Recent cuts in agricultural prices, most recently Arla cutting the amount they’ll pay farmers to produce milk, have hit UK farmers hard. Add on increased costs, of feed, livestock and machinery and it’s easy to understand why farmers lively hoods are under threat.

There are ways farmers can make additional income, without taking risks. In fact you’ll make money from Biomass just by heating your home, because the UK Government Renewable Heat Incentive will pay you for keeping your home warm.

Renewable energy is a great idea for farms

The majority of farm houses are pretty old, poorly insulated and off mains gas. So heating and powering these properties can be a major cost each month. Many farmers still rely on oil, LPG or even diesel boilers to heat their homes, meaning that they’re running inefficient, often old, costly systems.

By switching to a Commercial or a Domestic Biomass Boiler farmers have a boiler which is 90% efficient, more than provides the hot water and heat their farm house needs and as an added bonus be paid by the Government via the Renewable Heat Incentive (RHI) scheme.

Larger, older properties, with solid walls and little insulation generally require more kilowatt hours (kWh) to keep them at a steady temperature and in a regulated supply of hot water. This all means that the RHI payments on these properties are higher, making payback for the boiler a much shorter period.

Calculating the Domestic RHI for a farm house is very easy

Assuming your farm house has an EPC rating of 50,000 kWh and RHI tariff is at the current rate of 8.93p per kWh*.

To calculate the RHI payment we simply multiply the two figures together e.g. 50,000 kWh x 8.93p RHI tariff = £4,465 each year over the seven years of the RHI payments, tax free and index linked.

The Renewable Heat inventive pays you quarterly over 7 years so your full RHI payment will be £31,255!

That’s not taking into account inflation or the reduced cost of your fuel over that time.

With the typical installation cost of a Biomass Boiler being around £20,000, you can see that over the seven years of the RHI payments you’ll make £11,255 profit, not including the savings you’ll make because biomass pellets are much cheaper and more efficient than oil, LPG or diesel to heat your home.

The RHI benefits for a Commercial Biomass install are even higher.

*Figures are correct as of 1st April 2015.

Fossil fuel costs will continue to effect farmers

Despite the recent deflation we’re currently in, fossil fuel prices will continue rise making the cost of running a farm even higher. By fitting Solar Panels and Biomass to your farm you can become fully sustainable and reduce your reliance on fossil fuels to virtually zero.

There are a range of renewable energy options open to farmers, larger properties may qualify for the commercial RHI payments which are less per kWh but are paid to you over a 20 year period, meaning that you’ll make even more money back from the government.

To find out how Biomass can be a new revenue stream for your farm contact us today using the form below.