Decision time on renewable energy plans as threat hangs over support

Farmers and landowners interested in renewable energy projects but who are still considering what action to take have had a sharp reminder this week of the need to focus on which type of system to opt for to avoid losing out completely.

According to Kirsty Macpherson, of Gillespie Macandrew's energy group, the recent review of feed in tariffs (FIT) by Chris Huhne, Secretary of State for Energy and Climate Change, has flagged up a desire by the government to reduce the budget by 40 million by 2014-15.

"The government is seeking to make the FIT scheme fiscally more efficient and has also indicated it is seeking 10 per cent of savings within the scheme in 2014-15, she said.

"Therefore, I believe that Scottish farmers and landowners who are looking to diversify into renewable energy derived from hydro or wind sources should do so sooner rather than later."

She was also concerned that large-scale photo voltaic renewable energy projects in the south of the UK would reduce the amount of cash available for farmers and landowners in Scotland looking at hydro or wind power projects.

"It would be wrong if large-scale photo voltaic schemes empty the FITs 'pot' at the expense of the other two types of schemes."

Although there has so far been little interest in anaerobic digestion plants on farms, MacPherson said she hoped the review of FITs for this process could be good news for farmers who may be considering such an option.

"Schemes using slurry, crop waste or vegetable waste as the biogas source could be attractive to farmers, but only if the price is right," she added.

Earlier this week, Scottish cabinet secretary Richard Lochhead announced the injection of 2.4 million into the communities and renewable energy scheme Scotland fund which will help farmers working with local communities get into the renewable energy market.

Shirley Mathieson, of the Saffery Champness landed estates and rural business group in Inverness, described this move and the review into FITs for anaerobic digestion plants as good news for the rural sector in Scotland

"Both these announcements provide further incentive for farmers and land owners seeking diversification opportunities to look long and hard at renewables if they have not done so already both for their own energy supply and for feeding in to the grid and to do so now while the political wind and will is blowing strongly in their favour," she said.

The additional cash for renewables was also welcomed by the Scottish Rural Property and Business Association who called it "a vital new measure in helping land managers get started in the renewables field".

They said the up-front risk and cost burdens of developing renewable energy projects had often deterred land managers from considering such schemes.Chief executive Douglas McAdam said that, although many land managers were very keen to try and install renewable energy facilities on their premises, the associated pre-application planning costs were often so great that they simply prohibited the possibility of development.

"This fund will be vital in helping alleviate these concerns by acting as a financial cushion if applications for renewables systems are not successful and the projects cannot be delivered," he said.