Farmers: Champions of the New Energy Economy

Farmers and rural communities have the potential for big gains in the accelerating energy transformation. The massive entry of renewable energy is pushing out fossil fuels, revamping our energy infrastructures from big and centralized to distributed and more resilient, transforming business models, and providing opportunities for entirely new groups of stakeholders. On July 13-14, 2020 about 60 legislators, state government officials, and ag experts from 10 U.S. states and 3 Canadian provinces discussed how successfully to expand the role of farmers and rural communities in the production of clean energy. The interactive virtual meeting was hosted by the Midwest Legislative Conference of the Council of State Governments (CSG). It was the first joint meeting of the CSG’s Sub-Committee on Energy and the CSG Committee on Agriculture. The 35 legislators who attended each day compared notes on exciting new developments in their states and enthusiastically embraced the opportunity to learn what German farmers and rural counties are doing to capture value along the entire renewable energy value chain. 

“Renewables are a job creator, this is why we were so successful in Germany”, says Baerbel Hoehn, Chair of the Global Renewables Congress during the conference. She shared policy learnings and experiences with cross-party policy design from Germany with her peers: “Hardly any other branch of industry has such a potential for renewable energies as agriculture. Farmers have the territory for wind turbines, the rooftops on the stables for photovoltaics and the biomass. From 2009 to 2017, German farmers invested €24.8 billion in renewable energies.” In fact, they own about 11% of renewable electricity generation facilities. Mr Hans-Detlef Feddersen, a farmer himself, the organizer of Germany’s first community wind farm cooperative, and managing director of renewable energy coop developer ee-Nord added: “Energy cooperatives play a leading role in renewable energy development. In our county Nordfriesland there are about 90 renewable energy cooperatives as well as private investors, farmers, banks and enterprises own about 95% of 2300 MW total installed RE capacity.”  By owning the generation capacities, solar and anaerobic digestion technologies increase farmers’ annual income by reducing energy costs and providing new revenue streams. “And as a local mayor, I can also tell you, we don´t mind the additional tax income from all the new businesses in our area”, says Mr Hans-Detlef Feddersen.

How fundamentally and quickly the energy economy is changing was emphasized also by Mr Gerard Reid, Founding Partner with Alexa Capital (London) and an expert in the energy finance world. “We are living in an age of disruption,” he says. Within the next ten years, electricity will replace oil as the world’s most important energy source. Already today, solar energy is the cheapest form of electricity generation across most of the world. Digitalization is an accelerator. “Farmers are making more money with solar than with agriculture,” he says. However, Ron Schuler, Minister of Infrastructure in Manitoba highlighted the differences that need to be taken into account when considering transferable policy elements: “We, in Manitoba, have very low temperatures in many months of the year. Also, when we talk about farms, we refer to much larger scales than Germany can think of. We need to learn, how to adopt solar and wind energy under these conditions.”

For Minnesota state Senator David Senjem, who is Vice-Chair of the CSG Energy Subcommittee and initiator of the July Midwest Legislative Conference meeting on “The New Energy Economy,” one of the key learnings is the question of ownership rights: “We need to develop policy frameworks that allow farmers and rural communities to own energy infrastructure.”. Baerbel Hoehn, who is also former parliamentarian in Germany agrees and outlined the crucial policy changes to successfully expand the role of agriculture and rural communities in the production of clean energy:

  • simple, flexible planning right (find the solution with the least resistance quickly),
  • create incentives for investments that activate as many people as possible,
  • energy policy framework that allows investment (investment and planning security),
  • reduce subsidies for fossil energy and/or introduce a price for CO2.

Please download here the full presentation of Baerbel Hoehn.

Please find here the full agenda of the conference.

Please find some of the recordings of the presentations by Baerbel Hoehn and Hans-Detlef Feddersen.