Powering Affordable Clean Energy

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The Powering Affordable Clean Energy (PACE) program is part of the Inflation Reduction Act. With $1 billion in funding, PACE helps make clean, affordable, and reliable energy accessible to the people of rural America. Under PACE, USDA Rural Development’s Rural Utilities Service (RUS) will forgive up to 60 percent of loans for renewable energy projects that use wind, solar, hydropower, geothermal, or biomass, as well as for renewable energy storage projects. The PACE program allocates funding across three applicant categories: (a) Category 1: Provides up to 20 percent total loan forgiveness. (b) Category 2: Up to 40 percent total loan forgiveness if 50 percent or more of the population served by the proposed service area is located within the following areas: (1) Energy Communities; or (2) Distressed or Disadvantaged Communities. (c) Category 3: Provides up to 60 percent total loan forgiveness if: (1) The proposed service area is located in Puerto Rico, United States Virgin Islands (USVI), Guam, American Samoa or other U.S. territories or Compact of Free Association (COFA) states; or (2) The proposed service area consists of 60 percent or more of a Tribal area or serves an area that constitutes a SUTA; or (3) The Project is owned by an Indian Tribe defined by the Federally Recognized Indian Tribe List Act of 1994 (Public Law 103-454; 108 Stat. 4791, 4792), including their wholly owned arms and instrumentalities, or an Alaska Native Corporation, including regional or village corporations, as defined under or established pursuant to the Alaska Native Claims Settlement Act (Public Law 104-42; 85 State. 688).

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