Farmers and small businesses owners were expecting to start submitting their applications for a grant through the Rural Energy for America Program this July 1. But, one day before, the Department of Agriculture released a notice stating that the application window was canceled.
It’s not the first time this has happened.
Gabe Chelius works at the nonprofit Clean Energy New Hampshire providing technical assistance to those wishing to apply for a REAP grant. Back in December, they also received a notification that the March application window would be canceled because the USDA was still working on reviewing the applications received during the previous cycle.
“We only had a one day window for this most recent update, but the one before, it had been about a month before the next window opened when we'd gotten a communication about that change,” he said.
Chelius’s team connects people to all the resources they need to file an application. They can also write the grant applications free of charge. He said that, in about a year and a half, his team has written close to 20 applications.
“The main goal of REAP is to lower the energy use for the business whether that's through efficiency or new energy generation,” Chelius explained.
The program works through a reimbursement model, matching 50% of the cost to complete an awarded project. Those can range from installing solar panels from getting a new hot water heater, Chelius explained.
“Where I've really seen it be impactful is that it saves these folks a lot of money each year,” he said. “Farmers don't always have a lot of capital, so these grants are really important for them, for the longevity of their farm or for the longevity of a business.”
Read more about how federal funding freezes have affected farmers who had applied for these grants.
The program has been around for almost 20 years, but the passage of federal climate legislation in 2022 introduced a new influx of funds. The program went from a 25% match to a 50% one, and also moved to a quarterly application schedule, adding two more application windows.
“It's a shame that these past two periods haven't been open, but if you look at it from a historical context, moving on from the IRA now, it might not be surprising if we move it back to twice a year,” Chelius said.
Closing those two application windows will delay projects for about three months, until the next cycle opens in October. “But a lot of times the investments we're making are investments into long term resilience for the business,” Chelius stressed. “So three months does make a difference, but in the grand scheme of things it's not a huge detriment.”
The 2022 Inflation Reduction Act had also introduced changes to the project selection process.
According to Chelius, applications are selected based on a scoring model, which gives points for things like return on investment potential. Under the IRA, applicants could also gain points for diversity and inclusion. For example, if a business was female-owned or located in a disadvantaged community.
That criteria has since been removed and individuals were asked to revise their applications to remove DEI components.
Because only a few points were given for that category, Chelius said it’s difficult to say how much of a difference it made to the selection process. Still, he thinks removing that criteria might make REAP less competitive.
“They saw a three fold increase in applications over the IRA years,” he said.
While Chelius admits that all these changes have caused uncertainty, he thinks it’s too soon to be concerned about the program disappearing entirely, since REAP dates back to 2008.
In New Hampshire, a few projects funded through REAP are breaking ground this summer.
Chelius highlighted a general store in Stoddard which was awarded a solar application, a farm in Claremont installing a solar tracker in the summer and a business in Bethlehem putting solar on the roof of their Main Street location.
“Farmers taking it upon themselves to build their own energy production is like the epitome of New Hampshire,” he said.
