Methane Digester Loan Program

July 28, 2020


Established in 1998, the Minnesota Dept. of Agriculture Methane Digester Loan Program helps livestock producers install on-farm anaerobic digesters used for the production of electricity by providing zero-interest loans to eligible borrowers. The loan program is part of the Rural Finance Authority (RFA) revolving loan fund, through which farmers can receive financial aid for many different farming related activities and improvements. The general eligibility requirements for loans through the RFA are contained in Minn. Stat. § 41B.03, which permits loans only to Minnesota residents, domestic family-farm corporations, and family-farm partnerships. The methane digester loan program is specifically authorized by Minn. Stat. § 41B.049.

In order to be eligible for a Methane Digester Loan, a borrower must:

  • locate the projects and utilize the equipment and practices on land located in Minnesota;
  • provide evidence of financial stability;
  • demonstrate an ability to repay the loan;
  • provide evidence that the practices implemented and capital assets purchased will be
    properly managed and maintained; and
  • not have previously received a loan under this program

Within the Methane Digester Loan Program, the RFA may make a direct loan to the borrower or act as a participant in the loan with an eligible lender (more than 400 such approved lenders exist throughout the state). Loans may not exceed $250,000 for either participation or direct loans. The loan term is limited to a maximum of 10 years and repayment terms for the RFA's participation interest may differ from those of the outside lender. Loans can be used as a match for federal loans and grants, but may not be used to refinance a debt existing prior to the application.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Minnesota
Incentive Type: Loan Program
Web Site:
Administrator: Minnesota Department of Agriculture
Start Date:
Eligible Renewable/Other Technologies:
  • Biomass
  • Anaerobic Digestion
Maximum Loan: RFA can provide up to $250,000 of loan principal
Loan Term: 10 year maximum loan term, RFA portion at zero-interest


Name: Minn. Stat. § 41B.049
Date Enacted: 1998
Name: Minn. Stat. § 41B.03


Name: Ryan Roles
Address: 625 Robert Street North
Phone: ((65) 1) --201

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.