laska businesses are reaching for the sun with US Department of Agriculture (USDA) grants to take advantage of renewable energy or energy efficiency.

The Rural Energy for America Program (REAP) has $145 million to help agricultural producers and rural small business owners nationwide make energy efficiency improvements and renewable energy investments. Both grants are available to applicants in a one-year period, says Dan Smith, state energy coordinator for USDA Rural Development. The remaining periods for REAP applications in 2024 are April 1 to June 30 and July 1 to September 30.

For renewable energy, grants range from $2,500 to $1 million, and for energy efficiency the grants range from $1,500 to $500,000. This funding is made possible in part by the Inflation Reduction Act of 2022, which is the nation’s largest-ever investment in combating the climate crisis.

USDA’s REAP (not to be confused with the Renewable Energy Alaska Project, a local nonprofit with, by happenstance, the same acronym and a similar mission) is a competitive program where all projects are scored against one another within a state. If a project were unable to be funded because Alaska’s share runs out, it could compete with other projects nationwide, Smith says.

“Each state has an allocation to work with on a quarterly basis,” Smith says. “If we run out of funding, we would be able to go to the national office to get funds from, say, Kentucky, if it doesn’t use all its funding. Still, we would compete with other projects.”

Smith has heard complaints from business owners about the difficulty of applying for taxpayer money. “It’s your standard government process with certain hoops to jump through,” he says. “It’s a real headache with lots of paperwork, and we understand that. You’d rather be fishing or fixing cars.”

To speed the process along, there are now technical system partner vendors available to help, he says. But the best way to use this program, he advises, is to think about a specific need, like a new boiler.

“We can make that an energy efficiency project, and we’ll pay for half of it,” he says.

If the application is rejected?

Smith advises, “Hang on to that application.”

Alaska Solar has a track record of working on twenty-five REAP projects without being denied funding.

“We have done a ton of residential projects,” says Development Director Chase Christie.

The Anchorage company offers a complete turn-key process including design, permitting, net-metering applications, installation, inspections, commissioning, system monitoring, and warranty services.

“We are a design/build solar distributor and contractor,” says Christie, a senior solar consultant. “Part of our services is to guide our customers through the USDA REAP application process,” he says.

Since 2016, he figures Alaska Solar has completed more than 600 residential and commercial solar installations. REAP funding, however, is only available to agricultural businesses or small businesses outside of Anchorage due to the focus on rural projects.

“Anchorage exceeds the population numbers of being rural,” he says.

Christie notes it’s not easy for REAP applicants to make their way through the process, and he says Alaska Solar helps customers do just that.

The owner of Triverus, which manufactures aircraft carrier deck cleaning machines in Palmer, is one of Alaska Solar’s customers.

Hans Vogel says he adopted solar power to get ahead of the technology and determine the price point, which in economics are prices at which demand for a given product is supposed to stay relatively high. But he wanted to get a handle on the process first, get a feel for it, its gains and liabilities, so he put solar panels on his home.

“It was a bit of a learning curve,” Vogel says. “It’s sort of a complex situation really, but it’s a really good deal to supplement our energy costs.”

To make it happen, Alaska Solar served not only as vendor but as facilitator. “They made it pretty easy with helping us with the right permits—and that’s a big thing to do,” Vogel says. “They took out the headaches for us.”

He is amazed that the panels continue to collect energy even when the skies are overcast. “Right now, it’s 10.5 kilowatts even on a cloudy day in mid-February in Alaska,” he says. “It’s still pulling power off the sun.”

Vogel figures the panels will last him twenty-plus years.

“Also, we have an employee with a Tesla,” he says. “So we have to fill up the tank, so to speak.”

Vogel figures it’s a four-to-five-year return on his investment in the solar system.

At Metropolitan Garage, a family-owned auto repair shop in Fairbanks for more than twenty years, co-owners Steve and Rebecca Levy decided to upgrade their electrical system to deal with increased demand from the volume of vehicles serviced.

“We service electric cars and are seriously community oriented and think that solar-ready is the next step,” Steve says. “The chief officer drives an electric.”

In 2023, Metropolitan made that leap and applied for a REAP grant with guidance from Alaska Solar.

