Modern technologies used in agriculture enable the effective use of renewable energy sources. This allows farmers not only to support sustainable development but also to gain additional financial benefits. Therefore, in today's article from the "Lawyer on the Farm" series, we will present the most important programs that increase the profitability of renewable energy investments.
First, we highlight the Energy for Rural Areas program , which is intended for farmers and energy cooperatives. This subsidy was implemented by the National Fund for Environmental Protection and Water Management (hereinafter "NFOŚiGW") and runs from 2022 to 2030. Although applications for funding under this program could be submitted until February 29, 2024, the NFOŚiGW announced that the next round will be announced this year. The very good news is that the NFOŚiGW has increased the program's budget to PLN 1 billion, meaning that even more farmers can receive funding. The Energy for Rural Areas program provides funding in two forms: (i) a loan of up to PLN 25 million and (ii) a grant of up to PLN 20 million. Equally important, wind farms, photovoltaic installations, hydropower plants, and biogas plants are supported in the form of loans covering up to 100% of eligible costs. However, farmers can only obtain subsidies for hydropower plants and biogas plants, with such subsidies being granted for up to 65% of eligible costs. Therefore, for these types of investments, an own contribution of 35% of eligible costs is required.
Another renewable energy support program for farms comes from the Budget Fund of the Strategic Plan for the Common Agricultural Policy for 2023-2027 . Farmers wishing to invest in the construction of a biogas plant or photovoltaic installation can obtain funding from the Agency for Restructuring and Modernization of Agriculture, which is conducting a call for applications. Obtaining funding by a farmer is contingent on meeting the following conditions: (i) entry in the producers' register; (ii) granting the single area payment; (iii) operating a farm within the framework of special agricultural production sectors; (iv) completing training on farm energy efficiency no earlier than 24 months preceding the date of submitting the aid application. Under this program, support will be available in the form of a refund of up to 65% of eligible costs in the following areas: (i) construction of a biogas plant – support up to PLN 1.5 million; (ii) photovoltaic installation – support up to PLN 200,000. PLN, (iii) purchase of a heat pump, energy storage – support up to PLN 200,000, (iv) investments to improve the energy efficiency of farm buildings – support up to PLN 200,000. This year's call for applications ended on February 23, 2024, but it is already worth confirming that this program will be continued in 2025.
This year, the National Fund for Environmental Protection and Water Management (NFEP&WM) launched another program aimed at reducing pollution produced by agricultural activities and increasing the importance of renewable energy sources on farms. The program, called AgroEnergia 2024, introduces subsidies for the purchase of photovoltaic installations, heat pumps, wind farms, and other hybrid solutions. This funding will be available to individual farmers who own, lease, hold a perpetual usufructuary, or possess agricultural properties with an area between 1 ha and 300 ha. Under the first stage of this program, farmers can submit applications by March 30, 2025, for aid in the following amounts: (i) for installations with a capacity of 10 to 30 kW – PLN 15,000; (ii) for installations with a capacity of 30 to 50 kW – PLN 25,000; (iii) for hybrid installations and energy storage – PLN 10,000. We believe this program provides excellent support for farmers who intend to modernize their farms.
Another equally interesting solution is to take advantage of the Clean Air and StopSmog . These programs are specifically designed for farmers who want to implement solutions that improve air quality and reduce pollution. These programs offer farmers preferential loans and subsidies covering 100% of the eligible costs of purchasing photovoltaic systems and heat pumps. It's important to note that this program has been in operation for several years, and according to government announcements, a new round of applications will likely open in October 2024.
In addition to the above programs, farmers can take advantage of the most popular program – Mój Prąd (My Electricity) , which also provides subsidies for the purchase and installation of photovoltaic systems. Furthermore, farmers can also implement renewable energy investments using preferential loans . Another interesting aid for farmers is investment relief . Taking advantage of this relief means that farmers who are VAT payers can deduct the cost of purchasing a photovoltaic system from their agricultural tax.
In summary, it's important to emphasize that farmers currently have many tools to minimize the costs of investing in renewable energy sources. Numerous programs exist to help farmers. Furthermore, investing in renewable energy sources allows them to earn money from poor-quality soils, as well as from previously unused rooftops.
In the coming weeks, we will continue the topic of renewable energy, and we invite you to read our next articles, in which we will analyze the technical, legal, and environmental conditions that farmers must meet to invest in renewable energy. We will also answer questions such as whether a farmer can be a prosumer and how to establish renewable energy farms.
This article is for informational purposes only and does not constitute legal advice.
Legal status as of July 25, 2024
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