The Feasibility Study Consultant's Role in USDA REAP Applications

USDA stopped making REAP grant awards on 31 March 2026 and will not resume until it has rewritten the programme regulation. Guaranteed loans remain open. Anyone holding a Commitment of Funds letter without a fully executed Financial Assistance Agreement has to start again. This is the most restrictive posture in the programme's history, and a consultant working from 2024 guidance is advising on a programme that no longer operates that way.

Exactly what is paused, in USDA's own words

The definitive source is USDA's FY26 REAP Frequently Asked Questions, published 31 March 2026. Its answers are unambiguous and worth quoting rather than paraphrasing.

Will a notice of funding opportunity be issued for FY2026?

"No. Rural Business Cooperative Service (RBCS) intends to update the regulations at 7 CFR 4280 Subpart B to comply with Executive Order 14315… Accordingly, REAP will not be making further grant awards until the new regulations are in effect. This applies to all applications that do not have a fully executed Financial Assistance Agreement."

Will more grants be awarded under the October 16, 2024 REAP Notice?

"No. A forthcoming publication will rescind the October 16, 2024, Notice."

Is REAP accepting renewable energy system or energy efficiency improvement applications for FY2026? "No."

Will the Energy Audit and Renewable Energy Development Assistance programme be funded in 2026? "No."

Are REAP guaranteed loans still being accepted?

"Yes. The REAP guaranteed loan program follows the OneRD guarantee regulation and program applications for FY 2026 are currently being accepted."

Two further consequences follow from that FAQ. Environmental review processing "will stop immediately." And applicants who applied before the pause — including FY2025 IRA applications submitted before 30 December 2024, applications that failed technical merit review, and applications currently under appeal — will all have to file fresh applications once the new rule takes effect.

Even a Commitment of Funds letter is not protection. Without a fully executed Financial Assistance Agreement, the applicant is back in the queue.

What drove it

Executive Order 14315, "Ending Market Distorting Subsidies for Unreliable, Foreign Controlled Energy Sources," was signed 7 July 2025.

It directs agencies to "rapidly eliminate the market distortions and costs imposed on taxpayers by so-called 'green' energy subsidies" and to "build upon and strengthen the repeal of and modifications to wind, solar, and other 'green' energy tax credits in the One Big Beautiful Bill Act."

The rewrite of 7 CFR Part 4280 Subpart B is USDA's implementing response.

As of August 2026 no proposed or final rule text had been published in the Federal Register. The rewrite remains in the pre-proposal stage, which means the future grant terms — including whether the grant share reverts from 50% toward 25% — are genuinely unknown rather than merely unannounced.

Three disruptions in eighteen months

REAP has now been interrupted three separate times:

January 2025 — a funding freeze that captured already-obligated awards, following the 20 January executive order. Approximately $911 million in already-obligated REAP grants were held, roughly 75% of the programme's IRA funding, affecting more than 4,800 recipients. Funds began releasing in late March 2025.

30 June 2025 — a pause on the FY2026 application window, citing an FY2024 backlog.

1 October 2025 — the federal government shutdown, after which the programme did not reopen before the March 2026 grant halt.

And it is being litigated

In Ovanova Construction Services LLC v. USDA, filed 25 August 2025 in the District of Columbia and assigned to Chief Judge James Boasberg, a developer with more than 60 REAP applications alleges USDA applied "unclear, unstated, and inconsistently applied" technical merit criteria without notice — including rescinding an approved grant to its client La Finca Naturals roughly a week after a Commitment of Funds letter.

Earthjustice separately sued over the withholding of already-awarded IRA REAP grant funds, arguing the conditions imposed were arbitrary and capricious.

There is no successor programme

When IRA money is exhausted, REAP reverts to Farm Bill mandatory funding of roughly $50 million a year.

Lloyd Ritter, founder of the clean energy policy consultancy Green Capitol and a drafter of the original REAP programme as senior counsel to former Senator Tom Harkin, told Canary Media: "We're not looking at an IRA-like opportunity for REAP again any time soon."

