2026 Community Wood Energy and Wood Innovation Program

The USDA Forest Service is delivering the Community Wood Energy and Wood Innovation Program (Community Wood) to support the Rural Revitalization Technologies 7 U.S.C. Sec. 8113 and Agriculture Improvement Act of 2018 Pub. L. 115-334 Sec. 9013, and Infrastructure Investment and Jobs Act (Bipartisan Infrastructure Law) Pub. L. 117-58 Div. J Title VI which directly support the installation of thermally led community wood energy systems or development and expansion of innovative wood product facilities. The intent of the Community Wood is to support forest health and stimulate local economies by expanding renewable wood energy use and innovative wood products manufacturing capacity. 

The Forest Service solicits proposals for projects that will achieve the following:

• Expand thermally led community wood energy or innovative wood product opportunities;
• Improve Forest health; and
• Stimulate local economies.

This funding opportunity is intended for shovel ready projects that will not require additional funding or time to complete after the award period.

Examples of eligible projects include, but are not limited to: 

• Install a thermally led community wood energy system for heating, cooling, and/or electricity that replaces fossil fuels such as coal, oil, propane, or natural gas.
• Purchase and install manufacturing equipment at a mass timber production facility.
• Expand a sawmill to add higher value production lines that incorporate innovative technologies and cost cutting measures.
• Purchase and install equipment at a new facility to produce biofuels from forest residues.

All awards are based on funding availability. The Forest Service plans to award up to $6 million in total awards under this announcement. The maximum for each award is $1 million to pay for up to 35% of total capital costs. The Forest Service may consider awarding up to $1.5 million (for up to 50% of total capital costs) for a proposal that warrants special consideration, especially for projects located in areas of high unemployment. 

Matching funds are not required; however, leveraging is required. Applicants must contribute the remaining funds (leveraged funds) necessary to complete the project above and beyond the requested Forest Service funding. For example, if an applicant requests Forest Service funding for 35% of the total capital costs of the project, then the applicant must commit to providing 65% of the total capital costs of the project. In this example, the 65% of the total capital costs are considered the required leveraged funds. Even though leveraged funds have a lower reporting burden and fewer legal requirements than matching funds, applicants must adhere to requirements for leveraged funds.  

Leveraged funds must be from non-federal sources and be committed within the grant timeframe. Moreover, if third-party organizations contribute to the leveraged funds requirement, then applicants must submit with their proposal package commitment letters from the third-party organizations confirming the amount of leveraging being committed.

A pre-recorded webcast that presents information on applying for this funding opportunity can be found at FY26 Community Wood Pre-Application Webcast (Available by 2/20)

Additional details on the funding opportunity can be found at Wood Innovations Homepage

Instructions on how to apply for funding and the official application can be downloaded at the following weblinks:

Instructions FY26 Community Wood Program

Community Wood Grant Application (FS-1500-0051)

Community Wood Grant Factsheet