USDA late Tuesday announced it will release previously obligated funding for rural energy initiatives, including REAP, New ERA, and PACE programs. Applicants now have 30 days to voluntarily revise their proposals to align with President Trump’s Unleashing American Energy Executive Order. This move allows recipients to strip out Biden-era DEIA and climate requirements, emphasizing domestic energy production and rural economic priorities. USDA Secretary Brooke Rollins stated the shift underscores a broader realignment away from the Inflation Reduction Act that she said, “delivered more bureaucracy than benefits for rural families” and toward practical investments that serve America’s farmers, ranchers, and small businesses.
Rural Energy for America Program (REAP). REAP provides financial assistance to agricultural producers and rural small businesses for renewable energy systems and energy efficiency improvements. The program aims to increase clean energy production, efficiency savings, and economic activity in rural areas. Features include:
- Funding for fiscal years 2025-2027 at $180 million available per year
- Grants cover up to 50% of eligible project costs, up to $1 million for renewable energy systems and $500,000 for energy efficiency improvements
- Loan guarantees of up to 75% for eligible projects up to $25 million
Empowering Rural America (New ERA) Program. New ERA is a USDA program designed to support rural energy cooperatives:
- Awarded $5.5 billion in loans and grants for 28 clean energy projects across 21 states in January 2025
- Focuses on reducing emissions from rural electric cooperatives
- Allows cooperatives to receive grants for up to 25% of project costs, with a maximum of $970 million per entity
- Supports a wide range of projects, including carbon capture, renewable energy, storage, and nuclear power
Property Assessed Clean Energy (PACE) Financing. PACE is a financing mechanism for energy efficiency upgrades, renewable energy installations, and other clean energy projects:
- Available for residential (R-PACE) and commercial (C-PACE) properties, though R-PACE is more limited
- Financing is repaid through an assessment on the property tax bill
- Covers 100% of project costs with long-term payback periods
- Creates economic stimulus and jobs while helping meet emissions reduction goals