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Many farmers and agribusinesses can now use discounted and tailored asset finance through the Clean Energy Finance Corporation (CEFC) to reduce energy costs.
The cost of energy has an impact on the bottom line for many Australian farmers, contributing to tight financial conditions. The good news is that many farmers and agribusinesses can now use discounted and tailored asset finance through the CEFC to reduce energy costs.
CEFC’s Yolande Pepperall said there is significant potential for Australian agribusinesses to benefit from renewable energy and energy efficient technologies. “Now’s a great time for agribusinesses to take up this opportunity and invest in new plant and equipment — these upgrades can make a big difference to cutting energy and operating costs,” Ms Pepperall said.
Ms Pepperall said businesses looking for ways of financing energy efficient equipment have several options available to them, with loans being offered through a number of commercial banks for a diverse range of projects.
“Projects vary from on-site renewable energy generation to energy efficient equipment upgrades such as energy efficient irrigation equipment, energy efficient farm vehicles, building upgrades, lighting upgrades, processing line improvements and refrigeration — these investments allow farmers to reduce their energy bills,” Ms Pepperall said.
Over the past four years, the CEFC has financed more than 600 energy efficiency projects undertaken by a broad range of agribusinesses, topping $150 million in CEFC investment. This highly successful financing model makes it easier for businesses to tap into the benefits of energy efficient, renewable energy and low emissions technologies.
Energy savings projects financed through the CEFC
“CEFC asset finance has made a big impact on the operations of agribusinesses which have made the switch to more productive and energy efficient equipment and processes, typically reducing energy costs by 10 to 20 per cent,” Ms Pepperall said.
One such example is GV storage, a second-generation horticultural business growing apples and pears in Victoria’s Goulburn Valley, which is now reaping great rewards after using finance through CEFC to install a 506kW rooftop solar system. This system is now generating enough power to meet more than 65 per cent of the business's energy needs.
In Parilla, South Australia, a potato, onion and carrot producer cut energy use by about 15 per cent and water and fertiliser use by around 20 per cent after investing in new irrigators with variable rate centre pivots to control overwatering.
Tap into the benefits of clean energy
CEFC are working with major banks, NAB, Commonwealth Bank, and Westpac, to deliver the loans. “By working with major banks, we're broadening our reach across the Australian economy and making it easier for small businesses to tap into the benefits of energy efficiency, whether they are seeking loans of $10,000 or $5 million or anywhere in between,” Ms Pepperall said.
Some of the benefits of CEFC finance include discounted rates for small scale equipment upgrades to system wide updates (available for loans as small as $10,000) and loan terms of up to 10 years, with the equipment purchased generally acting as security for the loan. The loans do not require farmers to apply to government or the CEFC — only to the bank.
“It’s a win-win for business — people investing in equipment that will improve their day-to-day operations while reducing their energy consumption, and they're financing this equipment at lower rates than they would otherwise have been offered for general asset finance,” Ms Pepperall said.
The Department of Agriculture and Water Resources is working with the CEFC to promote the opportunities available to the agriculture sector, with further information available at agriculture.gov.au/CEFC.
If you have a question about current or potential agriculture projects, email your enquiry to firstname.lastname@example.org. You can also directly enquire about the various energy efficient finance programs by contacting NAB, Westpac or Commonwealth Bank.