Rural Utilities Service · Department of Agriculture
Affordable Rural Cooperative (ARC) Energy Program
Key facts
- Deadline
- Opens Oct 19, 2026 Estimate, not confirmed by the funder ?
- Award size
- Up to $20M
- Total available
- $175M · about 20 awards
- Match ?
- Required · Work out your budget and match
- Who can apply
- Set by the official notice: see Who can apply below
- Where
- Anywhere in the U.S., including Tennessee
Opening soon: the funder has announced this grant, but you can't apply yet. Use the time to get ready and check whether it fits.
How this fits you
- Available in Tennessee (nationwide program)
- Needs a match (see how much in the notice)
- Past Tennessee awards on file: 2
Tell us who you are to see whether you're eligible.
Official notice: https://simpler.grants.gov/opportunity/04c8d089-8193-4e94-b525-f06c2438d3b3 · Printed from grantme.click/grants/583c7e4b-2492-43a2-95d4-1098d255425b
View on Grants.gov Add dates to my calendar
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About this grant
The Rural Utilities Service (RUS or the Agency), a Rural Development (RD) agency of the United States Department of Agriculture (USDA), is soliciting Letters of Interest (LOI) for applications under the Affordable Rural Cooperative (ARC) Program. In addition, the Agency is announcing the eligibility requirements, application process and deadlines, and the criteria that will be used by RUS to assess ARC Applications. The ARC Program is making approximately $175 million in appropriated budget authority for the cost of loan and grant funds available under the Inflation Reduction Act (IRA) of 2022. In keeping with the statutory authority for the program, RUS will utilize the ARC funds to assist Eligible Entities to achieve future net reductions consistent with Section 22004 of the IRA through the deployment of advanced, efficient transmission infrastructure and nuclear power supply. Available funds will be allocated for each purpose while advancing the long-term resiliency, reliability, and affordability of rural electric systems. All Eligible Entities are responsible for any expenses incurred in developing their LOIs and ARC Applications.
This funding notice advances the statutory purpose of achieving the greatest reductions as provided in Section 22004 of the IRA associated with rural electric systems by increasing the amount of emission-free nuclear power and increasing the efficiency of the transmission grid within such systems. These new sources of cooperative power supply and enhanced transmission efficiency will result in reduced future demand for other sources of power.
Cost Sharing or Matching:
For Project and System loans, RUS will finance up to 75 percent of the total capitalized cost of the Project in the loan component of a Project and/or System Award. The Awardee will be required to initially provide and maintain for the term of the Project and/or System Award at least 25 percent of the Project’s total capitalized cost in the form of cash or an equity investment.
As noted in Section 2.0 of the NOFO, the Agency may where Financially Feasible allow an Awardee to utilize the grant component of the Award and/or any applicable tax credit that it expects to receive (including credit amounts expected to be received through Elective Pay elections under section 6417 of the Internal Revenue Code) toward the 25 percent equity requirement for a Project...
Who can apply, from the official notice
(1) Operating Electric cooperatives described in section 501(c)(12) or 1381(a)(2) of the Internal Revenue Code of 1986 who are currently or have been in the past a RUS electric loan borrower pursuant to the RE Act;(2) Electric cooperatives serving predominantly Rural Areas; or(3) Wholly or jointly owned subsidiaries of such electric cooperatives listed in (1) and (2).For the purposes of this program, the term “predominantly rural” as used in (2) in this paragraph shall mean a service territory that must include at least 50 percent Rural Areas
What the official notice requires
Pulled from the official notice ARC_NOFO.pdf (33 pages) so you can see the requirements at a glance. Each item shows the notice's own words. Open the page to read it in context.