“Working with them was easy,” Steve says. “They supported me in the REAP process, still we had to do a lot of it—eight to twenty hours of bookkeeping and lots of time calling back and forth.”

The Levys found the staff at USDA to be helpful but the process was very slow. In fact, Steve says he hasn’t seen any of the money yet. “You need lots of patience and you must meet the deadlines,” he adds. “And you have to meet them, because it’s the government and you can’t cut corners.”

He sees the employees at Alaska Solar as “young go-getters who are obviously inspired and interested in what they’re doing.”

They might even have a future in fixing electric vehicles. Steve says, “I wanted to hire every one of them.”

More than eighty-two commercial fishing vessels and buildings have received or are currently working on energy audits, according to a report from the Southwest Alaska Municipal Conference (SWAMC) Energy Audit Program. Funded through the USDA Renewable Energy Development Assistance grant, the program provides low-cost energy audits and grant assistance to small businesses, and that includes commercial fishers.

Once the audit is completed, SWAMC reports, many of the fishers and small businesses who receive the low-cost audit also qualify for a REAP grant, which covers up to 50 percent of the eligible costs of upgrading a vessel or building.

Most welcome is the news that the program offers support to commercial fishers and building owners with the REAP grant application process.

Since 2018, the SWAMC Energy Audit Program has helped twenty-seven Alaska small businesses and commercial fishers in Bristol Bay, the Aleutian and Pribilof Islands, and Kodiak receive more than $330,000 in federal grants to make cost-saving energy efficiency upgrades.

SWAMC notes that a commercial fishing vessel energy audit can focus on the propulsion system, but the USDA REAP grant does not cover propulsion upgrades. USDA REAP grants will also not cover new boat builds, the purchase of used equipment, or labor conducted entirely by the applicant.

The State of Alaska has had a program similar to USDA’s REAP for more than fifteen years. The Renewable Energy Fund (REF), a competitive grant program providing financial support for statewide renewable energy projects, began in 2008. It was originally enacted with a sunset date that was repealed last year.

The REF is managed by Alaska Energy Authority (AEA) in coordination with a nine-member REF Advisory Committee. More than 100 operating projects have been built with REF contributions, collectively saving more than 30 million gallons of diesel each year. It also creates jobs and utilizes local energy sources like wind, hydropower, and solar.

Since its beginning, the REF program has secured more than $317 million in state funds and tapped into more than $300 million in federal and local funds. With a critical role in advancing Alaska’s clean energy goals, it has also provided Alaskans and their communities with the ability to stabilize energy costs by reducing their dependence on fossil fuels.

AEA points to the approximately 85 million gallons of diesel and close to 2.2 million cubic feet of natural gas that have been displaced through 2022 as a success story. The amount of diesel fuel displaced is equivalent to roughly five percent of all petroleum consumed in Alaska in 2021. And eleven hydro projects account for the largest share of diesel displaced of all technology types, as well as the largest share of natural gas displaced through the program.

Displacing fossil fuels mitigated approximately 1 million tonnes of carbon dioxide cumulatively through 2022, according to AEA. This is equivalent to 3 percent of Alaska’s total energy-related carbon dioxide emissions in 2016. The avoided cost of particulate pollution through 2022 is estimated to range from $29 million to $43 million. These avoided costs include healthcare, declines in productivity due to illness, and other factors.

Cumulative gross energy cost savings from 2008 through 2022 reached $357 million, while cumulative net energy cost savings reached $53 million. These figures, reports AEA, demonstrate the REF program has generated significant energy savings, even after accounting for the capital costs of infrastructure.

According to AEA, grantees indicate that the most common primary goal for REF grants was to reduce fossil fuel use, with the second most-common goal to provide reliable sources of energy.

For Fiscal Year 2024, the state has made $17 million available for eighteen projects recommended by AEA and the REF Advisory Committe, and forty-four more are in development.

AEA will have some more federal money to utilize soon. In October 2023, US Senators Lisa Murkowski and Dan Sullivan and Representative Mary Sattler Peltola welcomed a $206.5 million grant awarded to the AEA to build a high-voltage direct-current submarine cable between the Kenai Peninsula and Anchorage. The connection is meant to add redundancy to the Railbelt electrical grid, and it could enable the system to plug into more renewable sources in the future.