Rural Energy Savings Program, 67427 [2020-21772]

Agencies

• DEPARTMENT OF AGRICULTURE
• Rural Utilities Service

[Federal Register Volume 85, Number 206 (Friday, October 23, 2020)]
[Rules and Regulations]
[Page 67427]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-21772]



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Rules and Regulations
                                                Federal Register
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Federal Register / Vol. 85, No. 206 / Friday, October 23, 2020 / 
Rules and Regulations

[[Page 67427]]



DEPARTMENT OF AGRICULTURE

Rural Utilities Service

7 CFR Part 1719

RIN 0572-AC45


Rural Energy Savings Program

AGENCY: Rural Utilities Service, USDA.

ACTION: Final rule and response to comments.

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SUMMARY: The Rural Utilities Service (RUS), a Rural Development agency 
of the United States Department of Agriculture (USDA), is confirming 
the final rule published in the Federal Register on April 2, 2020 to 
establish the Rural Energy Savings Program (RESP) as authorized by 
Section 6407 of the Farm Security and Rural Investment Act of 2002, as 
amended. This document also provides the Agency an opportunity to 
acknowledge public comments received on the final rule.

DATES: The final rule published April 2, 2020 at 85 FR 18413 is 
confirmed.

FOR FURTHER INFORMATION CONTACT: Robert Coates, Rural Utilities 
Service, Electric Program, Rural Development, United States Department 
of Agriculture, 1400 Independence Avenue SW, STOP 1568, Room 5165-S, 
Washington, DC 20250; Telephone: (202) 260-5415; Email 
[email protected].

SUPPLEMENTARY INFORMATION: The Rural Utilities Service published the 
RESP final rule to assist rural families and small businesses achieve 
cost savings by providing loans to qualified consumers through eligible 
entities to implement durable cost-effective energy efficiency measures 
pursuant to 7 U.S.C. 8107a(a) of the RESP authorizing statute. The 
Secretary may use this funding to allow eligible entities to offer 
energy efficiency loans to customers in any part of their service 
territory in accordance to 7 CFR part 1719. The Agency encourages 
applications that will support recommendations made in the Rural 
Prosperity Task Force report (see www.usda.gov/ruralprosperity) to help 
improve life in rural America, to consider projects that provide 
measurable results in helping rural communities build robust and 
sustainable economies through strategic investments in infrastructure, 
partnerships and innovation. Key strategies include: Achieving e-
Connectivity for rural America, developing the rural economy, 
harnessing technological innovation, supporting a rural workforce, and 
improving quality of life.

Summary of Comments and Responses

    RUS invited comments on the final rule published on April 2, 2020 
in the Federal Register (85 FR 18413) and received three comments. Two 
comments were received were from business organizations; Fleet 
Development and Energy Trust. One comment was received from an 
individual, Mr. Inri Gonzalez. The comments and Agency's responses are 
summarized as follows:
    Issue 1: One individual and one organization expressed support for 
the Program as published on April 2, 2020 in the Federal Register.
    Agency Response: The Agency appreciates the input from the two 
respondents that support the final rule.
    Issue 2: Two commenters provide energy efficiency services in their 
state, including services to multi-family dwellings and manufactured 
homes, and more specifically the replacement of substandard 
manufactured housing units. One commenter wrote that ``One 
recommendation we offer is to re-consider the allowable payback period 
of both the RESP loan to the eligible borrower and the loan from the 
borrower to the qualified consumer. Often utility infrastructure, 
energy efficiency and renewable energy projects are major long-term 
capital investments. It is not uncommon for a project of any scale to 
meet its return on investment in the 12-20-year range and then deliver 
energy savings for the next 10-20 years. We believe this financial 
reality may have been partly responsible for the historic under use of 
the program. Energy efficiency and renewable energy projects deliver 
their primary energy savings in the out years and are essentially 
break-even projects in the first years. A debt amortization period of 
only 10-years can leave a significant gap from Year 10 on.'' The 
commenter suggested a potential solution would be to allow the eligible 
borrower to request repayment schedules that fit the needs of the 
project for both repayment to RESP and the qualified consumer repayment 
to the re-lender. The other commenter states that their company 
invested in manufactured home replacement projects in Oregon. ``It has 
been our experience that the higher monthly payments associated with a 
10-year loan term for higher cost measures such as manufactured homes, 
can constitute a significant obstacle for low- and moderate-income 
Oregonians--many of whom live in rural communities. The manufactured 
home replacement pilot program which they successfully operate utilizes 
a 20-year customer loan term. Should RUS find it feasible to do so, the 
agency should consider whether extending the Qualified consumer loan 
term to 20 years would result in more uptake by rural utility customers 
and more effectively advance RUS ability to deploy these funds to the 
benefit of rural Americans.''
    Agency Response--The current 10-year maturity on loans to qualified 
consumers is a statutory requirement provided in the Rural Energy 
Savings Program enabling statute, see 7 U.S.C. 8107a(d)(1)(B). An 
amendment to that program feature will require Congressional action.
    The RUS appreciates the interest of the commenters in the RESP and 
thanks them for their submissions.

Chad Rupe,
Administrator, Rural Utilities Service.
[FR Doc. 2020-21772 Filed 10-22-20; 8:45 am]
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