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Renewable Energy - Agriculture

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Renewable Energy - Agriculture

What is this about?

To encourage agricultural businesses to install small scale renewable energy capacity, mainly for own consumption within the agricultural business as a way to help to combat climate change and improve business viability.

What will this achieve?

  • Improved business efficiency
  • Reduction in carbon emissions
  • Help to develop a local sustainable energy supply

What you can do?

Two distinct elements:

  • Purchase and installation of a renewable energy system up to 250kW. In exceptional circumstances, applications for installations over 250kW will be considered, where applicants can demonstrate the generation capacity is primarily for agriculture related activity.
  • If installing a biomass boiler, the purchase of supply chain or specialist equipment to harvest and process the woodchip or pellets.

Who can apply?

Agricultural businesses

Eligibility Criteria

  • Agricultural business registered with SGRPID
  • Where applications are made for the production of renewable energy on agricultural holdings, renewable energy production facilities shall be eligible for support only if their production capacity of a specific form of energy (heat or electricity) is no more than equivalent to the average annual energy consumption of that form of energy on the agricultural holding, including the farm household.
  • The ability to receive a grant for a renewable energy installation and also benefit from the feed in tariff is being phased out. You will also be unable to benefit from the Renewable Heat Incentive if you receive a grant for the installation - See below for more deta

What technologies and or equipment are supported?

  • Small scale wind turbines
  • Hydro-electric turbines
  • Solar panels
  • Automated woodfuel boilers
  • Heat pumps
  • Solar water heating
  • Anaerobic digestion equipment using slurry and other agricultural by-products in the production of energy
  • Specialist equipment for harvesting, pre-use processing (e.g. dryers, chippers, pelletisers), quality assurance (e.g. for checking moisture content, chip size, etc) and handling
  • Supply chain equipment

Which products and installers can I use?

  • If installing a micro renewable energy system (defined as having up to 50kW of electricity generating capacity or 45kW of heat generating capacity) the product and the installer must both be accredited, under the UK wide accreditation system called the Microgeneration Certification Scheme (MCS).
  • The exception to this is for hydro installers, where an accreditation scheme has not yet been established. Subject to confirming that more than one quote has been obtained, work can be carried out by local expertise under the supervision of a qualified advisor who can sign off installations to confirm that appropriate standards have been met
  • Details of installers and products can be obtained from the Microgeneration Certification Scheme website or on 020 7090 1082.
  • Independent advice on all aspects of installing renewable systems can be obtained from your local Energy Saving Scotland advice centre on 0800 512 012 or via their website.

Technical requirements for biomass installations

  • Boilers of over 50kW electricity or 45KW heat capacity will generally only be supported if they are on the Energy Technology List. This is to ensure that we are only supporting boilers of a particular standard. If not on the list then we would seek more information on the specification to ensure the boiler meets these standards.
  • If located in a Smoke Control Area you must install an exempt appliance

What costs could be supported?

  • Purchase and installation of equipment, including construction, upgrading or development of infrastructure.

Rate of support

  • For less favoured areas (LFA) up to 50% of eligible costs. Plus 10% Young Farmer Premium if eligible*
  • For non-LFA up to 40% of eligible costs. Plus 10% Young Farmer Premium if eligible*

*To be eligible for the Young Farmer Premium, you must be a farmer or crofter who, at the time of committing a Proposal is:

  • 16 years of age or over, but under 40 years of age
  • the head of an agricultural business (either as sole proprietor; or as the majority partner; or as the equal partner with another farmer or farmers under 40 years of age)

Note: For the Young Farmer Premium a copy of your birth certificate or other proof of age is required.  Companies are ineligible for the 10% Young Farmer Premium.

Inspections/verification

  • All final claims must be accompanied by relevant invoices.
  • You must allow any person, duly authorised by the Scottish Government, to have access to allow an inspection to take place. An inspection may take place at any reasonable time either before or after completion
  • If applicable, the Microgeneration Certification Scheme list of registered installers will be checked
  • If applicable, the criteria set of good quality CHP Programme will be verified for compliance
  • If located in a Smoke Control Area, applicants must install an exempt appliance and this licence must be verified

Technical Guidance

Registered installers information can be found here.
All appliances that qualify for Energy-Saving Enhanced Capital Allowance must meet the criteria for inclusion on the Energy Technology list.
Further information on CHPQA Programme.
Further information on Smoke Control Area.

Important Update on the Feed in Tariffs (FITs) and grants

The FITs scheme is intended to replace, not supplement, public grant schemes as the principal means of incentivising small scale, low-carbon electricity generation.

Until now generators have been allowed to benefit from both FITS and a grant from a public body where developments meet state aid de minimis requirements. However the UK Government has introduced changes to ensure value for money for consumers by avoiding double counting (installations that receive both grants and FITS would be getting a double benefit). It feels that if allowed to continue, the de minimis threshold would have the effect of making the combination of FITS and grants the rule rather than the exception.

Therefore the UK Government has introduced the Feed in Tariff Amendment Order 2011 which comes into effect from 30 May 2011. The Order states that the de minimis exemption will only apply where the grant has been made before 1st July 2011 for an installation that is first commissioned before 1st October 2011. All renewable installations installed and commissioned after those dates will not be able to benefit from a grant and be eligible for the Feed in Tariff. Therefore, if you decide to accept a grant, after 1st July 2011 you do so on the understanding that you will not be able to qualify for the Feed in Tariff.

This will not have any effect on installations that have already been accredited for FITS using the de minimis exemption.

Ultimately it is Ofgem who will determine whether installations are eligible for the FIT and applicants should contact Ofgem if they require further clarification on the eligibility of a proposed scheme.

Further information is available on Ofgem's website at www.ofgem.gov.uk/sustainability/environment/fits/pages/fits.aspx

Eligibility for the Renewable Heat Incentive

You cannot receive a grant which contributes to the direct costs of an installation and receive the Renewable Heat Incentive. 

 However, under the Renewable Heat Incentive Scheme (Amendment) Regulations 2014 that came into force on 28 May 2014  you will be given the option to pay back your grant and instead receive support under the Renewable Heat Incentive.