Farmers, ranchers and rural small businesses can apply now for grants and loan guarantees for clean energy projects under the Rural Energy for America Program – or REAP. REAP was renewed in the 2014 Farm Bill and supports a wide range of energy efficiency and renewable energy technologies, including wind, solar, biogas, biomass, small hydroelectric, geothermal, tidal, wave, and hydroelectric technologies.
The USDA accepts applications year round and people can apply now use existing application forms. Grants cover up to 25% of project costs. The loan guarantees facilitate lending by providing a guarantee of a portion of the principal to the lender. You can find more background information on REAP here.
An official notice of funding availability is expected in early April, with an application
deadline 60 days later. This notice would be for funds from the 2014 appropriation plus funds carried over from previous years (total about $28 million). When the final REAP rule is announced, possibly in June or July, a second funding announcement will be issued for the 2014 mandatory funding ($50 million) from the new Farm Bill. Applications submitted but not funded in the first round will be considered in the second round.
There will be some changes in projects eligible for funding this year. Due to changes in the new Farm Bill, there will be no funding for ethanol blender pumps or feasibility studies. As the statutory deadline has passed, there will be no funding for Energy Audit or Renewable Energy Development Assistance projects. The next opportunity to apply for those is next January.
How to win funding competition
Potential applicants should remember that the USDA awards REAP funds on a competitive basis, both within a state and nationally. Applicants improve their chances with careful planning to maximize the score on their application. Applications are scored on a number of criteria where careful planning and self-scoring can increase chances of success.
At Farmenergy.org, we provide tools and tips to help facilitate application preparation and self-evaluate applications scores. Application templates are available at the Iowa USDA REAP web page. These templates can help dealers and distributors prepare multiple applications.
Applicants should also be sure to check in early with the state staff of USDA rural development. They can answer questions, provide useful advice and may need to visit the project during the application process.
The USDA is working on implementing new rules from the 2014 Farm Bill and these new rules are expected be released this summer.