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Google provides the advertising space at no cost.
Google has given away $33 million in free advertising to 850 non-profits in the last two years, says Sheryl Sandberg, Google's vice president of global online sales. "We don't see any limit to this. We want it to continue growing."
The Google Grants program supports organizations sharing our philosophy of community service to help the world in areas such as science and technology, education, global public health, the environment, youth advocacy, and the arts.
I suspect that PSA's and the grant ads are 2 different things. A page that has no contextual meaning to Google cannot earn revenue as they would be doing a dis-service to their advertisers, hence the no cost PSA's. On the other hand if a page is known to be about a subject that happens to have a grant advertiser too, the ads will show along with any other paid ads and generate revenue.
Although I could be wrong.