NASHVILLE, Tenn., Oct. 22, 2020 - U.S. Secretary of Agriculture Sonny Perdue today announced that the U.S. Department of Agriculture (USDA) is investing an additional $3.1 billion to build or improve rural electric infrastructure in 25 states, and he highlighted a record level of funding for fiscal year (FY) 2020 to upgrade infrastructure. Tennessee Rural Development State Director Jim Tracy along with Kentucky State Director Hilda Legg are pleased to announce 13 rural counties across the Tennessee-Kentucky border will benefit from improvements to electric infrastructure.
“We are pleased to be making investments in South Kentucky RECC,” Tracy said. “Reliable and modern infrastructure, including electric infrastructure and smart grid technologies, is a cornerstone for prosperity in our rural communities.”
Background:
USDA is investing in 53 projects through the Electric Loan Program. This funding will benefit 1.4 million rural residents and businesses in Alabama, Arkansas, California, Colorado, Florida, Georgia, Iowa, Kentucky, Louisiana, Maine, Minnesota, Missouri, North Carolina, North Dakota, Nebraska, New Mexico, New York, Oklahoma, Pennsylvania, South Carolina, South Dakota, Texas, Virginia and Wisconsin.
Below are some examples of how the funds will be used in Tennessee:
- South Kentucky RECC will use a $44 million loan to connect 4,044 consumers and build and improve 178 miles of line. This loan includes $2,392,741 in smart grid technologies. South Kentucky, headquartered in Winchester, serves an average of 68,245 members over 6,932 miles of line throughout 11 counties in southeastern Kentucky and two counties in northeastern Tennessee.
Today’s announcement is part of a record level of USDA electric infrastructure investments in one fiscal year. The department invested $6.3 billion in the Electric Loan Program in FY 2020, up from $5.8 billion in 2019 – also a record. USDA made loans to 119 utilities in 34 states across the country during FY 2020, which ended on September 30. Those figures build upon the $3.7 billion invested in 2018.
Helping improve rural electric infrastructure is a significant part of the Trump administration’s “all-of-the-above” energy strategy. USDA’s Electric Program helps finance wind, solar and natural gas plants, as well as improvements to produce clean energy from coal-fired plants. Local utilities also use the loans to invest in infrastructure to deliver affordable power to thousands of residential, commercial and agricultural consumers.
Twenty-one of the loans that USDA awarded in FY 2020, representing almost 10 percent of total loan volume by dollar, will help expand smart grid technologies. Smart grid can be a catalyst for broadband and other telecommunications services in unserved and underserved rural areas. These loans will finance nearly 23,000 new line-miles of smart grid fiber when buildout is complete.
Rural electric cooperatives and utilities are increasing their internal communications capabilities to improve the reliability and efficiency of the electric grid. This added communications capacity helps cooperatives and their partners expand broadband coverage as they leverage these USDA smart grid investments.
In addition, this year, USDA has made it easier for rural electric utilities and cooperatives to use Electric Program loans for vegetation management programs to prevent and control wildfires.
During FY 2020, USDA also approved nearly $104 million in loans for 11 energy efficiency programs under the Rural Energy Savings Program and $11.7 million in High Energy Cost Grants to rural communities and villages in Alaska to lower the cost of energy consumption and upgrade aging generation systems.
Some Electric Program loans are specifically targeted to support the administration’s actions to spur economic development in areas where poverty rates have been stubbornly high for decades.
To learn more about electric infrastructure and other investment resources for rural areas, interested parties should contact their USDA Rural Development state office.
USDA Rural Development provides loans and grants to help expand economic opportunities and create jobs in rural areas. This assistance supports infrastructure improvements; business development; housing; community facilities such as schools, public safety and health care; and high-speed internet access in rural areas. For more information, visit www.rd.usda.gov/tn.
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