Greenhouse Grower Editor Brian Sparks recently caught up with Gretchen Schimelpfenig, a Senior Energy Engineer at Energy Resources Integration (ERI), to talk about how greenhouse and controlled-environment agriculture producers (in the wake of Trump administration policies) are being impacted by the changing landscape for energy efficiency grants they have either applied for or are considering. ERI is a clean energy consulting firm developing a sustainable future for our planet through cost-effective energy management. Gretchen is also the Executive Director of the Cornell University’s Greenhouse Lighting and Systems Engineering (GLASE), an academic consortium pioneering climate-smart agricultural technology demonstrations and workforce development. She has worked with more than 250 growers and researchers to optimize greenhouses and indoor farms through her emerging technology research, efficiency program implementation, and consultation with growers across North America.
Brian Sparks: You work with people from across the greenhouse and controlled-environment agriculture industry. What are you hearing in terms of funding for efficiency programs, etc.?
Gretchen Schimelpfenig: I’ve been working with growers on applying for grants through the USDA Rural Energy for America Program (REAP). Prior to 2023, REAP would cover 25% of project costs up to $500,000 for projects such as solar panel installations, biodigesters, renewable energy projects, or different types of efficiency projects or equipment replacements. Then during the Biden administration, the Inflation Reduction Act was passed, and it injected a bunch of new funding into different departments including the USDA, which used that to add more funding to REAP and increase the cost-share to 50%. Not surprisingly, the USDA received more than 3,000 applications in 2024, which requested more than double the available funding for that year. So while the increase in REAP funding was great, the agency received more applications than they could even award. They also didn’t add more staff to match this increase in funding, so those 3,000 applications were going through the same number of people who usually review them. That led to a large delay in people getting notified whether they received an award or not.
Then, in December 2024, the USDA posted a press release (which has since been deleted but has been archived) that explained that agricultural producers and businesses can continue to apply to the REAP program up to the March 31, 2025 deadline, which is still in fiscal year 2025. However, only Farm Bill funding would be available for those applicants, and the cost share would go back to 25%. The press release also noted that USDA anticipates accepting both REAP and Farm Bill applications to commence again, starting on July 1, 2025 for fiscal year 2026 funding.
Since January 2025, a new problem has also emerged: a grant freeze, which means awardees from 2024 applications are not getting their funds. I’ve worked with multiple applicants who have been told that they got their grant, but they can’t incur any costs until the final paperwork is signed and dotted by the USDA. The problem is, they’re not getting their emails responded to or their calls returned, because the USDA is probably unable to answer them because they’re not being told what they can do. So applicants from the December 2024 deadline are also not getting updates on their application status, and applicants from earlier 2024 deadlines have been told they are supposed to get money but are not.
Because of that, state and local office staff may have their hands tied. This means that big projects with large materials orders are stalled because growers can’t spend anything until the state-level USDA grants teams give them the go ahead.
Brian Sparks: Because REAP is a reimbursement program, do you know if growers had their own investments already, or do they have to wait for the federal cost-share to come in?
Gretchen Schimelpfenig: The USDA REAP requires that you cannot incur costs until after you sign the grant acceptance paperwork. So many are in limbo right now. They’ve been told that they have an awarded grant, but they haven’t completed the paperwork process. It’s kind of really terrible timing, because people who applied in September were notified around mid-January that they have received an award. But with the new administration and associated freeze, those awards are not being processed. The problem is, some growers are unable to wait. They have to go ahead with their construction, and they’re doing so without a grant. I know some growers in New Jersey who have rebates coming in from their utility, and that’s going to be the best financial support they can get for the project, but they’re no longer going to have the grant to make the payback period as good as it was supposed to be. They’ll still be able to pay back the project. But growers that were going to rely on just the grant are really being left in the lurch. A recent Washington Post article covered this a bit already; they had a flower farmer in their article.
I will say that the new USDA secretary was only recently confirmed (Editor’s note: this interview took place on Thursday, Feb. 20), and the new leadership team has not provided updates about when grant money will start flowing (Editor’s note: some funds ($20M) were released since this interview but they were not for REAP programs or grant recipients). Court orders and appeals may or may not impact timelines, but we will not know what happens until the USDA says something.
Another problem is that federal agencies are experiencing sudden and significant staffing cuts. I expect there will be increasing delays in response times to applicants, and anyone contacting the USDA Rural Development offices should know that they are probably going to be shorter staffed than they were before.
The last problem is that the budget proposals being submitted by Congress may include significant cuts to the USDA, so we’re going to be potentially seeing REAP caught up in the cuts. New applicants being given very little clarity about when they could potentially hear from the program, and in future years the program may or may not even exist.
Brian Sparks: What’s your advice to anyone trying to work through this process right now?
Gretchen Schimelpfenig: I am not recommending applying to REAP right now, because it seems like the clean energy and efficiency focuses of the program may be seen as political (which I believe they are not). I’ve worked with growers of many ideologies who depend on this program to make big capital upgrades, invest in solar, save money on energy, and become more resilient. But right now, I’m not recommending folks apply for the March 31 deadline.
I would also suggest looking into your state-level grants. If there’s not federal money coming, then check out how your state has made available its own sources of funding for farmers. That’s a key part of a strategy I think that folks should use for 2025. Also, look into private foundation funding. Grants don’t only come from the government; they also can come from benefactors, philanthropists, and other sorts of funding. And then, I’m really encouraging growers to work with their utilities to get rebates for either gas or electricity, or both. You can get rebates for thermal curtains, boilers, lights, and variable speed fans for example. The stuff in Washington won’t affect these programs; some utilities are private or investor-owned, some of them are municipal, and some of them are co-ops. It all depends on the financing mechanism of the utility. But in many cases they have efficiency programs, and those monies are their own to disperse because they bring them in through rate-payer bills.
Brian Sparks: How are you tackling some of these topics through your role as executive director of the GLASE program?
Gretchen Schimelpfenig: The government has suggested that they want to reduce indirect rates for grants; for example, they have floated maximum indirect rates of 15% for institutions like the National Institutes of Health. Indirect rates are generally much higher than 15%, and for institutions of higher education they’re sometimes 40%. A reduction to 15% could essentially cripple the research community if it is enacted. Look at what is happening to the NIH as an example. In Alabama, a huge portion of the state’s economy comes from NIH research, and so lawmakers in Alabama are now begging the federal government to stop making cuts and threatening research indirect rates. Many private and public institutions also get funding from the federal government for research, education, workforce development, or Extension services. That money comes from the federal government and is supplemented by the state and the university.
My one note of hope is that I thought that this new administration would want to look good helping farmers and growers, so maybe things will turn around and they’ll want to get some credibility by doing the right thing for farmers. That’s my hope, that maybe after a few months of appearing to do a lot of things, there can be some digging in and some thoughtful program changes that can be clear for fiscal year 2026.
I’ll finish by saying that if growers still want to consider applying for REAP, perhaps they think about applying in late summer. We’ll be in a new fiscal year, and hopefully they’ll have figured out budgets by then.
