Solar Incentives
Solar Incentive guide for non-profits
Solar incentives are financial incentives offered by federal, state, and local governments to encourage the adoption of solar energy. These incentives can take the form of tax credits, rebates, grants, and other financial incentives, and are designed to help offset the cost of installing a solar energy system.
Non-profit organizations, like schools, churches, and charities, can greatly benefit from solar incentives as they often have limited budgets and rely on donations to fund their operations. By taking advantage of solar incentives, non-profits can save money on their energy bills, which can then be used to further their mission and serve their community.
In this guide, we will explore the different types of solar incentives available to non-profits, as well as the eligibility requirements and the steps required to claim these incentives. Through case studies and practical examples, we will show you how non-profits can maximize their solar savings and make a positive impact on the environment.
Types of Solar Incentives
There are several types of solar incentives available to non-profits, depending on the location of the organization and the size of the solar energy system.
Federal Solar Incentives
The most well-known federal solar incentive is the Investment Tax Credit (ITC), which allows non-profits to claim a tax credit equal to 26% of the cost of their solar energy system. This credit is available for systems installed in 2021, and will gradually decrease to 22% in 2023 and expire in 2024.
The Federal Renewable Energy Production Tax Credit (PTC) is another federal incentive available to non-profits. This credit provides a financial incentive for every kilowatt-hour of electricity produced by a solar energy system. The amount of the credit depends on the size of the system and the location where it is installed in 2021, and will gradually decrease to 22% in 2023 and expire in 2024.
State Solar Incentives
Many states offer solar incentives to non-profits in the form of rebates, grants, and other financial incentives. These incentives can vary widely from state to state, so it is important for non-profits to research the specific incentives available in their state.
For example, according to EcoWatch reports, the California Solar Initiative offers rebates to non-profits that install solar energy systems, while the New York State Energy Research and Development Authority (NYSERDA) offers grants to non-profits that install solar panels on their buildings.
Local Solar Incentives
In addition to federal and state incentives, non-profits may also be eligible for local solar incentives offered by cities and municipalities. These incentives can include property tax exemptions, permit fee waivers, and other financial incentives.
For example, the City of San Francisco offers property tax exemptions to non-profits that install solar energy systems, while the City of Austin offers permit fee waivers for non-profits that install solar panels on their buildings.
Overall, it is important for non-profits to research the various solar incentives available at the federal, state, and local levels, as they can greatly reduce the cost of installing a solar energy system and make it more financially feasible for non-profits to go solar.
Eligibility for Solar Incentives
To be eligible for solar incentives, non-profit organizations must meet certain requirements set by the federal, state, and local governments. These requirements can vary depending on the specific incentive, but generally, non-profits must:
- Be registered as a 501(c)(3) organization with the Internal Revenue Service (IRS)
- Use the solar energy system for their own use (rather than selling the electricity to others)
- Install the solar energy system on their own property (such as on the roof of their
building)
In addition to these general requirements, there may be specific eligibility requirements for different types of solar incentives. For example, some incentives may have size or capacity requirements for the solar energy system, or may only be available to non-profits located in certain areas.
Determine Solar Incentive Eligibility
To determine their eligibility for solar incentives, non-profits can follow these steps:
- Research the specific solar incentives available at the federal, state, and local levels.
- Review the eligibility requirements for each incentive to determine which ones the non-profit organization qualifies for.
- Contact the relevant government agency or program administrator to confirm eligibility and ask any questions about the application process.
- Gather the necessary documentation to apply for the incentives, such as proof of 501(c)(3) status, a completed application form, and any required supporting
documentation.
By thoroughly researching and understanding the eligibility requirements for solar incentives, non-profits can ensure that they are able to take advantage of these valuable financial incentives and save money on their solar energy system.
How to Claim Solar Incentives
Once a non-profit organization has determined that it is eligible for solar incentives, the next step is to claim these incentives. Here are some general guidelines for claiming solar incentives:
- ● Filing deadlines: Solar incentives may have specific filing deadlines, so it is important for non-profits to be aware of these deadlines and make sure to submit their claim in a timely manner.
