As the conference committee meets to see if Congress can finally pass a Farm Bill, the renewable energy industry sent a letter urging them to fund rural energy programs.
While we don’t often think of the farm-renewable energy connection, under the Farm Bill, the US Department of Agriculture (USDA) has assisted bringing thousands of solar, wind and biogas projects to farms, while helping them increase their efficiency.
The Rural Energy for America Program (REAP) funds up to 25% of a renewable energy system or energy efficiency upgrade and provides additional support through loan guarantees. 8,250 renewable energy and energy efficiency projects have been installed under the Obama administration.
The Biorefinery Assistance Program supports young companies in getting their biofuel technologies off the ground. Sapphire Energy’s $54 million loan from the US Department of Agriculture (USDA) allowed it to build its Green Crude Farm in New Mexico, which turns algae into crude oil. Sapphire paid the loan back this year.
While these programs represent a tiny portion of Farm Bill costs – 0.7% of the 2008 Farm Bill – they are responsible for much of the growth of the US renewable energy industry, they say. Both programs are hanging by a thread because of funding cuts over the past few years.
The letter – from the solar, wind and biofuels trade associations – asks them to re-authorize $900 billion in guaranteed funds for the next five years, which is in the Senate version of the bill (S.954).
In the past, these funds have leveraged billions of dollars in private investment, they say. "These new agriculture, manufacturing, and high technology jobs are at risk without continued federal investment."
The House version, (HR 2642) leaves this funding out and instead, authorizes $1.4 billion in discretionary funds that can be allocated as congress wishes.
Indeed, in 2011, House Republicans cut funding from $75 million to just $1.3 million for the Rural Energy for America Program. They wanted to scrap the program.
Rep. Tim Walz (D-MN), the ranking member of the House Agriculture Subcommittee on Conservation, Energy and Forestry, is expected to lead on getting these programs through conference committee negotiations.
"The U.S. is experiencing strong growth in the development and commercialization of biofuels, bioproducts, biopower, biogas, energy crops, renewable energy, renewable chemicals and energy efficiency. These important and growing industries all benefit agriculture and forestry and are poised to make huge contributions to our economic, environmental and national security in the coming years, provided that we maintain stable policies that support clean energy manufacturing and innovation," the letter says.
Read our article, Why We Should Go Back to the Drawing Board for the Farm Bill.
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