September 23, 2011
Back on September 16, USDA announced the second round of FY2011 Rural Energy for America Program (REAP) grants and loans, with over $27 million to fund more than 500 energy efficiency and renewable energy projects.
REAP funding is provided to farmers, ranchers, and rural small businesses. REAP grants can fund up to 25-percent of a project’s cost not to exceed $500,000 for a renewable project and $250,000 for an energy efficiency project.
Almost one-half the new awards went to energy efficiency projects. The number of solar projects funded was 152 and funding was provided to 17 wind projects. In addition, eight geothermal and three hydropower projects received funding. Most of the grant awards were for less than $50,000.
Awards were also made to 32 projects for the installation of ethanol flex-fuel dispensers and biodiesel dispensers. The flex-fuel pumps is a new use of REAP not contemplated by the farm bill, but added earlier this year by administrative action.
Previously, in August, USDA announced the award of FY2011 REAP grants and loans to some 900 projects. In an interview, USDA Under Secretary for Rural Development Dallas Tonsager indicated that there will be another round of FY2011 grants and loans numbering about 500 later this year. That will bring the total number of FY2011 REAP grant and loan awards to about 1900.
REAP funding for FY2012 is in jeopardy. The FY2012 Agricultural Appropriations bill approved by the House slashed funding to $2.3 million. Even the $2.3 million had to be provided by a floor amendment to an underlying House bill that had completely zeroed out REAP. The bill approved by the Senate Appropriations Committee would reduce overall REAP’s FY2012 funding, from $75 million in FY2011 to $38.5 million in FY2012. REAP funding was already reduced by Congress in FY2011 by 25%.