By: Griffin Smith, Clean Power Intern

On October 18, 2024, The U.S. Department of Agriculture (USDA) announced that an additional $600 million from the Inflation Reduction Act (IRA) has been made available for funding three additional rounds of applications for the Rural Energy for America Program (REAP) for fiscal years 2025, 2026, and 2027. This updated funding and set of guidelines are designed to help agricultural producers and rural small businesses access grants and loan guarantees for renewable energy systems (RESs) and energy efficiency improvements (EEIs). The program aims to make these cost-saving technologies more accessible, encouraging energy innovation and environmental sustainability in rural communities.  The funding provides $180 million per year for each of the next three fiscal years plus another $20 million per year in set-aside funding for underutilized renewable energy technologies.  

What is REAP? Who Can Apply?

REAP provides financial support through grants and loan guarantees to eligible agricultural producers and rural small businesses. Agricultural producers, who earn at least 50% of their income from farming are eligible to use funds for renewable energy systems or new energy efficient equipment. Rural small businesses in qualifying areas can also apply to reduce their energy costs through similar improvements. Applicants must meet specific eligibility requirements, including size standards set by the Small Business Administration.

Funding, Terms, and Application Details

Thanks to the IRA, REAP will continue offering grants covering up to 50% of eligible project costs for qualifying projects, such as those with zero site-based greenhouse gas emissions, including projects implementing  underutilized renewable energy technologies or those located in designated Energy Communities. REAP will provide grants up to $1MM for a renewable energy system and up to $500,000 for an energy efficiency improvement project.  REAP also offers loan guarantees of up to 75% for eligible projects up to $25 million.  The three application rounds, by fiscal year (FY) are as follows:

FY 2025

• December 31, 2024
• March 31, 2025

FY 2026

• September 30, 2025
• December 31, 2025
• March 31, 2026

FY 2027

• September 30, 2026
• December 31, 2026
• March 31, 2027

Additional information on USDA REAP can be found here.