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Solar-Powered Faith Communities and Houses of Worship: Saving Money and Ethical Labor

By July 31, 2023September 17th, 2023No Comments

“In the words of Isaiah. ‘The mountains and the hills before you shall burst into song, and all the trees of the field shall clap their hands.’”

This prophetic verse touches the essence of our shared responsibility to the earth as faith-based stewards of this planet. The Reimagine Appalachia Faith in Action Team recently hosted an event entitled “Solar-Powered Faith Communities and Houses of Worship: Saving Money and Ethical Labor” detailing how Faith communities can, and should, transition to solar systems while adopting ethical solar installation practices.

We are grateful for our guest speakers and collaborators for speaking with us at this event:

Recognizing Our Role as Faith-Based Communities: 

Jeffery Allen reminds us that we did not create this world and as such, we have an obligation to respect and protect the abundance of life on this planet. As human beings, especially those of faith, we can, and must, recognize our own complicity in the destruction of the earth and the harm inflicted upon the more-than-human beings we share the earth with. We must acknowledge that we are part of the problem, and we can be part of the solution. Through reconnecting with the earth, we can build a relationship of reciprocity, stewardship, and respect. It is through our Faith Communities that many can begin to do this work. 

-Jeffrey Allen

West Virginia Council of Churches

“We can move from disconnection with the natural world to a rediscovery of just how beautiful and wonderful creation is.”

Faith Communities as Leaders: 

Faith Communities are situated in a particularly poignant spot; places of worship generally have the space needed for successful solar installation and are often leaders in setting moral, ethical standards necessary when building a more equitable and just energy infrastructure in Appalachia. As discussed in the webinar, Faith Communities can have a significant impact on creating a future without worker exploitation. Instead, Faith Communities can lead by example when they hire solar contractors who value ethical work practices. In this way, Communities of Faith exemplify to Faith members their religious and spiritual obligations to support ethically-installed solar not only for their communities, but for Appalachia as a whole. 

Embracing Ethical Labor Practices within the Solar Industry: 

What does hiring ethical solar contractors look like? For starters, it means hiring local as a means to uplift communities and instill a sense of pride in the project. It also means ensuring that the contractors are prioritizing the future through pre-apprenticeship and apprenticeship opportunities within the renewable energy field. For more information on choosing an ethical solar installer, please refer to the ReImagine Appalachia Solar Installer Sample Questionnaire below: 

Collaborating through Solar Co-ops: 

If you do not feel confident in your understanding of solar technology or the solar installation processes, you can still transition to solar energy by joining a solar co-op! 

Solar United Neighbors (SUN) is an Appalachian-based, vendor neutral nonprofit that helps people go solar, join together, and fight for their energy rights. In particular, SUN brings together a large group of homeowners, small businesses, nonprofits, and public entities, including Faith groups, who all transition to solar together. The co-op works to create collaborations between a group of motivated, educated, interested potential installers. SUN then takes this group directly to the installer, simplifying the process as much as possible. In this way, small projects can be bundled together and appeal to larger sustainable contractors, get a good deal on installation, connect with solar enthusiasts, demystify the solar installation process, and communally vet potential solar contractors based on price, equipment quality, warranties, experience, and location. According to SUN, those who are members of a solar co-op can save between 10%-15% on their energy payments when compared to market rate customers. 

Financial Incentives and Accessibility through the Inflation Reduction Act: 

Thanks to the Inflation Reduction Act, there are numerous financial options available to help organizations cut costs when installing solar. The Appalachian Solar Finance Fund offers a financial and technical assistance program designed to catalyze solar projects in coal-impacted communities across Central Appalachia. Nonprofit organizations, public institutions, and local businesses that serve as community anchors are all eligible to apply. At this time, residential solar does not qualify for the Appalachian Solar Finance Fund. 

Notably, the Solar Investment Tax Credit (ITC) now offers a direct payment option called “elective pay” for registered nonprofits including churches and houses of worship. Click here to learn more about “elective pay.”

If your organization or house of worship has not been officially registered through the IRS as a nonprofit, you will not be eligible for the Tax Credit. To access the ITC, the solar project must be otherwise financed and completed in order to pre-file for the appropriate year’s tax processes. Ideally, this would occur in December of the year the project is completed, or in early January of the following year. Afterwards, you will be issued an ID number. Once the IRS files the appropriate tax return, you will receive 30% of the total cost of purchase in direct reimbursement. Other incentive categories include Energy Community Bonus, Domestic Content Bonus, and Qualified Low-Income Bonus.

The bottom line? Many registered nonprofit projects can now receive between 60%-70% of their costs reimbursed from the U.S. Treasury! Additionally, there are three major financing options available to those interested in transitioning to solar: 

(1) power and purchase agreements, 

(2) loans and bridge loans, and 

(3) direct cash and payment. 

Between Inflation Reduction Act incentives and tax credits and various financing options, installing solar has never been more accessible, especially to Communities of Faith who have registered nonprofit status. Want to learn more about financial incentives? Check out this PowerPoint

You can watch the recording of this webinar right here

Resources shared during webinar:

Additional Federal Tools and Resources:

Federal Solar Tax Credits for Businesses: 

The Federal Solar Tax Credits for Businesses is a solar panel program that allows tax credits for non-taxable organizations, like nonprofits and houses of worship. They grant this access through “direct pay.” 

There are two tax credits available right now that can be used to purchase solar energy: The Investment Tax Credit (ITC) and the Production Tax Credit (PTC). Generally, projects can only qualify for one of these tax credits, though some have had success accessing both. It may be worth considering doing more project-specific research to determine your eligibility.

  • The Investment Tax Credit (ITC): 
    • Reduces federal income tax liability based on a certain percentage of the cost of the solar system 
    • Must be installed during that tax year 
    • If you want a more detailed understanding of the ITC, click here
  • The Production Tax Credit (PTC):
    • Based on kilowatt-hour (kWh) generated by solar systems, as well as other qualifying renewable energy technologies
    • Valid for the first 10 years of the system’s operation 
    • Reduces federal income tax liability 
    • Adjusted annually for inflation 

For more information on Federal Solar Tax Credits, click here