Diversify your income. Boost profits. - How to generate additional streams of revenue for your farm

Posted by Clare Burns on 07-Jul-2015 09:01:02

Farm margins for food production are thinner than ever. Ensure that your business is viable in the long term by generating renewable energy from your farm’s waste.

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recent survey by the NFU asked farmers in 2013, and again in 2014:

Will output prices affect you negatively in the next 12 months?

  • 27% said yes in 2013
  • 56% said yes in 2014

… an increase of more than 100% in just one year.

The survey also asked in 2014:

Will input prices have a negative impact on your farm business?

52% answered yes.

“This year has seen farmgate prices falling across various commodity sectors – arable, dairy, livestock and mixed – and this increased volatility has clearly impacted on our members’ confidence.”

 

The plight of dairy farmers has been well publicised…

Farmers are looking to diversify to survive.

38% of farms have some kind of renewable energy

… But potential still remains largely untapped.

 

On-farm renewables could provide between:

10 and 20GW of energy – enough to power up to 1.3 million homes

1GW could come from anaerobic digestion:

Slurry + energy crops + anaerobic bacteria
= Biofertiliser and biogas (50-70% methane) turned into heat and electricity

Should you be using your farm waste to boost your profits?

 

On-farm anaerobic digestion is more than an efficient waste-disposal method.

It provides additional income streams derived from on-site usage of power and heat with the export of surplus energy to the national grid.

 

Other financial advantages include:

  • Lower waste removal costs.

  • Reduced reliance on chemical fertilisers.

  • Double subsidies:

    • Renewable electricity – payments through the Feed-in Tariff

    • Renewable heat – payments through the Renewable Heat Incentive

… support is index-linked and guaranteed for a 20-year period.

 

More benefits:

  • Improved slurry handling.

  • Increased spreading windows.

  • Less crop taint and decreased re-grazing times.

  • Reduced farm environmental footprint.

 

Staples Vegetables Ltd, Boston, Lincolnshire

Aim:

To design an AD plant to utilise the 20,000 tonnes of out-of-specification vegetables produced every year, together with dual purpose crops such as sweetcorn, and an energy crop (mostly maize). Overall consumption: 1,000 tonnes of plant material per week.

Biogas use:

100% of the output (methane) powers a 1.4 megawatt combined heat and power plant which heats the office, chills the packhouse, and feeds back into the grid.

Biofertiliser use:

40% of the farm’s fertiliser requirements is supplied by the digestate.

The future:

To double the size of the existing plant and construct another, using the biogas produced to run their entire fleet of over 25 lorries.

“Now we’re up and running it seems the possibilities are endless … The heat produced has the ability to heat thousands of local homes ... Compost suppliers are interested in using our digestate … Some vegetables we grow are now dual purpose … It makes business sense … as well as making it more sustainable for the future.”

George Read, Production Director

 

The future

The NFU’s on-farm anaerobic digestion target is 1,000 by 2020.

Obtain advice from experts who offer a farm energy consulting service to determine whether anaerobic digestion can provide viable additional streams of revenue for your farm.

 

Takeaways:

Things to think about:

  • Financial advantages include reduced waste disposal, and decreased reliance on chemical fertilisers and fossil-fuel derived heat and electricity.

  • Double subsidies are available – index-linked and guaranteed for 20 years.

  • Farm energy consulting experts can give you assistance which provides you with a meaningful ROI from on-farm anaerobic digestion in just five to seven years.

Should you be seeking advice to future-proof your business?

 

To learn more about how to generate additional income on your farm, download our free eGuide: The Essential Farmers' Guide to the Financial Benefits of Waste Energy

The Essential Farmers' Guide to the Financial Benefits of Waste Energy

Topics: Anaerobic Digestion / Biogas, Farming

Clare Burns

Clare Burns is a technical marketer with many years’ experience in the energy arena, as well as in fashion, telecoms and education. Fluent in 3 languages, Clare has worked across Europe. She currently works for ENER-G, a UK manufacturer of carbon reducing, energy efficient products exporting its cogeneration technology across the globe.