There are numerous other examples of religious institutions which have made green energy part of their mission. Utility companies across the U.S. are embracing solar energy. Savvy investors like Warren Buffet see the potential in solar power. More businesses understand that reducing their carbon footprint and reducing their energy consumption make good business sense.  While religious organizations, like any other home or business, must carefully consider the economics of a distributed solar power installation, many religious institutions already recognize that improving their energy efficiency and reducing their carbon emissions serve their spiritual missions.  Regardless of denomination, Christians, Buddhists, Hindus, Muslims, and Jews all believe the earth is valuable and recognize environmental stewardship as a moral responsibility.

Here are some legal and practical considerations to determine whether solar panels are feasible for your organization.

Engineering/structural considerations:

Installing solar panels on the roof of any building will require an analysis of the structural integrity of the roof. We recommend hiring an engineer who can determine if the roof will bear the weight of the proposed solar panels, including any wind/water erosion that could occur, and whether the roof is suitable for operation and maintenance of the panels.

Prior to placing any solar system on the roof, the church should also consider the age/condition of the roof and the potential for the roof needing to be replaced during the solar project.

Mortgage and zoning encumbrances:

If the church building is subject to a mortgage or security agreement, the church should review those agreements to determine whether solar panels would be permitted or if the secured parties’ consent is required prior to installation.

The church will also need to check the applicable zoning and building codes to obtain all of the necessary permits and approvals prior to installation.

Lastly, a review of the appropriate insurance requirements will be necessary to protect against business disruptions resulting from the solar panels or loss of the system and what the property owners’ obligations are if there is an accident, loss or other casualty related to the solar panels.

Lease of panels to an LLC or electric utility:

Prior to creating a lease with an LLC to rent solar panels, the parties will need to negotiate the lease, including who will own the environmental attributes associated with the system, such as obtaining renewable energy credits, carbon offset credits and other environmental benefits for your overall solar project and who will be entitled to receive governmental or local electric utility incentives and rebates associated with the solar panel system. Additionally, tax obligations will need to be reviewed to make sure the parties understand their tax responsibilities and potential credits, given the non-profit exemptions of most religious organizations.

See Part I - Religious Organizations and Reducing the Carbon Footprint: “Let There Be Light"