UPDATE ON USDA PROGRAMSPRESENTER: DAVID THIGPEN, NC STATE OFFICE

APRIL 21 , 2015

USDA Rural Development

Area’s of Discussion

Loan guarantee and grant programs for energy development projects.

USDA Bio-Preferred program.

Projects that have been successful and that are currently in development.

Brief discussion of application process.

Programs

Loan Guarantee Programs:Business and Industry Loans (B&I)Rural Energy for America Program (REAP or

9007)Section 9003 Bio-refinery Assistance Loans

Grant Programs/Payment Programs:Rural Energy for America Program (REAP or

9007)Section 9005: Advanced Biofuel Payment

Program

Loan Guarantees

No direct loans available via USDA RD for energy or business development.

Loan guarantees can be provided to eligible lenders that have an eligible borrower/project. The guarantee acts as a “credit enhancement” tool or insurance against a percentage of the risk for the lender.

B & I Loan Guarantee Program

Maximum Loan up to $10mm for FY 2015. Loan maximum has been reduced from $25mm for this fiscal year due to reductions in program funding.

Program is able to assist with most any type of business operation in a rural area (city of less than 50,000 in population) including energy development projects.

Program has been active and funded for over thirty-five (35) years.

N.C. has completed close to 1,000 loans totaling just under $1 billion since the programs inception.

REAP Loan Guarantee

Maximum loans up to $25mm. Loan guarantee program is focused towards

development of renewable energy projects. Program was authorized under most recent

Farm BillOnly a limited number of states have utilized

loan guarantees under this program nationwide. In FY 2014 NC completed 18 of the 20 loans approved nationwide, utilizing $55.4 of the $56.9 million obligated for the entire country. All solar projects in 2015.

Section 9003: BioRefinery Assistance

Maximum loan guarantees up to $250mm. Focus of the program is developing first of its

kind commercial scale bio-refinery’s in the United States

Program has been re-authorized in most recent Farm Bill. A very small number of projects have been approved under this program. Applications are handled out of our national office.

REAP grant program

Grants available to rural small businesses and agriculture producers to either make energy efficiency improvements or install commercially proven renewable energy projects. Grants can be for up to 25% of the total project costs.

Maximum renewable energy grant $500,000, maximum EE grant $250,000.

Scoring is weighted towards small projects historically. Over 400 projects awarded in N.C. since 2008.

Section 9005 Advanced Biofuel Payment Program

Contract payment program that is available to producers of “advanced biofuel.” Broad definition that includes most all bio-gas and bi0-based transportation fuel, but excludes corn based ethanol.

Program has been allocated funds each year since 2009. Producers are paid based on verified production. The payments are divided amongst all eligible applicants on a pro rata basis (btu conversion formula utilized).

Program has had some delays at times, but is becoming more predictable. Currently, seven (7) producers have contracts in N.C.

Successful Projects

Anaerobic Digester Projects (Converting Waste streams to bio-gas)

Biomass Boiler systems for greenhouses or industrial applications.

Large Scale Solar arrays and small solar arrays.

Energy efficiency projects for businesses and ag producers. (tobacco barns, irrigation, poultry houses, greenhouses, lighting in large facilities)

Wood boiler system Greenhouse-2011

Carolina Cellulosic Biofuels. . .coming soon

USDA Bio-Preferred Program

Established by the 2002 Farm Bill, purposed with increasing the use and purchases of renewable bio-based products.

Bio-based products are defined as those determined by the U.S. Secretary of Agriculture to be commercial or industrial goods (other than food or feed) composed in whole or in significant part of biological products, forestry materials, or renewable domestic agricultural materials, including plant, animal, or marine materials

USDA BioPreferred Program

Two major components of the program:1. A process by which the Federal government

and its contractors give preference to bio-based products.

2. A USDA Bio-Preferred label for eligible bio-based products.

http://www.biopreferred.gov/BioPreferred/faces/Welcome.xhtml

Contact Information

USDA Rural DevelopmentNorth Carolina State OfficeDavid Thigpen4405 Bland Road, Suite 260Raleigh, N.C. 27609Ph# 919-873-2065E-mail: david.thigpen@nc.usda.gov