As legislators calculate the right balance on how much to spend on infrastructure and clean energy, they should take stock of both the environmental and the economic gains that everyday Americans earn through the transformation to an efficient, clean energy economy.
And make no mistake: The transition is underway, built up from many small projects and successes. Congress can maintain momentum by funding smart policy choices, such as USDA’s Rural Energy for America Program. In its nearly 20-year history, this program has supported more than 20,000 renewable energy and energy efficiency projects for rural businesses and farms. These projects are mostly small in scale and cost, but they add up to a big impact.
The return on these cost-sharing investments can be measured in many ways.
For example, this year a small family farm in Arizona received a $2,625 grant to help purchase LED lighting along with an energy efficient refrigerator and freezer. With the new equipment, the business will save about 30% on utility expenses each year, or about $858. That means in just over three years, the family will recoup their half of the investment. And they’ll reduce greenhouse gas emissions by 2.37 metric tons each year.
Also this year, a family-owned poultry farm in Pennsylvania received a $14,639 grant to install a 33.6-kilowatt solar photovoltaic system. This system will generate 100% of the farm’s electricity needs each year, about 28,609 kilowatt-hours of electricity. The farm will save $4,309 in electricity costs each year, recouping their share of the costs in less than three-and-a-half years. The project will also eliminate 20.3 metric tons of greenhouse gas emissions each year, at a cost of just $212 dollars per ton over the same length of time.
Additionally this year, a small, family-owned maple sugar producer in New Hampshire will use a $9,742 grant to install a more energy efficient evaporator, enabling them to eliminate 500 gallons of fossil fuel use in their operation. That will reduce energy costs 75% and save the growing business almost $1,100 annually.
And a hemp wood manufacturing facility in Kentucky will receive a $20,000 grant this year to make energy efficiency improvements in their process. The project will save the facility $12,731 per year in energy costs — a 64% return on investment in the first year. It will save 337,386 kWh of electricity annually, or enough to power around 30 homes during the year. And the energy efficiency improvement will save 231 metric tons of greenhouse gas emissions at a cost of just $84 per metric ton.
Appropriately, USDA announced these grant awards — and more than 100 others — on Earth Day in April this year. Overall, in that round of REAP announcements the agency provided about $2.25 million in grants to fund projects in 31 states. Combined, the funded projects will save more than 16.5 million kilowatt-hours of electricity each year, equal to the power needs of nearly 1,400 homes. More importantly, it will save the rural small businesses and agricultural producers that received grants more than $650,000 per year — an average payback of less than three-and-a-half years.
All told, the projects will eliminate over 11,730 metric tons of GHGs on an annual basis.
The REAP program is one of the most popular and successful grant programs USDA or the federal government has to offer. Each year, there are far more grant applications than there is available funding. The plan Congress is currently working to finalize would provide a significant boost over the next 10 years and set aside a portion of the funding for renewable energy and energy efficiency technologies that have been too often overlooked, like distributed wind power and biogas systems. The impact for small businesses and family farms will be measurable.
About the writer: Lloyd Ritter is managing partner of Green Capitol LLC.
