USDA Proposed Changes Would Make Energy Funding Easier


Washington – The U.S. Department of Agriculture has proposed a series of changes to make it easier for agricultural producers and rural small businesses to apply for renewable energy and energy efficiency funding.

USDA remains focused on carrying out its mission, despite a time of significant budget uncertainty. This announcement is one part of the Department's efforts to strengthen the rural economy.

REAP is one of USDA's most popular renewable energy and energy efficiency programs. From the passage of the 2008 Farm Bill through the end of Fiscal Year 2012, REAP funded more than 6,800 renewable energy and energy efficiency projects, feasibility studies, energy audits and renewable energy development assistance projects.

In 2012, for example, USDA Rural Development provided Benes Service Inc. of Valparaiso, Neb. a $19,750 REAP grant to assist with installing a 25KW wind turbine to offset energy costs of the farm implement dealership. The grant was leveraged with $62,250 of funding from the applicant.

As a direct result of the USDA grant and turbine installation, the company has helped secure its fuel costs for the life of the system which will help it remain a viable employer of 20 people in small town rural Nebraska.

"These changes are intended to help agricultural producers and rural small businesses throughout America," Agriculture Secretary Tom Vilsack said. "They will streamline and simplify the application process and give businesses more time to do what they do best: innovate, create jobs and serve their rural communities."

The proposed changes would affect applications for loans and grants through USDA Rural Development's Rural Energy for America Program (REAP). They would:

  • Reduce paperwork, especially for projects under $80,000;
  • Implement a more objective and uniform system to score applications;
  • Authorize funding for refurbished and retrofitted renewable energy systems;
  • Reduce certain reporting requirements;
  • Establish a quarterly application period for applicants seeking only guaranteed loans. This change is intended to make the program more appealing to lenders and to ensure that funds are available year-round.

USDA is accepting comments on the proposed rule through June 11, 2013. For details on how to submit comments, or for additional information, see Page 22044 of the April 12 Federal Register,