Adventist HealthCare, a large health system in the Northeast, has always had a robust energy management program. As part of its innovative facilities management efforts, a group of specialists consistently monitor weather data, energy markets and consumption trends.
Historically, this has allowed the team to plan ahead and avoid major price hikes, making their multi-million dollar energy budget go further and enabling the team to increase the resilience of the many hospitals within their system. As a non-profit hospital system, every dollar saved on energy is another dollar that gets reinvested back into patient care, so the stakes have always been high for Adventist to keep their energy management program at the cutting edge.
Adventist HealthCare’s PJM Challenges
In 2025, that program was tested under unprecedented conditions as PJM implemented extreme capacity price increases—compressing what would normally be multi-year cost escalation into a single planning cycle. For a primer on why PJM is raising rates in such a hurry, review our coverage.
Regardless of how PJM arrived at its current state of constrained supply and outsized demand, large consumers like Adventist needed to take action quickly. Because they already had a robust energy management program, the Adventist team was well positioned to take on this new challenge.
What is peak usage?
For large healthcare systems operating in PJM, peak usage is not just an operational metric it is a primary driver of long-term energy cost exposure. How a system performs during a handful of high-stress grid hours can determine millions of dollars in future charges. Central to Adventist’s plan to mitigate the impact of PJM’s rising rates was getting a handle on peak usage.
PJM determines customer capacity rates based on the five highest usage days in the previous year. While no one can predict exactly what those days will be, Adventist partner and energy efficiency expert InSite looks at real-time grid data alongside weather data to predict peak days with enough advance notice to impact operations. With that understanding, the teams were able to implement a peak demand management strategy that would curtail usage peaks during estimated monitoring periods.
A peak is the top of the consumption curve and it usually happens when equipment is just starting up or when an abrupt and large temperature change is implemented. Leveling out these peaks has outsized impact on energy costs because the peak is what PJM uses to determine the price it will charge its customer. The lower the peak, the lower the price. In the case of PJM, it’s worth noting that nearly all peak times are between 5-7 pm. Knowing this, InSite focuses its data analysis there first.
What are capacity charges?
In PJM territory, customer peaks directly determine capacity charges—separate line items on energy bills that reflect the cost of ensuring sufficient grid capacity during system-wide stress events.
For reference, in 2024 capacity charges accounted for 2.4% of total charges for Adventist. In 2025, capacity charges jumped to 8.4% – a difference of more than $200,000. Over the next two years, InSite estimates Adventist’s capacity charges will rise to 11.2% at their highest. Because these charges are based on historical peak behavior, today’s operational decisions directly influence future cost exposure.
As capacity charges grow, the financial value of reducing peak demand multiplies—turning peak management from a tactical energy exercise into a strategic financial lever.
Other Energy Hedge Options
Adventist, like many large consumers of grid power, has several energy cost hedges in place to mitigate the impact and provide options. And with their strong and proactive energy management program, they’re well positioned to shoulder the burden.
But many others may not be. To dig into this problem and offer more solutions with leaders on this issue, InSite will host an executive roundtable in Washington D.C. and online. Included in this discussion will be options for cogeneration and on-site power. Right now, that is the best hedge against rising costs. On the panel for this upcoming discussion will be representatives from companies that design and install cogeneration like CHPs (combined heat and power systems), microgrids, and other on-site generation options.
About InSite
Founded in 2013, InSite is a leading solution partner for optimization in buildings, extracting value from data to engineer meaningful outcomes for its clients. We deliver financial and operational impact by harnessing our team’s expertise in engineering and building performance optimization. Our Engineered for Results approach combines an intelligence platform that collects and analyzes data for single buildings and entire portfolios with our program management teams who transform data into prescriptive recommendations.
