I came across the Rural Energy for America Program (REAP) when we were talking to a potential client in the northern mountains of New Mexico. Unfortunately, it has been an early and extreme fire season for the area and their facility was consumed by one of the many wild fires. I found the program to be exciting because it can be very tough for many rural small businesses and agriculture producers to invest in capital improvement energy projects that will save them money in the long-term. This program could allow for over 50% savings on installation cost of renewable energy and energy efficiency projects if an applicant is awarded the grant. For example, say a farmer wanted to install a solar PV system on his property for $100,000. The farmer can take the Solar Investment Tax Credit (ITC) at 26% of the capital cost and if awarded the REAP grant for 25% of the capital cost then 51% of project upfront cost could be avoided. The farmer would only have to pay $49,000 for the solar PV system. Other tax incentives exist too including equipment depreciation, which allow for even more realized savings from installing the solar PV system.
The program provides guaranteed loan financing and grant funding to agricultural producers and rural small businesses for renewable energy systems or to make energy efficiency improvements. Agricultural producers may also apply for new energy efficient equipment and new system loans for agricultural production and processing. Primary eligibility for the program consists of the following:
- Businesses must be in located in rural areas with populations of 50,000 residents or less.
- Agricultural producers with at least 50 percent of their gross income coming from agricultural operations.
For more information on the program please visit the link below.