Restate your original condition for volunteering, observe that as these conditions now appear to have been changed, you are no longer able to contribute.
Don't spend too much time on the "don't want to offend" - if they want to take offense at your withdrawal, they will, no matter what you do. If they just forgot what the original arrangement was, they have a chance to remedy that error. In any case, their response is not something you can control. As long as you don't make it personal on your end, and keep the letter on a polite business-like footing, that's all you can do.