Claiborne Crain (202) 720-1255
ccrain@rus.usda.gov
Dan Campbell (202) 720-6483
dan.campbell@usda.gov

USDA LAUNCHES PROGRAM TO MEET PEAK ENERGY DEMAND

WASHINGTON, Nov. 3, 2000--The U.S. Department of Agriculture is launching a new program to meet rising peak energy demand by helping rural utilities buy and install combustion-turbine generating units. The program, a joint effort of USDA Rural Development and the Cooperative Finance Corporation (CFC), will help electric generation and transmission (G&T) cooperatives finance turbine purchases and get them on line as quickly as possible.

"Electric consumers in some parts of the nation have been hard hit in recent months by soaring energy costs and reduced reliability," said Jill Long Thompson, USDA under secretary for rural development. "By helping G&T cooperatives install combustion turbines, peak-energy demand can be handled much more efficiently, preventing service interruptions and helping to avoid sharp spikes in energy costs."

Combustion turbines are internal-combustion engines fueled primarily by cleaner-burning natural gas. They are brought on line during peak energy demand periods to prevent electrical generating systems from becoming overloaded.

Under the program, CFC will accelerate short-term financing for combustion turbines, processing applications in as little as 45 days. The Rural Utilities Service of USDA Rural Development will provide long-term financing and project evaluations. Cooperatives can thus react quickly to demand for increased power-generating capacity and avoid becoming stuck at the end of the long waiting lists for equipment as manufacturers struggle to keep up with soaring demand for combustion turbines.

"The program is tailored to situations where low-risk loans make speedy financing possible," said Long Thompson. "The program combines CFC's fast turn-around capabilities with USDA's low-cost utility funding program." She stressed that this new approach does not waive any of USDA's requirements for long-term financing.

For more information on the program, call (202) 720-1255, or visit the USDA Rural Development website at http://www.rurdev.usda.gov/rus/index.html

#

Return to Rural Development News and Information Room.