Going green in rural communities has always been a struggle. Finding funding for renewable energy projects for farmers and small businesses in rural communities is difficult. Often the requirements leave many small businesses and others without many options.
The United States Department of Agriculture (USDA) now offers the Rural Energy for America Program (REAP). Because it’s been notoriously challenging in the past, the program aims to bring renewable energy solutions like solar for farmers to rural areas of America.
The program offers both guaranteed loans and grants through the USDA to businesses in rural communities. This is to allow the purchase of renewable energy equipment and perform construction projects related to renewable energy.
The program promotes renewable energy for rural parts of America. It also aims to reduce the consumption of energy from traditional sources like power plants, nuclear, and coal. And to promote America’s energy independence by building energy independence for farms and small businesses.
How USDA REAP Grants Work
The REAP Grant Program is composed of two types of funding that helps farmers and rural businesses. It’s designed for agricultural farmers who make at least 50% of their gross income from farming. It is also meant for businesses located in areas that the USDA considers “rural” (areas with a population less than 50,000).
One of the larger parts of the program covers the construction of, purchase of equipment for, or upkeep and maintenance of large and small agricultural solar systems. Through the program, farmers can get loans and grants to cover up to 75% of the total cost of all projects.
The loan funds can even be used for upgrading HVAC systems and other equipment for a business or farm and farmers have the added benefit of being able to purchase energy-efficient farming equipment with the funds as well.
Special Requirements to Apply
Besides the requirements mentioned above pertaining to farmers and businesses in rural locations, there are a couple of other requirements that must be met in order to acquire a REAP grant or loan through the program.
Minimums and Maximums
All projects must be approved by the USDA before the funding will be guaranteed. Certain minimum requirements must be met, and there are maximum funding limits:
- $2,500 minimum on renewable energy system grants, $500,000 maximum
- $1,500 minimum on energy efficiency grants, $250,000 maximum
- Applicants must provide 25% of funding if applying for loans and grants, or 75% of funding if only applying for grants.
- Loans and Grants are guaranteed by the USDA but provided by individual lenders, so rates and terms may vary.
These are some of the basic requirements. However, it is important to note that any businesses receiving government funds either through a USDA grant or loan, must have registered for and provide a Data Universal Numbering System (DUNS) number to receive federal funds.
If your business does not already have a DUNS number, you can search and apply for one through the federal government’s database.
Additionally, there is a bit more to do if your business receives federal contracts, either through the Department of Defense or other government entities. In that case, you will be required to provide your business’s unique Commercial and Government Entity (CAGE) code. This number identifies businesses who receive and work on government contracts.
Getting Started with a REAP Grant
The very first thing to do is figure out the improvements you want to make to your farm or business. Renewable energy sources like hydro and solar are great for the environment and your utility bills! Especially if you have a large farm and can take advantage of the many benefits that renewable energy offers.
First, figure out a plan for installing solar or improving your energy usage. Then you can apply year-round for loans and grants. Check with your local USDA office for more details.
Go Green Today with Solar Sam
If you’re interested in adding solar to your farm or business, then contact Solar Sam today. We’re here for all your solar energy needs.
Not only are we well-versed in REAP grants, but we got our start in rural areas! We can help with your solar energy projects to get you on the path to energy independence and green living.