$200 Million Available for Energy Projects
USDA Rural Development Announces $200 Million Available to Rural Maine Small Businesses and Agricultural Producers for Renewable Energy and Energy Efficiency Projects
BANGOR, Dec. 15, 2015 – USDA Rural Development State Director Virginia Manuel has announced that the agency is now accepting applications from rural small businesses and agricultural producers to compete for $200 million in guaranteed loan funds available to finance renewable energy and energy efficiency projects in Maine’s rural communities. Funds are being made available through Rural Development’s Rural Energy for America Program (REAP).
USDA Rural Development State Director Virginia Manuel said, "This funding opportunity represents substantial potential for rural Maine businesses and agricultural producers to make long-term investments in renewable energy systems and energy-efficiency improvements through a local lender using USDA Rural Development’s REAP guaranteed loan program. This collaboration can help our businesses significantly reduce operating costs, decrease Maine’s independence on foreign oil, and ultimately demonstrate their positive environmental values to their customers and community."
USDA Rural Development has approximately $200 million available through the REAP guaranteed loan program for fiscal year 2016. Loan purposes include financing renewable energy systems such as biomass fueled anaerobic digesters and biodiesel production, solar, wind, geothermal, etc., and making energy efficiency improvements such as efficient lighting conversions, motor upgrades, building envelope improvements, HVAC upgrades and more.
REAP is a program driven by the lender who will request the USDA Rural Development loan guarantee, and if approved, make and service the loan. Benefits to our lenders include providing them with a tool that helps to expand their portfolio in rural areas, enabling them to increase earnings through participation in the secondary market, and allowing them to make loans above their lending limits. Agricultural producers and rural small businesses benefit from available credit, favorable rates and terms, and energy and cost savings.
Guaranteed loans are available for up to 75% of the total eligible project cost, and loan amounts can range from $5,000 to $25 million. The REAP loan guarantee requires that 25 percent of project costs come from other funding sources such as business equity or other borrowed funds, which could include a USDA Rural Development Business & Industry Guaranteed Loan. REAP loan guarantees range from 85% for loans of $600,000 and less to 60% for loans of more than $10 million.
A recipient of Guaranteed Loan funding in Maine is Exeter Agri-Energy. Exeter Agri-Energy utilized a USDA Rural Development REAP Guaranteed Loan along with $500,000 in REAP Grant funds to install an anaerobic digester at Stonyvale Farm, a third generation Maine dairy farm. The energy offset by the system through savings on electricity, heat, and cattle bedding was estimated to be $250,000 annually.
Applications are currently being accepted. For more information on how to apply, interested rural Maine businesses, agricultural producers, and lenders may contact Brian Wilson at 990-9168 or brian.wilson@me.usda.gov or visit the USDA Programs & Services online.
USDA Rural Development has Area Offices located in Presque Isle, Bangor, Lewiston, and Scarborough, as well as a State Office, located in Bangor. There are 58 employees working to deliver the agency’s Housing, Business, and Community Programs, which are designed to improve the economic stability of rural communities, businesses, residents, and farmers, and improve the quality of life in rural Maine. Further information on rural programs is available at a local USDA Rural Development office or by visiting USDA Rural Development's web site at http://www.rd.usda.gov/me.