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USDA Investments Expand Clean Energy Options For Ag Producers

Photo Courtesy U.S. Department of Agriculture

The United States Department of Agriculture (USDA) has ramped up its clean energy investments in recent months, announcing a pair of initiatives designed to help states and rural communities increase their use of renewable energy sources and reduce energy bills. Both initiatives are partly funded by the 2022 Inflation Reduction Act and are part of a broader U.S. government effort to cut carbon emissions and combat climate change.

In April, Xochitl Torres Small, Agriculture’s deputy secretary, announced that the USDA will fund more than 700 clean energy projects. The intent is “to lower energy bills, expand access to domestic biofuels, and create jobs and new market opportunities for U.S. farmers, ranchers, and agricultural producers.”

According to an April 23 news release, USDA is providing $238 million in funding through the Rural Energy for America Program (REAP) and the Higher Blends Infrastructure Incentive Program (HBIIP).

Photo Courtesy U.S. Department of Agriculture

More than $194 million in loans and grants will be provided through REAP to support projects in 35 states and Puerto Rico. The goal is to help agricultural producers and rural small business owners increase their use of wind, solar, geothermal, and small hydropower energy and improve energy efficiency. 

The REAP program is part of the Justice40 Initiative, which “aims to ensure 40% of the overall benefits of certain federal climate, clean energy, and other investment areas flow to disadvantaged communities that are marginalized by underinvestment and overburdened by pollution,” according to the news release.

As part of the same announcement, the USDA said it would award more than $43 million in grants through HBIIP to business owners, with the aim of increasing the availability of domestic biofuels in 15 states.

The program’s mission is to provide grants to fueling station and distribution facility owners and widen access to domestic biofuels. The HBIIP investments are used to assist business owners in installing and upgrading infrastructure such as fuel pumps, dispensers, and storage tanks.

Photo Courtesy Juan Fernandez

“We are excited to partner with hundreds more family farms and small businesses to address the impacts of climate change, grow the economy, and keep rural communities throughout the country strong and resilient,” Torres Small said in a statement.

The REAP/HBIIP announcements came about a month after Tom Vilsack, USDA’s secretary, announced that the agency would invest $124 million in renewable energy and fertilizer production projects in 44 states. The projects are intended “to lower energy costs, generate new income, and create jobs for U.S. farmers, ranchers, agricultural producers, and rural small businesses.”

Photo Courtesy U.S. Department of Agriculture 

Most of the projects are funded through REAP; however, an additional one is supported by the Fertilizer Production Expansion Program (FPEP), which provides grants to independent farmers and agricultural business owners to help them produce fertilizer. FPEP funds can be used to modernize equipment, adopt new technologies, build fertilizer production plants, and finance related work.

As part of the investment, $120 million will go to REAP projects, and $4 million will go to FPEP.

According to a March 28 press release, the latter money will be spent building Bluestem facilities and purchasing equipment at three locations in Iowa and Nebraska. Bluestem is an Omaha, Nebraska-based developer, owner, and operator of renewable energy resources, 

The FPEP facilities will be used to advance Bluestem’s process of removing water and pathogens to create a dry fertilizer mix. The project is expected to yield 3,800 tons of dry fertilizer per year and 11,400 tons annually across all three facilities, which will be made available to 1,500 producers.

Photo Courtesy Bluestem Energy Solutions 

“The investments announced today will expand access to renewable energy systems and domestic fertilizer, all while creating good-paying jobs and saving people money that they can then invest back into their businesses and communities,” Vilsack said in a press release.


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