Farmers looking to renewable energy to cut costs

A total of 82 per cent of farmers are motivated by concerns over rising energy costs, according to new research from Barclays, with one in three farmers looking to make a renewables investment in the next two years.

According to the research, over one quarter (27 per cent) of farmers see rising costs as the single biggest threat to their business in the next five years, with one in ten (10 per cent) also worried about price volatility.

Almost a third (31 per cent) expect the move towards renewables to reduce their business costs or generate an income of between £5,000 to £20,000 a year.

Martin Redfearn, Head of Agriculture at Barclays, said: “Most farmers see a move towards renewable energy as another form of diversification – and rightly so, as it can substantially cut energy costs and create new revenue.

“Over half of farmers considering renewables are still undecided about when they will actually make the investment. Investment in this relatively new technology is a big step, but there is plenty of support out there for farmers who want to know more. Talking to your accountant or your bank relationship manager can be a key first step towards finding out whether it is right for your farm.”

Renewable energy was seen a few years ago as a potentially lucrative source of additional income for the farming industry, but Government alterations to tariff rates have caused problems.

Of those farmers who are not considering investing in renewable energy, the main reason given was that it would be too expensive (18 per cent). Other reasons given include lack of time to consider, a lack of understanding as to how it would help and concerns over return on the investment.