The Biden administration has unveiled an $11 billion subsidy aimed at bringing affordable clean energy options to rural communities. The funding is intended to assist utility providers in delivering reliable and sustainable energy solutions to areas that may lack the infrastructure typically found in urban centers.

“This is an exciting and an historic day, and it continues an ongoing effort to ensure that rural America is a full participant in this clean energy economy,” U.S. Department of Agriculture Secretary Tom Vilsack said.

This announcement marks the largest federal investment in rural electrification since President Franklin D. Roosevelt signed the Rural Electrification Act in 1936 as part of the New Deal. The allocated funds will primarily be utilized to enhance power grids in rural communities, paving the way for the implementation of renewable energy systems, zero-emission technologies and carbon-capture systems. This program will also support the financing of large-scale solar, wind and geothermal projects.

“This is an exciting and transformative opportunity for co-ops and their local communities, particularly as we look toward a future that depends on electricity to power more of the economy,” said Jim Matheson, CEO of the National Rural Electric Cooperative Association. “USDA has smartly structured this program in a way that will help electric co-ops leverage new tools to reduce costs and keep energy affordable while meeting the future energy needs of their rural communities.”

The $11 billion subsidy is being sourced through the Inflation Reduction Act, a $738 billion spending bill signed into law back in August of last year. Within this bill, $369 billion was designated for green energy investments, with the rural energy grants constituting the latest installment of these funds.

By extending financial support to utility providers, the Biden administration aims to bridge the energy gap between rural and urban areas, ensuring that all communities have access to reliable and environmentally friendly power sources.

“This new funding from the Inflation Reduction Act shows that President Biden, and our entire administration, is serious about investing in rural America,” said John Podesta, senior adviser to the president for clean energy innovation and implementation. “This announcement embodies what the Investing in America Agenda is all about — building a clean energy economy that works for everyone.”