Rural Electrification Act
| Company type | Government agency |
|---|---|
| Industry | Electrical distribution, Rural electrification |
| Founded | May 11, 1935 |
| Founder | Franklin D. Roosevelt |
| Fate | Legislation signed into law May 20, 1936 |
| Headquarters | United States |
Area served | Rural United States |
Key people | Franklin D. Roosevelt, Lyndon Baines Johnson, John E. Rankin, George William Norris, Sam Rayburn |
| Products | Electrical distribution networks, rural electrification loans and programs |
The Rural Electrification Act of 1936 (REA), signed into law on May 20, 1936, authorized federal financing to establish electrical distribution networks in remote rural regions across the United States.
This funding was funneled through cooperative electric utilities, many of which continue to operate today. These member-owned cooperatives procured electricity wholesale and delivered it through their own transmission and distribution infrastructures. The REA was a component of President Franklin D. Roosevelt's New Deal programs aimed at reducing unemployment during the Great Depression.
An important supporter of the legislation was the future President Lyndon Baines Johnson, who, as a young congressman, rallied rural Texan constituents to back the bill, thereby enhancing his political influence. The act played a crucial role in transforming life in rural parts of Texas Hill Country by facilitating access to electric-powered pumps, stoves, washing machines, and other domestic appliances. It also enabled students to study without relying on kerosene lamps.
History
President Roosevelt issued Executive Order 7037 on May 11, 1935, which established the Rural Electrification Administration. Congress followed by enacting the Rural Electrification Act in 1936. At that time, while electricity was widespread in urban centers, it remained largely absent from rural farms and ranches. Key advocates for the legislation included Representative John E. Rankin and Senator George William Norris. Roosevelt officially signed the Act into law on May 20, 1936.
Speaker of the House Sam Rayburn, serving as Chairman of the House Interstate and Foreign Commerce Committee, played a vital role in securing passage of the REA. By 1959, he reported that electrification had reached ninety percent of American farm households, a significant rise from only three percent in the early 1930s.
Technical issues
During the 1930s, extending electrical service to distant rural locations was considered economically impractical. Urban areas utilized a 2300-volt distribution system limited to roughly due to voltage drop constraints. REA cooperatives implemented a higher-voltage 6900-volt system (later upgraded to the modern 12,470/7200V 4-wire Y configuration), allowing for substantially longer transmission distances—up to approximately . Although this approach necessitated more expensive transformers at each residence, it helped maintain overall system affordability.
Wiring homes and farms
REA teams traveled throughout rural America with electricians who installed wiring inside homes and barns to connect buildings to the new electrical grid. A standard post-World War II REA residential setup typically featured:
- A 60-amp, 230-volt fuse panel including:
- A dedicated 60-amp circuit for the range
- A 20-amp circuit for the kitchen
- Two or three 15-amp circuits for lighting
Each room contained a ceiling light fixture operated by a switch located near the entrance, with generally one electrical outlet per room—reflecting the limited reliance on plug-in devices at that time. Wiring used NM (nonmetallic sheathed) cable insulated with asbestos-reinforced rubber and protected by jute and tar coverings.
Many original installations are still intact today, though most have been modernized to accommodate contemporary electrical appliances.
Later modifications
Significant updates to the Rural Electrification Act consist of:
- 1944: The loan duration was extended to 35 years, and the legislation was made permanent.
- 1949: Authorized loans to telephone companies aimed at rural area expansion.
- 1993: Overhauled loan programs covering rural electricity, telephone cooperatives, and energy efficiency initiatives.
- December 1993: The "Buy American" clause was broadened to incorporate Mexico and Canada under NAFTA.
- 2008: Introduced measures to support rural broadband and internet connectivity.
- 2014: Initiated a pilot project focused on rural gigabit broadband networks.
| Date enacted | Public law identifier | U.S. statute reference | Legislative bill number | Presidential administration |
|---|---|---|---|---|
| September 21, 1944 | P.L. 78-425 | Template:Usstat | Template:USBill | Franklin D. Roosevelt |
| October 28, 1949 | P.L. 81-423 | Template:Usstat | Template:USBill | Harry S. Truman |
| June 15, 1955 | P.L. 84–70 | Template:Usstat | Template:USBill | Dwight D. Eisenhower |
| October 23, 1962 | P.L. 87-862 | Template:Usstat | Template:USBill | John F. Kennedy |
| May 7, 1971 | P.L. 92–12 | Template:Usstat | Template:USBill | Richard M. Nixon |
| June 30, 1972 | P.L. 92-324 | Template:Usstat | Template:USBill | Richard M. Nixon |
| May 11, 1973 | P.L. 93–32 | Template:Usstat | Template:USBill | Richard M. Nixon |
| November 4, 1975 | P.L. 94–124 | Template:Usstat | Template:USBill | Gerald R. Ford |
| October 20, 1976 | P.L. 94-570 | Template:Usstat | Template:USBill | Gerald R. Ford |
| May 25, 1984 | P.L. 98-300 | Template:Usstat | Template:USBill | Ronald W. Reagan |
| October 21, 1992 | P.L. 102–428 | Template:Usstat | Template:USBill | George H.W. Bush |
| November 1, 1993 | P.L. 103–129 | Template:Usstat | Template:USBill | William J. Clinton |
| December 17, 1993 | P.L. 103–201 | Template:Usstat | Template:USBill | William J. Clinton |
| June 18, 2008 | P.L. 110–246 | Template:Usstat | Template:USBill | George W. Bush |
| February 7, 2014 | P.L. 113–79 | Template:Usstat | Template:USBill | Barack H. Obama II |