Victory for Clean Energy in U.S. Farm Bill

clean energy

Clean Energy

Wednesday, February 05, 2014—The Environmental and Energy Study Institute (EESI) applauds the passage Tuesday of the Energy Title and the Rural Energy Savings Program as part of the Agricultural Act of 2014 (the Farm Bill). This represents a great victory for the production of clean energy on American farms and for the advancement of a clean energy economy. It is also a major milestone for EESI’s long-standing and ongoing efforts in these policy areas, including its extensive work with the “Help My House” on-bill financing pilot program in South Carolina.

According to EESI’s Executive Director, Carol Werner, “A strong Energy Title, benefiting from mandatory funding, shows a widespread recognition in Congress of the value of renewable energy, biofuels and bio-based products that provide a more diverse agricultural sector in our economy; one that spurs local economic development and fosters a more diverse energy and fuels portfolio for the country; and one that promotes a healthier environment as well.”

The Agricultural Act of 2014 includes language to create the Rural Energy Savings Program (RESP) within the U.S. Department of Agriculture’s Rural Utility Service. The agreement provides funding for RESP at $75 million per year over five years. RESP will provide zero percent loans to rural electric cooperatives for the purpose of relending the funds to co-op members to make energy efficiency improvements (such as air sealing, duct repair, HVAC upgrades, insulation improvements…). RESP will support “on-bill financing” programs, in which energy efficiency loans are repaid through the beneficiary’s electric bills.

EESI has worked closely with South Carolina’s electric co-ops for several years on their successful on-bill financing pilot, “Help My House,” which reduced participants’ average electricity use by 34 percent while also providing a net financial benefit. Indeed, in most cases, the energy savings that resulted from the pilot’s energy efficiency improvements more than covered the loan repayments, making it a win-win for everyone involved: utilities don’t need to invest as much in new power plants, households save money while making their homes more comfortable, and less energy use means fewer carbon emissions.

The Energy Title includes significant mandatory funding over five years for some key energy programs. These include the reauthorization of the Rural Energy for American Program (REAP) with $50 million per year for five years in mandatory funding; the Biomass Crop Assistance Program (BCAP) at $25 million per year for five years in mandatory funding; the Biorefinery Assistance Program with $200 million in mandatory funding from FY 2014-2016; the Repower Assistance Program which will receive $12 million in mandatory funding for FY 2014; and the Bioenergy Program for Advanced Biofuels with $15 million per year in mandatory funding for FY 2014-2018. This action provides the long-term certainty important to incentivize industry investment.

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