grants & loans for renewable energy and energy … · heating wind cooling small hydroelectric...
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GRANTS & LOANS FOR RENEWABLE ENERGY AND
ENERGY EFFICIENCY PROJECTS
Ron Omann, State Energy Coordinator - Minnesota
June 18, 2015
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USDA Rural Development’s REAP Program
• 2 Programs
• 2 Types of Funding
• 2 Energy Sectors
• 2 Types of Applicants
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REAP Renewable Energy Systems and
Energy Efficiency Improvement
Renewable Energy Systems
Energy Efficiency Improvements
Minimum Grant Request
$2,500 Total eligible project costs > $10,000
Minimum Grant Request
$1,500 Total eligible project costs > $6,000
Maximum Grant Request
$500,000 Total eligible project costs > $2 million
Maximum Grant Request
$250,000 Total eligible project costs > $1 million
GRANT = Up to 25%
of Eligible Project Costs
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REAP Renewable Energy Systems and
Energy Efficiency Improvement
Minimum Loan Amount
$5,000 Total eligible project costs > $6,667
Maximum Loan Amount
$25 million Total eligible project costs > $33.4 million
Details
• USDA guarantees a commercial loan; applicant must have a willing lender.
• Terms are negotiated between the lender and borrower.
• Fees, appraisals, equity & collateral requirements apply.
GUARANTEED LOAN = Up to 75%
of Eligible Project Costs
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Rural Business-Cooperative Service
Energy Programs
USDA Rural Development - the leading advocate for rural America at the federal level.
GUARANTEE
• 85% for loans $600,000 or
less.
• 80% for loans over
$600,000 up to $5 Million
• 70% for loans over $5
Million up to $10 Million
• 60% for loans over $10
Million
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Eligible Applicants
Agricultural Producer
Rural Small Business
• Individual or entity that receives 51 percent or more of their gross income from agricultural production – crops, livestock, aquaculture,
forestry operations, nurseries, dairies
• For-profit small business - as defined
by the Small Business Administration (SBA)
• Rural area or non-metro community of < 50,000
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Energy Efficiency Renewable Energy
Lighting Solar
Heating Wind
Cooling Small Hydroelectric
Ventilation Anaerobic Digesters
Fans Biomass
Automated Controls Geothermal
Insulation Wave/Ocean Power
Improve Profits for Your Rural Small Business,
Farm or Ranch with REAP
The technology must be commercially available. Research and development projects do not qualify.
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Eligible Project Costs Ineligible Project Costs
• Equipment: • Purchase & installation • New or refurbished
• Post-application construction & facility improvements
• Retrofitting
• Professional service fees
• Permits & license fees
• Second Meter
• Working capital, land acquisition, (Guarantee loan ONLY with restrictions)
• Refinancing Debt (Guarantee Loan ONLY; <50% of Total Project Cost)
• Residential energy projects • Equipment:
• Farm tillage equipment • Used equipment • Vehicles
• Pre-application construction & facility improvements
• Application preparation or grant writer fees
• Line of credit
• Lease payments
• Payment to the applicant/business owner, beneficiary, or relative
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REAP Application Window Closing Deadlines
June 30, 2015
Grant Request $20,000 or less not competing for set aside
Grant Request > $20,000
Combination Grant/Loan Request
October 31, 2015 Grant Request $20,000 or less Combination Grant/Loan Request
April 30, 2016
Grant Request $20,000 or less not competing for set aside
Grant Request > $20,000
Combination Grant/Loan Request
Continuous Application Cycle
Guaranteed Loans *Loan must score a minimum of 50 to compete monthly *Monthly competitions have now started – next May 1, 2015
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Application Process
• Application requirements under all three tiers have been streamlined reducing the time required to prepare applications
Form RD 4280-3A
Form RD 4280-3B
Form RD 4280-3C
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• Contact the USDA Rural Development in your state or region for application materials and resources
• Submit applications any time of year.
• Applications compete for funding based on score.
How to Apply
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REAP Funding Availability
• 2015: $80M in Grant; $200M in Guaranteed Loans
• 2016 & Beyond:
– $50 M appropriated • $40 M Grant
• $10 M Loan (Budget Authority)
– Discretionary Funds are possible
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Btu/Grant Dollar Requested (10)
Matching Funds (20)
Energy Saved, Replaced, Generated (15)
Previous Award (15)
Simple Payback (15)
State Direct/Administrator (10)
SCORING PROJECTS
Environmental Benefits (5)
8 Criteria = 100 points: Size of Applicant (10)
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Using Scoring to Determine Funding Potential
High Scoring Projects Include:
• High Percentage of Saving/Replacement of Current Energy Usage
• Large energy saving/generation
per Grant dollar
• Short Simple Payback Timeframe
High Scoring Applicants Include:
• Small Size of Operation
• Under represented/Unserved Groups
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Applicant & Scoring Trends
• Agriculture Producers
– Low threshold for size ($750,000)
– Look for other industries (NAICS) which may fit
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Project & Scoring Trends
– Lighting Projects (High % Saving & Energy saved/grant, low paybacks)
– Grain Drying Equipment (Mid-Energy saved/grant & % Saved, High paybacks)
– Solar (Low energy/grant, High Replacement, Less 25yr payback)
– Wind (Low energy/grant, High replacement, Less 25yr payback)
– Geothermal (Low energy/grant, Low replacement, Better Payback than wind & solar
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REAP Energy Audit and Renewable Energy
Development Assistance
mncerts.org/GreatRenewables
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Mission: We connect individuals and their communities to the resources they need to identify and implement community-based clean energy projects
CERTs: Minnesotans Building a Clean Energy Future
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Rural Energy for America Program (REAP)
www.rd.usda.gov/reap
Ron Omann, Minnesota Energy Coordinator
651-602-7796
USDA is an equal opportunity provider and employer. To file a complaint of discrimination, write: USDA, Office of the Assistant Secretary for Civil
Rights, Office of Adjudication, 1400 Independence Ave., S.W., Washington, DC 20250-9410 or call (866) 632-9992 (Toll-free Customer Service), (800) 877-8339 (Local or Federal relay), (866) 377-8642 (Relay
voice users).