The Rural Energy for America Program (REAP) provides financial assistance to rural small businesses and agricultural producers in the US specifically for the purchase, installation, and construction of renewable energy systems or energy efficiency improvements, and to conduct feasibility studies for such projects.

REAP grants cover up to 25% or 50% of total eligible project costs.  Grant awards range from $1,500 to $500,000 for energy efficiency improvement projects, and $2,500 to $1,000,000 for renewable energy systems projects.

Two critical things to know upfront about the timing of grant financing
– You must apply for the grant before you start construction on your project.
– You will still need financing, even if you get the grant, because the grant funds will be distributed after the project is completed and operational, and because the grant will only cover a portion of the project.

So your financing will need to be able to cover both the grant amount to be repaid in the short term, along with any other tax credit/rebates you might receive after project completion.  The the balance of the project which will require longer term financing.  Contact your CleanFi rep about that split financing process.

Do you qualify for a REAP grant?
There are two primary methods of evaluation for a REAP grant:
1. Geography.   Here is the map
https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=rbs

2.Organization.  Do you qualify as either:
– a small business according to the SBA? Here is where you can check
– an Agricultural producer that can received 50% of their gross income from direct production of agricultural products.

Does your project qualify?
Here is what the USDA says qualifies as a project for a grant:
Renewable Energy Systems

  • Wind Generation
  • Solar Generation
  • Biomass
    • Biodiesel and Ethanol
    • Anaerobic Digesters
    • Solid Fuels
  • Geothermal
  • Hydropower (below 30 megawatts)
  • Hydrogen
  • Ocean (tidal, current, thermal) generation.

Energy Efficiency Improvements

  • High Efficiency HVAC Systems (heating, ventilation and air conditioning)
  • Insulation
  • Lighting
  • Cooling or refrigeration units
  • Doors and windows
  • Smart Thermostats and other energy management systems
  • Electric, solar or gravity pumps for sprinkler pivots
  • Switching from a diesel to electric irrigation motor
  • Replacement of energy-inefficient equipment

Scoring system for allocation and distribution of funds:

The USDA website says that their “scoring process allows the USDA to rank applications and prioritize funding for projects that best align with the program’s objectives.  Applications for grants are evaluated using a competitive scoring system that considers a range of criteria, including energy generation or savings, location in a disadvantaged or distressed community, environmental benefits, and more. …The selection process ensures that funds are distributed fairly and equitably among eligible applicants, promoting the development of a diverse range of renewable energy and energy efficiency projects across the country.

REAP Scoring Criteria

There are 100 available points and the main criteria for scoring include:

  • Energy generated, saved, or replaced (up to 25 points)
    • ​Points are awarded based on the amount of energy the project is expected to generate or save, with higher points for more significant energy savings or generation.
  • Previous REAP funds (up to 15 points)
    • ​New applicants who have not received REAP funds before are awarded 15 points.
  • Location in a Disadvantaged or Distressed Community (up to 15 points)
  • Commitment of matching funds (up to 10 points)
    • ​Points are awarded based on the percentage of matching funds committed and verified by the application package.
  • Environmental benefits (up to 10 points)
    • ​Projects demonstrating significant environmental benefits, such as reducing greenhouse gas emissions, receive additional points.
  • State Director/Administrator Points (up to 10 points)
    • These points are determined differently for each state and are usually developed during the first competition each year.

The total points a project receives determine its ranking within the competition pool. Projects with higher scores are prioritized for funding.

The USDA reminds applicants to:
– Highlight energy savings or generation
– Secure matching funds
– Emphasize environmental benefits
– Collaborate with your State Energy Coordinator

Need for funding before, during and after the grant.
A requirement of the grant is to show that you have matching funds.

Additionally, because the grant is not paid until after the project is completed, as is the case with almost all rebates, tax credits and grants, you will need financing to actually build the project, even if part of the funds are paid back in the short term thanks to those programs.

CleanFi will help by matching you with a funder who provide a full use of funds while at the same time allowing an early pay-down and re-amortization of the loan so that the project can benefit from both a bridge financing of those award or credit programs and from a long term financing agreement for the balance of the cost of the project.

Starting your application
The USDA website has an excellent walkthrough of
-how to approach your application
-where to find your state coordinator for help applying
-do’s and don’t’s throughout the process of applying.

Here is the Application link:
https://usdareapgrant.com/application