REAP: Rural Renewable Energy & Efficiency

The Rural Energy for America Program (REAP) was created by Congress in the 2008 Farm Bill. Administered by the U.S. Department of Agriculture (USDA) the REAP program provides grants and guaranteed loans to agricultural producers and rural small businesses for renewable energy projects or energy efficiency improvements. In August, the USDA announced $63 million in loans and grants for 264 renewable energy and energy efficiency projects so far in 2015. Several of U.S. Energy’s ethanol clients have made applications to the REAP program to support their energy efficiency improvement efforts.

Applicant Eligibility

Agricultural producers may be in rural or non-rural areas as long as they derive at least 50% of gross income from agricultural operations

Small businesses must be in an area other than a city or town with a population of 50,000 or more. Small businesses can check if they are in an eligible rural area here.

Project Eligibility

Renewable Energy Systems – funds may be used for purchase, installation, and construction of systems. Examples of eligible renewable energy systems include:

  • Biomass
  • Geothermal
  • Hydropower
  • Wind
  • Solar

Energy Efficiency Improvements – funds may be used for purchase, installation, and construction of improvements. Examples of eligible efficiency improvements include:

  • Lighting
  • Insulation, doors & windows
  • High efficiency HVAC
  • High efficiency motors and pumps

Funding Types

Grants and loan guarantees are available through the REAP program and individual projects may apply for one or both. Combined grant and loan guarantee funding cannot be more than 75% of the total project cost.

Grants

  • Grants up to 25% of total project cost
  • Renewable energy system grants range between $2,500 – $500,000
  • Energy efficiency grants range between $1,500 – $250,000

Loan Guarantees

  • Loan guarantees up to 75% of total project cost
  • Minimum loan amount of $5,000
  • Maximum loan amount of $25 million

Energy Audits and Assessments

When applying for energy efficiency improvement (EEI) funding an energy audit or assessment is also required as part of the application package. For EEI projects with a total cost greater than $200,000 an Energy Audit must be conducted. For EEI projects with a total cost of less than $200,000 an Energy Assessment or Energy Audit may be done. In general, the Energy Audit requires more in-depth analysis of the proposed EEI, such as detailed specifications, measurement plan, and calculation of direct and indirect costs.

REAP Resource Links

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