What is the Renewable Energy & Energy Efficiency Improvements Program?

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Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006

What is the Renewable Energy & Energy

Efficiency Improvements Program?

• A program designed to assist farmers and rural small

businesses with energy projects.

• Formerly the Section 9006 Renewable Energy and Energy

Efficiency Improvements Program which was replaced by the Rural Energy for America Program (REAP) in the 2008 Farm Bill.

• The new Farm Bill has just been passed which created the

REAP Program. The new regulations for REAP have not yet been issued. This presentation is based on the existing 9006 Program regulations

• This program provides grants and guaranteed loans to

purchase and install renewable energy systems and to make energy efficiency improvements.

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Farm Bill Definitions

• Renewable Energy – energy derived from:

– wind, solar, biomass, or geothermal source, or

– hydrogen derived from biomass or water using one of the above energy sources

• Energy Efficiency Improvement.

Improvements to a facility, building, or process that reduces energy consumption, or reduces energy consumed per square foot

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Who is Eligible?

• Rural small businesses and agricultural producers can apply

• The regulation includes the following definitions:

– Rural – Any area other than a city or town with population over 50,000.

Cannot be in urbanized area adjacent to such a city or town.

– Agricultural Producer - An individual or entity directly engaged in the

production of agricultural products (including farming or ranching) that gets 50% + of their gross income from the operations

– Small Business - A private entity including a sole proprietorship,

partnership, corporation, cooperative (including most Rural Electric Cooperatives), and certain other electric utilities.

• Must meet SBA size standards for small business

www.sba.gov/size/indextableofsize.html • Non-profits excluded

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What Projects are Eligible?

• Requirements for eligible projects:

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Must be located in a rural area

- Must be for a pre-commercial or commercially available and replicable technology

- Must be technically feasible (technical report and/or energy audit)

- For Energy Efficiency Projects must demonstrate projected energy savings

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Eligible Project Costs for Grants

• Post application purchase and installation of equipment

(new, refurbished or remanufactured) except agricultural tillage equipment, used equipment and vehicles.

• Post application construction or project improvements,

except residential

• Energy audits or assessments

• Permit and license fees

• Professional service fees except for application preparation

• Feasibility studies and technical reports

• Business Plans

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What Costs are NOT Eligible

• Residential improvements

• Energy efficiency improvements related to

new construction

• Agricultural tillage equipment

• Vehicles

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Grant Limitations

• Grant request must not exceed 25% of project costs

– Minimum grant request: $2,500 for RE, $1,500 for EE – Renewable Energy:

• Maximum grant request: $500,000 – Energy Efficiency

• Maximum grant request: $250,000

• If total eligible project costs are over $50,000, an energy

audit must be conducted by or reviewed and certified by an energy auditor.

• If total project costs are $50,000 or less an energy

assessment or energy audit may be conducted by either an energy assessor or energy auditor.

• The applicant must be the owner of the project and control

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Guaranteed Loans

• On a guaranteed loan the lender is the applicant seeking a guarantee on a loan to an agricultural producer or rural small business

• Guaranteed loan request must not exceed 50% of total eligible project costs

– Minimum guaranteed loan request: $5,000 for RE and EE

– Maximum guaranteed loan request: $10,000,000 for RE and EE – Maximum percentage of guarantee:

85% if = or < $600,000

80% if > $600,000 & = or < $5 million 70% if > $5 million & = or < $10 million

– Eligible project costs are the same as those listed for a grant

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For More Information

• Contact your local Rural Development Office:

Asheville: 828-254-0916 Henderson: 252-438-3134 Jefferson: 336-246-2885 Williamston: 252-792-7197 Lumberton: 910-739-3349 Smithfield: 919-934-7156 Albemarle: 704-982-5114 Kinston: 252-526-9799 Shelby: 704-471-0235 Sanford: 919-776-4331 Additional Contacts:

Rossie Bullock, Program Specialist, phone: 910-739-3349 ext. 4 Steve Byrd, Program Director, phone 919-873-2043

– Information on eligibility and program details

– Assistance with filling out applications

– Advance action on environmental reviews for projects of concern

– Helpful websites:

– www.rurdev.usda.gov/rbs/farmbill

– http://www.rurdev.usda.gov/ia/rbcs_RE-EE_Section_9006.html