What is renewable energy?

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'Renewable Energy' is the new buzz word for diversification replacing the Livery/Holiday Cottages/office projects that landowners were implementing 10 years ago.

There are various types that differ in the amount of input and financial outlay a land owner must consider, from micro generation to multi-million pound anaerobic plants.

Types of renewable energy

Renewable energy is energy that is generated naturally and continuously in the environment, as opposed to energy generated from the traditional power stations using coal or other sources of fossil fuel or nuclear energy.

As renewable energy can be generated with low or zero carbon dioxide emissions, it plays an important role in combating climate change. It also plays an important role in ensuring security of energy supplies since it reduces dependence on imported fossil fuels.

Renewable energy sources include:

  • Wind power
  • Solar power
  • Wave and tidal power
  • Hydroelectric power
  • Biomass; and
  • Biofuels

The UK has potentially rich renewable resources, in particular:

  • A long and windy coastline, as well as high tidal ranges; and
  • An existing onshore and offshore energy industry and a strong technological research and development base.

Although the Government is keen to promote renewables and there is certain funding available for projects, landowners should be aware of barriers to the development of renewable energy in the UK. Principally, it is expensive and there are planning consent and national grid connection issues.

Microgeneration

Microgeneration is the generation of electricity and heat on a small-scale using renewable or low carbon sources. Examples of Microgeneration technologies include micro-wind turbines, ground source heat pumps, and solar panels (photovoltaic cells - PC). With the latter being the most 'on farm' popular renewable project that landowners are entering into.

There are many companies offering various deals for the fitting of PC panels and leasing the roof space on which they sit but before embarking on that route landowners should consider the option of buying the PC themselves. Although a costly outlay initially the return may be better over a 20 year period than the income generated from leasing roof space to companies who own the PC.

A careful approach needs to be taken when entering into a lease of a roof space as the agreement often produced by the company can be drafted in a fairly 'tenant friendly' style. The term of the lease is often 15 - 20 years so landowners must review their long term plans for the business as the building will be restricted for a lengthy period of time if PC are installed.