Renewables. Does it still pay for Poultry Producers?
In the heart of Herefordshire’s rolling green hills, is one truly global Agri-Food giant, Cargills. Now the European HQ for Cargill’s impressive poultry business, the business has developed a fully integrated supply chain from breeding stock to finished table birds. Stunningly, Cargill now processes some 1.6m chickens per week from a network of 100 independent farms.
We recently had the privilege to visit the Grandstand Road site in Hereford to meet the management team and see the facility firsthand. The most impressive conclusion from our visit was that sustainability paid. It paid, not only in lower costs for the business, but also paid in terms of the goodwill and loyalty it generated within Cargill’s customer base and the increasing engagement from its 3000 staff.
From Cargill’s 100 farm units, over 80% now had Solar PV systems deployed for reducing energy costs and generating electricity via the Feed In Tariff (FiT) system.
All were generating exciting returns for the farmers who had invested.
Does Solar PV still pay?
Much noise has accompanied the Solar PV industry in the last six months with many producers now assuming the opportunity has passed and the returns from the investment are minimal given the Government’s reducing support.
Our research at Powell’s paints a different picture:
- Solar PV qualifies as a capital investment against tax. So for any Producer there is an immediate 20% win on investment.
- The cost of the kit has reduced very significantly and with lower set up costs and continued support for a government guaranteed 20 year Feed in Tariff, the returns still look to be 10 to 12% per annum.
- For producers with tighter investment funds, options for Power Purchase Agreements (PPA) are plentiful. This means that with no cash upfront but producers can still enjoy significantly lower electricity bills.
In our next blog we will set out the specific payback details for a typical 50KW Solar PV system.
To discuss Solar PV and how it can be deployed on one of our new installations or on an existing Powell building please just email us at email@example.com