Science Energy CollectiveSun Helps Nonprofits Go Solar, and at a 15% Discount By Derek Markham Writer Derek Markham is a green living expert who started writing for Treehugger in 2012. our editorial process Twitter Twitter Derek Markham Updated October 11, 2018 ©. RMI via CollectiveSun Share Twitter Pinterest Email Energy Renewable Energy Fossil Fuels Thanks to massive drops in pricing, coupled with tax incentives and increased financing options, going solar is a bright idea for both homes and businesses, but nonprofits still find it challenging. This company is bridging that gap. What was once just an expensive fringe technology, costing more than $75 per watt in the late 70s, is rapidly becoming a go-to choice for affordable renewable energy for both homes and businesses, with costs coming in at well under $1 per watt in the last few years. And thanks to generous state and federal tax incentives, plus competitive pricing from the rapidly growing number of solar installers, coupled with a variety of finance options and falling costs, both residential and commercial solar installations are now not only the cleaner electricity choice, but the cheaper one as well. However, nonprofits can't take advantage of the available solar tax breaks, and they can have a much harder time getting financed, which means that churches, schools, and other nonprofit organizations are often left in the dark when it comes to clean energy. But one company is looking to change that, as it offers a range of helpful mechanisms for nonprofits that want to go solar, including the ability for them to save 15% on project costs, as well as access to a proprietary financing program, and tools to help facilitate the project's success. CollectiveSun, which claims that it is "the only company in America that exclusively helps nonprofits fund solar projects nationwide," enables nonprofits to save 15% on solar costs by essentially 'owning' the project itself and taking the federal tax incentive, and then passing on half of it to the organization to reduce its solar costs. The nonprofit then takes ownership of the solar array after about six years, and reaps the savings for the rest of the life of the system, which is typically 25 years or more. "We believe in nonprofits and we believe in community service. We serve on non-profit boards, we’ve founded nonprofits ourselves, and our parents have founded nonprofits. We also believe that “nonprofit” is a tax designation, not a business plan. Nonprofits can make a profit, they simply are exempt from paying taxes on that profit because of their charitable mission. Robust and effective organizations that can lock in a low cost of energy for 20 years are more fiscally responsible and less likely to become insolvent. We believe nonprofits are the backbone of any community and strong nonprofits create strong, vibrant and resilient communities." - CollectiveSun The company also manages a finance program called CrowdLending, which allows the nonprofit's supporters to make a direct loan for the solar project, which is then repaid with interest over a 10- to 12-year term. The CrowdLending program isn't the only option for nonprofit solar financing, as CollectiveSun also allows for nonprofits to use any combination of financing options, which can include traditional loans, donations, the use of cash reserves, a PACE (Property Assessed Clean Energy) loan, or other methods, while still qualifying for a 15% lower project cost.CollectiveSun also employs what is called a prepaid PPA (Power Purchase Agreement), which is a bit different of a mechanism than a traditional (and generally more expensive) PPA, and one which is cheaper over the long run because the nonprofit makes an initial advance payment (hence the term 'prepaid') instead of having to pay the higher costs of a financed PPA. "Under traditional “full cost” PPAs, a large bank, a Wall Street Investor or another unaffiliated entity is profiting from the financing of your nonprofit’s solar project. CollectiveSun’s “Prepaid” PPAs differ because they are funded by community members who profit from the transaction, thereby keeping dollars in the community." - CollectiveSun This model can allow nonprofits to get a solar array installed at a yearly cost near what their annual electricity costs are, and which will be owned by the organization in about 6 years and paid off within a decade, yet will continue to generate what is essentially free electricity for years to come, which can add up to a considerable amount of saved costs. Here's a quick look at the CollectiveSun model: There are a few caveats to the CollectiveSun model, including a minimum size of the solar array of 20 kW, and that the local utility company must allow PPAs. Nonprofits can either bring an existing bid from a solar installer to CollectiveSun, or can contact the company without a prior bid, after which the company will connect the nonprofit with a reputable solar installer to receive a bid.