The money, and the deadline that governs everything

Inflation Reduction Act Section 22002 appropriated:

• $820,250,000 for FY2022, plus $180,276,500 for each of FY2023 through FY2027 for general REAP
• An additional underutilised-technology tranche of $144,750,000 for FY2022 plus $31,813,500 for each of FY2023 through FY2027

Total: $2,025,450,000, of which $303.8 million is the underutilised-technology and technical assistance set-aside.

All funds remain available until 30 September 2031, and USDA cannot enter agreements disbursing after that date.

That is the hard deadline governing every project's construction timeline, and it is worth stating to any client whose project is waiting on the rewrite.

What has been obligated

There is no single clean USDA table splitting REAP obligations by fiscal year into grants versus loans. The best-sourced figures available:

USDA reported funding 8,012 clean energy projects with $1.3 billion in IRA funds by January 2025.

Environmental Law and Policy Center analysis, reported by Canary Media, found "more than $1 billion in IRA REAP funding was awarded in over 6,800 grants to farmers and rural small businesses between fiscal year 2023 and the first quarter of fiscal year 2025… with 80% of the grants going to Republican House districts."

Brookings, in April 2025, found that "just over $1.5 billion in total REAP grant obligations went out between October 2022 and March 2025, equal to 68% of all grant value in the program's history," with lifetime REAP obligating just over $2 billion in grants plus loans against a face value just under $3.3 billion.

Federal data cited by Canary Media indicates about half of IRA REAP funds have already been obligated.

Sizing

Average grant rose from $31,641 in the first Trump administration to $138,506 in the Biden years, per Brookings. Across 2014 to 2024 on an all-funds basis, the average REAP grant was $59,435.75, with RES and EEI grants averaging $88,444.

IRA-era guaranteed loans averaged approximately $11 million as of mid-2024, across 28 loans, six of which hit the $25 million statutory maximum.

Technology mix

Solar dominates. USDA data cited by the National Sustainable Agriculture Coalition put 72% of REAP grant projects as solar. A mid-2024 project-level count found 2,771 of 3,729 IRA-era projects — roughly 74% — included solar.

Other common uses: grain dryers at 302 awards, LED lighting at 97, and digesters at 37.

Roughly 84% of post-IRA awards were renewable energy projects and 16% energy efficiency.

Wind, geothermal and biomass are each small single-digit shares — 17 wind projects received a total of $674,652 in grants in FY2022.

The August 2025 solar restrictions

The operative document is the "Ensuring Strong Stewardship and Customer Service in RBCS Guaranteed Lending and Other Programs" Unnumbered Letter, signed by RBCS Administrator J.R. Claeys and dated 19 August 2025, with an expiration of 31 August 2026.

Four categories of solar are affected. Projects are ineligible for the REAP guaranteed loan and disincentivised for grants via priority points if they include any of the following:

• Ground-mounted solar PV systems larger than 50 kW
• Ground-mounted solar PV systems that cannot document historical energy usage
• Ground-mounted solar PV systems proposing to be installed on certified cropland — defined by reference to the Farm Service Agency's Handbook 10-CM, revision 2
• Solar PV systems containing any component made in a country named a foreign adversary as defined in 15 CFR 791.4 — the Commerce Department list naming China including Hong Kong, Cuba, Iran, North Korea, Russia, and the Maduro regime in Venezuela

The distinction that matters most

For the guaranteed loan, these four categories are ineligible — a hard bar.

For grants, they lose priority points — a scoring penalty, not an absolute bar.

That difference is genuinely consequential in advising a client. A disfavoured grant project could theoretically still be funded if it scored well elsewhere. A disfavoured loan project cannot be guaranteed at all.

Separately, under the Business and Industry programme, wind and solar are now categorically ineligible — a total bar rather than a scoring penalty.

What is not affected

Rooftop solar is untouched. Ground-mounted systems below 50 kW that document historical energy use remain eligible. All four restrictions target ground-mounted arrays.

