Federal grants to help dozens of Michigan farmers harvest their own clean energy

Federal grant funding is increasing American energy independence—helping several dozen Michigan farms tap into solar power and cut ties with their electric companies.

MICHIGAN—Nearly $23 million in federal grants and loans awarded this week through the Inflation Reduction Act is set to help dozens of Michigan farmers and other rural small businesses install solar panels and pursue new clean energy projects.

The federal funding—part of the US Department of Agriculture’s Rural Energy for America Program (REAP)—was announced on Thursday and includes more than $256 million in loans and grants that are set to support more than 1,100 clean energy projects across 40 states. 

And Michigan farmers and businesses received a significant slice of that federal pie—with about $22.5 million of those grants set to support 69 different clean energy projects across the state.

In a statement, US Agriculture Secretary Tom Vilsack said the funding is all about ensuring rural communities have the ability to produce their own clean, affordable, and renewable energy. The projects are also set to create thousands of new jobs for the nation’s clean energy workers.

“The Biden-Harris Administration and USDA are ensuring farmers, small business owners and rural communities have the resources they need for the future,” Vilsack said in a statement.

Here’s the deal:

The REAP funding is part of the Biden-Harris administration’s Inflation Reduction Act, which is designed, in part, to boost American energy independence and help small businesses— particularly in smaller, rural communities—lower (or totally eliminate) electricity costs.

The grants and loans can be used to cover up to 75% of the cost for Michigan farmers and other rural small businesses to install and operate their own renewable energy systems. Several dozen Michigan projects also received funding through the program earlier this fall and summer.

Since the start of the Biden-Harris Administration, the federal government has doled out more than $2.7 billion in REAP funding for nearly 10,000 clean energy projects nationwide. Almost 7,000 of these projects were funded by over $1 billion provided by the Inflation Reduction Act.

What Michigan businesses received grants?

Ten Michigan businesses received grants and loans for more than $900,000. They are: 

• Devereaux Saw Mill Inc.
• Witness Inspection Inc.
• Dairy Distillery Alliance LLC
• Benthem Brothers Inc.
• Mibelloon Dairy LLC
• Elmet Coldwater LLC
• Isabella RNG LLC
• Monterey RNG LLC
• Elsie Rng LLC
• Sunrise Acre Farms LLC

Sixteen Michigan businesses received grants and loans of between $300,000 and $700,000. Sixteen others received between $100,000 and $300,000. Twenty-seven others received less than $100,000—with the median grant amount awarded in Michigan averaging out to $204,500.

Click here to see a full list of recipients, along with details about each clean energy project. 

How does it work?

Encouraging the widespread adoption of solar, wind, and other forms of clean, renewable energy fits neatly with the Biden-Harris administration’s broader, nationwide goals to curb greenhouse gas emissions, which are—by far—the largest contributor to global climate change.

But even for Michiganders who are less enthusiastic about the environmental benefits of renewable energy, the federal grant program is set to provide some tangible economic rewards.

Is it just for businesses?

The REAP grants are only available to agricultural producers and small businesses.

But through incentives provided through the Inflation Reduction Act, homeowners can also reclaim up to 30% of the cost of purchasing and installing a new solar power system as a federal tax credit.

There is no maximum amount that can be claimed—and there’s still plenty of cash up for grabs.

Under the law, that incentive is slated to decrease to 26% for systems installed in 2033 and to 22% for systems installed in 2034 before expiring in 2035, unless Congress were to renew it.

Many utility companies, like the Lansing Board of Water & Light, also offer rebates of up to $2,000, which can also help significantly reduce the upfront costs of a new solar system.

Those without the cash to invest in a new solar system can still take advantage of the federal incentives through the Michigan Saves program, which provide grants, loans, and other financing for homeowners who want to make the transition to cleaner forms of energy.

Recently signed state laws have also enabled Michigan homeowners to earn credits off their next bill for any extra power generated by their solar systems—which can also help reduce installation costs over time and allow homeowners to recoup their investments even faster.

Additional state legislation introduced this year could also create additional rebates of up to $1,000 for installing solar power and battery storage systems at home, with the goal of lowering costs and creating new incentives for Michiganders who make the shift to renewable energy.

READ MORE: Federal investments put union workers at heart of clean energy boom=

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