Increasing numbers of farmers are accessing low-cost clean energy finance to buy more energy efficient equipment.
The Commonwealth Bank has partnered with the Clean Energy Finance Corporation (CEFC) to provide discounted loans to farmers and agribusinesses.
Demand for special loans for energy efficient equipment is increasing, according to research by the Commonwealth Bank.
Rising power prices are forcing Australian land-based businesses to seek more cost-effective farming solutions.
Clean energy finance boosting agribusiness
The joint Commonwealth Bank and CEFC venture allows agribusinesses to fund energy efficient vehicles, equipment and projects.
By choosing to finance qualifying equipment, customers receive a 0.7 per cent discount on their loan.
Equipment covered by the scheme includes rooftop solar panels, energy efficient lighting and fittings, farm machinery and commercial lighting.
The equipment can be valued between $10,000 and $5 million to qualify for the discounted funding.
According to the Commonwealth Bank, Agribusiness customers now comprise nearly half of the bank’s total lending in this sector.
Energy prices drive equipment choice across sectors
Financial challenges are persuading many Australian farmers to rethink their choice of technology, says Margot Faraci, Commonwealth Bank General Manager of Regional and Agribusiness Banking for NSW.
“Energy prices are one of the key cost concerns weighing on the minds of Australian farmers and regional business operators,” Ms Faraci says.
“Since the launch of our current energy efficient equipment finance program in October 2016, farmers have led the charge.”
By investing in efficient equipment, they are reducing their energy consumption, fuel costs and carbon emissions, she adds.
While farmers are leaders in the uptake of energy efficient equipment, other sectors are also boosting investment in this area.
According to Commonwealth Bank statistics, 15 per cent of businesses with an annual turnover exceeding $25 million currently use energy efficient equipment in their operations.
This figure is predicted to rise to 40 per cent by the end of 2017, the bank claims.
The bank releases its figures as Australian farmers gear up for AgQuip – in Gunnedah from 22-24 August – a key industry event showcasing a range of technological breakthroughs in agriculture.