And the practical scope is narrower than the headlines suggest. NSAC's own analysis found that "only about 152 projects of the 3,378 REAP grants that went to farms and agricultural businesses, maximum, would have been affected by the new limitations because they had ground mounted solar installations of more than 50kW."

In other words, the typical right-sized on-farm system is largely unaffected. The restrictions bite hardest on speculative, oversized ground-mount projects — which is arguably what they were aimed at.

One item to watch: the Unnumbered Letter carries an expiration date of 31 August 2026. Whether it is renewed, superseded by the rewrite, or allowed to lapse is worth monitoring.

The documentation tiers, which are the professional core of this work

REAP has never required a universal feasibility study. Documentation scales with total project cost, and matching the deliverable to the tier is where a consultant either adds value or wastes a client's money.

Total project cost of $80,000 or less — a six-element vendor or installer certification. No feasibility study. No engineer's stamp required.

Total project cost greater than $80,000 and less than $200,000 — for a renewable energy system, a technical report following Appendix D, Sections A through E: Project Description, Resource Assessment, Project Economic Assessment, Project Construction and Equipment Information, and Qualifications of Key Service Providers. For energy efficiency improvements above $80,000, Appendix C applies.

Total project cost of $200,000 and greater — for a renewable energy system, a technical report following Appendix E: Sections A through G plus nine technology-specific resource assessment subsections covering wind, solar, bioenergy and biomass, geothermal electric, geothermal direct, anaerobic digester and biogas, hydro and others.

A full independent third-party feasibility study is required for renewable energy system projects exceeding $200,000 — and whenever the lender or the Agency deems it necessary.

7 CFR Part 4280 Subpart B defines it as "A report including an opinion or finding conducted by an independent qualified consultant(s) evaluating the economic, market, technical, financial, and management feasibility of a proposed project."

One efficiency worth knowing: the regulation permits the technical report requirements to be satisfied within the technical feasibility section of the feasibility study, rather than as a separate document. On a project above $200,000 that avoids duplicating work.

Energy assessment versus energy audit

The distinction turns on cost, and it applies to efficiency projects rather than generation projects.

An energy assessment is the lighter analysis accepted for smaller energy efficiency projects.

A full energy audit is required for efficiency projects above the threshold — historically projects over $50,000 — and must be performed by a utility or a knowledgeable energy manager or engineer.

Renewable energy system projects require a technical report, not an energy audit. Different documentation, different scoring path, and confusing the two is a common error.

Who is qualified

A feasibility study must be prepared by an independent qualified consultant.

Technical reports and energy audits are typically prepared by a licensed Professional Engineer, or by holders of recognised energy credentials — the Certified Energy Manager and Certified Energy Auditor administered by the Association of Energy Engineers, or ASHRAE's Building Energy Assessment Professional.

USDA does not mandate a single credential, which preserves flexibility — but the reviewer's confidence in the author's qualifications is itself part of the technical merit determination.

What it costs

A REAP feasibility study for a project above $200,000 commonly runs $10,000 to $15,000. A documented case: a $500,000 solar array feasibility study cost $12,500 and demonstrated a seven-year payback.

USDA feasibility studies generally land between $10,000 and $50,000 depending on complexity, and the industry rule of thumb is 0.75% to 3% of total project cost.

Lighter technical reports for sub-$200,000 projects cost far less — and on a project under $80,000, a $10,000-plus feasibility study would be irrational as well as unnecessary.

Programme terms

Grant percentages under the IRA-era rules, now paused: up to 25% under Farm Bill funds and up to 50% under IRA funds for qualifying zero-emission renewable energy systems, all energy efficiency improvements, and projects in energy communities or from Tribal entities. IRA Section 22002 caps any REAP grant at 50% of total project cost by statute.

Grant limits: renewable energy system grants $2,500 minimum, $1,000,000 maximum. Energy efficiency improvement grants $1,500 minimum, $500,000 maximum.

Note that the FY2026 rewrite may reset the grant share back toward 25%, which is one reason a project economics model built on a 50% assumption should be flagged as contingent.

