Non-profit organizations often operate on tight budgets, with every dollar committed to furthering their mission. As a result, large capital expenditures — such as installing a commercial solar system — can seem out of reach.

Thanks to a variety of solar financing options, however, nonprofits can access affordable renewable energy solutions without breaking the bank. From grants to innovative financing structures, nonprofits can go solar with little to no upfront costs and start realizing immediate savings on their energy bills.

Solar Funding for Nonprofits

One of the most effective ways for nonprofits to go solar is through the many targeted non-profit solar grants that are available today. Government agencies, foundations, and private organizations all offer funding specifically designed to support sustainability projects, including solar energy initiatives. Here’s a look into some of the options:

Federal and State Grants

Federal and state governments offer various grants and incentives for non-profits looking to install solar panels. These grants can cover a significant portion of the upfront costs associated with commercial solar panel installation

The federal government also now offers nonprofits a cash-based direct pay option equal to “the full value of tax credits for building qualifying clean energy projects.” Because the regular commercial tax incentive is 30%, this means nonprofits are able to access a cash payment equal to 30% of the full cost of installing the system — effectively a huge grant that does not need to be repaid.

Foundation and Non-Profit Grants

Several foundations and non-profit organizations focus on supporting renewable energy adoption, providing grants specifically for solar energy. Organizations such as The Kresge Foundation and The Energy Foundation offer funding for non-profit sustainability projects, including solar panel installations. Many private foundations also have grant programs focused on promoting green energy initiatives for non-profits.

These grants for solar panels are highly competitive, but with careful planning and a solid sustainability proposal, nonprofits can secure significant financial assistance to help pay for their solar systems.

Power Purchase Agreements (PPAs)

For non-profits that are wary of large upfront costs, Power Purchase Agreements (PPAs) offer an attractive solution. A PPA is a financing model that allows non-profits to install a solar energy system with little or no upfront cost.

With a PPA, a third-party financier or solar developer installs the solar panels at no cost to the non-profit. In exchange, the non-profit agrees to purchase the energy produced by the solar system at a fixed, often lower rate than they would pay for electricity from the grid. The non-profit benefits from predictable, lower energy costs for the term of the agreement, which typically lasts between 15 to 25 years.

This option allows non-profits to immediately begin saving money on energy bills, which can be reinvested back into their mission-driven programs. Moreover, after the PPA term ends, the non-profit often has the option to purchase the solar system outright at a discounted rate, continuing to benefit from free or low-cost energy for the remainder of the system’s lifespan.

Under a typical PPA structure, a non-profit could see its energy costs decrease by up to 20% immediately after installation, with savings increasing over time as grid electricity prices rise.

Solar Leases

In a solar lease, the non-profit enters into an agreement with a solar provider to install and maintain the solar panels on their property. The non-profit does not own the system, but instead agrees to make fixed monthly lease payments for the use of the solar system.

Unlike PPAs, where the non-profit pays for the electricity generated, solar leases usually involve a fixed payment regardless of how much energy the system generates. However, similar to PPAs, solar leases allow nonprofits to enjoy the financial advantages of solar energy (such as reduced energy costs) without the need to invest capital upfront or worry about system maintenance.

Solar leases can also be structured with flexible terms, such as an option to purchase the system after the lease term ends. This can allow the non-profit to own the system and enjoy free energy for the long term.

Non-Profit Solar Financing Programs

In addition to grants and PPAs, federal and state programs offer specific non-profit financing options for renewable energy projects. These programs include:

  • New Jersey Clean Energy Program: Provides incentives and financing options for non-profits to install solar panels.
  • Federal 30% Direct Cash Payback: Under the Solar Investment Tax Credit (ITC), nonprofits are eligible for a direct cash payment equal to 30% of the installation cost of the system, significantly easing cash financing needs.

Programs like these help to bridge the gap between the upfront cost of solar systems and the long-term savings they generate. By taking advantage of these resources, nonprofits can access affordable solar energy without putting their budgets at risk.

Non-Profit Sustainability and Long-Term Savings

While grants and financing options help non-profits go solar, the long-term benefits are even more compelling. Solar energy systems typically pay for themselves over a period of 6-10 years through reduced electricity costs. After the payback period, the non-profit enjoys years of free or low-cost energy. These savings can be reinvested in other programs that support the organization’s mission.

Moreover, the environmental impact of switching to solar aligns with the values of many non-profits. Solar energy reduces reliance on fossil fuels and lowers greenhouse gas emissions, helping organizations meet sustainability goals and demonstrate environmental leadership.

We’re Making It Easy for Non-Profit Organizations to Go Solar

Solar financing options make it easier than ever for non-profit organizations to go solar, even with limited budgets. For non-profits in New Jersey, investing in solar energy is a smart, long-term financial decision that can help fuel your mission while promoting a cleaner, more sustainable future. Contact Geoscape Solar today to get started with a free quote.