USDA Bans Solar Funding in Key Rural Energy Program

The USDA’s new rules ban solar power funding under a key rural energy program.

The U.S. Department of Agriculture has implemented regulations excluding solar development from the Rural Energy for America Program, a shift prompting legal action from the Iowa Farmers Union and environmental advocates. This marks a significant policy realignment with implications for renewable energy investment in rural areas.

The rules, effective October 16, come after changes announced in August 2025 and a Trump administration executive order opposing renewable subsidies. REAP, established in 2008 to assist farmers with renewable energy projects, now bars solar systems from eligibility, citing protection of farmland. Applicants must have operational energy systems for one year before qualifying for reimbursement, which may pose challenges given solar installation expenses. The Iowa Farmers Union and Earthjustice argue these changes violate federal law and undermine rural economic opportunities, with the USDA refusing comment on the ongoing lawsuit filed September 28.

The pending litigation challenges the USDA’s restrictions on renewable energy funding in rural America.

While Montana is not specifically mentioned, the state’s vast agricultural lands and growing interest in renewable energy mean these policy shifts could affect local farmers weighing solar investments. Montana’s rural economy might feel the tension between preserving farmland and embracing new energy technologies, influencing future energy and land use strategies.

Trump just effectively killed a popular solar energy program for rural America
By Frida Garza, Grist