Guaranteed loan terms. REAP guaranteed loans run under the OneRD framework. The FY2026 fee and guarantee schedule was published in the Federal Register on 9 March 2026, effective 1 October 2025. The FY2025 REAP guarantee was 80%. Maximum guaranteed loan $25 million. Terms up to 40 years, set by the useful life of the financed assets. Interest rates are negotiated between lender and borrower, fixed or variable, with variable rates adjusted no more than quarterly. Fees historically cited for REAP: a 1% initial guarantee fee and a 0.25% annual retention fee.

One caution on fees. The widely available FY2026 fee detail — 85% guarantee with 3.0% upfront and 0.55% annual — is the Business and Industry tier. REAP historically carried an 80% guarantee at 1% and 0.25%. Confirm the REAP-specific line in the Federal Register notice before quoting fees to a client.

Combined structures. A combined grant and guaranteed loan cannot exceed 75% of total eligible project cost, and the combination requires a lender.

Eligibility. Two applicant types: agricultural producers, meaning entities deriving at least 50% of gross income from agricultural operations; and rural small businesses, meeting SBA size standards and located outside a city or town of 50,000 or more.

Agricultural producers may site projects in rural or non-rural areas if the project supports their agricultural operation. Rural small businesses must be in a rural area.

Eligible costs include equipment purchase and installation, new or refurbished, post-application construction, retrofitting, and professional service fees.

Ineligible: residential projects, used equipment, vehicles, farm tillage equipment, pre-application construction, grant writer and application preparation fees, working capital for grants, and payments to the applicant or relatives.

Scoring. Under 7 CFR 5001.319 the REAP loan priority point system uses a maximum of 90 points; the grant scoring system uses 100. Points are awarded for energy generated or saved per dollar requested, environmental benefits — up to 5 points, with all three areas of resource conservation, public health and environment earning 5, and any two earning 3 — simple payback period, commitment of matching funds, small or very small applicant status, previous grantee status, and State Director or Administrator discretionary points.

Right-sizing, and the evidence USDA accepts

USDA accepts standard resource modelling — solar irradiance and production models for PV, wind resource assessments for turbines, feedstock and gas yield analyses for anaerobic digestion, and Btu-based conversions for biomass — documented in the applicable Appendix.

The binding constraint is USDA's right-sizing philosophy. A system should offset the applicant's actual, documented energy consumption. Practitioners describe a "33% rule" limiting oversizing relative to measured load.

Applicants must supply a minimum of 12 months of utility bills showing energy usage and billing costs.

And since August 2025, documented historical energy usage is a hard eligibility gate for ground-mounted solar rather than merely a scoring input.

On payback, USDA requires a simple payback calculation with all assumptions shown. There is no single mandated maximum, but shorter payback earns more scoring points, and a payback that is implausibly long undermines the technical merit finding.

Current installed cost benchmarks

NREL's benchmark put commercial rooftop PV at roughly $1.78 per watt DC in 2023. Current market pricing for commercial systems ranges roughly $1.10 to $2.55 per watt depending on size:

• Small, 25 to 100 kW: $1.80 to $2.55 per watt
• Mid-size, 100 to 500 kW: $1.40 to $1.90 per watt
• Larger rooftop, 500 kW to 2 MW: $1.10 to $1.50 per watt

A representative 100 kW system runs $160,000 to $220,000 before incentives.

Net metering is reshaping the economics

The nationwide retreat from one-to-one net metering toward net billing successor tariffs materially changes project returns.

California's NEM 3.0 cut export values by roughly 75%, to about 5 to 8 cents per kilowatt hour from around 30 cents. Illinois stripped delivery fee credits from excess solar payouts for new interconnections across 2025 and 2026. Texas has no statewide mandate, with utilities such as Oncor buying back at about $0.037 per kilowatt hour.

High-retail states still deliver strong returns — Massachusetts at around $0.30 per kilowatt hour and Maine at $0.27 to $0.32 support five to eight year paybacks.

