Overview

A needs statement defines the issue your project addresses. It establishes the conditions that shape the problem and identifies who bears the consequences. Precision here determines whether reviewers immediately grasp what is at stake.

This Section Establishes

• The specific issue the project will resolve

• Who is affected and why the issue matters

• The context that created or sustains this problem

Example: GridEdge AI's Problem Statement

Extreme heat events are rising in frequency and severity across California. These conditions strain the power grid, leading to instability and outages. Multifamily buildings face disproportionate risk: tenants have limited control over energy use, and operators often lack the tools or budget to respond during grid stress.

More than 60 percent of Los Angeles County residents live in rental housing. Many properties operate with outdated energy management systems, which leaves them unprepared for demand-response programs. When energy systems fail during heat waves, residents in under-resourced neighborhoods experience higher rates of heat-related illness and displacement.

Grid pressure combined with inadequate building infrastructure creates a measurable gap in community resilience and safety.

System Gaps Highlighted Here

• Outdated energy management tools in multifamily housing

• Limited staff capacity for building operators

• Minimal pathways for tenants to understand or influence energy use

• Low participation in energy-saving and demand-response programs

• Weak coordination between operators, tenants, and utilities

Building Your Own Needs Statement

Surface the structural conditions surrounding your work:

• Where systems currently fail

• Who experiences the consequences most directly

• What environmental, economic, or social factors intensify the problem

• Where infrastructure or communication breaks down

• Who holds power in the current system and who is excluded from decision-making

Reviewers use your needs statement to assess whether the problem is real, urgent, and within the funder's scope. Get this right, and the rest of your proposal becomes easier to justify.

What's Next

The next lesson walks through the goals and objectives section. You'll see how a well-constructed needs statement leads naturally into measurable targets and project benchmarks.