USDA Rural Development Renewable Energy Systems & Energy Efficiency Improvement Program

1. USDA Rural DevelopmentRenewable Energy Systems & Energy Efficiency Improvement Program February 28, 2006 Bordentown, NJ

2. Renewable Energy Program • Notice of Funding Availability (NOFA) – February 13, 2006 • $11 million nationwide in competitive grant funds for FY2006 • $176 million in loan guarantees • Purchase renewable energy systems • Make energy improvements

3. Applicant Eligibility • Ag producers – 50% or greater of gross income derived from agricultural production; must be located in an eligible rural area • Rural Small Businesses – must meet U.S. Small Business Administration definition; must be located in an eligible rural area • Must use systems commercially available (have a proven operating history and an established design, installation, equipment and service industry) • Applicant must demonstrate that it is unable to finance the project from its own sources or other sources without grant assistance

4. Applicant Eligibility Must have financial feasibility (the ability to achieve the projected income and cash flow. The cost accounting system, the availability of short term credit for seasonal business and the adequacy of raw materials & supplies will be assessed.) • Must have technical feasibility

5. Applicant Eligibility • Individual applicants must be citizens of the U.S. or reside in the U.S. after being legally admitted for permanent residence • Entities must be at least 51 percent owned directly or indirectly by individuals who are either citizens of the U.S. or reside in the U.S. after being legally admitted for permanent residence • For small businesses, the business’ headquarters must be in a rural area and the project funded also must be in a rural area

6. Project Eligibility • Must be for renewable energy systems (“Renewable”) or • Efficiency improvements (“Efficiency”) • Project must be located in a rural area. • Not for research and development • Applicant must own and control the proposed project

7. Rural Area • Rural Area Definition - Any area other than a city or town with a population of greater than 50,000 and the urbanized areacontiguous and adjacent to such city or town. • Go to http://maps.ers.usdagov/loanlookup/ for assistance in determining rural area eligibility. This office will make the “official” determination.

8. Maximum Grant • USDA Grant will not exceed 25% of eligible project costs • “Renewable” grants – not less than $2,500 but no more than $500,000 • “Efficiency” grants – not less than $1,500 but no more than $250,000 • Applicant must provide 75% balance of funds for project (leverage requirement) • In-kind contributions & other Federal grants do not count towards leverage requirement

9. Eligible Project Costs • Purchase & installation of equipment • Construction & Improvements • Energy Audits • Permit fees • Professional service fees • Feasibility studies • Business Plans • Retrofitting

10. Energy Audit • Energy Audit – written by an independent qualified entity, documents current energy usage, recommends improvements and their costs, projects savings and shows the average payback period in years

11. Ineligible Project Costs • Land Acquisition • Capital leases • Working capital • Residential improvements • Agricultural tillage equipment • Vehicles • Grant application preparation • Waste Collection

12. Ineligible Project Costs • Funding of political or lobbying activities • O & M, repairs, or fuel costs • Production, collection, & transportation of energy inputs • Construction of a new facility, unless it is a similar replacement with net energy savings • Costs incurred prior to application being submitted to RD except for predevelopment costs

13. Quantity of energy replaced, produced or saved Environmental Benefits Commercial Availability Technical Merit Readiness Small Ag Producer/Very Small Business Low Cost Projects ($200,000 or less) Previous Grantees Return on Investment Evaluation Criteria

14. Qualifications of the Project Team Agreements and Permits Energy or Resource Assessment Design and Engineering Project Development Schedule Project Economic Assessment Equipment Procurement Equipment Installation Operation and Maintenance Dismantling and Disposal of Project Components Technical Merit Points

15. Applications • You must submit a separate application for “Renewable” and “Efficiency” projects • Only one application per applicant for each • The technical report is to be submitted in an original and one copy • The maximum amount of grant assistance to any one entity can not exceed $750,000 • Application content per RD Instruction 4280-B • Also see our website at: http://www.rurdev.usda.gov/nj/rbs.html

16. Applications Submit a complete application no later than close of business, May 12, 2006 to: USDA Rural Development Attn: Business & Community Programs 5th Floor North, Suite 500 8000 Midlantic Drive Mt. Laurel, NJ 08054 TEL 856-787-7750 FAX 856-787-7757 E-mail: victoria.fekete@nj.usda.gov

17. Thank You