The Inflation Reduction Act includes a provision allowing tax-exempt entities to receive the solar investment tax credit as a direct payment. In the past, to make nonprofit solar projects financially viable, most organizations had to partner with developers or banks that were able to take advantage of the tax benefits. Organizations would sign power purchase agreements (PPAs) where they would pay the bank or developer a set amount of money for the solar energy over a length of time, usually 25 years. Now, tax-exempt organizations like churches, public schools, cities and nonprofits can get those credits by direct pay and receive a check for 30% of the project cost just like a tax-paying entity would receive the income tax credit when filing taxes. Direct pay paves the way for organizations to own solar projects instead of just buying the power through PPAs.
Some rural electric co-ops have been leaders in solar adoption because of their member-centric structure. Co-ops now qualify for direct pay, allowing them to own their solar projects and receive credits directly.
If your church or nonprofit organization currently has an average electric bill of $1,000 per month or more, Commercial Solar has financing for your company or organization that provides: