Real farmers save piles of cash on energy
“I would encourage any farmer to look at it if they have access to the REAP grant. With a 25% cost share and the prices coming down so much, it’s become very affordable for farms to do this. I’m very pleased.”
–Spencer Pope Farms, Carthage, MS
You may have heard something about USDA REAP grants, the program that provides loans and grants to help agricultural producers and rural small businesses install renewable energy, especially solar.
But these days, it’s hard to know what to really make of it when you hear stuff like this, so you may be feeling a bit skeptical. Rest assured, the REAP grant is real, and we’re going to show you a couple case studies of businesses that have won REAP grant funding, and are now saving big money on their utility bills.
REAP grants can help your rural business go solar
Even though solar prices are much lower today than in the early days, a lot of farmers and rural small business owners still shy away from solar power because of what seem like steep upfront costs.
With the REAP grants and loans now available, the optimal time to make the switch to solar energy is now. Solar is the best way to secure huge long term energy savings. The USDA REAP grant makes it possible for agricultural producers to realize those savings much sooner.
Check out the case studies a bit farther down to see how much they saved through solar and other renewable energy projects with help from a REAP grant. Curious? Get a ton of REAP grant and loan information in this post.
What is the USDA REAP Grant?
There are two major parts to the Rural Energy for America Program (REAP): the grant and the guaranteed loan. The grant gets more attention, but both components are helping small businesses and agricultural producers across America cut their energy costs and shorten the payback period.
The REAP grant is like getting up to a 50% off coupon for your new solar panel installation. The loan can cover up to 75% of the costs of a project. The Rural Energy for America Program was created to help agriculture producers and rural small businesses improve their energy efficiency and save big money. It does this in two primary ways:
- Grants and loans to fund installation of renewable energy projects like solar technology
- Grants and loans to fund energy efficiency improvements like LED lighting
To qualify for a REAP grant or loan, your farm or rural small business must be eligible. The main issue is the location of your farm or small business. You must be in a rural area with fewer than 50,000 people. Click here to see if your farm or small business is eligible for the REAP grant.
How does REAP funding cut farm expenses?
The maximum grant award for a REAP grant is 50% of the total project cost, up to $1 million for renewable energy installations including solar power. The maximum loan amount is $25 million. So, the biggest advantage of winning a grant is that you’ll be able to fund a solar system while investing in less than half the cost.
And if you can combine a REAP grant or loan with state, local, or federal tax incentives, you can take a big bite out of the already-falling costs of solar panel installation. How big?
The federal solar tax credit currently sits at 30%. If that’s the only tax credit you get, and you also win REAP grant funding for 25% of the project cost, you’ll have avoided over half the cost of your solar system installation. If you win a 50% grant, you’d cover 80%!
And that doesn’t include the money you save on energy simply by having solar panels. With a good-sized system, you can eliminate a large portion of your energy bill every single month. How much depends on how many panels you choose to install.
But if you can obtain big funds from a REAP grant, you can install more solar panels and save even more.
What are the other benefits of winning a REAP grant?
In addition to the financial benefits of solar energy and being able to install it for less than half the price, USDA REAP grants also enable you to install more panels than you otherwise might have chosen.
These are made up numbers, but they make the point:
Suppose you were going to install $50,000 worth of panels to power your agricultural operations, because with the federal tax incentives, you could do it for just $35,000, and you’re comfortable with that investment and the timeline for recovering it.
But what if you also won REAP funding that would cover 25% more of the cost? If you are still willing to spend $35k, this would mean you could now buy over $60k worth of solar. If you win a 50% grant, you could get even more.
The more grant funds you win, the shorter the payback period for your project will be.
Examples of renewable energy projects
In 2024, the USDA REAP grant gave out $120 million to 544 projects over 44 states, and many of the renewable energy projects were solar panel installations for farms and other rural small businesses.
Here are two REAP case studies to give you some specific numbers.
REAP Grant case study 1: Free electricity at Spencer Pope Farms
Like many farmers who may be uncertain about solar energy, Spencer Pope heard about the REAP grant and wasn’t entirely sure it would be a good investment. But energy costs on his Mississippi poultry farm were skyrocketing “through the roof,” and the $20,000 solar REAP grant provided enough funding to make his panels affordable.