The lesson for REAP applicants is convenient: because the programme rewards offsetting on-site load, behind-the-meter self-consumption and battery pairing increasingly beat export-dependent designs. Right-sizing and good economics now point the same direction.

The tax credit deadline that has already passed

This is the most time-sensitive item for any solar project currently in design.

The One Big Beautiful Bill Act, enacted 4 July 2025, accelerated termination of the technology-neutral Section 45Y production tax credit and Section 48E investment tax credit for wind and solar.

Projects are eligible only if placed in service by 31 December 2027 — unless construction began on or before 4 July 2026, in which case the standard four-year continuity safe harbour applies.

That date has passed. A project that had not begun construction by 4 July 2026 now faces a placed-in-service deadline of 31 December 2027 to claim the credit.

Projects beginning construction after 31 December 2025 also face "material assistance from a prohibited foreign entity" restrictions — the FEOC rules, which interact directly with the fourth August 2025 solar restriction.

The residential Section 25D credit expired 31 December 2025.

For a consultant, the practical consequence is that the tax credit timeline is now a harder constraint than the REAP timeline — and for a project relying on the ITC, the placed-in-service date should be modelled before anything else.

Incentive stacking

A REAP grant can be combined with the commercial ITC and with state incentives, but the grant generally reduces the depreciable and ITC basis, so the credit is calculated on net cost after the grant.

USDA does not permit federal funds to match other federal funds unless specifically authorised.

Bonus ITC adders for energy communities and domestic content can stack on top. Combined REAP grant plus ITC has historically reached up to roughly 80% of project cost for well-structured projects — though that arithmetic depends on the grant programme reopening.

Anaerobic digesters and controlled environment agriculture: a documented crisis

This is a separate pause from the grant halt and it is driven by portfolio performance rather than policy.

On 14 January 2026, RBCS Administrator Claeys imposed a 90-day pause on acceptance, processing and awarding of loan guarantees for on-farm anaerobic digesters, citing portfolio delinquency. On 2 April 2026 he extended it through 31 December 2026, citing "continuing and significant risks."

The numbers, from Claeys's memos as reported by Agri-Pulse:

"$102.6 million worth of loans for anaerobic biodigesters are in delinquency – about 27% of the total $386.4 million." The April extension cited a 28% delinquency rate on top of realised losses.

The pause also covers controlled environment agriculture — vertical farming, hydroponics, aeroponics and aquaponics — where delinquent loans total "$135 million… representing 43% of the $311.9 million."

USDA found lenders lacked underwriting expertise for this "volatile sector."

Independent research corroborates the operational risk. Brent Kim, faculty scientist at the Johns Hopkins Center for a Livable Future, told Sentient Media that "since 2000, one in five manure digesters built in the United States have shut down" — see "Deconstructing the livestock manure digester and biogas controversy," Current Environmental Health Reports, 8 November 2025.

For a consultant this is straightforward advice: avoid these categories until the pause lifts and the delinquency data improves. Digesters, long marketed as the climate-smart flagship of rural energy, are the programme's worst-performing credits.

Where REAP applications fail

The technical report is the make-or-break document. Practitioners consistently report technically sound projects rejected because the report was incomplete or did not follow USDA's format.

Starting construction before receiving the eligibility or commitment letter renders those costs ineligible for reimbursement. This is among the most expensive avoidable errors in the programme.

Proposing technology that is not "commercially available."

Oversizing the system relative to documented load.

Weak or undocumented environmental benefit and payback narratives — leaving scoring points on the table.

Incomplete SAM.gov registration.

And a structural trap: grants are reimbursement-based. An applicant who cannot float project costs for six to nine months faces a cash flow problem regardless of how good the project is.

On timeline, even in normal conditions the path from application to funds ran six to nine months, with 60 to 90 days for scoring and ranking alone. The 2025 and 2026 freezes, shutdown and grant halt have made timing radically uncertain — against a hard 30 September 2031 disbursement ceiling.

