All About REAP

The Rural Energy for America Program (REAP) provides guaranteed loan financing and grant funding for farmers, agricultural producers, and rural small businesses to make energy efficiency improvements at their facilities.

Funds are available for a variety of projects that positively impact overhead energy costs. This includes renewable energy systems like solar, wind, geothermal, biomass, and even hydropower. Plus, funding covers other energy efficiency upgrades including HVAC systems, insulation, lighting, doors and windows, and much more.

In 2002 the annual Farm Bill created REAP via the USDA to give rural small businesses and farmers access to renewables and energy efficiency technology. Today, each state receives a pool of funds to distribute based on an application process.

Overall, the program represents a key part of accelerating the clean energy transition and is often an overlooked and underutilized source of funding that helps business owners and farmers reduce overhead energy costs.

Before the passage of the Inflation Reduction Act in 2021, funding provided only up to 25 percent of total project costs. In 2022, program resources quadrupled. Today, eligible applicants can secure grant funding for up to 50 percent of total project costs and loans for up to 75 percent of project costs. In addition, REAP funds may be combined with additional incentives like the 30 percent federal tax credit (ITC).

Loan Terms & Interest Rates

  • REAP loans approved in Fiscal Year 2024 will receive an 80 percent guarantee.
  • Interest rates are negotiated between the lender and the borrower.
  • Rates may be fixed or variable.
  • Variable interest rates may not be adjusted more often than quarterly.

Grant Terms

  • Renewable Energy System grants are available for $2,500 minimum and $1 million maximum.
  • Energy Efficiency Grants are available for $1,500 minimum and $500,000 maximum.

Learn more about terms and additional requirements.

Location: Foley, AL

System Size: 24.48 kW

Grant Funding: $59,885

Location: Fort Walton Beach, FL

System Size: 36.86 kW

Grant Funding: $53,477

Location: Fort Walton Beach, FL

System Size: 19.855 kw

Grant Funding: $35,753

REAP eligibility depends on a handful of factors. Business owners and farmers must be located in a REAP-eligible area. In addition, farmers must earn at least 50 percent of their gross income from agricultural operations. See if you’re eligible using the map above or search for your business address.

All REAP projects require collaboration with your local USDA office and a regional REAP Representative. Energy Consultants at SunFarm Energy can also assist with providing documentation, permits, and other necessary documents. Start your application today!

Learn more and start your application process today.