7th August 2023

Multimillion-pound financial incentives boost for renewable energy projects

Thrings agriculture and clean energy

Farmers and landowners considering renewable energy projects on their land could further stand to benefit from public investment following a £22million cash injection into one of their flagship schemes.

Increasing funding for the Contracts for Difference scheme - the government’s main system for supporting low-carbon electricity generation launched in 2014 – will focus mainly on established technologies such as solar and wind, providing further opportunity for rural landowners to enter the market. As of 2021, the NFU estimated that more than 70% of solar power in the UK was generated on farms, and it is likely to have increased as farmers look to find new avenues of income through diversification.

The announcement is the latest in a string of public sector investments into agriculture and renewable energy, committing to the 2050 Net Zero pledge, but comes amid a controversial decision by the government to encourage further extraction of fossil fuels with the granting of 100 new North Sea oil and gas licences.

Renewables, however, continue to gain a greater stake in the energy sector, with government statistics claiming that around 42% of the UK’s electricity generation came from renewable sources in 2022.

Mark Charter, Partner in the Thrings Agriculture team, said: “Farmland has some of the highest potential for delivering cleaner energy at scale across the country, and this latest funding boost demonstrates the significance increasingly attached to renewables.

“This is resulting in a continuing opportunity for farmers and landowners to diversify their practices and make the most of otherwise less productive land in the long term. Whilst there will undoubtedly be continuing public debate and inherent tension around the use of the best grade land for uses outside food production, opportunities to diversify in particular the use of ‘poorer’ land for other activities such as renewables or improved natural capital will no doubt remain welcome.

“To make the most of this when considering a renewables scheme or indeed any other options to diversify, we would always recommend seeking out robust professional advice in order to optimise both the monetary and other benefits from such diversification.” For more tips on how to make the most of your renewable energy project, check out our Take Five Guide.

The Thrings Agriculture team is one of the largest and most experienced in the UK and regularly advises clients on all matters including diversification and renewables. Ranked in Band 1 by Chambers Guide to the Legal Profession and in the Top Tier by Legal 500, the team has been chosen by the NFU to act for its members in more counties than any other firm. Find out more about how we can support farmers, food producers and rural communities on our Information for Farmers page.

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