Taking control of power
New report has energy in its sights
THERE are no surprises that high-energy costs are affecting farmers but a newly released Commonwealth Bank Agri Insights report shows how that is translating into a range of strategies and trends around on-farm renewables and efficiencies.
The report, Exploring energy use and investment in the Australian agribusiness sector, revealed that 61 per cent of Australian farmers said rising energy costs had a moderate to significant impact on their farm operation and 76 per cent would like to invest in solar with battery storage.
Commonwealth Bank general manager of regional and agribusiness banking for Queensland Kerry McGowan said the report had confirmed trends the bank had been witnessing in Queensland in recent years.
“Queensland is a big state, we cover about 1.8 million square kilometres, so you do get variability in it,” he said.
“The sectors that are higher in terms of energy consumption were the ones we expected to see more concerned about their ability to control energy costs and also look towards ways that they might be able to mitigate that by investing in energy-efficient solutions.”
Nationally, the sectors demonstrating the highest number of producers reporting moderate to significant impacts from rising energy costs were sugar cane
(54 per cent), followed by dairy and cotton.
Solar with battery was consistently the favoured option for investment towards mitigating energy costs, with those three most impacted agri-business sectors also indicating a strong interest in modifying equipment to increase energy efficiency.
“Queensland producers understand that investing in energy-efficient solutions is an investment for the future,” Mr McGowan said.
“We’re seeing farmers upgrade their tractors and machines to be more energy efficient. It’s a topic that is on the state’s mind.”
Mr McGowan said there had been a trend over recent years towards rural producers seeking finance towards renewable energy equipment.
“In Queensland we are seeing some fantastic growth through our energy-efficient loans, which we’ve offered for some time,” he said.
“We had an arrangement with the Clean Energy Corporation, where they subsidised it, and that’s now ceased but we’ve continued the funding arrangements and we are subsidising those loans internally – so we’ve had great uptake.
“It’s interesting to see such a strong lean towards investment in solar with battery back-up.
“In the field, we’ve seen much more of a focus on energy-efficient equipment, so this new research offers some good insight into future directions and plans.”
He said this interest had been a surprise insight, because in the past there had been some reluctance around battery set-ups because of cost and efficiency issues.
“We are seeing curiosity around those types of technologies becoming more and more evident,” he said.
“Our research found that farmers in Queensland are very interested in looking at new energy resources but as yet the action on this interest has not been significant.
“While it’s troubling to see the impact energy costs are having on our producers, it’s encouraging that they are considering alternative measures.”
The report revealed that 81 per cent of rural producers nationally were more concerned by the cost of energy than by reliability.
Considered by sector, sugar again responded strongly in this area at 93 per cent, closely followed by dairy and horticulture.
Mr McGowan pointed out that two-thirds of Queensland responders in the survey had indicated a lack of control over energy costs but there was a trend towards countering this.
“Through energy-efficient loan products we’ve seen a trend of people looking at more efficient machinery and more efficient ways of doing things, so I think people are thinking about the problem more broadly and not just a more efficient tractor.”
Mr McGowan said while the bank had not yet seen approaches from farmer groups seeking to create shared renewable energy hubs, it had been conversing with clients on potential to share farm assets more broadly.
“There is an interest to share farm assets,” he said.
“We took the opportunity at Beef Australia to talk to a lot of our farming clients around that concept of shared assets and there was some interest.
“I think that could be a thing for the future to get more efficient use of assets across operations.”
❝ It’s interesting to see such a strong lean towards investment in solar with battery back-up. — Kerry McGowan