The “One Big Beautiful Bill” (OB3) and the executive order signed shortly after its passage rapidly phase out solar tax benefits and add new restrictions for nonprofits who want to go solar.
We’ve been keeping you updated on these developments with articles and webinars that chart a path forward to help your nonprofit go solar — if you act now. We urge nonprofits to act as quickly as possible, while the Investment Tax Credit (ITC) for solar projects is still in place.
Now, there is more reason than ever to save on your electricity bills with solar.
Rising electricity costs
You may have noticed that your nonprofit’s electricity bill has been going up.
Across the nation, power prices have been skyrocketing. In August, residential electricity prices were up more than 6% compared to the same month last year. While inflation is partly to blame, it doesn’t tell the whole story. Some states — like California, Connecticut, Maryland, Massachusetts, New York, Pennsylvania, and West Virginia — have been hit harder than others, with retail electricity prices rising significantly faster than inflation. In California, prices have gone up 34% since 2019.
What’s behind the rise in electricity costs?
You’ve likely been hearing that data centers and AI are adding to electricity demand, and that’s an important part of the story. As demand increases and supply can’t keep up, that does drive up prices.
But there’s much more to the price increases than data centers. Increases are driven by a number of factors that vary from state to state. Prices in California, for example, have been affected by an increase in destructive wildfires, which have raised insurance prices and forced utilities to engage in costly wildfire risk mitigation. In Florida, which is experiencing hurricanes of increasing severity, utilities are now required to bury their power lines and strengthen electrical substations; these costs are passed on to customers.
Even in states that aren’t dealing with that scale of natural disasters, the grid is aging and needs to be modernized. That’s behind much of the price increase.
It’s not the price of the energy itself that’s driving rising electricity prices. Although gas prices are going up, in general the price of electricity generation has come down in recent years due to both the fracking boom and the increased use of solar and wind, now the most cost-effective forms of new energy generation.
But while the price of electricity generation has gone down, utilities have been spending more on the infrastructure that delivers that electricity to homes and businesses: the poles and wires. From 2003 to 2023, utilities more than doubled the amount they spend on this infrastructure, in real 2023 dollars.
What rising costs mean for nonprofits
Rising electricity costs affect nonprofit organizations as well as households. According to the Environmental and Energy Study Institute, energy costs are typically the second-highest operational expense for nonprofits, after salaries. With those costs rising, more nonprofits will feel the pinch to their budgets.
That’s in the face of already strained budgets. The Nonprofit Finance Fund’s 2025 State of the Nonprofit Sector Survey found that nonprofits’ costs are rising faster than their funding. Of the nonprofits surveyed, 86% said high costs related to inflation affected their organizations and clients in 2024. With more Americans living near or below the poverty line, nonprofits provide critical relief that’s increasingly needed; many nonprofits already couldn’t keep up with demand for their services in 2024, and 85% said they expect that demand to increase in 2025. Cuts in government funding are also affecting the ability of some nonprofits to provide essential services to their communities.
In this challenging time, meeting rising energy costs will further strain the resources of nonprofits.
Hedging against rising electricity costs
Going solar has always been a great way for nonprofits to save money — money that they can use to fulfill their crucial missions.
That’s true now more than ever. Going solar can go beyond saving money for nonprofits in the short term: it can also hedge against future increases in electricity costs.
You may think solar is too expensive, but you don’t need to pay for your system with upfront cash. Many nonprofits opt for CollectiveSun’s Solar Loan or Solar Power Agreement (SPA), which free up your cash so you can use it — plus your solar savings — to support your nonprofit’s programs, all while receiving the benefits of CollectiveSun’s guidance and support.
- The CollectiveSun Solar Loan — designed by nonprofit professionals, not traditional bankers — supports your nonprofit’s purchase of a solar system while allowing you to start saving from Day One.
- Our Solar Power Agreement (SPA) subscription and Prepaid SPA are third-party ownership options that make it easy for your nonprofit to go solar. With these options, you will also start saving from Day One, but CollectiveSun handles the vendor negotiations, construction management and fund control. Plus, don’t need to deal with the responsibilities of owning and operating your system after it’s placed in service.
You can learn more about these financing options in our article “Choosing the Right Solar Financing Option for Your Nonprofit.”
With these choices, it makes sound financial sense for many nonprofits to go solar and hedge against rising electricity costs. If you’d like to determine if solar will work for your organization, or if you have any questions about the process and financing options, don’t hesitate to reach out to us.
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To make it even easier for nonprofits to go solar, CollectiveSun has created a new 62-page Guide to Going Solar for Nonprofits. Download your free copy here!