Registrations you need first (2)
SAM.gov, Unique Entity ID (UEI) · p. 2
“To do business with the Federal Government and to submit your application electronically using the Grant Application Portal, you must— o Have a Unique Entity Identifier (UEI) and a Taxpayer Identification Number (TIN); o Be registered in SAM.gov (System for…” Open page 2
Grants.gov · p. 9
“Any system that does not produce any emissions of gases described in Section 22004 when it is operated. 1.4 Application of Awards All LOIs must be submitted to RUS electronically through Grants.gov.” Open page 9
Registration is free but can take weeks, so start now, not when the deadline is close. Get-ready checklist
Steps before the deadline
Loi · p. 9
“LOI submitters with high-ranking scores will receive an invitation to proceed and the agency will provide information about the method of application submission at that time Letters of Interest must include data as calculated in the New Clean Power Tool or…” Open page 9
Pre-application · p. 15
“Award funds must be used to pay only allowable, necessary, and eligible costs incurred post Award, except for approved pre-application expenses that are listed below.” Open page 15
Loi · p. 17
“The LOI must include the following:” Open page 17
Loi · p. 17
“If the Eligible Entity is a subsidiary of one or more Eligible Entities the Eligible Entity must list its owners in the LOI.” Open page 17
What to submit
Environmental documentation · p. 19
“If the Applicant has not received written notice from RUS that the Project environmental review process is concluded as provided in the Environmental and Historic Preservation Requirements, it must submit documents that establish that a review is in progress…” Open page 19
Letters of support or commitment · p. 28
“All RUS requirements and Award conditions specified in the Commitment Letter must be met before loan or grant funds will be disbursed.” Open page 28
Length limits
Portfolio of Actions: 1,500 words max · p. 18
“(ii) The description of the Portfolio of Actions shall not exceed 1,500 words, and it must include a summary of the technical aspects of the various actions that will allow RUS to measure the Section 22004 Reductions resulting from the Portfolio of Actions.” Open page 18
Dates in the notice
October 19, 2026 · p. 1
“ET on October 19, 2026 Letter of Interest Due Date: 11:59 a.m.” Open page 1
September 30, 2031 · p. 13
“Four (4) years from the date of environmental clearance, but no later than September 30, 2031.” Open page 13
Mistakes that get applications rejected (3)
Could get your application rejected: Letters of Interest will not be accepted after 11:59 a.m. · p. 2
“Letters of Interest will not be accepted after 11:59 a.m.” Open page 2
Not an eligible applicant: Any request for an advance of funds under the Award that includes any ineligible costs will be rejected. · p. 15
“Any request for an advance of funds under the Award that includes any ineligible costs will be rejected.” Open page 15
Missing a required part: (a) Incomplete LOIs and applications or ineligible applications as of the deadline for submission will not... · p. 26
“(a) Incomplete LOIs and applications or ineligible applications as of the deadline for submission will not be considered further, and the Applicant will be notified in writing.” Open page 26
Who in Tennessee has won this program
2 awards to Tennessee groups in 2 counties since 2025. Largest shown:
| Past winner | Where | Amount | Fiscal year |
|---|---|---|---|
| Chickasaw Electric Cooperative | Somerville, Fayette County | $35.7M | 2025 |
| Seven States Power Corporation | Chattanooga, Hamilton County | $24.7M | 2025 |
Source: USAspending.gov. Past awards show who this program funds. They don't guarantee future awards.
About the federal program
Affordable Rural Cooperative, also called “22004”
Program number 10.758 (the federal Assistance Listing number) · U.S. Department of Agriculture, Rural Utilities Service · Grant, loan
How applications are judged
RUS will review and evaluate the LOIs to determine if they are eligible, feasible, competitive and within the funding limits and policy objectives of the ARC Program. Each of the metrics in the criteria will be scored using the New Clean Power Tool or other methods acceptable to RUS. Pursuant to Section 22004, points will be awarded as described in the NOFO. Other factors to be considered include: reliability and resiliency; affordability; geographic diversity; resources of the ARC Program; SUTA provisions; funds available from other federal programs; and feasibility.
Applicants who have been invited to proceed with an application will be placed into one of two categories: 1) For Eligible Energy Awards, project ranking will be based on the estimated increase in MWh eligible nuclear power supply and the cost per MWh as well as the corresponding reduction as measured by the New Clean Power Tool. Both the estimated total cost of the project(s) and the anticipated cost to government will be evaluated and factored into the ranking. For power purchase arrangements or equivalent, the estimated cost of the project(s) will be based on the anticipated cost schedule for the term of the arrangement. For the construction of generation facilities and improvements to existing facilities, the estimated cost will be based on the estimated total capitalized cost. Cost estimates shall be inclusive of all expenses associated with the project(s) and modeled using assumptions and methods...
Match
For Project and System loans, RUS will finance up to 75 percent of the total capitalized cost of the Project in the loan component of a Project and/or System Award. The Awardee will be required to initially provide and maintain for the term of the Project and/or System Award at least 25 percent of the Project�s total capitalized cost in the form of cash or an equity investment.
As noted in Section 2.0 in the NOFO, the Agency may where Financially Feasible allow an Awardee to utilize the grant component of the Award and/or any applicable tax credit that it expects to receive (including credit amounts expected to be received through Elective Pay elections under section 6417 of the Internal Revenue Code) toward the 25 percent equity requirement for a Project Award. Such financial equity may not come from the proceeds of any loan from any creditor, including insiders of the Awardee.
Examples of funded projects
Fiscal year 2025: An electric cooperative in rural America was awarded a grant for the construction of new generation facilities, improvements to transmission systems, and the purchase of power through a Power Purchase Agreement.