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USDA $9.7B Rural Community Clean Energy Program Receives 150+ Letters of Interest

Rural Electric Co-operatives have stepped up to take advantage of historic financing from the Inflation Reduction Act that will lower power bills and create more resilient communities across America.

WASHINGTON, D.C. – October 4, 2023

Last week, the US Department of Agriculture (USDA) announced that 157 letters of interest had been submitted to the competitive Empowering Rural America New ERA program, which is part of the Inflation Reduction Act (IRA) and offers rural communities historic levels of financial support to reinvest in their energy systems. This funding will lower their members’ costs and upgrade their energy infrastructure to be safer and more resilient in the face of increasingly extreme weather. The record-setting rush for financial support to improve the energy systems of rural Americans came from 40 states and Puerto Rico and were submitted primarily by rural electric co-operatives (co-ops).

According to the USDA:

  • The submitted proposals, with leveraged private investment considered, represent $93 billion in investments in rural communities.
  • More than 50 percent of letters of interest indicate that they will serve distressed, disadvantaged, energy, or tribal communities.
  • The carbon emissions that could be avoided if all the projects in the submitted proposals were built are 127 million tons, which is the equivalent of taking 24 million cars off the road for a year.

“Rural cooperatives have once again demonstrated their ingenuity and enterprise in identifying nearly $100 billion in clean energy investments that could both drive economic development and reduce energy costs in counties that badly need a break,” said RMI clean energy expert Uday Varadarajan.

RMI (founded as Rocky Mountain Institute) provided resources to prospective applicants in the form of a series of webinars, bootcamps, and a financial modeling tool to support strong engagement by co-ops. Co-ops operate with the sole mandate to serve their membership and are uniquely positioned to achieve a rapid transformation to cleaner, more resilient systems. In 2021 RMI released a report that concluded that between 2020 and 2030 there is $220 billion in potential lifetime value from the 600 gigawatts of wind and solar projects possible in rural America. The overwhelming level of interest shown in the New ERA program would indicate that rural electric co-ops are ready for these investments.


Co-ops generate 13 percent of US electricity load, but power 56 percent of the nation’s land mass. These system upgrades will provide more affordable sources of electricity for these vast service territories and insulate their membership from fuel supply issues that could otherwise strand them with unaffordable options.

The New ERA program represents the largest federal investment in rural energy systems since the Rural Electrification Act of 1936. Because they are nonprofits, co-ops were previously unable to take advantage of federal incentives meant to lower the cost of reinvestments in energy systems — until the IRA, these incentives were offered primarily in the form of tax credits. Through the IRA’s “direct pay” provision, 30 percent or more of co-op projects can now be covered by the federal government, and that is in addition to any funding awarded through the New ERA program. The projects that result from these early indications of interest are a clear testament to the ambition and innovative capacity of rural America when offered support to build a better future.

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About RMI

RMI decarbonizes energy systems through rapid, market-based change in the world’s most critical geographies to align with a 1.5°C future and address the climate crisis. We work with businesses and policymakers to identify and scale energy system interventions that will cut greenhouse gas emissions at least 50% by 2030.

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