[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1721.104]

[Page 229-230]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER XVII--RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 1721--POST-LOAN POLICIES AND PROCEDURES FOR INSURED ELECTRIC LOANS--Table of Contents
 
       Subpart B--Extensions of Payments of Principal and Interest
 
Sec. 1721.104  Eligible purposes.

    (a) Deferments for financial hardship. (1) In cases of financial 
hardship, a Borrower may request that RUS defer principal or interest or 
both. RUS will consider whether the deferral will help a Borrower place 
its operations on a more stable financial basis and thereby provide 
assurance of repayment of loans within the time when payment of such 
loans are due under the terms of the note or notes as extended.
    (2) RUS will determine whether a Borrower qualifies for the 
deferment on a case-by-case basis, considering such factors as the 
following:
    (i) Substantial unreimbursed or uninsured expenses relating to storm 
damage;
    (ii) Loss of large power load (as defined in Sec. 1710.7(c)(6)(ii) 
of this chapter, Large retail power contracts); or
    (iii) Substantial loss of consumers or load due to hostile 
annexations and condemnations, without adequate compensation.
    (b) Deferments for energy resource conservation (ERC) loans.
    (1) A Borrower may request that RUS defer principal payments to make 
funds available to the Borrower's consumers to conserve energy. Amounts 
deferred under this program can be used to cover the cost of labor and 
materials for the following energy conservation measures:
    (i) Caulking;
    (ii) Weather-stripping;
    (iii) Heat pump systems (including water source heat pumps);
    (iv) Heat pumps, water heaters, and central heating or central air 
conditioning system replacements or modifications, which reduce energy 
consumption;
    (v) Ceiling insulation;
    (vi) Wall insulation;
    (vii) Floor insulation;
    (viii) Duct insulation;
    (ix) Pipe insulation;
    (x) Water heater insulation;
    (xi) Storm windows;
    (xii) Thermal windows;
    (xiii) Storm or thermal doors;
    (xiv) Electric system coordinated customer-owned devices that reduce 
the maximum kilowatt demand on the electric system;
    (xv) Clock thermostats; or
    (xvi) Attic ventilation fans.
    (2) ERC loans will be amortized over not more than 84 months, 
without penalty for prepayment of principal.
    (c) Deferments for renewable energy projects. (1) A Borrower may 
request that RUS defer principal payments to enable the Borrower to 
finance renewable energy projects. Amounts deferred under this program 
can be used to cover costs to install all or part of a renewable energy 
system including, without limitation:
    (i) Energy conversion technology;
    (ii) Electric system interface;
    (iii) Delivery equipment;
    (iv) Control equipment; and
    (v) Energy consuming devices.
    (2) A Borrower may request that RUS defer principal payments for the 
purpose of enabling the Borrower to provide its consumers with loans to 
install all or part of customer-owned renewable energy systems up to 
5kW.
    (3) A renewable energy system is defined in Sec. 1710.2 of this 
chapter.
    (4) For the purpose of this subpart, a renewable energy project 
consists of one or more renewable energy systems.
    (d) Deferments for contributions-in-aid of construction.
    (1) A Borrower may request RUS to defer principal payments to enable 
the Borrower to make funds available to new full time residential 
consumers to assist them in paying their share of the construction costs 
(contribution-in-aid of construction) needed to connect them to the 
Borrower's system.
    (2) Amounts available for this purpose will be limited to the amount 
of the construction costs that are in excess of the average cost per 
residential

[[Page 230]]

consumer incurred by the Borrower to connect new full time residential 
consumers during the last calendar year for which data are available. 
The average cost per residential consumer is the total cost incurred by 
the Borrower and will not be reduced by the amounts received as a 
contribution-in-aid of construction.