USDA Wraps Up FY2011 Rural Energy for America Program Grants and Loans
December 20th, 2011
USDA has announced the final FY2011 loan and grant awards for the Rural Energy for America Program (REAP). The program funds renewable energy and energy efficiency projects for farmers, ranchers and rural small businesses. REAP grants can fund up to 25-percent of a project’s costs, up to $500,000 for renewable energy systems and $250,000 for energy efficiency improvements. USDA estimates that these REAP projects are expected to lower energy usage by 2 billion kilowatts and prevent nearly 2 million metric tons of emissions from being released into the environment.
The REAP funding for energy efficiency and renewable energy projects available in FY2011 was directed as follows:
• $28.8 million funding for 53 biomass projects, of which $20.9 million were for 19 biodigesters (anaerobic digesters)
• $23.2 million to fund more than 1,100 energy efficiency projects
• $20. 3 million for solar energy projects
• $8.2 million for hydroelectric systems
• $4.28 million for 266 mixed fuel “blender pumps” included in 65 projects in 30 states
• $3.9 million for wind energy projects
• $1.4 million geothermal installations.
NSAC appreciated that in FY2011 almost one-half of the grant awards were for $20,000 or less. NSAC championed a provision in the 2008 Farm Bill that required that no less than 20 percent of the REAP funding be used for grants of $20,000 or less.
Our favorite end-of-year REAP announcement was the award of energy efficiency grants to six maple syrup producers, five in Vermont and one in Michigan. The grants will help fund reverse osmosis systems to remove water from sap before it is boiled down to syrup, a process that reduces the energy needed to concentrate the syrup.
Unfortunately, Congress limited REAP in FY2012 to $22 million in mandatory funding, a cut of $48 million from the 2008 Farm Bill level, plus an additional $3.4 million in discretionary appropriations. Combined, the appropriations bill for this year reduces REAP in FY 2012 relative to FY 2011 by $50 million. In addition, REAP is going into the next Farm Bill without baseline funding, a situation that makes the program vulnerable going forward.