Grant opportunites make renewable energy solutions possible
by Brian Dinnis
July 15, 2009
As well as being part of the climate change solution, the implementation of energy efficiency measures can bring valuable bottom line financial benefits to many farming businesses, says Brian Dinnis of leading agents, Carver Knowles.
The cost of supplying power to a business can be significant and like any input should be reviewed. Dinnis explains, “although energy costs may be only a small percentage of turnover, the impact of reducing them on profits and competitiveness can be significant. As energy prices increase over time due to diminishing global resources, cutting energy use will only become more cost effective”.
From a taxation perspective, Enhanced Capital Allowances (ECAs) provide a mechanism for businesses to write off the whole of the capital cost of investment in qualifying energy saving technology against taxable profits of the period during which investment is made. “This can deliver a helpful cashflow boost and is another incentive to invest in energy saving equipment”, advises Dinnis.
Beyond energy efficiency, installing renewable energy technology can also bring a range of benefits to businesses. The Rural Development Plan for England (RDPE) recognises the need to improve energy efficiency and increase the uptake of renewable energy. Dinnis points out “this is good for the South West since there is tremendous scope for the development of renewable energy in the region”.
Diversification projects for renewable energy production for off-farm use are eligible for grant under the RDPE’s capital grant scheme. Under the capital grant scheme most applications accepted attract grant offers of up to 40% to 50% of total eligible costs.
Farmers also should be aware that the RDPE’s Agricultural Resource Management (ARM) programme will be rolled out later this summer. ARM will offer smaller capital grants for a range of on-farm resource management improvements, including energy/fuel projects. In addition to capital funding, ARM will also offer on-farm reviews and specialist advice.
The ARM programme will provide a great opportunity for farmers to review their energy usage and look at opportunities for improving efficiency and increasing profits, explains Dinnis and concludes by saying that the availability of capital grants alongside advice provides the means for farmers to get projects off the ground and shorten payback periods.
If you would like further information on the capital grant scheme or Agricultural Resource Management programme please call either Brian Dinnis or Yvonne Davies at Carver Knowles on 01823 350000 or alternatively Business Link on 0845 600 9966.