VINALHAVEN — The ratepayer-owned Fox Islands Electric Coop was among those winning funding from USDA Rural Development to upgrade its systems with “smart grid” equipment and improve distribution lines. The money comes in the form of loan guarantees.

Agriculture Secretary Tom Vilsack announced the funding winners on May 6. The money will go to projects in 18 states to improve electric service to business and residential consumers in rural areas. The $540 million in guarantees to fund these projects is made available through the U.S. Department of Agriculture’s (USDA) rural utilities program which include more than $35 million for smart grid projects to improve rural electric system communications technology.

“Electric reliability is a critical component of the success of our rural economy,” Vilsack said. The loans “will help continue to ensure the safety, reliability and affordability of electric service in rural areas.”

The funding is part of the Obama administration’s vision for a new rural energy economy. “Investments in smart grid technologies help rural electric cooperatives improve system operations to meet the needs of rural customers,” Vilsack said.

Virgina Manuel, USDA Rural Development’s state director for Maine said: “These essential USDA Rural Development funds will assist Fox Islands Electric Cooperative with valuable smart grid improvements and will improve nine miles of distribution line for these rural Maine island communities, helping their sustainability in the long run.”

Awards are contingent upon the recipient meeting the terms of the loan agreement.