Learn more about USDA Rural Energy for America Program (REAP)

• At least 12 months of recent utility bills, showing energy usage and billing costs.
• Quotes or estimates for the proposed energy-related projects.
• Letter of commitment or proof of funds.
• Employee Identification Number (EIN).
• Unique Entity Identifier (UEI) from the System for Award Management (SAM).
• Additional documentation, such as an environmental impact study, will be required for projects exceeding $200,000.
• Layout of the faculty being considered

Grant applications are typically due by October 31 for projects under $80,000 and March 31 for all other projects. These deadlines are subject to change based on the availability of federal funding. Applications can be submitted at any time but will be held by the USDA until the next appropriate deadline based on project size.

Once the USDA receives your complete application, you may begin the project (such as purchasing or ordering equipment). However, starting the project before USDA review and approval is at your own risk, as there is no guarantee the project will be funded. Any orders, purchases, or down payments made before submitting the application to the USDA are ineligible for reimbursement, even if the application is later approved.

Once the USDA receives your complete grant application, you may begin the project (such as purchasing or ordering equipment). However, if you start the project before the USDA reviews and approves the application, you assume the risk that the project may not receive funding. Any orders, purchases, or down payments made before submitting the application will not be eligible for reimbursement, even if the application is later approved

If your application is approved, the project must be completed before you can request reimbursement. Once the project is finished and all required documents are submitted to the USDA Rural Development Office, the reimbursement process typically takes a few weeks.

Funds can be utilized for the purchase and installation of renewable energy systems, including:

• Biomass (e.g., biodiesel, ethanol, anaerobic digesters, and solid fuels)
• Geothermal for electric generation or direct use
• Hydropower (under 30 megawatts)
• Hydrogen
• Small and large wind generation
• Small and large solar generation
• Ocean energy (tidal, current, thermal)

Additionally, funds can be used for the purchase, installation, and construction of energy efficiency improvements, such as:

• High-efficiency heating, ventilation, and air conditioning (HVAC) systems
• Insulation
• Energy-efficient lighting
• Cooling or refrigeration units
• Energy-efficient doors and windows
• Electric, solar, or gravity-powered pumps for sprinkler pivots
• Converting from diesel to electric irrigation motors
• Replacing energy-inefficient equipment

For energy efficiency improvements, applications must include an Energy Audit or Energy Assessment (depending on total project costs) in compliance with Appendix A to RD Instructions 4280-B.

Agricultural producers can also use guaranteed loan funds to install energy-efficient equipment and systems for agricultural production or processing.

• Loan guarantees covering up to 75% of total eligible project costs.
• Grants covering up to 50% of total eligible project costs.
• A combination of grants and loan guarantees covering up to 75% of total eligible project costs.

The loan guarantee percentage is published annually in the Federal Register. For Fiscal Years 2024 and 2025, REAP loans will receive an 80% guarantee.

The lender, with approval from the Agency, will determine and justify the loan term based on the intended use of the funds, the economic lifespan of the financed assets and collateral, and the borrower’s ability to repay. The loan term will not exceed 40 years.

• Individual borrowers must be U.S. citizens or residents who have been legally granted permanent residency.
• Private entity borrowers must ensure that the loan funds will stay within the United States.

• Interest rates are negotiated between the lender and borrower.
• Rates may be fixed or variable.
• Variable interest rates may not be adjusted more often than quarterly.

• There is an initial guarantee fee, currently 1 percent of the guaranteed amount.
• There is a guarantee retention fee, currently 0.25 percent of the outstanding principal balance, paid annually.
• Reasonable and customary fees for loan origination are negotiated between the borrower and lender.

• The lender will conduct a credit evaluation using credit documentation procedures and underwriting processes that are consistent with generally accepted prudent lending practices and also consistent with the lender’s own policies, procedures and lending practices.
• The lender’s evaluation must address any financial or other credit weaknesses of the borrower and project and discuss risk mitigation requirements.
• The lender must analyze all credit factors to determine that the credit factors and guaranteed loan terms and conditions ensure guaranteed loan repayment.
• Credit factors to be analyzed include but are not limited to character, capacity, capital, collateral, and conditions.

Renewable Energy System Grants:

• $2,500 minimum.
• $1 million maximum.

Energy Efficiency Grants:

• $1,500 minimum.
• $500,000 maximum.

• Applicants must provide matching funds if applying for a grant only.
  • 50% Federal grant share limited to projects that meet one of the following:
    • Project is a Renewable Energy System (RES), or RES retrofit that produces zero greenhouse gas emissions (Carbon Dioxide, Methane, Nitrous Oxide, or Fluorinated Gases) at the project level.
    • Project is located in an Energy Community as defined in 26 USC 45(b)(11)(B) and determined by the Department of the Treasury.
    • Project is an Energy Efficiency Improvement (EEI).
    • Is a project proposed from an eligible Tribal Corporation or other Tribal Business entity (including agriculture operations) as described in 7 CFR part 4280.
  • All other projects are limited to 25% Federal grant share
• Applicants must provide at least 25 percent of the project cost if applying for loan.
• All projects must have technical merit and utilize commercially available technology.
• Energy efficiency projects require an energy audit or assessment.
• All projects require an environmental review prior to award or construction