Healthcare is one of the few industries seeing continued growth in sustainability, but rising energy costs and barriers to decarbonization are making it increasingly difficult. In this article, Third Partners Principal John Haugen shares sustainability trends impacting hospitals in 2026 and how healthcare organizations should respond.
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Climate Change & Energy Cost Volatility Affecting Medical Facilities
Climate change and the associated increased energy costs are putting a major strain on hospital budgets – and taking funding away from clinical investments.
Climate change is wreaking havoc on energy budgets.
- Extreme weather events disproportionately impact hospitals.
While the rest of the community shuts down, hospitals must remain operational. Extreme weather forces them to rely on backup systems – like diesel generators and microgrids – that are expensive to maintain and subject to regional energy shortages and cost spikes. - Rising temperatures drive up HVAC operational costs.
Clinical settings require high air exchange rates and energy-intensive humidity control to prevent pathogen growth and equipment failure. As outdoor temperatures rise, hospital HVAC systems have to work overtime to keep ORs and ICUs within regulatory compliance. - Infrastructure resilience costs compete with clinical investment.
For a hospital, climate resilience is mandated by building codes. That means instead of investing in clinical technology and patient care advancements, hospitals have to allocate funding towards resilience efforts like elevating critical electrical switchgear above new flood plains and installing "islandable" power systems that can run independently of a failing grid.
As energy budgets take a hit, hospitals are under increasing pressure to find ways to reduce consumption and costs.
There's a greater imperative for energy efficiency.
In the healthcare industry, reducing energy consumption is about more than saving on overhead costs or checking compliance boxes – though these pressures aren't insignificant. Overspending on energy takes funding away from advancing clinical technology and improving patient outcomes.
Healthcare energy use reduction plans often include initiatives like:
- Onsite Generation & Microgrids: Producing their own electricity to bypass grid volatility.
- Strategic Procurement: Using commodity hedging and long-term contracts to lock in predictable rates.
- Demand Response: Utilizing curtailment protocols for non-clinical areas to earn incentives during grid stress.
- Efficiency Mandates: Executing deep retrofits for aging infrastructure and prioritizing aggressive energy performance standards in all new construction.
- Telehealth Care: Reducing reliance on high-energy waiting rooms and administrative areas to reduce utility costs. However, because telehealth increases data center demand and clinical areas still need to be heated and cooled, the net reduction in energy use is minimal.
These efforts can reduce energy costs in the long run, but new equipment, retrofits, and protocols require significant upfront capital.
Regardless of costs, internal and external pressures mean they're no longer optional.
Stakeholder Pressure for Decarbonization in the Healthcare Supply Chain
Sustainability efforts are about more than cost reduction. Hospitals also face mounting pressure from stakeholders to reduce their carbon footprint.
Group Purchasing Organizations (GPOs) demand reduced carbon emissions.
GPOs help healthcare organizations reduce supply chain costs through collective purchasing power. But to take advantage of those savings, hospitals are beholden to the GPO's sustainability criteria.
GPO sustainability efforts include:
- Embedding Environmentally Preferable Purchasing (EPP) criteria into contracting processes
- Requiring suppliers to disclose carbon footprints, chemical compositions (e.g., PVC or phthalate-free), and waste-reduction data
- Supplying and normalizing sustainable products that might be too expensive for a hospital to source independently
- Providing advanced analytics and dashboards that allow administrators to track environmental impact and form a roadmap for decarbonization
Hospitals have to balance stakeholder pressure with barriers that make it difficult and costly to reduce carbon emissions.
Barriers to Carbon Reduction
Barrier: Rigid waste regulations prevent hospital decarbonization.
Current regulations often classify "single-use" devices as medical waste even when safe sterilization and reuse are clinically possible. Relaxing these barriers could significantly reduce waste, spending, and production emissions.
Barrier: Restrictive GPO sole-source contracts limit supply chain choices.
Eliminating these contracts would allow hospitals to bypass global logistics chains in favor of local food and supplies – reducing Scope 3 emissions from international shipping, fostering a circular economy, and minimizing the impact of climate-driven supply chain disruptions.
Barrier: Hospitals must navigate a patchwork of regulations that weren't designed with climate change in mind.
Conflicting building codes, clinical safety mandates, and waste-handling laws create significant regulatory complexity. Modernizing these frameworks would make it easier for hospitals to meet decarbonization goals.
Barrier: Long-term energy savings are sidelined by narrow operating margins.
This is an ongoing challenge: the long-term return on sustainable infrastructure is overshadowed by the immediate pressure of thin margins. Hospitals should work with a specialist to develop a healthcare sustainability plan that supports both the organization's mission and its financial goals.
These barriers help explain why U.S. healthcare organizations are falling behind their European counterparts – who operate under strict EU mandates – in decarbonization efforts.
U.S. healthcare organizations are also facing investment uncertainty, which compounds the hesitancy to commit capital to long-term sustainability projects.
International Investment Uncertainty in U.S. Healthcare
International investors aren't in a full retreat from U.S. healthcare, but they are wary and increasingly selective.
This isn't new. Investors have been concerned about American healthcare policies, medical inflation, and economic uncertainty for years.
What has changed is a continually widening gap between multi-billion dollar investors and mid-market investors.
Capital investment is concentrated in megadeals.
We're seeing a K-shaped investment market. Capital is concentrated in $5 billion deals and in high-growth niches like AI-enabled healthtech. Large, strategic investors with deep pockets continue to invest while mid-market investors remain sidelined by high valuations and persistent economic uncertainty.
Investment uncertainty creates a "resilience tax" on sustainability.
When capital is tight, hospitals often delay long-term sustainability projects – like deep energy retrofits – in favor of immediate operational needs. This creates a cycle in which the organizations that most need to invest in resilience are least able to do so.
However, for organizations with capital access, sustainability is increasingly viewed as a risk mitigation tool rather than an elective cost. Hedging against future energy price spikes and potential carbon taxes keeps sustainability projects on the priority list despite broader market jitters.
AI & Healthcare Cybersecurity Concerns
In 2026, AI has moved from experimental to essential in healthcare sustainability. It offers a sophisticated toolkit for reducing the industry's massive carbon footprint — though it also introduces environmental trade-offs.
Where AI is making an impact in the healthcare industry:
- Predictive Maintenance (PdM): Machine learning shifts facility management from rigid calendar-based servicing to condition-based care. Catching equipment issues before they escalate reduces "idle creep" and can slash facility electricity use by up to 22%.
- Supply Chain Monitoring: Computer vision tracks inventories in real time, preventing the expiration of sensitive pharmaceuticals and significantly curtailing medical waste.
- Intelligent HVAC Management: Intelligent platforms adjust climate systems based on real-time occupancy data and weather forecasts, helping hospitals reduce energy spending without compromising patient safety and strict clinical standards.
The trade-offs of AI use in healthcare:
- Energy-intensive nature of AI: A single clinical query can consume ten times the power of a traditional search.
- Data centers that power AI: AI algorithm processing requires massive data centers that require billions of gallons of water to keep servers cool.
- Operational leanness becomes digital heaviness: The hardware turnover and electronic waste contributes to increased Scope 3 emissions.
Without careful usage management, AI can introduce a significant "digital carbon" debt and net-negative environmental impact. To achieve true sustainability, the most forward-thinking 2026 healthcare systems are prioritizing localized "edge computing" and small language models to minimize these hidden environmental costs.
Cybersecurity is now a sustainability issue.
Cybersecurity is a major factor in healthcare sustainability planning. A digital breach can physically compromise environmental controls and drain hospital budgets.
A major cyberattack can:
- Shut down "smart" systems – like AI-driven energy optimization – forcing them to revert to energy-intensive "safe modes."
- Create massive operational waste when tracking failures force hospitals to discard sterilized supplies to maintain compliance.
- Dramatically increase transport-related emissions when patients are diverted to other facilities.
Healthcare facilities must treat cybersecurity as more than an IT issue – digital attacks create direct risk for patients, the environment, and energy efficiency. Have a prevention and response plan in place to mitigate cyber threats.
Sustainability as Risk Mitigation & Cost Reduction
Healthcare organizations must balance competing financial priorities of thin margins and climate resilience efforts. The most successful organizations have stopped treating sustainability as an elective “green” expense and started treating it as a core risk-mitigation strategy.
However, tight budgets, increasing energy costs, and stakeholder pressures make it difficult to form a sustainability plan that doesn’t sacrifice other priorities.
Third Partners’ sustainability consulting helps healthcare organizations navigate the “double whammy” of rising energy costs and climate-driven operational risks. We bridge the gap between ambitious sustainability goals and the harsh realities of hospital finance.
- Energy Budgeting and Analytics: We prevent “utility bill shock” by implementing ISO 50001-ready management systems. Our automated dashboards identify inefficiencies before they drain your budget and provide the data-driven ROI cases needed to justify deep energy retrofits and infrastructure modernization.
- AI Solutions to Sustainability: We build custom AI solutions to automate strategy development, provide real-time data analysis, and streamline workflow with AI-powered applications.
- Waste Management and Reporting: We protect your brand and bottom line by substantiating environmental claims with hard data. Our systems track medical waste and supply chain inefficiencies, ensuring your sustainability narrative is backed by measurable, transparent data to eliminate greenwashing risks.
- Climate-Related Compliance: We solve the complexity of evolving state and federal reporting requirements like HHS Climate Pledge commitments. Through geospatial studies and climate consulting, we identify infrastructure vulnerabilities and ensure your organization meets investor demands while hardening facilities against extreme weather disruptions.
We’re ready to help. Book a free consultation to get started.
