By Paul Spackman – (5 min read)
Publication of the Agriculture Bill on 12 September 2018 provided the first major insight into how the government plans to deliver on its promise of a “Green Brexit”. The long-awaited policy, together with the forthcoming Environment Bill – the first dedicated Environment Act since 1995 – will help shape the UK’s agriculture and energy sectors after leaving the European Union and Common Agricultural Policy (CAP) on 29 March 2019.
A key feature of the new Agriculture Bill is the phased ending of direct farm subsidies over seven years between 2021 and 2027, replaced with a new Environmental Land Management (ELM) system.
The ELM will pay farmers for delivering “public goods” and environmental benefits, such as reducing the farm’s environmental footprint, improving air, water and soil quality, higher animal welfare standards, public access to the countryside and flood alleviation.
Defra says farmers and land managers who “provide the greatest environmental benefits will secure the largest rewards, laying the foundations for a Green Brexit”.
The replacement ELM scheme will be trialled and developed over the next few years before coming into full effect by 2028 onwards.
With precise details yet to be agreed, it remains to be seen what this green rhetoric means in practice and, importantly for many farmers and landowners, whether any meaningful incentives are put in place to encourage uptake of green technologies, such as wind, solar, AD or battery storage.
Environmental campaigners have called for future agricultural policy to be more closely integrated with environmental policy, but some farming groups worry that too much emphasis on incentivising farmers to divert land into alternative uses may threaten food security and the competitiveness of UK agriculture.
Only time will tell as to what shape the new policies will take, although given the government’s recent track record for removing financial support for renewables (such as the Renewables Obligation and Feed-in Tariff), any new money to support investment in green energy generation may not be high on their agenda.
For farmers and landowners keen to develop new renewable energy projects, it may well be down to individuals to seize the initiative, to potentially benefit both their “green credentials” and the profitability of the business.
As direct farm support is phased out over the next decade, there will be even greater need to protect and possibly diversify farm income sources to make rural estates more financially resilient in post-Brexit Britain.
Renewable energy projects such as onshore wind, solar and anaerobic digestion may well play a part in this, either through investment in new schemes where the economics can be made to stack up (with or without government support) or finding ways to maximise returns from existing installations.
In the case of wind energy, planning has long been a major barrier to new developments, but there are some signs of attitudes thawing. A recent YouGov poll found some encouraging public support for onshore wind, with two-thirds of respondents in favour of changing current policy to allow onshore wind to go ahead where it has local support.
Elsewhere, a number of developers are looking to build large-scale subsidy-free solar arrays as costs come down, while improvements to battery technology, combined with falling costs, are creating other ways to maximise revenues from new and existing renewable energy generation projects.
As always, the ‘devil is in the detail’ so we will wait to see what the new Agriculture and Environment Bills have in store and how ambitious the government wants to be with its “Green Brexit” aims.
As political discussions progress and new policy details are drawn up, much remains very uncertain, although change is guaranteed. Landowners will have to adapt to this change to secure a viable future, whatever direction Brexit takes us in.
Paul Spackman is a freelance writer and former Deputy Business and Renewables Editor at Farmers Weekly.