One of the biggest obstacles to overcome is ensuring the flow of investment into a natural resource-based economy in which an increased amount of energy and material commodities will emanate from the land-based sector. Raising this capital is essential to achieve the low-carbon transition, but it may yet be deemed to be too high a risk for many investors and banks. Governments must continue to take steps to support the flow of credit to companies investing in renewable energy and materials. Volatility in energy prices, high capital costs and the relatively long pay-back periods for some forms of low-carbon investment may inhibit small scale investors like farmers, so further financial instruments such as enhanced capital allowances (tax write-offs) may be required.
With 75 per cent of our national land area in the agricultural sector, UK farmers are well-placed to capture renewable natural energy flows, while maintaining our traditional role in food production as well as the delivery of other environmental and land management services. The NFU welcomes the government’s expectation that renewable energy will underpin at least 13,000 farming jobs in the UK and anticipate that these will be supported by income from on-farm anaerobic digesters, other forms of small-scale on-farm heat and power generation, ground rents and electricity sales from wind power, and supply of biomass feedstocks at both small and large scales (for heat, power and transport fuels).
The National Farmer’s Union calls for greatly accelerated action in delivering energy efficiency, renewable heating and other forms of renewable energy, through support for energy users as well as producers. Energy users of all types (including those within agriculture and horticulture) should be encouraged to produce their own sustainable energy, where practical and viable, and should receive rewards appropriate to the benefits of renewable decentralised production. We want to see reasonable administrative charges and grid connection costs, and would encourage Distribution Network Operators to work with farm-based generators, and to value and highlight the improvements to system performance that may result from embedded generation.
Governments must lead by example in their own procurement policies and infrastructure developments. Developers of public sector projects should be encouraged to engage with agricultural businesses as potential providers of biomass fuels and energy services. Government action is also needed to raise awareness among planners and rural dwellers of the renewable energy potential of rural areas and the possible opportunities for self-sufficiency and enhanced energy security in rural areas.
The NFU believes that agriculture and horticulture can help to mitigate climate change, while contributing to both energy security and food security and our aspiration is for every farmer to have the opportunity to become a net exporter of low-carbon energy services.
Ceris Jones is a climate change adviser at the National Farmers Union