Staying in control of rising poultry production costs

Strong global demand and tight supplies of oil have led to a doubling of prices over the past 18 months, with market speculation also contributing to the bull run, explains Andrew Kneeshaw, managing director of the Farm Energy Centre.

“If the price of oil goes up it knocks onto everything else. Rising prices of gas, which is used for electricity production, results in higher electricity prices, too,” he adds. “It’s all inextricably linked.”

How will this affect producers?

Poultry producers have already seen costs of production soar, and coming into the winter higher energy costs will have an even greater impact. Extensive producers will be particularly badly hit, as the energy use per bird is greater, says Rob Newbery, chief poultry adviser at the NFU.

With RSPCA Freedom Foods soon requiring more natural daylight, producers will have to install windows to their houses, potentially lowering thermal efficiency, says Mr Newbery. “Make sure you fit the windows properly to avoid gaps – and use the most insulating materials available.”

How can I save energy and cut costs?

The main areas of energy use in poultry farming are heating, ventilation and lighting. And the best way to cut costs is to reduce energy wastage and improve efficiencies.

“Make sure your buildings are structurally sound and well insulated – insulation helps keep buildings warm in winter and cool in summer and so reduces the energy requirement for heating and ventilation,” says Mr Newbery. Sealing gaps and cracks is relatively cheap and a effective way of reducing heat loss in winter.

Accurate temperature controls are also essential, to maintain an even temperature across the house and avoid over-heating certain areas, he adds. “Where fans and heaters are installed in the same building, interlocked controls should be used to stop the heating when the fans are running above their minimum ventilation setting.”

Over-ventilation in the winter should also be avoided as it dramatically increases heating costs. “Operating ventilation at 4% of maximum output rather than 2% increases average heating costs by 7p a bird.”

Fans, air ducts and guards can get very dirty due to high levels of dust in the atmosphere, reducing air throughput by up to 60%, says Mr Newbery. Cleaning them will improve energy efficiency and lengthen the fan’s motor life. When fans fail, replace them with more efficient models to yield ongoing savings.

Most poultry buildings use tungsten lighting, which take four to five times the electricity of fluorescent ones. New flicker-free fluorescent lights are long-lasting, use less energy and are getting cheaper all the time, resulting in a payback of just a few months, he adds. Producers could also replace outdoor halogen lights with high-pressure sodium lamps, which are much cheaper to operate.

What else can I do?

Keeping records of energy use in each house enables producers to compare and reduce energy use, as it highlights problem areas at the earliest opportunity, says Mr Newbery.

It is also important to find the best electricity and gas contract, so shop around and join a buying group for maximum savings. “Look hard at where the market’s heading and how far ahead you want to be buying for. The markets are high and this certainly isn’t the year to buy five years’ of energy.”

However, electricity prices tend to lag behind gas and oil prices, warns Mr Kneeshaw. “We are expecting fairly hefty increases in the next four to six months.”

When changing contracts it is essential to serve a termination notice on your existing contract, even if it is due to expire anyway, he adds. “It is worth addressing this a few months ahead or you could be tied in for a further 12 months at a new standard rate.”

Larger producers could also benefit from signing up to a Climate Change Agreement, which gives up to an 80% discount on the Climate Change Levy if they meet targets to reduce energy use, says Mr Kneeshaw. Although the scheme costs about £160 a year to administer, larger units can save thousands of pounds each year.

What about changing fuel types?

Most units are set up to only use one type of fuel, but where producers can change mains gas provides one of the cheapest options, says Mr Kneeshaw. Renewable fuels are also cheap and very flexible, although capital set-up costs are high. LPG is another alternative, as a clean-burning fuel which is compatible with many renewable fuel systems.

Further information

NFU CallFirst for advice and energy information leaflets – 0870 845 8458

Farm Energy Centre – 02476 696 512