1. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 1 USDA Funding for Renewable Energy and Energy Efficiency Improvements April 20, 2007 Rowan University Glassboro, New Jersey Victoria Fekete, NJ Energy Coordinator for USDA Rural Development

2. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 2 What is the Section 9006 Program? Created as a U.S.D.A. program Program designed to assist farmers, ranchers and rural small businesses with energy projects In FY 2006, this program provided $11 million nationwide in grant funds for renewable energy systems and energy efficiency improvements as well as $176 million in loan guarantees.

3. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 3 Who is Eligible? Agricultural producers and rural small businesses can apply Definitions:* – Rural – Any area other than a city of town with population over 50,000. Cannot be in urbanized area adjacent to such a city or town. – Agricultural Producer -- An individual or entity directly engaged in the production of agricultural products (including farming or ranching) that gets 50% + of their gross income from the operations – Small Business – A private entity including a sole proprietorship, partnership, corporation or cooperative Must have 500 or fewer employees and $20 million or less in annual revenues. Excludes entities formed solely for a charitable purpose. Must meet SBA definition of small business * Summarized definitions. See Full RD Instruction 4280-B for full definitions.

4. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 4 Who is Eligible? (cont’d) Must use systems that are commercially available (have a proven operating history & an established design, installation, equipment & service industry) Applicant must demonstrate that it is unable to finance the project from its own sources or other sources without grant assistance. Applicant must have financial feasibility - the ability to achieve the projected income and cash flow. (Your accounting system, the availability of short term credit if your business is seasonal and the availability of raw materials/supplies will also be assessed.)

5. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 5 Who is Eligible? (cont’d) Other requirements for eligible applicants: –If individuals, must be U.S. citizens or legal permanent residents of the U.S. –If an entity, must be at least 51 percent owned by individuals who are either U.S. citizens or legal permanent residents of the U.S. –If a rural small business, the business headquarters must be in a rural area & the project funded also must be in a rural area. http://eligibility.sc.egov.usda.gov/eligibility/ http://eligibility.sc.egov.usda.gov/eligibility/

6. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 6 What Projects are Eligible? Any renewable energy and energy efficiency project as defined in the law. Requirements for eligible projects: Must be located in a rural area. Must be for a pre-commercial or commercially available and replicable technology. Must be technically feasible. Must have sufficient revenues to provide for operation and maintenance

7. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 7 What Projects are Eligible? (cont’d) Grants request must not exceed 25% of project costs Renewable Energy: Minimum grant request: $2,500 Maximum grant request: $500,000 If request is over $200,000, NOFA requires a project-specific feasibility study prepared by a qualifies independent consultant Energy Efficiency Minimum grant request: $1,500 Maximum grant request: $250,000 If total project costs are over $50,000, an energy audit is required (if under $50,000, energy assessment acceptable) The applicant must be the owner of the project and control the operation and maintenance of the proposed project.

8. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 8 ELIGIBLE PROJECT COSTS Purchase/Installation of Equipment Construction & Improvements Energy Audits Permit Fees Professional Service Fees Feasibility Studies Business Plans Retrofitting

9. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 9 INELIGIBLE PROJECT COSTS Land acquisition Capital leases Working capital Residential improvements Agricultural tillage equipment Vehicles Grant application preparation Waste collection

10. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 10 INELIGIBLE PROJECT COSTS  Funding political or lobbying activities  O&M, repairs, or fuel costs  Production, collection, transportation of energy inputs  Construction of a new facility, unless it is a similar replacement with net energy savings  Costs incurred prior to application being submitted to RD except for predevelopment costs.

11. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 11 How Do I Apply? Deadline for 2007 Grant Applications – May 18, 2007 Full details concerning the application process can be found in the Notice of Funds Availability (NOFA) which was published in the Federal Register on March 22, 2007. A copy of the NOFA can be obtained at: http://www.rurdev.usda.gov/rd/nofas/index.html http://www.rurdev.usda.gov/rd/nofas/index.html More information and assistance available from our office at: USDA Rural Development 5 th Floor North, Suite 500, 8000 Midlantic Drive Mt. Laurel, NJ 08054 (856-787-7750)

12. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 12 Filling out the Application The NOFA requires a number of Standard Forms –All necessary forms available for download at www.rurdev.usda.gov/rbs/farmbill/ www.rurdev.usda.gov/rbs/farmbill/ SF-424: Application for Federal Assistance –Organizational DUNS To obtain your DUNS Number, call the government dedicated DUNS Number self-request line at: 1-866-705-5711 –Catalog of Federal Assistance Number: 10.775 –Is application subject to review by State Executive Order 12372 Process? New Jersey does not require a review

13. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 13 Application Requirements Must meet eligibility requirements for: –Applicant –Project –Financial Need –Replicability –Complete application Technical Report required for both RE & EE projects To qualify for funding, the application will also have to pass: –Technical Review by the National Renewable Energy Lab –National Environmental Policy Act (NEPA) Review

14. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 14 Technical Requirements Different technical requirements are based on type of technology and size of project : 1.Biomass, Bioenergy 2.Anaerobic Digester 3.Geothermal, electric generation 4.Geothermal, direct use 5.Hydrogen 6.Solar, small (10 kW or smaller) 7.Solar, large (larger than 10 kW) 8.Wind, small (100 kW or smaller) 9.Wind, large (larger than 100 kW) 10.Energy Efficiency USDA has worked with technology experts to develop Guidance on the Technical Requirements for each technology. –Designed to help applicants better understand how to respond to the technical requirements. –Available at www.rurdev.usda.gov/rbs/farmbill/www.rurdev.usda.gov/rbs/farmbill/

15. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 15 Technical Requirements All renewable energy requirements follow the same standard project development process: –Qualifications of project team –Agreements and permits –Resource assessment –Design and engineering –Project development schedule –Financial feasibility –Equipment procurement –Equipment installation –Operations and maintenance –Decommissioning

16. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 16 Environmental Requirements All projects receiving federal grants are subject to the provisions of the National Environmental Policy Act (NEPA). The USDA will perform the NEPA review Per RD Instruction 4280-B, applicants must: –Complete Form RD 1940-20, “Request for Environmental Information.” –Provide all information necessary for the Agency to complete a NEPA review and analysis. USDA may contact applicant after preliminary review if more information is needed. –Be responsible for any applicable analyses and studies required as part of completing the NEPA analysis (i.e. Archaeological studies, Biological Assessments, etc.) –Strive to achieve positive community support, select good sites, and mitigate environmental impacts resulting from their proposals.

17. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 17 Environmental Requirements If an environmental review cannot be completed in sufficient time for grant funds to be obligated by September 30, 2007, grant funds will not be awarded. –One potential exception: funds may be obligated even though the U.S. Fish and Wildlife and Historic Preservation portions of the NEPA review are not completed. –Funds will not be disbursed until the full NEPA review is satisfactorily completed. If a project requires public comment and input as part of the NEPA review, the applicant will need to complete that effort prior to September 30 to receive an award. If you anticipate any potential environmental or public concerns with your project, discuss these with your USDA state rural energy coordinator as early in the development process as possible.

18. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 18 Evaluation Criteria All projects scored on : –Quantity of energy replaced, produced or saved –greater the quantity higher the score –Environmental Benefits – if project is needed to meet environmental regulation, it gets extra points –Commercial Availability – extra points if available –Technical Merit Score - this is scored by NREL –Cost Effectiveness – the shorter the payback, the higher the score –Matching Funds – the higher percentage match that the applicant provides for the grant, the higher the score –Management – if the project is monitored and managed by a third-party qualified operator, it gets extra points –Small Agricultural Producer – if the applicant qualifies as a small producer, the project gets extra points. –Simplified application/low cost project – if project costs under $200,000, it gets extra points –No Previous Grants within last 2 years – project gets extra points.

19. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 19 More Information Web site for the USDA Farm Bill Section 9006: www.rurdev.usda.gov/rbs/farmbill/ –Overview of Program –Standard Government Application Forms –Technology-specific Guidance for Technical Requirements –Links to other resources and incentives for these technologies Additional website for invaluable assistance, fillable forms and reference material is: www.rurdev.usda.gov/ia/rbcs_RE-EE_grants.html www.rurdev.usda.gov/ia/rbcs_RE-EE_grants.html NOTE: This is a site maintained by USDA Rural Development in Iowa. All inquiries, correspondence and applications must be addressed to USDA Rural Development in NEW JERSEY.

20. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 20 More Information (cont’d) Submit separate applications for “Renewable” and “Efficiency” projects Only 1 application - per applicant for each Technical report must be an original + 1 copy Maximum amount of grant assistance to any one entity cannot exceed $750,000 Application content see RD Instruction 4280-B and NOFA dated March 22, 2007

21. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 21 Assistance Available Assistance in the completion of the application package can be obtained from: Rutgers EcoComplex David R. Specca, Director 1200 Florence-Columbus Road Bordentown, NJ 08505-4200 609-499-3600 phone 609-499-3647 fax ecocomplex@aesop.rutgers.edu

22. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 22 Lessons Learned Preparing Your Application : –Carefully read all the terms of the NOFA and RD Instruction 4280-B. Include everything that they require. –Make use of available resources, especially the USDA state Rural Energy Coordinator. –Only include more information if it will really add value and help bolster your project. Longer is not better. –Organize your application in line with the NOFA and include a table of contents, page numbers. –If you don’t understand something on a form or in the NOFA, contact the USDA State Office.

23. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 23 Schedule of Award Process FY 2007 Program Notice of Funding Availability (NOFA) Published in the Federal Register March 22, 2007NOFA for renewable energy and energy efficiency grants is issued. USDA begins accepting applications. May 18, 2007Deadline for applications. August 2, 2007USDA announces awards. September 30, 2007End of Fiscal Year Deadline for obligating all funds to awardees

24. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 24 APPLICATIONS Submit a complete grant only application no later than MAY 18, 2007 Mail to: USDA Rural Development Attn: Business & Community Programs 5 th Floor North, Suite 500 8000 Midlantic Drive Mount Laurel, NJ 08054

25. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 25 1-856-787-7750 NJ RD State Office

26. Renewable Energy and Energy Efficiency Program: Farm Bill Section 9006 26