Going Solar Has Never Been More Affordable for Housing Authorities and Other Nonprofits, Here’s Why

PowerOptions is excited to announce Sunwealth as our solar provider for affordable housing, group homes, senior living, houses of worship, community development corps, and centers for the performing arts.

The Inflation Reduction Act (IRA), passed in August 2022, is a monumental piece of legislation that unlocks nearly $400 billion in funding to spur the domestic clean energy economy and take meaningful action on climate change and inequality. The bulk of funding in the IRA will be divvied up for climate and energy investments, with housing authorities and multi-family housing projects well-positioned to snag a chunk for themselves. To be exact, $394 billion will be distributed over the course of the next ten years through a mix of tax incentives, grants, and loan guarantees. With provisions to incentivize the investment and development of solar, the IRA creates greater opportunities for communities to participate in the clean energy transition.

A significant element of the IRA is the extension of the investment tax credit (ITC) and the production tax credit (PTC). The ITC is a dollar-for-dollar reduction of tax liability meant to offset the cost of renewable energy, like solar panels, geothermal heat pumps, and energy storage systems. Historically, these incentives have been inaccessible to nonprofits, municipalities, and other tax-exempt entities that have limited financing options to install solar. The IRA makes these incentives more accessible and provides these entities with a greater diversity of financing options to own and install solar systems. By going solar with the help of new federal investments in the clean energy economy, nonprofit organizations can strengthen local economic resiliency and energy security.

Incentivizing Solar

In addition to the extension of the ITC, the IRA introduces “adders” that increase the base ITC and make the economic benefit of going solar even more appealing. Projects located in low-income communities are eligible for an additional 10% ITC adder; projects qualified as low-income residential buildings or low-income economic benefit projects are eligible for a 20% ITC adder. Additionally, the IRA implements a 10% adder for projects located in designated “energy communities.” All told, the maximum ITC under the IRA is up to 70%.

These incentive programs strive to support clean energy development in communities and regions that have been left behind in the clean energy transition, experience the disproportionate effects of environmental injustice, and have been harmed by fossil fuel infrastructure. With the help of these programs, solar customers who qualify will feel the impact of the adder upside, reducing their electricity rate, increasing their annual energy savings, and lowering the financial burden of installing solar.

With only 1.8 gigawatts (GW) of capacity available nationally for the two low-income adders, these incentives are limited and will likely be allocated quickly once application windows open in the second half of 2023. If your organization is considering going solar, now is the time to begin planning your project and take advantage of the wide range of incentives available.

Installing solar not only helps you and your organization act on climate change, but it’s fiscally prudent and serves as a model for how other organizations in your community can embrace accessible, affordable, and reliable clean energy. Even in their first year, solar projects can deliver meaningful energy savings that can be reinvested into initiatives that support communities. There has never been a better time to go solar and reap the benefits of the clean energy economy.

Charting a Path Forward

Based in Cambridge, MA, Sunwealth is a clean energy firm that finances and develops community-based solar projects that benefit diverse communities – particularly low-to-moderate income communities, communities of color, environmental justice and energy communities, and rural communities that have been overlooked by traditional solar development. We seek to change who benefits from clean energy by changing the way we invest in it. Our innovative financing and deal structure enables community-based organizations – like nonprofits, housing authorities, and houses of worship – to go solar at low or no cost. Sunwealth projects deliver meaningful energy savings to customers while reducing emissions, supporting local solar developers and installers, and creating green jobs.

Founded in 2014, Sunwealth has financed and developed 575 projects totaling 37 megawatts worth of solar capacity that benefit communities across 16 U.S. states and D.C. Examples of these projects include:

Centerboard

Lynn, MA

Sunwealth partnered with Centerboard, a Lynn, MA-based nonprofit human services organization with a mission to revitalize communities by investing in its people and places, and Woburn, MA-based developer Boston Solar to install solar across fourteen multifamily housing buildings in Centerboard’s portfolio. The group of projects totals 134 kW of clean energy that will deliver over $200,000 in lifetime energy savings.

New York City Housing Authority (NYCHA)

New York, New York

Our solar portfolio of 67 projects on the roofs of NYCHA buildings totals 3 MW of clean energy capacity that delivers energy savings to hundreds of NYCHA residents and LMI households across New York City. The portfolio will collectively deliver millions of dollars in energy savings to NYCHA and community solar subscribers.

Edwards Church

Framingham, MA

Our project with Edwards Church helps the congregation get closer to achieving their goal of net-zero emissions. The Church will receive an estimated $120,000 in lease revenue for hosting the 89 kW solar installation on their roof, which will generate power for a local nonprofit and two low-income households in the surrounding area. The project is part of a community solar program that will deliver over $200,000 in lifetime energy savings to the offtakers.

We are excited to be trusted alongside PowerOptions in our efforts to bring solar to more of our communities and ensure that everyone has a stake in the better energy future we’re working to create. If you’re interested in learning more about how Sunwealth and PowerOptions can help your organization go solar, get in touch with us today.