Solar panels can generate incredible savings for a nonprofit, but they have also been out of reach financially for many organizations due to the up-front installation costs. However, in the last few years, the field has shifted. The Biden administration's Inflation Reduction Act has opened up avenues for nonprofits to be reimbursed for some of the cost of going solar; here's how.
What are the incentives available to NPOs under the IRA?
As solar marketplace EnergySage has explained, nonprofit organizations are eligible to receive specific tax credits under the IRA. Normally, NPOs simply wouldn't be able to claim the funds an individual or business would; but in this case, an NPO can receive a direct payout for IRA tax credits. This "direct pay" system is also sometimes called "elective pay."
Those tax credits can cover a range of eco-friendly activities, including investing in community solar, installing electric vehicle charging stations, and installing wind power. And, of course, they cover the installation of solar panels.
🗣️ If you were to install home solar panels, which of these factors would be your primary motivation?
🔘 Energy independence ⚡
🔘 Lower power bills 💰
🔘 Helping the planet 🌎
🔘 No chance I ever go solar 🚫
🗳️ Click your choice to see results and speak your mind
Specifically, the IRA had instituted tax credits up to 30% for qualifying solar installation projects. Spend $100,000 installing solar panels, and you could receive $30,000 back in four to 18 months. Spend more than $330,000 on a large project, and you could theoretically get $100,000 — or more. Federal incentives can also stack with state and local incentives, per EnergySage.
💡Save 50% on solar for your business
Own a business with high energy bills? New tax incentives will pay for up to half the cost of a solar system — and EnergySage can help you get it installed for the lowest possible price.
Use EnergySage's free tool to find local options, compare prices, and see how much you can save — up to $50k in many cases, before you factor in bill savings.
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That said, the IRA tax savings could end soon. President-elect Donald Trump has gone on record saying he plans to eliminate large portions of the provisions, so interested parties may want to act soon to ensure their ability to save thousands of dollars while the opportunity remains available.
Why is broader access to solar panels important?
Solar panels can partially or fully meet your organization's energy needs, depending on your specific setup. By reducing or eliminating your energy bill, they will pay for themselves — and then just keep generating savings. The up-front investment masks decades of financial benefits that can reduce your nonprofit's operating costs and free up funds for your important mission.
Meanwhile, using the clean energy from solar panels reduces the need for dirty energy from the grid, minimizing air pollution. That eco-friendly choice aligns perfectly with the goals of many environmental nonprofits, and it's a nice bonus for many other NPOs as well.
How EnergySage helps with solar panel installation
To get a better idea of the possibilities for your organization, you can use EnergySage's free online tools to locate providers in your area. Get quick quotes for solar panel arrays and compare the available deals from vetted providers to get the most cost-effective setup for your organization.
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