Empowering Rural America (New ERA) Program

Description

The New ERA Program provides Rural Utilities Service (RUS) with $9.7 billion in appropriated loan and grant funds under the Inflation Reduction Act (IRA). In keeping with the statutory authority for the program, RUS will utilize the New ERA funds to assist Eligible Entities to achieve the greatest reduction in Greenhouse Gas (GHG) emissions while advancing the long-term resiliency, reliability, and affordability of rural electric systems.As provided in Section 22004 of IRA, no one Applicant may receive an amount equal to more than 10 percent of the total $9.7 billion of budget authority appropriated under Section 22004, which equals $970 million. The Applicant’s Portfolio of Actions may cost more than $970 million as long as the funded application uses less than $970 million in budget authority. Funds can be used to make energy efficiency improvements to eligible generation and transmission systems, to purchase, build, or deploy renewable energy, zero-emission systems, carbon capture storage systems, or to purchase renewable/ clean energy. The following types of financial assistance can be requested:• Loan: The interest rate for loans will be set either at the U.S. Treasury rate or at a fixed rate as low as 2 percent. Treasury interest rates are set at the time funds are drawn. A zero percent interest rate is available to refinance debt related to stranded fossil assets or for projects that serve predominantly distressed, disadvantaged, or energy communities (as defined in the funding notice).• Grant: Applicants can apply for a grant only that equals no more than 25 percent of the total project cost. Applicants would have to demonstrate the ability to meet the remaining 75 percent of the project cost.• Loan and Grant Combinations: Applicants can request loan and grant combination financing for proposed projects.• Loan Refinancing or Loan Modification: In addition to loan and grant combinations, applicants may propose to refinance debt related to a stranded fossil assets if the applicant utilizes the refinancing savings to fund eligible clean energy project(s).Letters of Interest will be scored and ranked on the greatest reduction in cost-per-unit measure of greenhouse gases. Projects must be reliable, resilient (able to recover quickly following an unexpected disruption), and affordable.

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