Impact of Direct Pay: How a Washington Church Installed Resilient Solar+Storage

The Direct Pay provision of the Inflation Reduction Act of 2022 allows nonprofits and other tax-exempt entities to benefit from clean energy tax incentives for the first time, by reimbursing them with cash payments equal to the value of the tax incentive. Direct Pay can cover up to 70 percent of eligible project costs.  

The Vashon United Methodist Church in Washington was among the first churches to successfully apply for Direct Pay reimbursement for a solar and battery storage resilience hub. The church installed 60 solar panels and an 81-kilowatt-hour battery storage system, which will enable the church to keep its power on for up to 3 days in the event of an outage, depending on the weather. The church received its Direct Pay reimbursement in 2024, seven months after the project became operational and only three months after filing for Direct Pay.

In this Clean Energy Group webinar, Eric Walker (Council Chair at the Vashon United Methodist Church) shared how the resilience hub was developed, the process to apply for Direct Pay reimbursement, and what impact the solar+storage system has had in the year since it became operational. The system was funded in part by a Washington State Department of Commerce Solar plus Storage for Resilient Communities program grant. Kate Pedersen (Energy Resilience Specialist) from the Washington State Department of Commerce joined the webinar to present on the impact of the grant program and what current opportunities are available to communities seeking project support. Clean Energy Group’s Anna Adamsson moderated the discussion.

Note: Since the time this webinar was recorded, Congress reconsidered the future of the Investment Tax Credit. Please follow new developments on the Lawyers for Good Government website: https://www.lawyersforgoodgovernment.org/elective-pay-ira-tax-incentives