The Biden-Harris Administration today announced the availability of nearly $11 billion in grants and loan opportunities that will help rural energy and utility providers bring affordable, reliable clean energy to their communities across the country. This represents the single largest investment in rural electrification since President Franklin D. Roosevelt signed the Rural Electrification Act into law in 1936.
Funding is available through two programs under President Biden’s Inflation Reduction Act. Specifically, the U.S. Department of Agriculture (USDA) will be opening a Letter of Interest process for the Empowering Rural America (New ERA) program, which makes $9.7 billion available to eligible rural electric cooperatives to deploy renewable energy systems, zero-emission and carbon capture systems. In addition to New ERA, USDA will also be opening a Letter of Interest process for the Powering Affordable Clean Energy (PACE) program, which makes $1 billion available in partially forgivable loans to renewable-energy developers and electric service providers, including municipals, cooperatives, and investor-owned and Tribal utilities to help finance large-scale solar, wind, geothermal, biomass, hydropower projects and energy storage in support of renewable energy systems.
Together, these two programs represent the single largest investment in rural electrification since President Franklin Delano Roosevelt signed the Rural Electrification Act into law in 1936. This announcement is part of President Biden’s Investing in America agenda to grow the American economy from the bottom up and the middle out by rebuilding our nation’s infrastructure, driving more than $435 billion in private-sector manufacturing investments, creating good-paying jobs, and building a clean-energy economy to tackle the climate crisis and make our communities more resilient, according to the USDA statement.
More information on the New ERA program is available at www.rd.usda.gov/programs-services/electric-programs/empowering-rural-america-new-era-program. Rural electric cooperatives, including current and previous USDA borrowers, are eligible for funding. To apply, eligible entities must submit a Letter of Interest between July 31 and Aug. 31, 2023.
More information on the PACE program is available at www.rd.usda.gov/programs-services/electric-programs/powering-affordable-clean-energy-pace-program. Loans through this program may be forgiven by 40% of the loan amount, and the maximum loan amount is $100 million. Applicants in Puerto Rico, the Federated States of Micronesia, the Republic of the Marshall Islands, the Republic of Palau, and Tribal communities are eligible for up to 60% loan forgiveness. For this program, USDA will begin accepting Letters of Interest starting on June 30, 2023, on a rolling basis until Sept. 29, 2023.
The goal of the PACE program is to make clean energy affordable for vulnerable, disadvantaged, Tribal and energy communities to heat their homes, run their businesses and power their cars, schools, hospitals and more. USDA may be able to leverage nearly $3 billion in projects through this program. This is in line with President Biden’s Justice40 Initiative, which aims to ensure that 40% of the overall benefits of certain federal investments reach disadvantaged communities that are marginalized and overburdened by pollution.