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USDA Offering $1 Billion in Funding to Help Agricultural Producers and Rural Businesses Lower Energy Costs and Build the U.S. Clean-Energy Economy

Barbara Bowen
Release Date

RICHMOND, Va., March 31, 2023 – Virginia agricultural producers and businesses now have an unprecedented opportunity to make their operations more energy efficient through a just announced application period for the Rural Energy for America Program (REAP).
USDA Rural Development (RD) is using funding from President Biden’s landmark Inflation Reduction Act to make $1 billion in grants available to rural small businesses and agricultural producers interested in installing renewable energy systems or making energy-efficiency improvements. The application period opens on April 1 with quarterly competitions held through Sept. 30, 2024. The agency is also setting aside $144.5 million to create REAP's first underutilized technology fund.
The maximum grant is $1 million for renewable energy systems and $500,000 for energy-efficiency projects. The maximum federal share of up to 50 percent of total project costs may be requested for all energy-efficiency projects and zero-emissions renewable energy systems. An award of up to 50 percent of the total project cost is also available for any project in a designated energy community and/or submitted by an eligible tribal entity. All other projects are eligible for grants of up to 25 percent of total costs. 
"Projects financed under this program don't just reduce the amount of carbon pollution affecting our climate," said Perry Hickman, USDA Rural Development Virginia State Director. "Investments in climate-smart solutions can help Virginians create thriving communities that are more livable in the long-term."
USDA RD is particularly interested in projects that will help rural communities recover economically through more and better market opportunities and improved infrastructure, reduce climate pollution and increase resilience to the impacts of climate change, conserve and protect farmland, and invest in underserved communities. At least 20 percent of the available funds will be set aside until June 30 of each year for grant requests of $20,000 or less to help ensure that small projects have a fair opportunity to compete for these resources. That total includes the grant portion of a combined grant and guaranteed loan request.
The program is part of the Biden-Harris Administration’s Justice40 Initiative, which aims to ensure that 40 percent of the overall benefits of certain federal investments flow to disadvantaged communities that are marginalized, underserved and overburdened by pollution. See page 19239 of the March 31 Federal Register for additional information on application deadlines and submission details.