Words by Richard Rennie, Images by Annie Studholme
Ruralco has partnered up with Canterbury based solar energy company Platinum Energy to provide farms with a viable, effective energy alternative.
In the past solar has often been seen as an energy source that is slow to deliver a return, at considerable up-front cost. However recent surges in electricity prices that are unlikely to come down, coupled with significant reductions in solar energy technology, have built a strong case for solar electricity generation on farms.
Co-founders Liam Brown and Nick Donkers say almost 90% of their business is focused on the agri-energy supply market, particularly to Canterbury dairy farms.
“We find Canterbury’s larger sized dairy farms make the economics of installing a solar system particularly appealing.”
“Dairy businesses themselves are also in something of a sweet spot when it comes to utilising solar electricity. Higher production occurs over the summer months, when solar generation is at its peak, and when dried off over winter, solar is generating the least, so the seasonality and time of use lines up really well,” says Nick.
Electricity prices have taken a continuous hike along with all other farm costs in the past 18 months and more farmers are wanting to find ways to keep a lid on them.
Ruralco Energy Sales Manager Tracey Gordon has Ashburton clients who had signed on for 8-9¢/kWh looking at 12–13¢/kWh in the Ashburton district under a new contract.
The electricity futures market has prices out for the 2023 calendar year surging even further to touch over 20¢/kWh, before possibly easing back to 17.5¢/kWh.
It is not until well into 2025 that prices show any indication of easing back to under 15¢/kWh.
In 2020-2021 season the average irrigated Canterbury dairy farm’s operating expenses amounted to $5.25 per kilogram of milk solids. Irrigation costs including electricity were 31¢/kgMS, while additional electricity use was 9¢/kgMS.
“All the retailers are looking hard at the electricity futures pricing profile, and it is not coming down,” says Tracey.
Nick emphasises that unlike some of the hard sell exerted by residential installers, Platinum will not propose a system where it does not make economic sense.
“But we are getting past a tipping point where for most dairy farmers it can offer a return on investment of 12–15%, that is appealing and within the warranty period for the panels installed. Usually, we expect clients to have a payback period of six to seven years, with a warranty up to 25 years.”
Typically, a Platinum installation will consist of a photo voltaic solar array, inverter and potentially also a capacitor “battery” bank for energy storage, if the use case is ideal. Every system is different, but most 40kW systems required for Canterbury dairy units will require about 500–600m2 of area to be set up in, depending on how many rows are required to face the array north, and the shape or layout of the land available.
“As the technology continues to evolve and energy density of panels continues to improve, we expect to see more of those awkward pieces of marginal/unproductive land on farms provide the opportunity for panels, areas like the centre of the tanker loop, for example,” says Liam.
Platinum uses super capacitor ‘batteries’ for the electrostatic storage of electricity generated by the panels. These offer a number of advantages over conventional lithium-ion batteries most are familiar with.
“Super capacitors are capable of charging up more quickly, they are non-chemical and don’t degrade the way conventional batteries do and you can use 100% of whatever their capacity is, unlike chemical batteries which can be limited in their true capacity and may need to be oversized for the application.”
Liam and Nick founded Platinum based on a mutual interest in renewable energy and particularly on the potential they could see as solar technology developed so rapidly. This was alongside emerging new battery types and the potential to “decentralise” power generation and delivery.
They are looking across the Tasman at developments in Australia that could be applied here. They are particularly interested in how multiple rural solar generators could ultimately be managed via ‘virtual power plant (VPP)’ software, being directed to deliver power to the grid, to owners’ demand or to battery storage, depending upon total energy needs, spot power prices, and time of day.
“The whole industry presents a lot of opportunity in these areas and our equipment is made to be compatible with emerging control technology which opens up further income earning opportunities for solar panel owners,” says Liam.
Until recently electricity supplied back onto the grid by home/farm generators has received below wholesale rates, but this is changing and making the appeal of farm based solar supply even greater. Liam and Nick see Canterbury having the potential thanks to its dairy farms’ scale to be New Zealand’s first region with a power system that is decentralised from traditional hub and spoke supply.
“A 40kW solar system may not seem a lot on its own, but with the potential of VPP when you can link many of them up, you are looking at quite a substantial generation source – comparable to that of a utility scale solar farm,” says Nick.
Tracey Gordon says interest in solar from Ruralco shareholders is growing, prompted by electricity being far from an incidental item in the farm budget.
“We are looking forward to working with Platinum and our clients to come up with an energy solution that can really make a difference to their bottom line for years to come,” she says.
IMAGE: Liam Brown from Platinum Energy, Tracey Gordon, Ruralco Energy Sales Manager, Nick Donkers from Platinum Energy and Glenn McWhinnie, Ruralco Key Account Manager - Energy