Farmers plough the way for solar power in the UK

UK farmers are set to profit quite significantly since the introduction of the solar photovoltaics feed-in tariff in April. Farmers, who saw a 7% drop in income in 2009 as commodity prices fell, could now install solar power systems on their land for a secure investment, reports the Telegraph. 

“Investment in renewables and developing new income streams from land and buildings is part of the defence against volatile commodity prices,” says Tom Hind, Head of Economics at the National Farmers’ Union.

Farmers are now beginning to realize that they are in fact sitting on a gold mine, since their land and large buildings are perfect for the large-scale installation of solar power systems. By generating renewable energy, farmers can not only power their own facilities, but also earn a handsome profit.

Stephen Frankel, who owns a farm in Carhart Mill in Wadebridge, Cornwall has installed a 3kW system on the barn roof at his rare breeds pig and cattle farm. Frankel’s system earns him £1,700 of income a year, since the FiT pays out 41.3p per kilowatt hour (kWh) for a period of 25 years for a system of this size.

^{Stephen Frankel with his £11,400 solar system}

The Sunday Telegraph contacted several farmers to talk to them about this kind of opportunity, and most said that they were inundated with calls and correspondence from investors wanting to engage them in solar projects. The tariff system is designed to offer an 8-10% rate of return on all scales of project, making it more attractive for investors than a bank account and more reliable than the stock market.

Since the FiT scheme began, there have been 3,721 installations in the UK, 98% of which were solar panels, according to the latest figures from Ofgem, the energy regulator. Many of the systems included within this figure are residential rooftop installations, however as the year progresses, the amount of installs is likely to spike as farmers begin generating their own electricity.

A system installed on an average barn roof could generate as much as £20,000 of income a year however, large field-based projects could provide an income in the region of several million pounds a year, with the potential to secure and diversify farmers' income.

Madeleine Lewis of Farming Futures, a body backed by the Department for Environment, Food and Rural Affairs (Defra), the NFU and Forum for the Future, the environmental group said, “A year ago, farmers thought of solar as not very profitable and that's obviously changed. They are now very keen to invest in renewables. They are using a lot of energy, prices are going up and that has hit their businesses hard. Renewables projects insulate them against rising prices and provide a new income. There's a lot of buzz around it.”

Nearly 40 farmers have already inquired about planning permission for solar projects in the county and more are likely to follow. Installations are also being planned in Herefordshire, Somerset and even the North East of England. Cornwall is expected to be the solar hub of the UK, since it receives the most of sun hours (solar irradiation) in the UK.

The NFU believes that as many as 100 farmers will be setting up major solar projects by next year with many more already planning small-scale developments. Jonathan Scurlock, the NFU's Chief Adviser on renewable energy said, “Farmers are extremely interested in diversifying and this is completely compatible with the traditional business of a farm.”

The NFU is encouraging farmers to mount panels on barn roofs or to use land around the edge of fields for solar panels rather than using fertile agricultural land for so-called 'solar vineyards,' since these projects will be less susceptible to opposition. However, Scurlock does explain that farmers can graze chickens, geese or even sheep underneath field-based panels to maintain agricultural use.

Investors are currently increasing their interest in farm land solar installations in the UK. Since farmland is so vast, there is the potential for a 13-15 hectare site, which could generate 5MW, providing an annual income of £50,000 a year. However, some farmers are suspicious of partnerships with developers or financiers because they fear the majority of the income will end up elsewhere. Experts also warn that the returns for solar projects are being overestimated by investors keen to persuade farmers to sign up, reported the Telegraph.

This sudden increase in solar power on farmland follows years of similar success in Germany, the solar capital of the world, where thousands of farmers have taken advantage of the FiT.