Government plans to cut subsidy for crop fed AD ’good news’

The Tenant Farmers Association has welcomed as good news Government proposals to reduce or eliminate public subsidies for new anaerobic digestion (AD) installations relying on crops as their primary feedstock.

TFA Chief Executive George Dunn said “The TFA has been the only farming organisation calling on the Government to stop the public subsidy for crop fed AD systems because of the impact on land rents and soil management. We are delighted that the Government has listened to our concerns and is at last proposing to make some changes to the support structure for AD systems”.

The TFA understands the need to develop renewable energy technologies to assist in the process of ensuring the long-term energy security of the nation, but it is important that such development takes into account wider impacts. It has been a major concern of the TFA that a significant number of existing and proposed AD plants have identified crops such as maize, sugar beet and grass silage as dedicated feedstocks.

“We understand the rationale for using waste material such as food waste and green waste combined with farm slurries to produce energy and for this to be supported from the public purse, but we do not see the justification for subsidising the use of crops as feedstocks for AD plants. Not only does this appear to undermine the perceived carbon reduction benefits of AD, but it also adds significantly to the burden on agriculture particularly given the strong competition that already exists for access to agricultural land,” said Mr Dunn.

In areas with significant AD capacity, the TFA has seen land rents reach unsustainable levels as subsidised competition for land to grow maize has intensified. It is not unusual to see rents of £300 per acre paid for land to grow crops for AD plants which is more than double what the average farmer would be willing to pay for the same ground to grow crops to feed their livestock.

“We do not want to ban people from using crops in AD plants completely, we just do not believe that they should be subsidised for doing so. Whilst there is a clear economic justification for continuing to support AD plants using food and green waste through the Feed in Tariff, as it is more difficult to convert waste into energy, there is an absence of any justification for continuing to publicly subsidise crop-based plants. The technology clearly can stand on its own feet financially given the level of rents that are being paid,” said Mr Dunn.

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