facilities in New England, Florida, and Texas. Nonprofit systems can capture the federal credit as a cash payment through elective pay under Section 6417, which changes the economics compared with the years when tax-exempt owners needed a third-party investor.

Last reviewed: September 2026. Code editions adopted by your authority having jurisdiction, IRS elective pay procedures, and incentive values change; confirm with your facilities engineer, accreditation advisor, and tax counsel.

Why a 24/7 load profile favors solar

An acute care hospital never sleeps. Air handling with high outdoor air requirements, imaging, sterilization, data centers, kitchens, and lighting in patient areas keep a high base load at all hours and all days. Healthcare buildings are among the most energy-intensive commercial building types in EIA's Commercial Buildings Energy Consumption Survey.

For solar that means two things. First, there is essentially no export risk: even a large array rarely exceeds the hospital's midday load, so output is valued at the full retail rate regardless of net metering rules. Second, solar will offset a modest percentage of annual consumption at a campus hospital, because the load is large and roof space is limited by mechanical equipment, helipads, and building height. We report results in dollars and IRR, not percent offset, so boards and finance committees see the real number.

Medical office buildings are different. They behave like office buildings, with weekday daytime loads, tenant physician practices, and often individual meters. The landlord and tenant structuring questions on our office building solar page apply directly.

NFPA 99, NFPA 110, and where solar fits

Hospital essential electrical systems (EES) are governed by NFPA 99, the Health Care Facilities Code, which CMS enforces for Medicare and Medicaid participating facilities, and by NFPA 70 Article 517. In a Category 1 space, the EES is divided into the life safety branch, the critical branch, and the equipment branch. The emergency power supply system is designed, installed, and tested under NFPA 110. For hospitals that means a Level 1 system, and the life safety and critical branches must be restored within 10 seconds (Type 10). Diesel generators remain the standard way to meet that, with required fuel on site and monthly and annual load testing.

The key point for administrators. A grid-tied solar array shuts down when the grid fails, as required by IEEE 1547 anti-islanding rules. Even a battery-backed microgrid is not automatically a code-compliant EES source; any alternate source must meet NFPA 99 and NFPA 110 and satisfy your authority having jurisdiction and accreditor. We design solar and storage as a separate, non-EES system that reduces cost every day and supports resilience, and we coordinate with your existing generators and transfer switches rather than touching the life safety design.

What solar and storage can do for resilience

  • Carry non-EES loads during an outage. Generators are sized for essential loads. A battery with islanding capability can support selected normal-power loads, such as additional HVAC, IT, or administrative areas, that the generator plant does not cover.
  • Extend fuel. In a long event, solar recharging a battery that carries part of the load can reduce generator fuel burn, which matters when fuel resupply is uncertain after a hurricane or ice storm.
  • Support clinics without generators. Outpatient clinics, dialysis centers, and pharmacies that are not required to have a Level 1 system can use solar plus storage to protect refrigeration of vaccines and medications and keep IT running.
Nonprofit Hospitals

Elective pay: the federal credit as a cash payment

Section 6417, added by the Inflation Reduction Act, allows tax-exempt organizations, state and local governments, and certain other entities to treat applicable clean energy credits, including the Section 48E clean electricity investment credit, as a payment of tax. The IRS then refunds the amount. A nonprofit hospital that owns its solar and storage system can therefore capture the credit directly instead of signing a PPA to let a taxable investor claim it.

The 48E credit rules are the same as for taxable owners: 6 percent base, 30 percent for projects under 1 MW AC or projects that meet prevailing wage and apprenticeship requirements. Under the One Big Beautiful Bill Act (enacted July 4, 2025), solar facilities that began construction on or before July 4, 2026 are not subject to the 2027 placed-in-service deadline, subject to continuity rules; facilities beginning construction after July 4, 2026 must be placed in service by December 31, 2027. See federal ITC plus SMART.

Pre-filing registration

Elective pay requires registering each facility with the IRS through its online pre-filing registration tool before filing the return that makes the election, and then claiming the credit on the annual return by its due date, including extensions. Missing that window can forfeit the payment.

