Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 1 USDA Funding for Renewable Energy and Energy Efficiency Improvements February 23, 2007 Rowan University Glassboro, New Jersey Presenter: Victoria Fekete, Loan Specialist USDA Rural Development
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Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 1 USDA Funding for Renewable Energy and Energy Efficiency Improvements February.
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Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006
Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006
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What is the Section 9006 Program?
• Created as a U.S.D.A. program• Program designed to assist farmers,
ranchers and rural small businesses with energy projects
• In FY 2006, this program provided $11 million nationwide in grant funds for renewable energy systems and energy efficiency improvements as well as $176 million in loan guarantees.
Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006
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Who is Eligible?
• Agricultural producers and rural small businesses can apply
• Definitions:*– Rural – Any area other than a city of town with population
over 50,000. Cannot be in urbanized area adjacent to such a city or town.
– Agricultural Producer -- An individual or entity directly engaged in the production of agricultural products (including farming or ranching) that gets 50% + of their gross income from the operations
– Small Business – A private entity including a sole proprietorship, partnership, corporation or cooperative
• Must have 500 or fewer employees and $20 million or less in total annual receipts.
• Excludes entities formed solely for a charitable purpose.• Must meet SBA definition of small business
* Summarized definitions. See Full RD Instruction 4280-B for full definitions.
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Who is Eligible? (cont’d)
• Must use systems that are commercially available (have a proven operating history & an established design, installation, equipment & service industry)
• Applicant must demonstrate that it is unable to finance the project from its own sources or other sources without grant assistance.
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Who is Eligible? (cont’d)
• Applicant must have financial feasibility (The ability to achieve the projected income and cash flow. The cost accounting system, the availability of short term credit for seasonal businesses and the adequacy of raw materials and supplies will also be assessed.)
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ELIGIBLE PROJECT COSTS
• Purchase/Installation of Equipment• Construction & Improvements• Energy Audits• Permit Fees• Professional Service Fees• Feasibility Studies• Business Plans• Retrofitting
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ENERGY AUDIT
Required for ALL energy efficiency improvement projects over $50,000,
• written by an independent qualified entity, • documents current energy usage,• recommends improvements & their costs, • projects savings, and • shows the average payback period in years.
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INELIGIBLE PROJECT COSTS
• Land acquisition• Capital leases• Working capital• Residential improvements• Agricultural tillage equipment• Vehicles• Grant application preparation• Waste collection
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Farm Bill Definitions
• Renewable Energy – energy derived from:– wind, solar, biomass, or geothermal source, or – hydrogen derived from biomass or water using one of the above
energy sources
• Biomass – any organic material that is available on a renewable or recurring basis. Includes:– agricultural crops– trees grown for energy production– wood waste and wood residues– plants (including aquatic plants and grasses)– residues, fibers – animal wastes and other waste materials, and – fats, oils and greases (including those that are recycled).
• The term “biomass” does not include paper that is commonly recycled or unsegregated solid waste.
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Technical Requirements
• Different technical requirements are based on type of technology & size of project
• All renewable energy requirements follow the same standard project development process:– Qualifications of project team– Agreements and permits– Resource assessment– Design and engineering– Project development schedule– Financial feasibility– Equipment procurement– Equipment installation– Operations and maintenance– Decommissioning
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Technical Requirements• Different Technology Requirements for:
1. Biomass, Bioenergy 2. Anaerobic Digester3. Geothermal, electric generation4. Geothermal, direct use5. Hydrogen6. Solar, small (10 kW or smaller)7. Solar, large (larger than 10 kW)8. Wind, small (100 kW or smaller)9. Wind, large (larger than 100 kW)10.Energy Efficiency
• USDA has worked with technology experts to develop Guidance on the Technical Requirements for each technology. – Designed to help applicants better understand how to
respond to the technical requirements.– Available at www.rurdev.usda.gov/rbs/farmbill/
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Environmental Requirements
• All projects receiving federal grants are subject to the provisions of the National Environmental Policy Act (NEPA).
• The USDA will perform the NEPA review• Per RD Instruction 4280-B, applicants must:
– Complete Form RD 1940-20, “Request for Environmental Information.”
– Provide all information necessary for the Agency to complete a NEPA review and analysis. USDA may contact applicant after preliminary review if more information is needed.
– Be responsible for any applicable analyses and studies required as part of completing the NEPA analysis (i.e. Archaeological studies, Biological Assessments, etc.)
– Strive to achieve positive community support, select good sites, and mitigate environmental impacts resulting from their proposals.
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Environmental Requirements• If an environmental review cannot be completed in
sufficient time for grant funds to be obligated by September 30, 2007, grant funds will not be awarded.– One potential exception: funds may be obligated even
though the U.S. Fish and Wildlife and Historic Preservation portions of the NEPA review are not completed.
– Funds will not be disbursed until the full NEPA review is satisfactorily completed.
• If a project requires public comment and input as part of the NEPA review, the applicant will need to complete that effort prior to September 30 to receive an award.
• If you anticipate any potential environmental or public concerns with your project, discuss these with your USDA state rural energy coordinator as early in the development process as possible.
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Evaluation Criteria
• All projects scored on:– Quantity of energy replaced, produced or saved –greater the
quantity higher the score– Environmental Benefits – if project is needed to meet
environmental regulation, it gets extra points– Commercial Availability – extra points if available– Technical Merit Score - this is scored by NREL– Cost Effectiveness – the shorter the payback, the higher the
score– Matching Funds – the higher percentage match that the
applicant provides for the grant, the higher the score– Management – if the project is monitored and managed by a
third-party qualified operator, it gets extra points– Small Agricultural Producer – if the applicant qualifies as a
small producer, the project gets extra points.– Simplified application/low cost project – if project costs
under $200,000, it gets extra points– No Previous Grants within last 2 years – project gets extra
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Technical Merit Points
• Qualifications of the Project Team• Agreements and Permits• Energy or Resource Assessment• Design and Engineering • Project Development Schedule• Project Economic Assessment• Equipment Procurement• Equipment Installation• Operation and Maintenance• Dismantling and Disposal of Project
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More Information
• Web site for the USDA Farm Bill Section 9006:www.rurdev.usda.gov/rbs/farmbill/– Overview of Program– Standard Government Application Forms– Technology-specific Guidance for Technical
Requirements – Links to other resources and incentives for these
technologies• Additional website for invaluable assistance, fillable
forms and reference material is: www.rurdev.usda.gov/ia/rbcs_RE-EE_grants.html
• NOTE: This is a site maintained by USDA Rural Development in Iowa. All inquiries, correspondence and applications must be addressed to USDA Rural Development in NEW JERSEY.