U.S. Agriculture Secretary Mike Johanns has announced $176.5 million in loan guarantees and $11.4 million in grants to support investments in renewable energy and energy efficiency improvements by agricultural producers and small businesses.

"By promoting energy efficiency and development of energy sources that are farm based and renewable, we're taking another step toward achieving the President's goal of reducing America's gasoline consumption by 20 percent in ten years," Johanns announced last month. "We hope to dramatically expand renewable energy programs like these, as reflected in our 2007 farm bill proposals."

The Renewable Energy and Energy Efficiency loan and grant program was established under Section 9006 of the 2002 Farm Bill. It provides loan guarantees and grants to agricultural producers and rural small businesses for the purchase and installation of renewable energy systems or for energy efficiency improvements.

Loan guarantees cover up to 50 percent of a project's cost, not to exceed $10 million. Grants are available for up to 25 percent of a project's cost, not to exceed $250,000 for energy efficiency improvements and $500,000 for renewable energy systems.

These loans and grants are expected to reduce greenhouse gas emissions by 0.97 million metric tons, replace 821 million barrels of foreign oil and generate almost two million kilowatt hours of electricity annually.


Applications for grants must be completed and submitted to the appropriate USDA Rural Development state office postmarked no later than 18 May. The deadline for submitting loan applications as well as for loan and grant combinations is 2 July.

For more information, refer to the announcement in the 22 March Federal Register or contact any state Rural Development office.

The announcement came ahead of a speech Johanns gave on renewable energy in West Lafayette, Indiana.

In that speech, Johanns spoke about some of the renewable energy programs contained in the 2007 farm bill proposals.

He also announced a new web-based tool designed to make energy-related activities from across the Department accessible from a single web page. The Energy Matrix is a comprehensive collection of information on all of USDA's energy-related programs, research efforts, funding opportunities and technical assistance.