USDA REAP: Only Built Rural Energy Projects Need Apply Now
Published Date: 10/1/2026
Rule
Summary
The USDA’s Rural Energy for America Program (REAP) is shaking things up! Now, only projects that are already built and running can apply, using real energy data from the past year. This new way speeds up applications, cuts red tape, and focuses on rewarding projects that prove they save energy and money, starting October 2026.
Analyzed Economic Effects
8 provisions identified: 1 benefits, 5 costs, 2 mixed.
No large ground-mount solar on Cropland; foreign-adversary parts banned
REAP excludes ground-mount solar photovoltaic and wind turbines installed on certified Cropland (per 7 CFR 718.2) and disallows any solar or wind system components made in a country named as a foreign adversary (per 15 CFR 791.4). An exception exists for projects completed before the regulation's publication.
Grants only after projects are built
Starting October 16, 2026, you can only apply for REAP grants after your project is fully built and operational. Your application must include 12 months of actual pre-installation energy data and 12 months of actual post-installation energy production or savings.
One location, one award per year limit
REAP no longer accepts multi-location projects — each application must represent a single project at one location. Applicants are limited to one application and one award per Federal Fiscal Year.
Tighter applicant eligibility rules
To apply you must be the Highest-Level Owner (no parent entity owning you), be an Existing Business at application with a current assets-to-liabilities ratio of at least 1:1, and Rural Small Businesses must meet SBA small business definitions. Applicants with foreign investment will be evaluated and entities deriving income from gambling are ineligible (with Tribal gaming exceptions).
New limits on project types and equipment
Certain projects and equipment are now ineligible: flexible fuel pumps, electric vehicles and chargers/charging stations, standalone energy storage, retrofitting an existing renewable system to add storage, Biogas pipelines, distribution-only projects, and mobile projects not directly mounted on business vehicles. Battery energy storage is limited to 120% of the applicant’s average energy use for the 12 months before installation. The minimum REAP award for RES and EEI is $1,500, and projects must have Simple Payback equal to or less than Useful Life to be eligible.
Single national competition and faster processing
The program replaces state-level competitions with one national scoring and selection process, will publish annual application windows, and plans an online application portal. USDA says these changes will shorten application length and reduce review times.
Grant plus guaranteed loan allowed; combined funding cap
You may separately apply for and receive a REAP guaranteed loan (under 7 CFR 5001) and a REAP grant for the same project, but combined REAP grant and guaranteed loan funding is capped at 75% of project costs (the 75% limit is noted in Sec. 4280.122(b)).
New provenance and foreign-ownership disclosures
Applicants must identify the name and percentage of any foreign ownership and must provide the country of origin for all solar photovoltaic and wind system components (panels, inverters, racking, monitoring software, etc.).
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Key Dates
Department and Agencies
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