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USDA Grants

Rural Energy For America Program Grants
(REAP Grants) 25% of Project

The REAP/Feasibility Grant Program will provide grants for energy audits and renewable energy development assistance. It also provides funds to agricultural producers and rural small businesses to conduct feasibility study for a renewable energy system.

NOTICE: The Rural Energy for America Program (REAP) which is a grant and guaranteed loan program to help small businesses and ag producers with energy efficiency improvements and renewable energy projects has an application deadline of June 30, 2010.

REAP Info        Info Sheet      Application Deadline Info    REAP Application



How much are the grants?
The grants are awarded on a competitive basis and can be up to 25% of total eligible project costs.

Who is eligible?
The program is designed to assist small businesses, farmers, and ranchers. All agricultural producers, including farmers and ranchers, who gain 50% or more of their gross income from the agricultural operations are eligible. Small businesses that are located in a rural area can also apply. Rural electric cooperatives may also be eligible to apply.

What types of projects are eligible?
Eligible feasibility studies for renewable energy systems include projects that will produce energy from wind, solar, biomass, geothermal, hydro power and hydrogen-based sources. The energy to be produced includes, heat, electricity, or fuel.

For all projects, the system must be located in a rural area, must be technically feasible, and must be owned by the applicant.


Rural Energy for America Program Guaranteed Loan Program (REAP LOAN)

The REAP Guaranteed Loan Program encourages the commercial financing of renewable energy (bioenergy, geothermal, hydrogen, solar, wind and hydro power) and energy efficiency projects. Under the program, project developers will work with local lenders, who in turn can apply to USDA Rural Development for a loan guarantee up to 85 percent of the loan amount.


Guaranteed Loan Specifications
Loans Limits:
  • Loans up to 75% of the project’s cost
  • Maximum of $25 million, minimum of $5,000

Maximum percentage of guarantee (applies to whole loan):

  • 85% for loan of $600,000 or less
  • 80% for loans greater than $600,000 but $5 million or less
  • 70% for loans greater than $5 million up to $10 million
  • 60% for loans greater than $10 million up to $25 million

Fees and Interest Rates

  • Lender’s customary interest rate, fixed or variable, negotiated by lender and business Lender’s customary fees, negotiated by lender and business
  • One-time guarantee fee equal to 1% of guaranteed amount
  • Annual renewal fee


Benefits to Businesses
Benefits include higher loan amounts, stronger loan applications, lower interest rates and longer repayment terms that can assist businesses that may not qualify for conventional lender financing.

Benefits to Lenders
Lender benefits include expanding lender’s loan portfolio, allowing lenders to make loans above loan limits, protecting guaranteed portion of loan against loss by the Federal Government, existing secondary market for REAP guarantees, helping to satisfy Community Reinvestment Act (CRA) requirements, and allowing lenders to use their own forms, loan documents, and security instruments.

Eligibility: Borrowers, Lenders, Location
New definition being determined. Borrowers must be an agricultural producer or rural small business. Agricultural producers must gain 50% or more of their gross income from their agricultural operations. An entity is considered a small business in accordance with the Small Business Administration’s (SBA) small business size standards NAICS code. Most lenders are eligible, including national and state-chartered banks, Farm Credit System banks and savings and loan associations. Other lenders may be eligible if approved by USDA.

Eligible Project Costs
Eligible project costs include: 1) Post-application purchase and installation of equipment, 2)Post-application construction or improvements, 3) Energy audits or assessments, 4) Permit or license fees, 5) Professional service fees, 6) Feasibility studies and technical reports, 7) Business plans, 8) Retrofitting, 9) Construction of a new energy efficient facility only when the facility is used for the same purpose, is approximately the same size, and based on the energy audit will provide more energy savings than improving an existing facility, 10) Working capital, 11) Land acquisition.

KS REAP Simple Grant Application (2.25MB .pdf)

Small Wind Technical Worksheet (174KB .doc)