Zero Emissions Northwest, a boutique energy advisory company, has spent the last 15 months helping farmers and small businesses in rural parts of Idaho, Oregon, and Washington state apply for funding from the Rural Energy for America Program.
In total, 67 farms and businesses have been awarded $3 million in grants in that time, for projects aimed at decreasing energy costs via increased efficiency or building renewables. Those grants, explained ZEN president David Funk, range from just over $6,000 to $540,000 — small drops in the bucket compared with some of the major generation project funding stemming from the Inflation Reduction Act or the Bipartisan Infrastructure Law. They fund projects like hydropower, solar installations, irrigation upgrades, HVAC systems, and insulation.
But this week, because of the “pause” on IRA spending signed on Trump’s first day in office, the company furloughed most staff, and is advising farmers to hold off on any projects for which they were granted funding.
The Rural Energy for America Program, which is authorized with a $50 million annual funding baseline by the Farm Bill and which received significant additional funding from the Inflation Reduction Act, is now on hold. ZEN — which is a technical assistance contractor for the U.S. Department of Agriculture, charged with helping farmers apply for the funding — isn’t getting paid for its work. And the farmers the firm has helped win grants aren’t getting paid either.
In mid-January, just days before President Donald Trump’s inauguration, Funk submitted an invoice for work completed between October and December of last year. This week, USDA notified him that the invoice wouldn’t be paid until the 90-day pause on all IRA disbursements lifts. In other words, “that contract is not getting paid for six months,” Funk said.
There was initially some confusion as to what exactly had caused the freeze; the Monday memo from the Office of Management and Budget, or the prior executive orders. It eventually became clear, Funk said, that it was the Unleashing American Energy order that was ultimately responsible. ZEN spent the week going back and forth with their partners at USDA, he added, who were also “learning about it in real time and trying to navigate it.”
There are two streams of funding that are paused: both the grant funds that ZEN helps farmers secure, and the money that USDA pays ZEN directly for its contract work.
When a farmer wins a grant, they must first invest their own money into the project; REAP funds aren’t given out until projects are completed. Renewable energy projects can apply to be reimbursed after they’ve been online for 30 days, while energy efficiency projects can apply after installation is complete.
“We’ve asked all of our farmers that have not spent significant amounts of money to just pause their project,” Funk said. “We don’t have any guarantees that this money will be released…what happens after the pause? If you pause it once, can you pause it twice?”
ZEN’s work, via the contract with USDA, involves helping farmers through the REAP application process, conducting energy audits or energy assessments as needed, connecting them with contractors, as well as to manage the reimbursement and reporting process USDA requires for grant recipients.
It’s a rigorous process, Funk added, and that’s part of the reason USDA contracts organizations like ZEN to help applicants through it. ZEN itself gets paid for that contract via invoices submitted regularly to USDA, and that’s equally challenging, even in an administration that is friendlier to the organization’s aims.
One time, Funk said, USDA declined to reimburse for a $50 gift card to Staples that ZEN had purchased to raffle off at a conference, in an attempt to garner more attention from attendees. (“How do you get outreach to farmers at a conference? Sometimes it is a $50 gift card to a hardware store.”)
Funk said he is worried that speaking so publicly about the negative impacts of the pause on his business and on the businesses of the rural farmers he works with, will make him something of a “lightning rod.” However, he emphasized that the most confounding element of his current position is that REAP actually is advancing the goals of the new administration.
“We are working on lowering operating costs, we are generating energy locally, and we are buying American products,” he said. “Our work is really in service of these ideals and we would like Washington, D.C. to stop playing politics and let our farmers invest in themselves.”
