The Renewable Energy Systems and Energy Efficiency Improvements Program, also known as Section 9007, was created as part of the Energy Title in the 2002 Farm Bill and renewed in the most recent Farm Bill. It provides grants and loan guarantees to farmers, ranchers and rural small businesses.
Section 9007 will be known as the Rural Energy for America Program (REAP) in 2014. REAP improves the Farm Bill's extremely successful Section 9007 Renewable Energy/Energy Efficiency grant and loan guarantee program.
REAP is the only major Farm Bill energy program that directly benefits farmers, ranchers and rural businesses by providing access to start-up and operating capital for all clean energy technologies (primarily ethanol, biodiesel, wind, manure digesters, energy efficiency, biomass and solar).
The Rural Energy for America Program (REAP) directly helps farmers and rural businesses develop farm-based clean energy opportunities.
What is the Section 9007 program?
- To foster rural economic development and growth, Congress passed the Rural Energy for America Program (REAP) as Section 9007 of the 2008 Farm Bill. This program provides financial assistance to agricultural producers and small rural businesses to purchase renewable energy systems or make energy efficiency improvements.
- The Rural Business Section of the United States Department of Agriculture (USDA) administers this program.
How much are the grants?
- The 2008 Farm Bill authorized funding for 5 years. The program offers grants and guaranteed loans that will be awarded competitively to fund rural renewable energy systems or energy efficiency improvement projects.
- Grants can fund up to 25% of a projects total eligible costs. Grants are limited to $500,000 for renewable energy system projects or $250,000 for energy efficiency improvements. Grants as low as $2,500 for renewable energy projects and $1,500 for energy efficiency improvement projects will be considered.
- Guaranteed loans can fund up to 50% of a project total eligible costs with a minimum of $5,000 and a maximum of $25 million.
- Combined applications for both a grant and a guaranteed loan can fund up to 75% of a projects total eligible costs.
What types of projects are eligible?
- Eligible renewable energy projects include projects that produce energy from wind, solar, biomass, geothermal, hydro, and hydrogen-based sources. The project can produce any form of energy, including heat, electricity, or fuel.
- Energy efficiency improvements projects such as retrofitting lighting, windows, and insulation, or replacing older equipment with more efficient units (heating, ventilation, air-conditiong, grain dryers, etc.) are eligible. New building construction is typically not eligible.
- For all projects, the system must be located in a rural area, must be technically feasible, must meet all environmental requirements and must be owned by the applicant.
• How the REAP program could help your clients
Case examples of past grant winners
• Top dry system
• Understanding how Grain driers qualify and how different systems compare
• Getting specific on making a grant application