Methane Digester Loan Program
Administered by Minnesota Department of Agriculture
If you're a Minnesota livestock producer, this zero-interest loan program can help you finance an on-farm anaerobic digester system to generate electricity from manure. You can borrow up to $250,000 with repayment over a maximum of 10 years, and you'll need to show financial stability and ability to repay. Contact the Rural Finance Authority at 651-201-6004 or RFA.Loans@state.mn.us with your application and a $100 application fee.
This program finances digester equipment purchases and system construction for eligible Minnesota farms, offering your customers zero-interest loans up to $250,000 through either the RFA directly or through one of over 400 approved lenders statewide. Your customers must be Minnesota residents or family-farm entities, demonstrate financial stability and repayment ability, and show the system will be properly maintained—and the loan can serve as matching funds for federal grants or loans.
The RFA operates this revolving loan fund established in 1998 under Minn. Stat. § 41B.049, offering zero-interest direct loans or loan participations up to $250,000 with 10-year amortization to livestock producers installing anaerobic digesters on Minnesota farms. Borrowers must demonstrate financial stability, repayment capacity, and proper asset management; prior loan recipients may reapply if the previous loan is fully repaid. The $100 application fee supports administration, and loans cannot refinance existing debt but may serve as federal grant/loan matches.
Program details
- Program ID
- 2716
- Last updated
- 7/29/2025
Eligibility
- Sectors
- agricultural
- Technologies
- biomass anaerobic digestion
Program summary
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; and
- provide evidence that the practices implemented and capital assets purchased will be
properly managed and maintained.
Additionally, a borrower who has previously received a loan under this program may receive another methane digester loan if the previous loan has been repaid in full.
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.
Contact & resources
- Contact email
- David.Weinand@state.mn.us
- Additional resources
Please verify current program details with the administering agency before making any financial decisions.
