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Frequently Asked Questions
The Renewable Energy Systems and Energy Efficiency Improvements Program, also known as Section 9006, was created as part of the Energy Title in the 2002 Farm Bill. It provides grants and loan guarantees to farmers, ranchers and rural small businesses.
Section 9006 will be known as the Rural Energy for America Program (REAP) in 2008. REAP improves the Farm Bill's extremely successful Section 9006 Renewable Energy/Energy Efficiency grant and loan guarantee program.
REAP is the only major Farm Bill energy program that directly benefits farmers, ranchers and rural businesses by providing access to start-up and operating capital for all clean energy technologies (primarily ethanol, biodiesel, wind, manure digesters, energy efficiency, biomass and solar).
The Rural Energy for America Program (REAP) directly helps farmers and rural businesses develop farm-based clean energy opportunities.
Since 2003 - nearly $215 million in grant and loan guarantee awards for more than 2,100 clean energy projects in virtually every state in the country.
With a cumulative value of billions of dollars, these projects -- including wind power, biofuels, anaerobic methane digesters, solar and other power, and energy efficiency -- are helping individual farmers and rural businesses and boosting rural economies.
2008 funding levels are still being determined.
In 2007, $23 million in funding will be available nationwide. 25% of the funding is set aside for grants, 25% for grant-loan guarantee combinations and 50% for loan guarantees.
Because a dollar of federal funding can support approximately $15 in loan guarantees, the program can support $180 million in loan guarantees.
Any funds not awarded for loan guarantees will be available to fulfill additional grant funding.
In 2007, grant funds could not exceed 25 percent of eligible project costs. Guaranteed loans could not exceed 50 percent of eligible project costs. Combination guaranteed loan and grant c could not exceed 50 percent of eligible project costs.
Renewable: A minimum grant of $2,500 and a maximum grant of $500,000. A minimum guaranteed loan of $5,000 and a maximum guaranteed loan of $10,000,000.
Efficiency: A minimum grant of $1,500 and a maximum grant of $250,000. A minimum guaranteed loan of $5,000 and a maximum guaranteed loan of $10,000,000.
The program is open to farms, ranches, livestock operations, rural small businesses and rural electric cooperatives.
To be eligible, you must be actively involved in the business and the proposed project. You must also show a "demonstrated financial need" for grant funding. Farmers must derive the majority of their income from farming.
The definition of "small business" is based on the Small Business Administration's criteria based on the type of business. To determine if your business qualifies, see: http://www.sba.gov/services/contractingopportunities/sizestandardstopics/indexguide/index.html
"Rural" means a community of fewer than 50,000 people not located within a larger metropolitan area. To determine whether a potential project is in a rural area, use the rural area determination map.
Energy Efficiency: Any projects that save energy (electricity, propane or natural gas, or diesel fuel) are eligible.
Renewable Energy: Renewable energy systems can include:
Other uses that are eligible include:
Energy Efficiency: Replacement of equipment and/or improvements to a facility, building, or process that will reduce energy consumption.
Renewable Energy: Derived from wind, solar, biomass, geothermal, or hydrogen derived from these sources.
Biomass: Any organic material that is available on a renewable or recurring basis, including agricultural crops, trees grown for energy production, wood waste, wood residues, plant residues/fibers, animal wastes, fats, oil, and greases. Biomass does not include paper that is commonly recycled or unsegregated solid waste.
The following professionals offer assistance in completing and filing 9006 applications. They are listed here for informational purposes, and this listing should not be considered an endorsement by the State of Indiana or the Office of Energy & Defense Development. If you or your organization would like to be included in this list, contact Eric Burch
(317) 228 0134
Prosperity Ag Resources and Communications