Rural Electrification Loans and Loan Guarantees

This program is to provide lower cost financing for rural utilities to assure that people in eligible rural areas have access to electric services comparable in reliability and quality to the rest of the Nation and to assist electric utilities in implementation of demand-side management, energy efficiency and conservation programs and on-grid and off-grid renewable energy systems.

Rural electric cooperatives, public utility districts, municipalities, corporations, and other qualified power suppliers including those located in the U.S. Territories, the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau.

Applications for direct loan and loan guarantees are made by resolution of the board of directors of the borrowing organization. Application packages are prepared with the assistance of RUS. Information on submitting applications is contained in 7 CFR Part 1710 and 1714.

Depending on the amount of the loan requested, the RUS Administrator, Assistant Administrator, or appropriate Regional Director makes the final decision on approval of the loan upon a finding that it is economically feasible and serves the purposes of the Rural Electrification Act. Borrowers and Members of Congress are notified of the approval of a loan or loan guarantee directly, and the public is notified through normal media communications.

Distribution loans and loan guarantees are approved generally on an average of 3 to 6 months as funding becomes available. Loan guarantees for transmission and generation projects are approved generally on an average of 6 to 12 months. Larger projects may take longer.