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Advice on farming into feed-in tarrifs
7Apr2010
Ewan Pate Farming Editor at The Courier
The renewable energy industry, much of which is land based, has received a considerable boost with confirmation that feed-in tariffs (FiTs) are now in place.
These are designed to support investment in renewable projects of all sorts and have been set at a level guaranteed for 20 years and linked to inflation.
For example electricity generated by a micro wind power installation of under 15KW capacity will attract a payment of 26.7p per kilowatt-hour regardless of whether the power is used on the farm, in the home or sold to the grid.
Importantly this is not a government subsidy but a scheme which will be paid for by electricity consumers as an incentive.
This makes future political interference by a greedy Chancellor improbable.
The FiT scheme replaces existing Renewable Obligation Certificates (ROCs) on all but the largest renewable energy installations.
"I very much welcome the introduction of FiTs. They will provide a fantastic opportunity to increase employment and boost the economy, " said Joe Fergusson, Ayr-based microgeneration consultant with land agents Bell Ingram.
"Because they are not taxpayer funded they shouldn't be vulnerable to political whims.
"The whole point of them is to give certainty to investors. They have been in place in Germany since 2002 and since then the number of people employed in manufacturing and installing photovoltaic panels alone has jumped from 5000 to over 50,000."
In all 63 countries across the globe have introduced FiTs.
Mr Fergusson's understanding is that they will be generally available on all eligible renewable projects but with the important proviso that an accredited installer has been employed.
This could be a restricting factor because to date there are only a few accredited suppliers and the process of gaining accreditation is "far from simple."
At the same time he encouraged farmers and landowners to make sure they installed durable plant.
"For example there is a huge difference between a well-conceived and planned hydro-electric scheme and one just put together.
"It might generate the same power for a while but the maintenance and repair bill could be very high.
"SEPA have just launched a consultation on micro-hydro schemes which may well result in tight eligibility but it is practical and sensible to have a more objective approval process."
Mr Fergusson also has some concerns that the consultancy side of the industry will be overstretched as it strives to meet demand.
"It worries me that people without suitable experience will jump on the bandwagon, " he said.
Planning issues will also be important as the renewables industry gains momentum.
Currently planners take a very different view across the country to the extent that in one county two bladed turbines are favoured whereas in others three blades are preferred.
"It is all very messy at the moment and we could really benefit from strategic direction from Scottish Government. After all, we are trying to achieve a national objective, " Mr Fergusson added.
The UK currently gets just over 5% of its electricity from renewable sources against a target of 30% generated from such sources by 2020.
NFU Scotland president Jim McLaren also welcomed the announcement of FiTs.
"They present a huge opportunity for Scottish farmers to get involved in small scale renewable energy projects and it is worth any farm business looking at whether generating energy may have a role in the future, " he said.
"Government is keen to encourage greater deployment of such technologies and, looking at the bigger picture, the benefits are many. They can help tackle climate change, reduce reliance on centrally generated electricity and increase security of energy supplies.
"At a farm level, FiT provides a financial incentive to meeting the farm business energy needs with the added bonus of a return on any surplus electricity supplied to the grid.
"There is an expectation that by 2020, FiT will support over 750,000 small-scale low-carbon electricity installations across the UK and will have saved 7 million tonnes of carbon dioxide. The possible returns from involvement in FiT have been pitched at a level that many farmers may find attractive and will help to achieve these ambitious targets.
"It is clear that farmers have a key role in making sure FiT works.
"For that to happen, we need more detailed guidance on how our industry can get involved in power generation projects, the opportunity for community-type approaches to schemes and the availability of start-up funding through Rural Priorities."
The front-runners to date for renewable projects have been based on harnessing wind or hydro power, but Mr Fergusson urged farmers and landowners not to ignore photovoltaic or solar panels.
"I think they have been overlooked, " he said.
"Every time I pass a large farm building with a south facing roof I think of it as an opportunity.
Once these panels are in place they shouldn't need to be touched again.
Ewan Pate - The Courier