NFUS SUBMITS EVIDENCE AGAINST PROPOSED CHANGES TO FEED IN TARIFFS

NFU Scotland has expressed major concerns at proposed changes to renewables by the Department of Energy and Climate Change (DECC).
In a submission which went to DECC on Friday 23 October, NFU Scotland expressed concerns that a drastic cut, up to 87 per cent of current Feed in Tariffs (FITs) rates, could have a damaging impact for NFU Scotland members looking to diversify into renewable energy. FITs are the government’s subsidy scheme for the generation of renewable electricity from small-scale installations.
Previously, NFU Scotland President Allan Bowie raised reservations about proposals by DECC surrounding the removal of the requirement for pre-registration to the scheme, resulting in farmers considering investing not being able to do so with any knowledge about what income to expect.
NFU Scotland also expressed its disappointment that no provision has been made for community projects, as a number of NFU Scotland members have successfully collaborated with local communities. This has seen a broader benefit for the rural economy, as well as deployment of renewable energy into areas where it would otherwise not have been possible.
NFU Scotland President Allan Bowie commented: “On farm renewables projects provide farming businesses with a valuable opportunity to diversify their farm business income streams and reduce their exposure to the risks associated with commodity fluctuations. Current levels of reduced support under the new basic payment scheme combined with low commodity prices leave farm business more exposed than ever.
“Renewable energy plays an important role in employment in Scotland, with over 11,000 jobs directly supported by it. Many of these jobs are smaller scale companies in remote rural areas, where many NFUS members are based. Cuts to FITS will directly affect the ability of such companies to survive.
“Going forward, NFUS has a number of major concerns. Farm businesses who wish to diversify into renewables to reduce their risk will be unable to do so; those who have already diversified into renewables will be unable to invest further in developing.
“Many renewables projects take many years to develop, at considerable cost. As a result, there will also be some NFU Scotland members who have invested heavily in developing such projects, often leveraged against the farm assets, based on projects which would have been expected to realise FITS support. Such projects will no longer be able to proceed.
“On farm renewables will no longer be a viable diversification option going forward, which will remove an important mechanism by which NFUS members can reduce their exposure to price volatility within agriculture.”