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*Rural Energy for America Program (REAP)

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What is the current status of this program?

This program, which pre-dates the Inflation Reduction Act, is continuing, but the USDA may make changes to it for the Fiscal Year 2026 cycle, which is currently paused. We recommend checking with the NC Clean Energy Technology Center for program updates. See their Sept. 2025 update for details.

What does this funding get me?

This USDA program provides loan guarantees, grants, and combined grant and loan guarantee funding for renewable energy systems and energy efficiency improvements installed by agricultural producers and rural small businesses.

Funds may be used for the purchase and installation of renewable energy systems, such as:

  • Biomass (for example: biodiesel and ethanol, anaerobic digesters, and solid fuels)
  • Geothermal for electric generation or direct use
  • Hydropower below 30 megawatts
  • Hydrogen
  • Small and large wind generation
  • Small and large solar generation
  • Ocean (tidal, current, thermal) generation

Funds may also be used for the purchase, installation, and construction of energy efficiency improvements, such as:

  • High efficiency heating, ventilation and air conditioning systems (HVAC)
  • Insulation
  • Lighting
  • Cooling or refrigeration units
  • Doors and windows
  • Electric, solar or gravity pumps for sprinkler pivots
  • Switching from a diesel to electric irrigation motor
  • Replacement of energy-inefficient equipment

Energy efficiency improvement applications must include an energy audit or energy assessment (depending on total project cost).

Agricultural producers may also use guaranteed loan funds to install energy-efficient equipment and systems for agricultural production or processing.

Combined grant and loan-guarantee funding may be as much as 75% of project costs. Details on the amount and type of funding are in the 7-page funding announcement here.

Typically, loan guarantees that cover up to 75% of total eligible project costs are available. However, for projects approved in Fiscal Year 2025, loan guarantees up to 80% of total eligible project costs are being offered. Grants for renewable energy systems are available, with a $2,500 minimum and $1 million maximum. For energy efficiency grants, there is a $1,500 minimum and a $500,000 maximum. Currently, the USDA is maintaining the 50% cost share for eligible project costs for REAP grants. This may be reduced to 25% in Fiscal Year 2026. Check with the NC Clean Energy Technology Center for updates; their Sept. 2025 update has more detail.

Am I eligible?

Agricultural producers: An entity directly engaged in the production of agricultural products with at least 50% of gross income coming from agricultural operations.

Small businesses: Must meet the Small Business Administration size standards in accordance with 13 CFR 121, be located in an eligible rural area, and be one of the following:

  • Private for-profit entity (sole Proprietorship, Partnership, or Corporation)
  • Cooperative, including those qualified under Section 501(c)(12) of IRS Code
  • Electric utility (including a Tribal or governmental electric utility) that provides service to rural consumers and operates independently of direct government control
  • Tribal corporations or other Tribal business entities that are chartered under Section 17 of the Indian Reorganization Act (25 USC 477) or have similar structures and relationships with their Tribal entity without regard to the resources of the Tribal government.

How can I access the money?

For information on the necessary forms required to apply for funds for your projects, visit the USDA’s REAP web pages for North Carolina and South Carolina. USDA recommends reaching out to your Rural Energy Coordinators before attempting to fill out any forms or applications.

What is the timeline?

Please find your state office contact information and speak to a program specialist before attempting to fill out any forms or applications. 

The USDA was expected to begin accepting applications for REAP grants and guaranteed loans on October 1, 2025, but new information has been delayed. This page will be updated when an announcement is made for FY2026.

What other incentives could I use to help me accomplish my goals?

  • If you are installing solar or certain other clean energy technologies, REAP funding can be used in conjunction with the 30% clean electricity investment tax credit for businesses or tax-exempt entities, and businesses may also get a tax deduction on the depreciation of the equipment.
  • Check the Database of State Incentives for Renewables & Efficiency (DSIRE) for additional incentives that may be offered by your state, local government, or utility, as well as important federal, state, and local policies. For questions regarding DSIRE, contact Justin Lindemann (NC Clean Energy Technology Center) at jplindem@ncsu.edu.
  • Check out our (non-exhaustive) list of non-federal funding from other sources that may fit your energy and cost-saving goals.

What are examples of projects that have been selected for awards?

  • Walter P. Rawl & Sons Inc. to Install Solar Array – Pelion, SC ($944,212)
  • Luz Solar to purchase and install a 1.782 MWDC commercial utility scale solar array – Darlington County, SC ($1,000,000)
  • Ashley Solar to purchase and install a 3.564 MWDC commercial utility scale solar array – Darlington County, SC ($1,000,000)
  • C & M Hog Farm to purchase and install a new GSI 1226 grain dryer – Dillon County, SC ($94,846)

See more project examples.

Where can I get more information?

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