Agriculture Biofuel SummitOctober 19-20, 2010

USDA Rural DevelopmentBusiness Cooperative Programs

John Guthmiller, Program Director406-585-2540

john.guthmiller@mt.usda.gov

Business Cooperative Programs• Business & Industry (B&I)Guaranteed Loan • Rural Business Enterprise Grant (RBEG) • Rural Business Opportunity Grant (RBOG) • Intermediary Relending Program (IRP) • Rural Cooperative Development Grant (RCDG) • Rural Economic Development

Loan & Grant (REDLG) • Value Added Producer Grant (VAPG) • Renewable Energy for America Program (REAP)Grants & Guarantees • Renewable Energy Audit (EA) Grants• Energy Feasibility Study (FS) Grants• Rural Microentrepreneur Assistance Program (RMAP)

Energy Programs

• Biorefinery Assistance Program (Section 9003)– Provides guarantees on loans up to $250 million to

construct commercial scale biorefineries.– 2010 Application deadline is August 4, 2010

• Repowering Assistance Program (Section 9004)– Provides payments to biorefineries to replace fossil fuel

energy sources with renewable energy sources– 2010 Application deadline is July 20, 2010

Energy Programs (cont.)

• Bioenergy Program for Advanced Biofuels (Section 9005)– Provides payments to advanced biofuel producers (biomass

conversion facilities) for producing advanced biofuels.– 2010 app deadline is July 6, 2010 for transportation fuels only

• Similar to FSA’s Biomass Crop Assistance Program (BCAP) (Section 9011)– Provides payments for collecting, harvesting, storing, transporting

biomass to eligible advanced biomass conversion facilities.– http://www.fsa.usda.gov/FSA/webapp?

area=home&subject=cops&topic=bcap

Energy Programs (cont.)

• Rural Energy Self-Sufficiency Initiative (Section 9009)– Provides grants for the purpose of enabling

eligible rural communities to substantially increase their energy self sufficiency.

– Rule to be published by Spring 2010.

Rural Energy for America Program (REAP) aka Section 9007

• Grants• Guaranteed Loans• Project development: ►Renewable Energy Systems

►Energy Efficiency Improvements• Energy Audit Grants• Feasibility Study Grants

Renewable Energy System TechnologyBioenergy (Biomass)Anaerobic DigestorGeothermal – Electric GenerationGeothermal – Direct Use HydrogenSolar WindHydropower

Energy Efficiency Improvements

• Defined:

Improvements to a facility, building, or process that reduces energy consumption, or reduces energy consumed per square foot.

REAP Eligible Applicants

• Agricultural Producer– Directly engaged in agricultural production– 50% or greater of gross revenue from agriculture– Located in rural area less than 50,000 population

• Small Business– SBA size standards– Located in rural area less than 50,000 population– Must operate independent of direct government

control

REAP Restrictions• Residences cannot benefit from project– Separate meters

• Nonprofit corporations are not eligible• Applicant must be the owner• Maximum grant/loan combo cannot exceed

75% of eligible project cost• Revenues sufficient for operation,

management maintenance, and debt service.

REAP Guarantee• Commercial Loan• Minimum loan: $5,000 • Maximum loan: $25 MM or 75% of project• Rates & Terms: Negotiated • Guarantee is 85% to $650,000 / 80%to $5 MM

/ 70% to $10 MM / 60% to $25 MM• 1% Fee

REAP Grant Funding 25% of eligible project cost

• Renewable Energy System:

• Energy Efficiency

Improvement:

Minimum / Maximum

$2,500 to $500,0000r 25%

$1,500 to $250,000or 25%

2010 REAP Funding • State Allocation–Grants < $20,000 – $218,301–Grants > $20,000 - $173,178– Loan Guarantees - $1,858,870

• National Office Reserve (priority order)– Loan Guarantee only– Loan Guarantee/Grant Combo–Grant only

Montana 2010 REAP Usage

• 4 small grants totaling $25,780– $192,521 returned to the National Office

• 4 large grants totaling $577,587– $404,409 received from the National Office

• 2 loan Guarantees totaling $10,200

Agricultural Biofuel SummitImportant Websites:• www.rurdev.usda.gov/mt • www.farmenergy.org • www.rurdev.usda.gov/ia

Questions?