What is the USDA Solar REAP Grant Program and How Do I Know if I Qualify?

Clean Earth Renewables will show you exactly how REAP Solar works:

Our development team will share with you the exact strategy that Illinois Farmers and Agriculture Businesses are using to receive a USDA Solar REAP Grant for their Commercial Farm or Rural Small Business.

What Clean Earth's development team will help you with:

1. How to find out if you meet eligibility requirements for a USDA Solar REAP Grant
2. How to analyze a Project Pro-Forma
3. Setting up your Legal Entity for USDA REAP Grant Acceptance
4. When to use the Federal Tax Credit vs. when to opt-in for the Tax Credit Transfer
5. Smart Inverter Rebate - WHY is it not always offered by EPC's bidding on your projects??
6. SREC Incentives - Who gets them, when do you get them, and why do some projects offer it up-front vs. over time?
7. Understanding what CPA-Audited financials get you approved for REAP financing

The Illinois Solar REAP Guide breaks down step-by-step from Preliminary Assessment to Financing, Incentive Reimbursement, and Project Payoff Period:

How to check reputable USDA Solar REAP Grant eligibility requirements for a rural or small agriculture business:

• Rural Energy for America Program Renewable Energy & Energy Efficiency Factsheet
• Rural Energy for America Program Renewable Energy Systems & Energy Efficiency Improvement Guaranteed Loans & Grants - 2nd USDA factsheet
• USDA REAP Property Eligibility Map - type in your facility address here, and look for this response:

Setting up your Legal Entity for USDA REAP Grant Acceptance

To ensure your legal entity is setup for USDA REAP Grant Acceptance, be sure to provide the following to your EPC or REAP Advisor:

1. Business Start Date
2. Federal EIN or Tax ID Number
3. Articles of Incorporation
4. Ownership Structure & Percentages
5. Copy of Deed
6. Property Zoning

For REAP Financing, be sure to provide the following to your REAP Commercial Lender:

1. Last 3 Years of Income Statements, Balance Sheet, and Statement of Cash Flows
2. Last 3 Years of Federal Tax Returns

Industry-wide, all accredited commercial solar lenders will require the same stack of financials. Most banks won’t accept the financials unless they are professionally prepared by a CPA and/or signed by the business owner. Banks are incredibly cautious due to fraud. Federal Tax Returns are only useful when lenders can cross reference them with another document (balance sheets / income statements) as so many businesses can alter their tax returns in order to report less in taxes. There are many loopholes for businesses to attempt to only use their tax returns for lending decisions, and that’s why commercial solar lenders look at other docs to corroborate. 

When to use the Federal Tax Credit and when to opt-in for the Tax Credit Transfer

If you have an annual federal income tax liability, meaning at the end of each year you project to owe federal income taxes, then you may benefit from taking the Federal Tax Credit. Speak with your tax professional about the tax credit and how to deduct it, as a business owner you can use the Federal Tax Credit for all years up until 2032 when the Federal Tax Credit code is subject to change or be renewed.

If you do not have an annual federal income tax liability that would make the federal tax credit feasible for you, you have a strong alternative by working with Clean Earth Renewables - the Tax Credit Transfer. You can allow Clean Earth’s financiers to transfer the tax credit onto another taxable entity (such as a tax equity investor) who has a federal income tax liability and desires to reduce it by investing in renewable energy systems. This can be an institutional or private-sector tax equity investor. A non-profit is not eligible for REAP but is eligible to receive Direct Pay for the federal tax credit, since they do not report income or pay annual federal income taxes.

• IRS Tax Credit Transfer Guidelines and Requirements
• Solar Power World - IRS Releases Final Rules for Solar Tax Credit Transferability

If you've made it this far, chances are you've got an interest in securing a REAP Solar Grant for your agriculture business, farm or rural small business. Fill out the form and a member of our team will guide you through the entire REAP Solar process.

Clean Earth Renewables is an emerging climatech startup driven to accelerate USA's net zero goals through education and integration of on-site and off-site solar. Join the mission and partner with us for your next solar project.