Livestock Event 2014: Solar is still a viable option for livestock farmers

Government support for renewables is declining, but solar panels can still offer attractive returns for livestock farmers. Paul Spackman reports.

The solar industry has gone through a rollercoaster four years since the introduction of Feed-in Tariffs (FiTs), with the perception that returns have substantially fallen over this period.

But with more stable support, albeit at a lower level than in the past, and technology costs falling as the market matures, experts believe photovoltaics (PVs) still offer decent returns and are worth another look.

Livestock farmers with large on-site energy demand are among those with most to gain from solar, which remains one of the simplest forms of renewable energy generation, with a payback of less than 10 years in many cases.

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“As a rule of thumb, if you’re in southern or south-west England and can use most power yourself, returns can be up to 15%, whereas if you’re selling more back to the grid it is likely to be nearer 10%,” says Andrew Dyke from Savills Energy.

Adapting on-farm power use to make the most of electricity generated rather than exporting it to the grid is key to maximising returns, he says.

On dairy units, for example, peak panel output (around the middle of the day) does not normally coincide with the main energy demand during morning or evening milking.

But the operation of equipment such as ice builders and water heaters can be altered to make better use of the energy generated, he says.

Falling costs of solar power

Solar costs have come down a lot over recent years, compensating for cuts in FiTs, Mr Dyke says.

As a guide, installation costs are about £950-1,200/kW for relatively straightforward rooftop schemes, which is almost a third of the cost compared to two to three years ago.

“Farmers who had previously dismissed solar during the uncertainty that surrounded past FiT cuts may find it’s worth having another look at the technology, as there are some good returns to be had.”

There are also more companies now offering asset finance, where the loan is based on the asset value and earning potential of the solar array, rather than other aspects of the business. Rates may be slightly higher, but it means existing borrowing is not affected, he adds.

Farmers with suitable buildings but no upfront capital could consider renting out roofspace for solar panels in return for cheaper electric. “You won’t get the same return as owning the panels yourself, but rental roof schemes still have some merit. If you’re a high-energy user and can strike a deal to buy power at a lower rate, with future prices linked to RPI rather than energy company inflation (typically at 7-8%), it may be worthwhile.”

Potential pitfalls of solar power

Planning is not generally an issue for sub-50kW rooftop solar, as it falls under permitted development rights provided certain conditions are met, Mr Dyke says.

However, grid connection remains one of the biggest hurdles for many farmers and costs of upgrading supply can make projects unviable.

A roof area of about 8sq m/kW of peak capacity is required for solar panels, so this may be the biggest limiting factor for smaller buildings.

Other factors for livestock farmers to consider are the aspect and pitch of roofs, building construction and ventilation or lighting requirements, says Eddie Chadfield, technical sales adviser at Bowler Energy.

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South-facing buildings with a roof pitch up to 35deg are generally best, although those facing south-east or south-west will work, albeit with slightly lower returns, he says.

A full structural survey should be carried before installation to ensure the building can support the extra loading, he advises. “The panels and fittings add about 15kg/sq m, but you’ve also got to think about snow or wind loading as well. When you’re fitting panels to the south side of a building only, the load is asymmetric, so strengthening may be needed on one side.”

Panels can be fitted to most roof materials, including asbestos, although the process is more expensive and time consuming. There may also be difficulties fitting panels to buildings with concrete frames and perlings due to lack of suitable fixings, he adds.

“A lot of companies will simply screw the support rails for panels into the roofsheets, but this isn’t ideal and you really want to mount panel supports to the perlings themselves. Don’t forget the panels have a 25-year lifespan, so whatever roof material you have, it needs to last that long.”

Ventilation and lighting is another consideration and farmers should make sure panels do not obstruct necessary vents or skylights. Dust and dirt may be an issue where yards or bedding is particularly dusty and panels could need cleaning more often. High-ammonia environments can damage panels and Mr Chadfield urges farmers to ensure panels have been ammonia tested.

It’s also important to position inverters where there is adequate ventilation to keep them cool and where they won’t get knocked by livestock.