America’s 21st century energy landscape presents

needs that are greater than ever before. We face new

challenges to reduce dependence on imported oil; to

improve the environment; and to make clean, sustainable and affordable energy alternatives available to businesses. USDA Rural Development is helping to lead the

way in the agriculture sector – finding energy solutions in

our fields and helping rural residents and communities

access renewable energy systems and use energy more

efficiently. USDA Rural Development provides funding

for the development and commercialization of renewable

energy sources – including wind, solar, geothermal,

hydrogen, ocean waves, hydroelectric, biomass, and

biofuel (ethanol, biodiesel, etc.) – to change the way

people power their cars, homes, businesses, and industries. By making renewable energy sources commercially viable, USDA Rural Development is also creating sustainable opportunities for wealth, new jobs, and

increased economic activity in rural America.

Rural Energy for America Program (REAP) 

(Formerly the Renewable Energy Systems and Energy

Efficiency Improvements Program.) Provides loan guarantees and grants to agricultural producers and rural

small businesses to purchase and install renewable

energy systems and make energy-efficiency improvements. Renewable energy systems include those that

generate energy from wind, the sun, biomass, geothermal sources, or that produce hydrogen from biomass or

water using renewable energy, and ocean and hydroelectric source technologies. Energy-efficiency projects

typically involve installing or upgrading equipment to significantly reduce energy use. Energy audits and feasibility studies are also eligible for assistance. Eligible applicants for energy audits include State, tribe, or local governments; land-grant colleges and universities; rural

electric cooperatives; and public power entities. Eligible

applicants for feasibility studies include rural small businesses and agricultural producers.

Value-Added Producer Grant Program

Provides grants for planning activities and for working

capital for marketing value-added agricultural products,

and for farm-based renewable energy. Priority is given to

applicants who have at least 51 percent of project costs

dedicated to activities for a bioenergy project. Eligible

applicants include independent producers, farmer and

rancher cooperatives, agricultural producer groups, and

majority-controlled producer-based business ventures.

Business and Industry (B&I) Guaranteed Loan

Program

Provides financial backing for rural businesses through

guarantees up to 80 percent of a loan made by a commercial lender. Loans may be used for working capital,

machinery and equipment, buildings and real estate, and

certain types of debt refinancing. Biobased, bioenergy,

and other qualified energy projects may be financed

through the program for technologies that convert biomass into affordable, commercially proven electricity, fuel

chemicals, pharmaceuticals, and other materials in costcompetitive ways for large national and international

markets.

Biomass Research and Development Program

Provides funding for research, development, and

demonstration of technologies and processes leading to

significant commercial production of biofuels, biobased

energy innovations, development of biobased feedstocks, biobased products, and other such related

processes including development of cost-competitive

cellulosic ethanol. Eligibility is limited to institutions of

higher learning, national laboratories, Federal or State

research agencies, private sector entities, and nonprofit

organizations.

Biorefinery Assistance Program

Provides loan guarantees to viable commercial-scale

facilities and grants to demonstration-scale facilities to

develop new and emerging technologies for advanced

biofuels. Eligible entities include Indian tribes, State or

local governments, corporations, farmer co-ops, agricultural producer associations, higher education institutions,

rural electric co-ops, public power entities, or consortiums of any of the above.

Repowering Assistance Program

Provides payments to biorefineries that use fossil fuels to

produce heat and power to replace the fossil fuels with

renewable biomass. To be eligible, the biorefineries must

have been in existence as of June 18, 2008, and applicants must demonstrate the economic, technical, and

environmental feasibility of the proposed biomass system.

USDA Rural Development Energy Programs
Bioenergy Program for Advanced Biofuels

Provides payments to producers to support and expand

production of advanced biofuels refined from sources

other than cornstarch. To be eligible, producers must

enter into a contract with USDA Rural Development for

advanced biofuels production and submit records to

document such production.

Other Business-Oriented Programs

Qualified energy-efficiency projects may be assisted

through the Rural Business Enterprise Grant

Program, which facilitates development of small and

emerging private rural business enterprises; the Rural

Businesses Opportunity Grant Program, which sustains economic development in rural communities with

exceptional needs; and the Rural Economic

Development Loan and Grant Program, which provides zero-interest loans and/or grants for sustainable

rural economic development and job creation projects

for Rural Development electric and telephone utility loan

borrowers. Applicants for these programs should contact

their local Rural Development Energy Coordinator.

Cooperative Programs’ Energy Research

Conducts and oversees a range of research related to

the economics and business of renewable energy. The

research provides a greater understanding of business

options, market conditions, and policy implications of

renewable fuels for renewable energy investors, entrepreneurs, business assistance providers, and policy

makers. 

Direct and Guaranteed Electric Loan Program

Provides financing to eligible nonprofit utility organizations, such as electric co-ops and public utility districts, to

develop renewable energy, hydroelectric, biomass, photovoltaic, and wind-powered renewable energy projects

developed by Electric Program loan borrowers. In addition to on- and off-grid renewable energy systems, the

loan and loan guarantees may also be used to finance

energy conservation programs.

High Energy Cost Grants Program

Provides financing to energy generation, transmission

and distribution facilities that serve communities with

average home energy costs exceeding 275 percent of

the national average. Grant funds may be used for onand off-grid renewable energy projects, energy efficiency, and energy conservation projects serving eligible

communities.

2

Residential Energy Programs

The Rural Energy Plus Program provides additional

incentives to certain low- and moderate-income families,

who might not otherwise qualify for homeownership, to

purchase an energy-efficient home. The Home Repair

and Preservation Program provides assistance to lowand very low-income rural homeowners for critical home

improvements, including weatherization, insulation and

new heating systems. USDA Rural Development also

provides Housing Preservation Grants to sponsoring

organizations or rental property owners for the repair or

rehabilitation of low- and very low-income multi-family

housing, including energy efficiency upgrades. 

See Also:

n Business Programs (Fact Sheet PA 1589)

n Assistance for Rural Electric Utilities (Fact Sheet

PA 1789)

For More Information:

Visit the USDA Rural Development Web site at

http://www.rurdev.usda.gov or call (800) 670-6553.

Or contact your nearest USDA Rural Development State

office or USDA Service Center. These are usually listed

in telephone books under "U.S. Government,

Department of Agriculture."

PA 1928

Published March 2007

Revised September 2009

The U.S. Department of Agriculture (USDA) prohibits

discrimination in all its programs and activities on the

basis of race, color, national origin, age, disability, and

where applicable, sex, marital status, familial status,

parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or a part

of an individual’s income is derived from any public

assistance program. (Not all prohibited bases apply to

all programs.) Persons with disabilities who require alternative means for communication of program information

(braille, large print, audiotape, etc.) should contact

USDA's TARGET Center at (202) 720-2600 (voice and

TDD). 

To file a complaint of discrimination write to USDA,

Director, Office of Civil Rights, 1400 Independence Ave.

SW, Washington, DC 20250-9410 or call (800) 795-

3272 (voice) or (202) 720-6382 (TDD). USDA is an

equal opportunity provider and employer.