Domestic content

For elective pay entities, projects of 1 MW or more that do not meet domestic content requirements face a reduction in the payment, with limited exceptions. We document equipment origin during procurement so your tax counsel can assess it.

Grants and tax-exempt bonds

Restricted grants and tax-exempt financing can reduce the credit basis or payment. Confirm the treatment with counsel before combining funding sources.

Ownership versus PPA

With elective pay, owning often beats a PPA on lifetime value. A PPA still makes sense when capital budgets are committed elsewhere. We model both; see solar financing.

For other nonprofit property types, see our nonprofit solar page and schools and universities page.

Building and construction considerations on a hospital campus

  • Infection control risk assessment. Roof work near air intakes can draw dust into ventilation. We work with your infection prevention team on an ICRA and schedule dusty activities away from intake operation or with intake protection.
  • Helipads and obstruction. Arrays must stay clear of approach and departure surfaces, and glare near flight paths should be analyzed.
  • Interim life safety measures. Any work that affects egress, fire alarm, or sprinklers triggers ILSM under your life safety program.
  • Electrical tie-in. We connect on the normal power side, never on EES branches, and plan the tie-in outage with your facilities and clinical leadership.
  • Parking garages and surface lots. Campus parking is often the largest available area. Carports on the top deck of a garage require structural review of the deck. See solar carports.

Demand charges and storage at healthcare facilities

A hospital's load is high and relatively flat, but summer cooling still creates a pronounced afternoon peak. A battery can shave that peak and, in Massachusetts, participate in ConnectedSolutions demand response. Some hospitals already run generators for demand response; storage offers a way to earn similar value without emissions or engine hours. We model storage using your interval data, as described in battery storage cost and ROI.

Questions

Frequently asked questions

Can solar and batteries replace a hospital's emergency generators?

No, not in practice today. Hospital essential electrical systems must meet NFPA 99 and NFPA 110, including restoring life safety and critical branch power within 10 seconds, and any alternate source must satisfy your authority having jurisdiction and accreditor. Solar and storage complement generators by reducing daily energy costs, carrying non-essential loads in outages, and reducing fuel burn in long events.

Can a nonprofit hospital get the federal solar tax credit?

Yes, through elective pay under Section 6417. A tax-exempt owner can treat the Section 48E credit as a payment and receive it as a refund, after completing IRS pre-filing registration and filing its annual return on time. Domestic content rules can reduce the payment on projects of 1 MW or more, so confirm details with tax counsel.

Does a hospital's solar array keep working during a power outage?

A grid-tied array shuts down automatically during an outage for utility worker safety. To use solar during an outage, it must be paired with a battery and controls that can island a defined set of loads. We design those systems on the normal power side, separate from the code-required essential electrical system.

How much of a hospital's electricity can solar supply?

Usually a modest share of annual consumption, because hospital loads are very large and roofs are crowded with mechanical equipment. The upside is that virtually all output is consumed on site at full retail value. Parking garages and surface lots often add more capacity than the roof.

How do you manage construction on an operating hospital?

We coordinate with facilities, infection prevention, and clinical leadership on an infection control risk assessment, interim life safety measures, air intake protection, crane lifts, and the timing of the electrical tie-in, which is made on normal power rather than essential electrical system branches.

Sources

  • NFPA, NFPA 99: Health Care Facilities Code. nfpa.org
  • NFPA, NFPA 110: Standard for Emergency and Standby Power Systems. nfpa.org
  • Centers for Medicare & Medicaid Services, Life Safety Code and Health Care Facilities Code Requirements. cms.gov
  • Internal Revenue Service, Elective pay and transferability. irs.gov
  • Internal Revenue Service, Elective pay frequently asked questions. irs.gov
  • Internal Revenue Service, Publication 5817, Elective Pay Overview. irs.gov
  • Federal Register, Section 6417 Elective Payment of Applicable Credits. federalregister.gov
  • U.S. Energy Information Administration, Commercial Buildings Energy Consumption Survey. eia.gov
  • U.S. Congress, H.R. 1, One Big Beautiful Bill Act (Public Law 119-21). congress.gov