The agriculture sector and its use of energy - both the type and amount - varies widely across different types of activities. Agriculture accounts for nearly 4 per cent of industry energy usage in Australia, with energy being consumed in 3 major forms on most farms - general electricity (lighting, appliances), fuel (machinery, vehicles and freight costs) and heating/cooling and refrigeration (especially in industries such as dairy, horticulture, piggeries and poultry).
Electricity and natural gas account for nearly half of all energy use in horticulture and intensive animal production. Broadacre and pastoral farming accounts for approximately 80 per cent of energy consumption in the sector, with dairy farming accounting for another 11 per cent.
Small to medium-sized farming enterprises have experienced significant increases in energy costs over the last 5 years. The National Irrigators' Council has identified escalating electricity prices as very worrying for farmers, making Australia uncompetitive in the global food market.
CEFC/LCAL co-financing for the agriculture sector has covered diverse projects, facilitating greater use of available renewable energy sources and allowing them to save on energy costs, offset the impact of rising energy prices and increase competitiveness. Electricity runs refrigeration, compressors, electrical motors, air compressors and lighting, while thermal energy is consumed by on-site treatment of waste products and hot water heating. Learn more about our CEFC/National Australia Bank (NAB) and CEFC/Commonwealth Bank finance programs for agriculture.
The amount of fossil fuel energy consumed in processing plants varies between sites. While 85 per cent of organic solid waste produced is re-used, mainly as compost, converting waste into energy means there is substantial potential for biogas to be used as an energy source in the agricultural and related food processing sectors.
There is also significant potential for the agriculture sector to make greater use of available solar resources.
The CEFC financing for innovative projects at scale include the circa $40 million for Sundrop Farms' application of solar thermal technology for a 20 hectare greenhouse complex in Port Augusta SA which will supply 15,000 tonnes of tomatoes annually to national markets. Watch the Sundrop Farms story.
CEFC is co-financing with NAB for Australia's largest beef company, AACo, to install solar PV units, which demonstrates the potential for agriculture businesses to reduce their grid energy consumption and costs.
Examples of how the type of financing offered by the CEFC (or previously by LCAL) works for agriculture include: