USDA REAP Grant Increases in 2023
In a time of great need for increased investment in renewable energy, the green energy economy continues to grow in the United States. Electric vehicle sales have doubled in recent years, and more and more Americans are looking for ways to invest in renewable energy sources for their businesses and homes.
Still, a major hurdle in the renewable energy economy is finding ways to make renewables more accessible to the average American. As discussed in a previous blog entry, the US Department of Agriculture’s REAP Grant Program (Rural Energy for America Program) allows agricultural producers and rural small business owners the ability to receive grant money for investment in renewable energy systems. This year, the potential funding available to applicants has risen to an unprecedented level.
Before we get into the increase in the REAP grant, it is important to understand the program itself. The REAP program provides eligible applicants with guaranteed loan financing as well as grant funding for both energy efficiency improvements and the implementation of renewable energy systems. For those looking to implement renewable energy systems, the REAP program can provide funding for biomass, geothermal, hydrogen, wind, and solar power systems. The REAP loan program can provide loan guarantees on up to 75% of the total project cost.
The biggest change in the program in 2023, is that this year the REAP grant can provide funding for up to 40% of total project costs. This marks a 15% increase in the grant money provided for accepted applicants in comparison to 2022 and previous years. When a small business owner or agricultural producer combines the REAP grant with the Investment Tax Credit of 30% (that was recently increased by the Inflation Reduction Act), the property owner will be looking at an incredible 70% savings on the entirety of the project.
To put this all into perspective, a small business owner looking to install a $50,000 photovoltaic array would only be paying $15,000 for the total of the project, if they are accepted for the REAP grant and receive the Investment Tax Credit. Though the system would only cost the business owner $15,000, the owner’s property value would likely increase by the approximate total cost of the project as discussed in a previous blog entry examining how a solar array can impact one’s property value.
At Northstone Solar we have helped a number of small business owners successfully complete the REAP Grant application and have helped save around $100,000 for our clients. If you are interested in pursuing a solar project or have questions about the REAP Grant program, contact us today.
Sources:
https://www.rd.usda.gov/programs-services/energy-programs/rural-energy-america-program-renewable-energy-systems-energy-efficiency-improvement-guaranteed-loans