New USDA Rural Energy Rule Takes Effect: Projects Must Be Built and Operating for a Year Before Applying, Cropland Ground-Mount Solar No Longer Eligible
WASHINGTON — A final rule from the Rural Business-Cooperative Service of the Department of Agriculture (USDA) overhauling the Rural Energy for America Program (REAP) took effect on October 16. The energy grant program for agricultural producers and rural small businesses now works on a build-first basis: projects must already be fully built and operational before an application is filed, and applicants must submit 12 months of actual energy production or savings data alongside 12 months of pre-installation data, with awards based on documented output, savings, costs and system performance. The rule was published in the Federal Register on October 1 (Document No. 2026-20178, 7 CFR Part 4280), with a public comment period running through November 2.
Grant limits were also tightened: requests start at $1,500, with a maximum of $500,000 for a renewable energy system and $250,000 for an energy efficiency improvement, and applicants must cover at least 75 percent of project costs, so a grant can fund no more than one quarter. Projects must have been completed 12 to 24 months before the application date, widened to 12 to 36 months for the first window under the new rule. Ground-mounted solar and wind projects on cropland are no longer eligible, multi-location projects are excluded, and solar or wind systems installed on or after October 1, 2026 that contain components made in a country listed as a foreign adversary are ineligible. State-level competitions are replaced by a single national scoring and selection process.
USDA had paused REAP grant awards in March 2026 while it rewrote the program rules. Rural Business-Cooperative Service Administrator Gimmie Jansonius states in the rule that the agency recognizes the uncertainty over whether an applicant will receive an award and expects that uncertainty to factor into applicants' decisions about buying renewable energy systems or making efficiency improvements. Application opening and closing dates for each year will be set by annual USDA notices.
Published by GSM · USA (original Chinese edition)
Photo: Minnesota 一处旧农田里的光伏板阵列（资料照片）。Courtney Celley 摄，美国鱼类及野生动物管理局 USFWS 公共领域图片，经 Wikimedia Commons 发布。
