USDA REAP 7 CFR 4280.115: Grant Funding and Cost-Share Limits
Updated 6 September 2026 · By SolarNevs Research Desk, Dealer surveys + verified sources · 1 source · Method ↗
Key Takeaways
- Codified under 7 CFR § 4280.115, REAP grant funding provides up to 25 percent of eligible project costs for renewable energy systems.
- Enforces a statutory minimum grant request of $2,500 and a standard maximum request of $500,000 for solar RES applications.
- Restricts total grant assistance to any single person or entity to $750,000 per Federal fiscal year.
- Explicitly authorizes passive third-party equity contributions, including capital raised through the sale of Federal tax credits.
- Defines eligible project costs as expenses incurred after complete application receipt, including equipment, permits, and interconnection fees.
Regulatory Structure of 7 CFR § 4280.115
Under Title 7, Part 4280, Subpart B of the Code of Federal Regulations, § 4280.115 establishes the financial parameters governing USDA Rural Development grant distribution.
The regulation requires the applicant to secure the remainder of total project costs through non-federal matching funds, while strictly barring unapproved federal grant stacking.
REAP Solar Grant Parameters & Cost Classification Matrix
The Agency administers grant awards across clear statutory boundaries:
Regulatory Category | Statutory Mandate | Project Application for Solar Developers |
|---|---|---|
Maximum Cost Share | Will not exceed 25 percent of eligible project costs | Restricts base federal grant to one-quarter of total eligible capital cost |
RES Grant Request Range | Minimum request $2,500; maximum request $500,000 | Accommodates small farm arrays up to utility-scale agricultural projects |
Annual Fiscal Cap | Maximum assistance $750,000 per entity per fiscal year | Prevents monopolization of federal allocations across multi-site portfolios |
Tax Credit Equity | Passive third-party equity acceptable from federal tax credits | Enables clean energy tax credit transferability and third-party PPA models |
Application Timing | Eligible costs incurred only after complete application receipt | Disqualifies equipment purchased prior to formal USDA filing confirmation |
Permitting & Interconnection | Covers construction permits, licenses, and interconnection fees | Reduces utility study and distribution upgrade cost burdens |
Ensuring Cost Eligibility Before Filing
To safeguard grant eligibility under Section 4280.115:
- Delay Equipment Procurement: Never issue binding purchase orders or pay equipment deposits before USDA issues a formal complete application receipt.
- Document Interconnection Expenses: Itemize utility interconnection application fees and engineering study invoices as eligible costs under § 4280.115(c)(4).
- Structure Tax Credit Monetization: Secure written commitments for third-party tax equity monetization to document matching fund availability under § 4280.115(b)(2).
Frequently asked questions
What is the maximum grant cost-share percentage under 7 CFR § 4280.115(a)?
Under Section 4280.115(a), the amount of grant funds made available to an eligible RES or EEI project will not exceed 25 percent of eligible project costs (August 2026).
What are the minimum and maximum grant request thresholds for solar RES projects?
The minimum request for a RES grant application is $2,500 and the maximum request is $500,000, unless otherwise specified in a Federal Register notice (August 2026).
What is the annual limit on grant assistance to one person or entity?
The maximum amount of grant assistance to one person or entity under this subpart will not exceed $750,000 per Federal fiscal year (August 2026).
Can solar developers utilize third-party tax credit equity to satisfy matching fund rules?
Yes. Under Section 4280.115(b)(2), passive third-party equity contributions are acceptable for RES projects, including equity raised from the sale of Federal tax credits (August 2026).
References
- Cornell Law: 7 CFR § 4280.115 — accessed 31 August 2026
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