What to do now

Triage against the four-part solar test first. If a project involves ground-mounted solar over 50 kW, sits on certified cropland per FSA Handbook 10-CM revision 2, lacks 12 months of documented historical energy use, or contains any 15 CFR 791.4 foreign adversary component, it is ineligible for the loan guarantee. Redesign to roof-mounted, sub-50 kW, behind-the-meter and domestic-component before spending anything on documentation.

Pursue the guaranteed loan rather than the grant. Grants are closed with no reopening date. The loan is the live product.

For solar clients, the tax credit is now the binding timeline — the 4 July 2026 begin-construction date has passed, so the placed-in-service deadline of 31 December 2027 governs.

Match documentation to the cost tier and do not over-buy. Under $80,000, a vendor certification suffices. Between $80,000 and $200,000, Appendix D or Appendix C. At $200,000 and above, budget $10,000 to $15,000 for a full independent feasibility study.

Consider pivoting marginal renewable clients toward energy efficiency, which is untouched by the August 2025 restrictions, evaluated on documented savings rather than generation forecasts, aligned with USDA's right-sizing priorities — and receives only about 16% of REAP dollars.

Avoid anaerobic digester and controlled environment agriculture projects until the pause lifts.

And watch three things: publication of the Part 4280 Subpart B proposed rule, which is the single event that reopens grant strategy; the 31 August 2026 expiration of the Strong Stewardship Unnumbered Letter; and the 31 December 2026 expiry of the digester and CEA pause.

Frequently asked questions

Sources

USDA Rural Development, FY26 REAP Frequently Asked Questions, published 31 March 2026.

Executive Order 14315, "Ending Market Distorting Subsidies for Unreliable, Foreign Controlled Energy Sources," 7 July 2025.

USDA Rural Business-Cooperative Service, "Ensuring Strong Stewardship and Customer Service in RBCS Guaranteed Lending and Other Programs," Unnumbered Letter dated 19 August 2025.

7 CFR Part 4280 Subpart B, including Appendices C, D and E.

7 CFR Part 5001, including §5001.307 and §5001.319; OneRD FY2026 fee notice published 9 March 2026.

Inflation Reduction Act, Section 22002.

15 CFR 791.4, foreign adversary designations; FSA Handbook 10-CM revision 2.

RBCS Administrator memoranda of 14 January 2026 and 2 April 2026 on anaerobic digester and controlled environment agriculture loan guarantees, as reported by Agri-Pulse.

Kim, B., Johns Hopkins Center for a Livable Future, as quoted by Sentient Media; "Deconstructing the livestock manure digester and biogas controversy," Current Environmental Health Reports, 8 November 2025.

Environmental Law and Policy Center analysis, as reported by Canary Media; Lloyd Ritter, Green Capitol, as quoted by Canary Media.

Brookings Institution REAP obligation analysis, April 2025.

National Sustainable Agriculture Coalition analysis of REAP restrictions and programme data.

Ovanova Construction Services LLC v. USDA, D.D.C., filed 25 August 2025; Earthjustice litigation on withheld IRA REAP funds.

One Big Beautiful Bill Act, enacted 4 July 2025, Sections 45Y and 48E provisions.

National Renewable Energy Laboratory commercial PV cost benchmark; NC Clean Energy Technology Center.

Prepared by feasibility-study-consultant.com. REAP is changing rapidly and this article describes the position as at the date below. The Part 4280 Subpart B rewrite was unpublished at the time of writing, so all statements about future grant terms are provisional. Obligation figures vary by source and cutoff date and no clean official fiscal-year table splitting grants from loans exists. The FY2026 REAP-specific guarantee and fee schedule should be confirmed in the Federal Register notice rather than assumed from the Business and Industry tier. The Strong Stewardship Unnumbered Letter carries an expiration of 31 August 2026 and the digester and controlled environment agriculture pause runs to 31 December 2026; both should be re-checked. Net metering terms are state and utility specific. Installed cost and payback figures draw partly from vendor sources and should be validated for a specific project. This is not legal, tax or lending advice. Last updated: August 6, 2026.