See How much would you save?
So in 2009 he installed enough solar panels to cover 20% of his farm’s electricity usage. It was an 8.4kW photovoltaic (PV) solar system. In the first year, it saved him $250 per month, which was more than the predictions he’d been given.
$250 per month equates to about $3000 per year. With the REAP grant and other tax incentives, he realized he would recover the cost of his solar panels in just a few years.
Pope was so pleased by these results that he installed an additional 38.7kW of solar after that. With that additional project, his solar panels generate 100% of his poultry farm’s electricity needs. And now, 15 years later, he has completely recovered his investment and gets free electricity every year on his farm.
Pope is now a solar believer. He wants every qualified rural small business to know that USDA REAP grants and loans have turned solar power into the most economical way to slash your energy costs:
“Especially with solar, now that prices have come so extremely down in the past two years, we really are at the point where this grant will be the tipping point…. I would encourage my neighbors to pursue it.”
REAP Grant case study 2: Energy efficiency audits, University of Georgia
In this example, REAP funds didn’t go directly to farms, but instead funded an energy auditing program that has led to thousands of poultry businesses saving on energy costs.
The University of Georgia won a $100,000 REAP grant that allowed it to perform energy audits for poultry farms throughout Georgia. These audits gave farmers specific steps they could take to improve their energy efficiency. As a side benefit, the audits also gave information about USDA REAP grants, so they could pursue their own grant funding for solar energy and other renewable energy projects.
So far they have audited over 1000 poultry houses on 50 farms. 75-80% of those farms have now made energy efficiency upgrades because of what the audits found, such as outdated equipment. One problem was found on almost every farm – plastic ventilation curtains. Replacing these with insulated walls cut energy use by as much as 50%.
The amount of energy savings just from these audits is enough to power 5600 homes. Dr. John Worley from the university says it this way:
“If we can put money into helping people be more energy efficient and use less energy, then that’s probably the cheapest way to reduce our dependence on fossil fuels.”
How much more can be done?
There are over 12,000 poultry houses in Georgia alone. In the whole Southeastern US, there are many more than that. And there are many other kinds of farms and rural small businesses too. The potential energy and cost savings are enormous – for individual agricultural producers and for the whole energy grid.
And that’s just from making efficiency improvements. If these farmers were also to use the REAP grant to install solar power, their financial savings and their energy conservation would both skyrocket.
How do I apply for a REAP Grant or loan?
First, check if you’re eligible for the REAP grant here.
As you might expect with the government, they make the REAP grant application process more complicated than it needs to be. There is a lot to do, and it can quickly get overwhelming. Visit this USDA page for more details.
But if you’re serious about wanting to save big on your energy bills by switching your farm or small business to solar, Ag Solar will take care of your REAP application. We’ll simplify the process, make it easier, finish it faster, and ensure accuracy with all the details so you get the biggest USDA REAP grant possible.
Ag Solar’s REAP application track record
We’ve successfully submitted numerous REAP grant applications for all sorts of projects, and have won millions of dollars for our customers in grant funding.
We know how to write applications that lead to big REAP grants. We also specialize in agriculture industry solar panel installations, and we know the ins and outs of the REAP grant program for these specific types of projects.
Contact us today and we’ll help you answer questions about REAP funding, such as:
- Is my farm eligible to receive a REAP grant or loan?
- If so, how much funding might I get?
- What’s best for me – the grant or the loan?
- Which REAP grant application do I have to fill out?
- What information do I need to have ready to submit the application?
- When are the application deadlines? (It changes every year)
- And much more
We’ll walk you through the REAP grant application process and make sure you get the most funding and the best possible deal on your new solar panels. Soon enough, you’ll be able to tell your fellow business owners and other friends about how much money you saved on your energy, just like Spencer Pope has done.
As he said, the REAP grant has made this the “tipping point” that makes solar not just a feel-good dream, but the most economically wise option available to eligible agricultural producers.
