By David Poulson
Interest in powering Catholic parishes, schools and missions with the sun is surging in the wake of a solar deal recently announced in the Archdiocese of Washington, D.C.
And church groups nationwide, including in Michigan and Minnesota, are keeping a close eye on the project.
The group, in existence about two years and largely under the radar until recently, brokered the deal that enabled Catholic Charities to cut energy costs at a dozen Washington church buildings. The project also contributes to an energy program for low-income residents and to desperately needed maintenance at a Missionaries of Charity hospice.
“We are being good stewards of God’s earth and yet enabling our agency to work on its core mission and have cash flow to help the sisters maintain their mission,” said Mary Jane Morrow, the chief financial officer of Catholic Charities in Washington.
That beat selling the 5-acre site of the solar array in the city’s Northeast sector to developers who had been eagerly eyeing the parcel.
But the project’s greatest impact could be the grassroots interest it generates among other Catholic institutions. It is yet another factor driving diverse religious organizations’ increasing interest in solar, including those in the Great Lakes region.
The Washington deal prompted between 50 and 60 calls from Catholic organizations of all sizes, Gravely said. He expects to have contracts for three more projects yet this fall and up to 30 by the end of the year. Earlier, the group helped Immaculate Conception Catholic Church in Hampton, Virginia, with a solar project requiring no upfront payments by the church. See video.
The larger Washington project was a perfect storm of buildings needing cheap power, a large vacant lot in a crowded city and some of the most generous local solar incentives in the country, Gravely said.
But experts say opportunities without as many advantages are still attractive for Catholic and other churches for a variety of reasons.
“We have a food kitchen here and they are putting solar in,” said Gerald Bernstein, the special projects coordinator for Interfaith Power and Light based in San Francisco. The interdenominational organization is affiliated with 340 church groups nationwide that have installed solar power since about 2002.
The group was founded as a religious response to climate change and has worked with the same consultants now staffing Catholic Energies.
Interest is catching on in the Great Lakes region.
“As more congregations add solar, it expands other people’s sense of what’s possible, and they start to think maybe we could do it,” said Leah Wiste, the executive director of the Michigan chapter of Interfaith Power and Light. About 20 church groups in her state have installed solar.
Right now, the group’s Minnesota chapter is affiliated with 10 to 20 solar-powered church groups, said Julia Nerbonne, the executive director of that state’s organization. But there is pent-up demand as the group helps aggregate the solar interest of some 45 churches looking for an institutional investor to finance $1 million worth of projects.
The delay is worth it for the lower rates such a large project could produce, Nerbonne said.
“It’s the big project that’s really holding people back.”
Gravely said researching solar decisions is tough for busy priests and church finance committees that lack solar expertise. Catholic Energies eases that burden at no charge.
The interest is consistent with Laudato Si, the 2015 encyclical on faith and the environment written by Pope Francis. The Catholic Climate Covenant was created in 2006 by the U.S. Council of Catholic Bishops to implement Catholic social teaching on ecology.
After the Washington deal, calls came from members of parish creation care teams and from those on finance committees, Gravely said.
“Despite the driver of Laudato Si and sound environmental stewardship, it most likely is not going to cross the finish line if the (chief financial officer) and the leadership doesn’t think it’s a sound business decision,” he said. “It’s our job to flush that out early to see what the numbers are.”
Whether such a deal works depends in part on local incentives that vary by state and utility. Churches cannot benefit directly from federal tax incentives. But some can lease space for solar cells to investors who receive the tax benefit of owning them, Gravely said.
During the run of the lease, churches gradually buy the system from investors. They benefit from the lease payments and from cheaper electricity or stable energy costs during the system’s lifetime.
Such investor arrangements aren’t allowed everywhere. But there are other mechanisms, such as borrowing to install solar with loan repayments cheaper than buying electricity at current rates, Bernstein said. On the other hand, “it could be utility rates are so low we can’t beat those rates.”
Adding to the complexity is the impact of Chinese trade tariffs enacted by the Trump administration. They have increased the cost of imported solar cells, Bernstein said, although that’s been offset somewhat by declining manufacturing costs.
Driving year-end activity now is that the federal tax credit for encouraging solar installations is dropping from 30 percent to 26 percent at the end of 2019.
That 26 percent rate remains attractive, but the looming expiration of the higher rate means some installers are struggling to keep up with a boom in solar construction, Bernstein said. “We’re talking to installers now who don’t want to talk to us about anything in the fourth quarter.”
Churches have significant advantages, including large roofs and parking lots to hold solar cells. Sometimes land is given to them with the provision that it not be sold. But a solar array installed on it can generate revenue as well as electricity.
And hosting a community-level installation could also directly benefit members of a congregation if their household demand for electricity is calculated into a proposal. That helps support large scale solar projects that can charge lower rates.
Interfaith Power and Light lists its state chapters here.
Meanwhile, Morrow is getting calls from parishes and other groups eager to replicate the success in Washington, D.C.
“I had a call last week from Catholic Charities in the Archdiocese of Harrisburg (Pennsylvania) about a major project on rural land that they own,” she said.
Her advice? Solicit bids then “go for it.”