Does Your Business Qualify to Receive Renewable Energy Grants?

There is much talk in the grant world about green energy and renewable energy.  The federal government has certainly put its money where its mouth is with regards to clean energy and renewable energy in the form of new grants to support green energy manufacturing, decarbonization of manufacturing facilities, and development of new clean energy technologies.  In addition, a generous amount of additional funding was allocated to current programs such as the USDA Rural Energy for America Program, or REAP.

If you are planning to install renewable energy such as solar, wind, or geothermal at your manufacturing facility you may wish to take advantage of the incentives available.  In this article, I will explain what is typically required to access this funding.

How Would Your Business Qualify for Renewable Energy Grants? 

  • Ensure you are an eligible entity. For most renewable energy grants, including the REAP program grants (the most common source for manufacturers), the following are considered eligible entities:
    • Private for-profit entity that meets Small Business Administration (SBA) size standards
    • A cooperative
    • An electric utility that provides service to rural consumer and operates independent of direct government control
    • A tribal corporation or other Tribal business entities
    • Companies with no outstanding delinquent federal taxes, debt, judgement or debarment.
    • Agricultural producers
  • You are located in an eligible area. For REAP funding, the USDA Eligibility Map allows you to insert your address where prompted.  The map will tell you whether or not your business’ location qualifies.
  • If you are replacing more traditional sources of energy usage, obtain actual historical energy consumption data. USDA asks for the most recent 12 to 60 months. For new buildings installing renewable energy, this would be scored by REAP as an energy generation project.
  • Ensure that you are installing qualifying renewable energy technology. For REAP, this includes energy derived from wind, solar, renewable biomass, ocean, geothermal or hydroelectric source, or hydrogen derived from renewable biomass or water.  These are typical technologies for most renewable energy funding sources.
  • To received maximum funding through the REAP program (50% of project cost), identify if your project fits into one or more of the following categories (if not, grants can only cover 25% of the project cost):
    • Renewable energy system or retrofits produce zero greenhouse gas emissions at the project level;
    • Projects located in an Energy Community
      • A brownfield site
      • A metropolitan or non-metropolitan statistical area had 0.17% or greater employment or more than 25% of tax revenues that came from extraction of coal, oil or natural gas and has an unemployment rate at or above the national average for the previous year
      • A census tract in which a coal mine has closed or a coal-fired generating unit has been retired or is directly adjoining to this census tract
    • Energy efficiency improvement projects
    • Projects proposed by eligible Tribal entities.
  • Identify all activities associated with your project. For example, do you need to replace a roof to structurally support solar panels?  If so, REAP may cover the cost of the roof.
  • Identify your greenhouse gas emissions (GGE) historically and estimate the reduction once you install the renewable energy equipment. The EPA has a calculator you can use to estimate GGE.

While the REAP program largely informed the above recommendations, I have found that most grant programs that fund renewable energy have these basic requirements.  Funding for renewable energy projects is largely predicated on the amount of fossil fuel or greenhouse gas reduction your project will result in.  The most information you can put into the application to show this outcome, the more likely you are to get funding!

If you need assistance evaluating your project’s fit with REAP or other renewable energy funding, please contact our team to schedule a brief and complimentary discovery call.

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