The federal government awards grants to help people and businesses convert from traditional energy to renewable forms.
The benefits of converting to renewable energy extend beyond environmental protection to saving money. But systems can cost thousands of dollars---or millions of dollars for large scale projects---creating large initial expenses that can add time to when there is a return on the investments. The federal government, through several of its agencies, gives financial incentives such as tax deductions or loans. One method many agencies use to distribute money is through grants.
Energy Block Grant
The U.S. Department of Energy created a grant program it modeled after the Department of Housing and Urban Development's Community Development Block Grant Program. The DOE's Energy Efficiency and Conservation Block Grant Program awards money for projects or initiatives that: reduce fossil fuel consumption, reduce total energy use, and improve energy efficiency in areas such as transportation or building. The DOE first began awarding the grants after receiving funding from the American Recovery and Reinvestment Act of 2009, which allocated $3.2 billion for the program. State and local governments are eligible to apply.
Weatherization Assistance
Low-income families can prepare their homes for winter---and the potential for higher energy bills---by using Weatherization Assistance Program grants. The grants, issued from the Department of Energy, go to state and local governments to then flow to low-income families. Recipient families must have combined incomes of 200 percent of the federal poverty level or less. The maximum awards for grants are $6,500. Projects can involve weather stripping, installing insulation and replacing furnaces or air conditions, among other renovations.
Renewable Energy for America
Farmers, ranchers and small business owners in rural communities of 20,000 people or fewer can reduce costs by 25 percent for installing renewable energy systems or making efficiency upgrades. The Renewable Energy for America Program awards two grants to business owners and agricultural producers. One is worth up to $50,000 for studying the feasibility of installing a system. The second grant is worth up to $250,000 to make efficiency improvements or up to $500,000 for installing new systems, such as solar panels, wind turbines or geothermal pumps. REAP offers a third grant, worth up to $100,000, to local governments and other community groups to audit their towns' energy needs. For all three grants, the funding covers 25 percent of the costs or the maximum award caps.
Tax Credit Substitute
Commercial, industrial and agricultural businesses can receive 30 percent or 10 percent off the costs of installing renewable energy devices, depending on the type of system. The U.S. Department of the Treasury covers 30 percent of the costs of for renewable energy equipment installed at qualifying solar panels, wind turbines or fuel cells. All other energy equipment eligible for the program receives 10 percent off. The program began as a tax credit, but the Recovery Act allowed business owners to apply for grants instead. Construction or installation must begin by Dec. 31, 2011, to be eligible.
Tags: renewable energy, awards grants, Block Grant, business owners, local governments