Futureproofing agriculture: How renewable energy offers a sustainable lifeline for farmers

TL;DR

• The farming industry is under pressure to produce despite challenges resulting from climate change and global economic conditions.  

• Participating in the energy transition by installing solar panels and wind turbines or switching to biofuels can help farmers cut costs and diversify their incomes.  

• The practice of agrivoltaic farming ensures agriculture and renewable energy work together, unlocking several benefits that would not otherwise be available if the two are viewed as being in opposition.  

• Government funding is critical for improving uptake. Through the Improving Farm Productivity solar grant, £45 million has been made available for grants between £10,000 and £100,000, enabling farmers to invest in solar arrays.

The detail

Global agriculture is facing myriad challenges.  

Climate change heavily is impacting both arable and pastural farmers, affecting soil fertility and rain patterns while also increasing instances of drought and floods that can decimate crop yields.  

Critically, these difficulties are worsening at a time where the pressure to produce is also mounting. According to the UN, food production will need to increase by as much as 70% if the world is to feed a population that is predicted to exceed 9.7 billion by 2050.  

Further, with the global food system currently contributing to 26% of global greenhouse gas emissions, making it crucial for farmers to reduce their environmental footprint and adopt climate-resilient practices. 

In this context, farmers may feel trapped between increasing production demands and the need to mitigate their environmental impact. However, there are several ways in which they can simultaneously overcome the impacts of worsening weather patterns and combat climate change in a profitable way. 

By embracing sustainable renewable energy solutions, farmers can be at the forefront of industry innovation and adaptation. From reducing emissions to improving food security, providing new sources of income, and playing a key role in driving energy transition, the opportunities are significant. 

Innovation and Diversification  

Indeed, leveraging agricultural land for renewable initiatives can help the industry – and the world more generally – to reduce its reliance on fossil fuels.  

This shouldn’t be viewed as an additional burden on farmers, however. Rather, embracing alternative renewable or low-carbon fuels should be seen as an opportunity to cut costs while also bringing in new revenue streams. 

Take biofuels as an example. Indeed, many farmers cultivate crops like corn, soybeans, and switchgrass which can be converted into biofuels such as biodiesel and ethanol, provide an eco-friendly alternative to fossil fuels. By producing their own biofuels, farmers can reduce their reliance on non-renewable resources and stabilise their fuel costs. 

In addition, the installation of solar panels and wind turbines can provide another additional source of electricity that can either be stored for use on the farm or fed back into the national grid for extra income.  

Here, partnering with solar developers and leasing land can be an extremely cost-effective way for farmers to benefit from renewables. 

Between 2010 and 2019, many UK farmers benefited from generating their own solar power, thanks to the UK feed-in tariff (FiT), which guaranteed payments for supplying renewable energy to the grid for generators of less than 5MW. However, with the phasing out of these incentives, leasing land to solar developers has become a lower-risk option for farmers. 

For those exploring this option, the potential for revenue diversification and emissions reduction is significant. According to estimates from the US think tank RMI, if 90% of America's electricity were to come from renewable sources by 2035, wind turbines and solar arrays in rural areas could generate over $80 billion in annual revenue. In contrast, US corn and soybean production is projected to decline by 80% over the next 60 years due to climate change.  

This stark contrast underscores the need for farmers to proactively explore and harness alternative revenue streams to secure their future. 

Mutually beneficial arrangements 

Of course, It is crucial for the farming industry to harness renewable energy in a way that does not disrupt current farming practices or reduce crop yields. If the installation of solar panels or wind turbines were to hinder agricultural productivity, these solutions would be impractical and financially inviable for many farmers. 

Fortunately, this challenge is being addressed through innovative agrivoltaic systems that enable the dual use of land for both solar energy production and agriculture, allowing both to coexist in a complementary rather than combative manner. 

Progressive industry players are already embracing effective solutions, demonstrating that renewable energy can be integrated into farming without compromising crop yields. In fact, solar panels can actually be used to positively impact water-stressed land, with one study in Oregon, US showing that farming land around solar panels was 300% more water efficient.  

Where agrivoltaic farming has been adopted, solar panels also have the potential to boost biodiversity. Sheep farmers in Australia participating in a four-year study found that their wool had improved in both quantity and quality since solar arrays were installed. The two greatly complement one another – grazing sheep prevent the panels from being obscured by overgrown flora, improving their efficiency, while the panels themselves offer shade to the sheep that improve their health and wellbeing, whilst also preventing soil from drying out. 

As well as conventional solar and wind farms, there are also several other tools available for farmers to leverage in an effective manner.  

Geothermal heat pumps, for example, can be used to both heat and cool buildings, exchanging air and ground temperature on a year-round basis. With greenhouses hotting up during warm daytime hours, this heat can be captured, stored, and released at night when the space cools.  

Critically, this approach has allowed one flower farm in the US to reduce their greenhouse costs from $1,000 a month to just $100.  

Grants to go green  

Of course, the success of these projects hinges on a logical, effective marriage between agriculture and renewable energy, with solutions being introduced thoughtfully and strategically with considered planning.  

In addition, governments can further support farmers by rewarding and regulating improved land management practices in solar arrays to ensure panel installation enhances agricultural activities rather than risk damaging the land and rendering it unusable.  

Diversifying into renewables represents a potentially profitable opportunity. Indeed, it’s estimated by the Energy and Climate Intelligent Unit that farmers without solar panels could miss out on £1 billion in both cost cutting and additional revenue over two years. However, it’s not always easy to find the initial investment needed. That’s where government grants and funding come in.  

In the UK, the Environment Secretary announced the Improving Farm Productivity solar grant in November 2023. This represents £45 million support for farming innovation, broken down into grants of between £15,000 and £100,000 for solar equipment to be installed on rooftops or float on irrigation reservoirs.  

Each grant can cover 25% of the capital cost for a range of equipment including solar PV panels, battery storage, inverters, utility meters, electrical grid connectors, and power divertors. 

A sustainable solution  

Recent years have been extremely challenging for farmers, especially in the UK. Brexit and Covid-19 have led to a lack of seasonal workers to harvest crops, soil fertility has been low, and the worldwide fertiliser shortage has meant very little can be done to improve conditions.  

According to forecasts by the Department for Environment, Food, and Rural Affairs (DEFRA), cereal farm incomes have dropped by 77% in the last year due to weather volatility and a reduced crop output. Further, dairy farm incomes are down by 78%, general cropping enterprises by 58%, and mixed farms down by 46%.  

Within such a challenging context, the energy transition plants fresh seeds of optimism for farmers and agricultural industry prospects more broadly. By embracing renewables, farmers can diversify their income, cut costs, and futureproof their operations.  

Critically, agrivoltaic farming is proving that investment doesn’t have to be an either/or decision; farmers can introduce solar, wind, and biofuel in a way that complements – and potentially enhances – their current operations.  

With farmland occupying 75% of the UK’s square footage, this approach can not only support farmers and ensure the agricultural sector is strengthened, but can also represent an important step towards achieving net zero by 2050.  

— Lew 👋

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