Defra launches AD loan fund for farmers

Farm owners will be able to apply for up to 400,000 or 50% of the overall cost from the AD Loan Fund to help them finance on-site anaerobic digestion plants.

The Department for Environment, Food and Rural Affairs (Defra) said the technology will save farmers money on energy costs and could boost their income if they export electricity to the grid as well as being eligible for government incentives for producing renewable energy.

In addition, Defra said farmers would be able to save money by using the digestate produced by the AD plant to replace some of the artificial fertilisers they would otherwise have to buy.

The initiative was launched by Environment Secretary Owen Paterson who said: Dealing with waste and recycling properly is good for the environment and can boost economic growth and create jobs. This funding provides an opportunity for farmers across the country to consider whether AD technology is right for their farms, in order to cut waste, reduce greenhouse gas emissions and recycle valuable nutrients back to the land.

Farmers who would have otherwise struggled to get finance to set up a small scale AD plant will be able to apply for a loan for up to 50 per cent the cost.

Defra said the use of this technology on farms is an essential part of the governments plans to invest in infrastructure to help businesses and the rural economy grow.

Benefits

The fund will be administered by the Waste & Resources Action Programme (WRAP) in two phases. Farmers can apply for funding to develop a business case to find out whether AD is the right solution for them and can then apply for the loan.

Commenting on the fund, Liz Goodwin, chief executive of WRAP, said: The use of small-scale anaerobic digestion on farms to treat manures and slurries has a number of economic and environmental benefits and is an excellent example of the circular economy in action.

However, access to finance for on-farm AD has been difficult, especially for small scale operations. Currently there is no targeted financial support available to increase this capacity. The On Farm AD Fund has been designed to both attract funding into the sector, and to provide support and materials for farmers to help them access finance in the future.