The American Recovery and Reinvestment Act of 2009 (ARRA), enacted in February 2009, includes provisions to promote the renewable energy industry and provide capital over the next three years with a goal to double domestic renewable energy capacity. The criteria for receiving ARRA funds are projects that create jobs, save energy, reduce greenhouse gas (GHG) emissions, and leverage non-ARRA funds. Another key element for projects seeking money is that they must be ready to start construction, usually within six months of receiving the award.
State Energy Program
Under the ARRA, the Department of Energy (DOE) is distributing $3.1 billion to states under the State Energy Program. States that agree to accept the money, which requires certain commitments to implement policies supporting energy efficiency and renewable energy, will have discretion over how the money is distributed. States have started to receive the money and are expected to be issuing a variety of grant opportunities this fall. For example, Pennsylvania created a new grant under the Green Energy Works! Program that has set aside $5 million to develop biogas projects. Individuals interested in developing anaerobic digester projects should contact their State Energy Office to learn more about their state’s process for distributing grants. DOE’s Web site has posted a list of State Energy Offices.
Energy Efficiency and Conservation Block Grant Program
Under the ARRA, DOE is also administering more than $3.2 billion through the Energy Efficiency and Conservation Block Grant (EECBG) Program, which is providing grants to local governments, tribal governments, states, and U.S. territories, to reduce energy use and fossil fuel emissions, and to implement energy efficiency improvements. Projects reducing methane emissions are eligible. More than $2.7 billion has been distributed through formula grants, with recipients listed on DOE’s EECBG Web site. Each state must pass not less than 60 percent of its allocation on to smaller cities and counties that were ineligible for direct formula grants. DOE is expected to solicit applications for the more than $400 million slated to be distributed through competitive grants. Farmers interested in finding out about potential funding opportunities related to this money are encouraged to contact their State Energy Office.
Under Section 1603 of the ARRA, the U.S. Department of the Treasury can reimburse taxpayers eligible for the business energy investment tax credit with a cash payment for up to 30 percent of the construction and installation costs for the facility, as long as the facility is depreciable or amortizable. By receiving payments under Section 1603, applicants are electing to forego renewable energy production tax credits and investment tax credits. Earlier this year, the U.S. Department of the Treasury issued guidance to establish the procedures for applying for payments under the Section 1603 program and to clarify the eligibility requirements under the program. AgSTAR believes that anaerobic digesters for livestock manures would qualify for this funding under the open-loop biomass category. To be eligible, the facility must be placed in service in 2009 or 2010, or construction must begin in either of those years and be completed prior to the end of 2013. The ARRA established an October 1, 2011, application deadline for the grant. Companies interested in applying for the program can visit the U.S. Department of the Treasury Web site for more information.
The law firm of Stoel Rives, LLP has developed a clean energy guide to ARRA entitled Show Me the Money: The Law of the Stimulus Package.
Source: US EPA AgStar