About Government Grants for Green Energy

"Going green" through renewable energy is one way that has been suggested to decrease energy consumption and reduce dependence upon fossil fuels. Going green, however, costs a lot of money and may be out of reach for individuals, small companies and farms. In order to meet the need for renewable energy, energy efficiency and "green" energy, federal and state governments have a system of grants available to ease the financial burden of "going green."

  1. Significance

    • Green energy is classified as a system by which energy is produced without adverse environmental impact through the release of harmful chemicals, radiation or noxious gasses. There are four basic types of green energy, including water power, wind power, solar power and geothermal. Water uses the movement of streams, rivers, waterfalls and even tides to generate electricity. Wind uses the movement of air in a similar manner. Solar energy captures the sun's rays and converts it into electricity. Geothermal uses the constant temperature of the ground to heat and cool houses and buildings through a series of fans or "pumps," which move air underground where it is warmed or cooled to a certain temperature before being circulated through the structure.

    Types

    • The United States Department of Agriculture (USDA) is offering grants from the Rural Energy for America Program (REAP). It is designed to promote energy efficiency and renewable energy investment in rural areas. Sparsely populated areas such as farmlands and American Indian reservations are costly to bring energy to, requiring hundreds of miles of transmission wires and support equipment to power relatively few homes or businesses. REAP offers grants for farms and rural small businesses to invest in green energy such as biomass (the conversion of organic waste or produce into energy), as well as solar, wind, water and geothermal technologies (see Additional Resources, below).

    Features

    • The United States Department of Energy (DoE) also offers grants for investment in renewable energy and energy efficiency. Most of these grants and programs are aimed at building and home manufacturers to increase the insulation on homes, or to reduce the environmental impact of buildings. For example, a construction company or home builder may receive a grant for installing a geothermal heating and cooling system instead of a conventional fossil-fuel system in a home or building.

    Identification

    • For taxpayers who want to install solar cells or other green energy producers, the federal government offers tax-break incentives, reducing the taxable burden on consumers. Also, states such as California and Ohio offer direct grants and additional tax incentives to homeowners. Ohio, for example, offers certification programs that allow homeowners to avoid property taxes on their homes for as long as 15 years. California is using a $1 billion grant to assist low-income homeowners to invest in renewable energy sources for their homes. See Additional Resources, below, for more information.

    Identification

    • The DoE's Energy Efficiency and Renewable Energy (EERE) is offering grants and other assistance to universities, corporations and industries that invest in energy efficiency and renewable energy. It is hoped that by offering large institutions a financial incentive to traditional fossil-fuel-created energy, the overall price for such energy will be reduced for everyone. In the 2007 fiscal year, the DoE's EERE program granted $574 million to such institutions in return for their investment in renewable energy.

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