- Documentation: Non-profits will typically need to provide documentation to support their claim for solar incentives. This may include proof of 501(c)(3) status, a completed application form, and documentation of the solar energy system (such as the installation contract and receipts).
- Claiming the incentive: The process for claiming solar incentives can vary depending on the specific incentive and the government agency or program administrator. Some
incentives may be claimed through the non-profit's tax return, while others may require a separate application process.
To claim solar incentives, non-profits can follow these steps:
- Review the filing deadlines and gather the necessary documentation for the solar
incentive. - Contact the relevant government agency or program administrator to ask any questions about the claim process and to confirm the required documentation.
- Submit the completed application form and supporting documentation to the government agency or program administrator by the filing deadline.
- Follow up with the government agency or program administrator to ensure that the claim has been received and is being processed.
Examples
To help illustrate how non-profits can take advantage of solar incentives, let’s look at three examples of non-profits that installed solar panel systems and qualified for different types of incentives:
Example 1: A Non-Profit Installs a Solar Panel System and Qualifies for a Federal Tax Credit
A non-profit school is a registered 501(c)(3) organization that operates a K-12 school in California. The school has always been committed to sustainability, and decided to install a solar panel system on its roof to reduce its carbon footprint and save money on energy costs.
The school worked with a solar energy company to design and install a 50 kW solar panel system, which was completed in 2020.
As a non-profit organization, the ABC School was eligible for the federal Investment Tax Credit (ITC).
Energy Research and Development Authority (NYSERDA) Non-Profit Solar PV Incentive Program. Through this program, the charity was able to receive a rebate of $0.75 per watt for the solar panel systems, for a total rebate of $56,250.
Example 2: A Non-Profit Installs a Solar Panel System and Qualifies for a State Rebate
A charity is a registered 501(c)(3) organization that provides services to the homeless
population in New York. The charity operates several shelters, and decided to install solar panel systems on the roofs of its shelters to save money on energy costs and reduce its carbon footprint.
The charity worked with a solar energy company to design and install solar panel systems on three of its shelters, with a total capacity of 75 kW.
As a non-profit organization located in New York, the charity was eligible for the New York State Energy Research and Development Authority (NYSERDA) Non-Profit Solar PV Incentive Program. Through this program, the charity was able to receive a rebate of $0.75 per watt for the solar panel systems, for a total rebate of $56,250.
Example 3: A Non-Profit Installs a Solar Panel System and Qualifies for a Local Grant
A church is a registered 501(c)(3) organization located in Austin, Texas. It operates a large building that serves as a place of worship and a community center, and decided to install a solar panel system on its roof to reduce its energy costs and carbon footprint.
The church worked with a solar energy company to design and install a 100 kW solar panel system, which was completed in 2021.
As a non-profit organization located in Austin, the church was eligible for the City of Austin’s Solar Photovoltaic Rebate Program. Through this program, the church was able to receive a grant of $0.50 per watt for the solar panel system, for a total grant of $50,000.
In these examples, we can see how non-profits can take advantage of different types of solar incentives to save money on their solar panel systems and make a positive impact on the environment. By researching and claiming these incentives, non-profits can maximize their solar savings and make going solar a financially feasible option.
Conclusion
In this guide, we have explored the various types of solar incentives available to non-profits, including federal tax credits, state rebates, and local grants. We have also discussed the eligibility requirements for these incentives and the steps required to claim them.
Through case studies, we have seen how non-profits can take advantage of solar incentives to save money on their solar panel systems and make a positive impact on the environment. By thoroughly researching and claiming these incentives, non-profits can maximize their solar savings and make going solar a financially feasible option.
Overall, solar incentives can be an invaluable resource for non-profits looking to reduce their energy costs and carbon footprint. By taking advantage of these incentives, non-profits can not only save money, but also contribute to a cleaner, more sustainable future.
Written by:
Katie Collins
