By Mike Casey, co-owner of Forest Lodge Orchard and chief executive of energy transition charity Rewiring Aotearoa.
Every Sunday night I sit down with my family – and about half a million other New Zealanders – to watch Country Calendar. It’s a love letter to the land and an ode to innovation and I’m always inspired by the resourceful rural folk coming up with clever ways to keep the coffers full.
That is becoming increasingly difficult, however. Farmers are battling economic headwinds, global competition, synthetic substitutes and expensive – some might argue excessive – compliance, so anything that can save or make them money is about as rare as a hen’s tooth.
But there is something that could potentially achieve both of those things: electricity.
Since I was a young boy, I’ve always wanted to be a farmer. I got that opportunity in 2019 when my wife Rebecca and I bought land near Cromwell, planted thousands of cherry trees and decided to try to run everything using electric machines instead of fossil fuel machines.
We’ve now got about 21 of these electric machines on our farm, from electric frost-fighting fans to an electric irrigation system, and we power them with a combination of rooftop solar, batteries and the grid.
The warm glow of doing the Right Thing has traditionally come at a financial cost – whether that’s a household buying solar back in the day or a government subsidising renewables – but not anymore: we’re saving around $60,000 per year on energy costs across our farm and home.
Completely electrifying our farm certainly wasn’t easy and we had to come up with a number of our own technological solutions and solve a few thorny problems, but now it feels like a hack – like we’ve been given a secret cheat code to reduce our costs and increase our profits.
We’re determined to share that secret, however, and we’ve hosted well over 10,000 visitors at Forest Lodge. And no matter their political persuasion, there are a couple of things that unite them: they all love driving my electric tractor and they all love saving money.
Having our orchard featured on Country Calendar last year helped spread that message even further and sitting down to watch that particular episode with the family was one of the highlights of my life.
We also electrified our farmhouse and there were similar financial upsides, so, after I was named chief executive of the energy transition charity Rewiring Aotearoa, one of our first pieces of work was finding out what kind of savings were on the table for other households across the country.
Our Electric Homes report showed that NZ is one of the first countries in the world to reach what’s called the electrification tipping point. That means it is now cheaper to buy electric machines and run them with a combination of rooftop solar, home batteries and our highly renewable grid than it is to buy and use fossil fuel equivalents, even when you include the upfront costs and cost of finance.
In fact, solar panels are now so cheap that they are occasionally being used for garden fencing and one of the world’s biggest battery makers is set to launch a new battery that will be half the price yet has twice the energy density of a Tesla – and a 15-year warranty.
At this rate of advance, batteries will outlive the cars they are installed in. This changes how we plan for the future because it may not make sense to spend money on more poles and wires to deal with peak electricity use when these technologies could go a long way to solving that problem.
Those living in rural areas drive a lot more than the average New Zealander, so the economics get even better for farmers with electric vehicles that can be charged with their own solar, which is by far the cheapest source of delivered energy for New Zealanders and now the cheapest form of energy ever created by humans.
The more remote the farm, the more expensive it tends to be to get grid electricity there, so solar and batteries make even more sense the further into the backblocks you go.
Many farmers are already struggling with high levels of debt and many of these electric machines come at a significant upfront cost. We used capital from the sale of a previous business to pay for ours, and our payback time has been much quicker than expected, but not everyone has that luxury and that’s why farmers – and everyone else in NZ, no matter their income – needs access to low-interest finance options. If we can fix the finance – and there are a number of ways the government could facilitate that – there are savings on the table right now.
Going electric could also be a whole new revenue stream for farmers. There are estimates that NZ will need two to three times more electricity in the future and we believe farms are perfectly suited to providing a good chunk of it. Most farmers are owner operators, so they decide what happens on their land and creating mid-scale power stations on farms would improve the economics, make our energy system more resistant to shocks like floods and fires, and help lower NZ’s carbon emissions.
At the moment, however, our electricity system is not set up for that. Export rates for customers with solar or batteries are extremely low in comparison to the cost of using electricity from the grid and while there are now more flexible plans that charge users different rates at different times, export rates don’t change or respond to higher levels of demand.
There are some positive signs that this is changing, as it has changed in other markets. On our farm, for example, we’re currently running a trial with Aurora, which has a contract to export power back into their network when they need it. We get the wholesale rate for selling power plus an agreed additional payment for peak services from Aurora.
We estimate this could bring in an additional $30,000 of revenue per year on our farm, and that extra money will allow me to support the regional economy by going to the local pub more often to chat to my mates about electrifying their farms. I’d call that a win-win.
We believe everyone with solar and batteries should be able to benefit in this way and, if that was the case, more people would be incentivised to play a role in our energy system and potentially profit from it.
Australia has already introduced fairer pricing and that’s why we need the government (and the Commerce Commission, which is currently running a ruler over the electricity sector with its Default Price-Quality Path consultation) to change the rules so that the contribution of households and farmers is valued appropriately and we avoid spending billions of dollars on new poles and wires that will only increase the price customers pay for electricity.
We believe there is also potential for farmers to play a role in fulfilling National’s promise of rolling out 10,000 EV chargers. Plenty of New Zealanders who grew up in the country may have been able to fill up their old rust heaps from a farm fuel pump. Imagine the electric version of that, where farmers who invested in solar and battery systems could not only power their own machines much more affordably, but could also become part of an extensive national charging network and make even more money.
Farmers are smart. And they also care about their environmental impact. Emissions are a major issue when it comes to agriculture, but we don’t yet have non-burping cows or zero-emissions overseas transport options. I’m an orchardist, so I love low-hanging fruit and on-farm and household electrification is the low-hanging fruit of emissions reduction.
By electrifying everything, we’ve reduced our emissions by around 60 tonnes per year.
Our electric cherries have proven to be a powerful demonstration of what’s possible with technology that exists right now and we don’t believe it will be long before we’re drinking electric milk, eating electric kiwifruit, raising electric beef and wearing electric wool.
If our own cherries are any guide, those farmers could also be selling their food and fibre at a premium because consumers have shown a willingness to pay more for more sustainably produced goods.
The No 8 wire mentality is part of our national mythology. Early generations of farmers had to learn to be self-sufficient and make the most of the resources they had around them. What farmers have around them now is plenty of land, lots of sun and increasing demand for renewable electricity.
Using and creating more electricity on NZ’s farms is in everyone’s economic and environmental interests, so let’s take a leaf out of Bill Gallagher’s book and make that No 8 wire electric.
