USDA Announces Funding For Renewable Energy Projects

Geothermal heating and cooling equipment being installed by the Central Valley Electric Cooperative in Artesia. The equipment was partially paid for by the REAP program. Courtesy/USDA

USDA News:

  • REAP Program Reduces Energy Costs for 47 Ag Producers and Small Rural Businesses in NM Since 2009

 WASHINGTON, D.C. – Agriculture Secretary Tom Vilsack has announced that rural agricultural producers and small business owners can now apply for resources to purchase and install renewable energy systems or make energy efficiency improvements.

These efforts help farmers, ranchers and other small business owners save money on their energy bills, reduce America’s dependence on foreign oil, support America’s clean energy economy, and cut carbon pollution. The resources announced are made possible by the 2014 Farm Bill.

“Developing renewable energy presents an enormous economic opportunity for rural America,” Vilsack said. “The funding we are making available will help farmers, ranchers, business owners, tribal organizations and other entities incorporate renewable energy and energy efficiency technology into their operations. Doing so can help a business reduce energy use and costs while improving its bottom line. While saving producers money and creating jobs, these investments reduce dependence on foreign oil and cut carbon pollution as well.”

USDA Rural Development State Director agreed with Secretary Vilsack saying, “In the last few years we’ve seen more businesses access the REAP program because it’s because it allowed them to buy energy efficient equipment with less out of pocket money.” Brunner added, “Ultimately each business saves money on its energy bill which in turn makes the business more profitable.”

USDA is making more than $280 million available to eligible applicants through the Rural Energy for America Program (REAP). Application deadlines vary by project type and the type of assistance requested. Details on how to apply are on page 78029 of the Dec. 29, 2014 Federal Register or are available by contacting your state’s Rural Development offices.    

USDA is offering grants for up to 25 percent of total project costs and loan guarantees for up to 75 percent of total project costs for renewable energy systems and energy efficiency improvements. The REAP application window has been expanded. USDA will accept and review loan and grant applications year-round.

Eligible renewable energy projects must incorporate commercially available technology. This includes renewable energy from wind, solar, ocean, small hydropower, hydrogen, geothermal and renewable biomass (including anaerobic digesters). The maximum grant amount is $500,000, and the maximum loan amount is $25 million per applicant.

Energy efficiency improvement projects eligible for REAP funding include lighting, heating, cooling, ventilation, fans, automated controls and insulation upgrades that reduce energy consumption. The maximum grant amount is $250,000, and the maximum loan amount is $25 million per applicant. 

USDA is offering a second type of grant to support organizations that help farmers, ranchers and small businesses conduct energy audits and operate renewable energy projects. Eligible applicants include: units of state, tribal or local governments; colleges, universities and other institutions of higher learning; rural electric cooperatives and public power entities, and conservation and development districts. The maximum grant is $100,000. Applications for these particular grants have been available since Dec. 29 of last year and are due Feb. 12.

The REAP program was created in the 2002 Farm Bill. Because of the success of the program, Congress reauthorized it in the 2014 Farm Bill with guaranteed funding of no less than $50 million in annual funding for the duration of the 5 year bill. The 2014 Farm Bill builds on historic economic gains in rural America over the past six years while achieving meaningful reform and billions of dollars in savings for taxpayers.

Since 2009, USDA has awarded $545 million for more than 8,800 REAP projects nationwide. This includes $361 million in REAP grants and loans for more than 2,900 renewable energy systems. When fully operational, these systems are expected to generate more than 6 billion kilowatt hours annually – enough to power more than 5.5 million homes for a year.

Here in New Mexico forty-seven businesses and Ag producers have taken advantage of the REAP program since its creation. Altogether Rural Development has obligated $2,289,819 to help these businesses install new energy efficient equipment or solar systems. 

Some of the businesses that have been funded with the REAP program include BCA Medial Associates in Roswell which received a grant of $8,384 to offset the cost of installing a new more efficient heating and cooling equipment to replace a 40 year old system. It’s estimated the new system will save the medical company almost 60 percent on its yearly energy bill.

Also, Central Valley Electric Cooperative in Artesia received a grant for $81,900 to offset the cost of installing a geothermal heating and cooling system at its new office complex in Artesia. The new heating and cooling system is estimated that it will save 60 percent on its energy consumption to heat and cool the building.

USDA Rural Development hosted a stakeholder forum on REAP Feb. 6.

President Obama’s plan for rural America has brought about historic investment and resulted in stronger rural communities. Under the President’s leadership, these investments in housing, community facilities, businesses and infrastructure have empowered rural America to continue leading the way – strengthening America’s economy, small towns and rural communities. USDA’s investments in rural communities support the rural way of life that stands as the backbone of our American values.

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