We Make Solar Work for SoCal Non-Profits…
The perils of solar projects for non-profits…
Non-profit organizations—schools, churches, and other entities—are often big consumers of electricity, but their non-profit status can make the process of going solar complicated. For one thing, many non-profits operate on a consensus model that can cause decision making to take an extended period of time, thereby jeopardizing the temporary availability of advantageous rebates or price discounts.
Non-profits are often saddled with less predictable budgets—tied to the whims of foundations or other institutional donors—that can make long term financial obligations more complicated. Even conventional funding mechanisms like commercial loans may be hard to arrange given the lack of loan guarantors who are both able/willing to accept that risk and acceptable to the lending institution.
Compounding these perils, non-profits cannot directly take advantage of federal tax benefits (i.e., the ITC and accelerated depreciation) that can reduce the cost of adding solar by as much as 55%.
Put all of that together, and it is clear that non-profits are in need of innovative approaches before they can live up to their “green” potential—perhaps even their mission—of caring for the environment by adding solar.
Despite the hurdles, churches, schools and other organizations are successfully going solar.
Here are some examples:
- Prescott's Sacred Heart Church Expands Leadership Role by Going Solar
- Churches saving costs and the environment at the same time
- New solar installation at Westridge School brings environmental lessons to life
- Solar Powering Your Community: A Guide for Local Governments
Non-profits are in our blood as we have worked both in, and with, non-profits for many years. Keep reading to learn how our expertise can help your non-profit start saving money and the environment by going solar.
It can be done…
Run on Sun to the Rescue!
While we do not finance solar projects ourselves, Run on Sun has been successful in helping numerous non-profits—
from schools to churches to other entities—
install solar, thereby saving money and safe-guarding the environment.
Here are a few examples:
Westridge School for Girls
Pasadena's Westridge School for Girls has been educating young women in grades 4-12 for over one hundred years. Blessed with a Performing Arts Center building that was a perfect candidate for solar, Run on Sun filled the space with a 52 kW solar array that has produced 105% of its predicted output since going live in the spring of 2011.
Beyond those clear financial benefits, Westridge has also made its solar power system into a teaching tool, incorporating data from the system into their math and science curriculum.
Ware Reservoir for Lincoln Avenue Water Company
Following on the success of our solar installation at LAWC's Headquarters building in 2010, Run on Sun was asked to tackle a far more ambitious project—design and build a free-standing solar structure to help power the pump station at LAWC's Ware Reservoir site in the Altadena foothills.
The resulting 69 kW array will substantially reduce the non-profit's operating expenses, helping to keep its water rates low for LAWC's many subscribers.
One of our most recent non-profit projects was the summer 2015 installation of a 45 kW system on the gymnasium roof of Chandler School in Pasadena.
As Headmaster John Finch noted:
“If we want our students to be stewards of the environment in the future, schools need to be examples of best practices. The installation of solar panels on our gym roof is a best practice.”
Here are some financing options that have been helpful…
Property Assessed Clean Energy financing involves making payments for the solar power system on the site's regular property tax bill. While many non-profits do not pay property taxes, they often receive a bill from the County Tax Assessor's office for other obligations to which they are subject, such as road improvement fees or special lighting districts. In Los Angeles County, if an entity receives a bill from the Assessor's office, it can participate in PACE financing, regardless of its tax status.
Leveraging Endowment Funds
For non-profits with significant endowments, it may be possible that those funds could be used to pay for the solar system. But what about situations where the funds are restricted in such a way that they cannot be used for such capital improvements?
One possibility is to carve out a portion of those funds to cover the cost of the system and deposit those funds into a special, interest-bearing account against which a lending institution can attach a lien. This provides collateral for the loan (something that is otherwise hard to do with solar power systems), a return on the deposited funds, and, potentially, sufficient security to satisfy the conditions of the endowment.