Investing & Saving Today While Honoring Our Planet for a Clean Energy Future
Before the Inflation Reduction Act (IRA) of 2022, nonprofits and houses of worship were not eligible to apply the federal tax credit to their solar installations. To leverage the full value of the federal tax credit, these organizations had to install their systems through third parties who were be able to monetize the tax credit and incorporate those savings into the final price. With the passing of the IRA, tax-exempt organizations are now able to take advantage of the federal tax credit through an elective pay option. Elective pay operates similar to a rebate system in which an entity notifies the IRS of an eligible project when filing an annual tax return and then receives a portion of the project cost as refund from the IRS. The tax credit is 30% of the installed system cost through 2032.
Get Inspired by Christ Episcopal Church
Christ Episcopal Church, located in Cedar Rapids, was able to leverage new tools in the Inflation Reduction Act to go solar. The IRA provides nonprofits including houses of workshop with 30% direct pay, making such investments more accessible. Additionally, Iowa’s net metering policy plays a crucial role in making renewable energy projects viable and financially feasible.
The approximate $140,000 investment to build the solar array is estimated to save $10,000 a year in electricity costs with a 14-year payoff period, and then free electricity afterward. With the direct pay from the IRA, it cut the cost to around approximately $100,000 for a 10-year payoff period before free electricity. The church has already raised roughly $30,000, so the payoff period is down to 7 years.
There are even more benefits for the church, besides financial ones. Not only will the church’s 45kW DC solar array produce an estimate 59,940 kWh annually in its first year, the system will offset the church’s utility usage by 100% over the course of a year, saving an estimated $200,000+ in utility costs over 25 years. In terms of carbon and greenhouse gas emission reductions, the array will cut CO2 by 998 metric tons over 25 years. To put this in perspective, it’s like eliminating 1.1 million pounds of coal being burned or planting 16,502 trees and having them grow for 10 years. As an added bonus the solar installer worked with the church to provide a perimeter fence and landscaping changes to to facilitate vegetable gardening between and beneath the solar panels, an example of agrivoltaics or agrisolar. What can your house of worship do to go solar and care for the environment?
Getting Started
Select a Solar Installer
Finding a trusted solar installer is one of the most important parts of the solar journey. Instead of choosing the first solar panel installer that knocks on the door, do a bit of research. Ask friends and family who they used for their solar panel systems. Also, for each potential contractor, find out where they’re from. Choose a local solar installer with a proven record of quality installations when possible, and be very cautious around offers from out-of-state companies. To find trusted installers in Iowa near you, visit the Iowa Solar Energy Trade Associations member directory at www.iowaseta.org/memberdirectory.
Tips for Selecting an Installer
- Ask lots of questions
- Don’t sign anything without a close review
- Get multiple quotes
- Make sure you understand financing terms
- Be cautious of installers that also try to sell you financing through them
- Check for certifications, such as: NABCEP, UL Photovoltaic System Installation, Electronics Technicians Association Photovoltaic Installer
Start with Energy Efficiency Upgrades
Before adding solar to your home, business, or house of worship, consider how simple energy efficiency updates could help. Start with an assessment of your property, and upgrade appliances, windows, and/or lighting to the latest energy-efficient models. These updates will help limited the size of your solar array, reducing the overall cost of your PV system. The cheapest kilowatt hour is the one you don’t have to use at all!