Agiculture Secretary Bob Bergland and representatives of seven rural electic co-ops have signed agreements launching a "home weatherization" loan program which may eventually reach $1 billion.
Bergland said the program will enable low-and-moderate-income rural families to borrow up to $1,500 to insulate their homes and reduce heating and cooling bills.
The loans, running up to five years and bearing 6 per cent interest, will be made by the Agriculture Department's Farmers Home Administration.
Borrowers, however, will deal with local rural electric cooperatives which will handle the paperwork and collect repayments on the consumer's monthly power bills.
Bergland said initial loans may be made in about 30 to 60 days. Over a period of several years, he said, tentative estimates indicate that perhaps about 4 million homeowners will borrow a total of about $1 billion.
Bergland noted in a statement that his department is considering proposed new insulation standards for rural homes financed by Farmers Home Administration credit programs which go beyond current federal standards.
When new thermal standards are adopted and homes are better insulated, he added, "We can now begin to think seriously about alternative energy sources - solar, for example - which are not practical until home insulation meets the minimum that may soon be required."