The U.S. Department of Agriculture has published new rules for the Rural Energy for America Program (REAP) that sharply limit the solar projects farmers can get federal grants for. The changes, announced Thursday, prevent grants for arrays that generate more power than a farm consumes, for projects sited on cropland, and for systems using components from "foreign adversaries" — a provision that the Environmental Law & Policy Center says sweeps in much of the global solar supply chain.
Under the new rules, farmers must wait until their array has operated for a year before applying for a REAP grant, and grants are capped at 25% of project cost. Previously, awards were made before construction began, and under the Biden-era Inflation Reduction Act grants could cover half the cost. The changes also affect grants that were already awarded but not yet disbursed, leaving some farmers who invested in solar expecting reimbursement now facing the possibility they will never receive it.
A group of farmers, solar developers, and advocates sued the Trump administration this week, three days before the rules were published. The lawsuit, filed by Earthjustice and the Environmental Law & Policy Center, alleges the changes violate Congress' directive to promote renewable energy in agriculture. Plaintiffs include an Illinois family promised nearly half a billion in REAP funds for solar to power grain driers, and an Iowa farmer who spent over $250,000 on a rooftop array expecting more than $100,000 in REAP funds. The suit also names a Minnesota solar developer that says it lost substantial business and had to lay off a staff member because of the REAP clawbacks.