An Opportunity for the Agricultural Sector: The Renewable Energy Sources
Riccardo Testa and Salvatore Tudisca
DOI : 10.3844/ajabssp.2016.100.102
American Journal of Agricultural and Biological Sciences
Volume 11, Issue 3
Today, among the mostimportant issue for energy decisions by policymakers, there are securitychallenges and environmental impacts on climate change and economic aspects.
Since the seventies, infact, global warming and environmental issues have had an increasing importancein international debate, attracting the attention of several scientific studies(Landi and Benelli, 2016). Many of these studies denoted that over the lastfifty years the Greenhouse Gases (GHG) increased of 2 parts per million peryear, having no equal in the history (WMO, 2013). This is due especially toextensive use of fossil fuels that contribute to increase the atmospheric CO2(Hoppe et al., 2016).
For this reason, nowadays there is here a raisingawareness towards both environmental issues and productive processes able topreserve the environment in the course of time so that future generations canbenefit the same extent of natural resources. Having a secure supply of energyis crucial for the well-being of worldwide citizens and the economy (Olson-Hazbounet al., 2016).
In this context, on the one hand the increased energy demands, on theother hand the progressive reduction of fossil fuel reserves, have stimulatedthe interest for development of new technologies as renewable energies.
Renewable energy, infact, is often framed by policymakers and the media as an environmental or‘green’ issue motivated by global climate change and the need for greenhousegas reductions.
Renewable EnergySources (RES), such as hydropower, biomass, geothermal, wind and solar, provideseveral benefits, representing a viable alternative to traditional fuels.Firstly, being not subject to depletion, they produce environmental benefits byreducing GHG emissions and increasing the health security, as established bythe Kyoto Protocol. Secondly, they appear an interesting energy source forvolatility of oil prices that produce fluctuations and uncertainty in themarkets (Karakosta et al., 2012).
Moreover, the diffusionof renewable energies occurred in the last years, is due to their reduction ofcosts that, despite are higher than fossil fuels, are also falling morerapidly, helping to reduce the gap between these sources of energy.
The reduction of costs occurred in the last years, is attribuible also tomany energy policies aimed at reducing GHG emissions and promoting developmentof renewable electricity technologies (Connor, 2013).
Energy policies,depending on the Country and the renewable energy typologies, can providedirect means such as government-sponsored Research and Development (R&D),feed-in tariffs, policies that support the production of renewable electricityand renewable energy certificates (Kaplan, 2015). In this way, policymakers,drive deployment, foster innovation and encourage greater flexibility in energyinfrastructure. This has attracted the interests in RES sector both of manysmall and medium investors and especially of large financial groups.
Due to this, RES in the last decades have had a growing impact in globalelectricity production.
According to the latestavailable data, in 2015 at least the policy of 145 countries supportsapplication of RES and there are about 8.1 million jobs in RES sector. With apower capacity equal to 1,849 GW (up almost 9% over 2014), RES accounted for23.7% of global electricity production, while renewable energy represented19.2% of global final energy consumption. In particular, traditional biomass(used primarily for cooking and heating in remote and rural areas of developingcountries) represented 8.9% of global final energy consumption, while modernrenewables (not including traditional biomass) were 10.3% (REN21, 2016).
Therefore, in view of both the rapid diffusion and the growing scientific,technological and economic interest on the renewable sources occurred in thelast years, in this issue of AJBS what opportunities RES might hold for farmersin the next future was considered.
In this context, agriculture plays a key role as, among productivesectors, represents the one with the greatest opportunities for development ofRES (Chel and Kaushik, 2011).
Thisincreasing importance of agricultural sector for RES is due mainly to the factthat being part of primary sector, agriculture lends itself to produce rawmaterials for energy production (i.e., biomass, biofuel, biogas), by means of DedicatedEnergy Crops (DEC). DEC, in fact, may represent an interesting use of set-asideland for farmers, granting several positive environmental impacts, as well aserosion and desertification prevention of soils, nutrient and carbon supply,increase of biodiversity and landscape values (Bonner et al., 2014; Pompeianoet al., 2016). Besides, the large availability of land and/or farmbuildings allows farmers to install Photovoltaic (PV) systems, wind turbinesand other energy plants.
Another aspect isrepresented by the role of farm that is changed in the last years: It is passedfrom an exclusive productive role to a multifunctional one. In developedeconomies, agriculture is increasingly considered in a systemic approach, ableto produce food commodities and to meet the new needs of the consumer,providing both public goods (biodiversity, agricultural landscape) and services(tourism, energy, educational services). The production of energy fromrenewable sources fully represents this new farm conception, respecting theenvironmental and landscape equilibrium of territory for the benefit of a newconception of a more-environmentally sustainable agricultural activity,reducing energy demand and contributing to sustainable management of naturalresources (Mekhilef et al., 2013). Renewable sources in agriculturalsector, in fact, are an alternative energy source which guarantees maximumenergy security while at the same time having a less disruptive environmentalimpact.
Finally, substantialsubsides granted by energy policies and tax concessions, facilitate the rapiddiffusion of RES among farmers of many countries in the world. This createsinvestor confidence in agricultural sector by guaranteeing rates and minimizinginvestor risks (Hanemann, 2012).
For these reasons, today the concept of “energy farm” is well-known: A farmthat integrates its agricultural production with revenues of energy derivingfrom renewable sources (Schievano et al., 2015).
Inlast years, many scientific studies have addressed the introduction of RES infarm, analyzing the environmental effects (Zona et al., 2013; González-Garcíaet al., 2013) or the technical characteristics of energy plants orfuels produced (Koçar and Civa?, 2013; Paskaand Surma, 2014; Pompeiano et al., 2016; Spinelli et al.,2011).
However, since economicprofitability is the most important factor for farmer, several studiesevaluated the economic feasibility of the introduction of RES respect totraditional crops (Styles et al., 2008; Talavera et al., 2010; Wolbert-Haverkamp,2012).
The majority of them showed an economic convenience of RES, especially formarginal areas and also for energy plants that require heavy financialinvestments (Gasol et al., 2010; Schweier and Becker, 2013; Sgroi etal., 2015).
So, for the farmer the energyproduction from renewable sources could represent an economic opportunity, bothfor the incentives provided by energy policies and for higher revenues thatincrease the farmer’s income. The revenues deriving from energy production aredue to the energy sale and/or the saving generated by self-consumed energy (Schuetze,2013). This is a very important factor in a global market, where farmers haveto be able to diversify and improve their economic performances, changing theirentepreneurial strategies, as well as the energy production from renewablesources.
Besides, on-farmrenewable energy production could lead to a higher environmental awarenessamong farmers and thus more economically and environmentally sustainableagricultural practices.
However, since RES subtract inevitably surface to the agricultural land, it should be essential tomaintain a right balance between energy production from renewable sources andcultivation of traditional crops used for human food or animal feed. For thisreason, it would be desirable that RES do not conflict with agri-foodproduction, but valorize marginal and/or unproductive areas.
Moreover, it has not toforget that the farmer is required to produce agricultural products and thusthe production of goods and services related to agriculture have to beconsidered to supplement his income or reduce production costs. Therefore, RESintroduction have to represent for farmer an income integration, by avoiding tocause a radical transformation of the business core from agricultural toenergetic one by means of overestimated energy policies.
In this perspective,next energy policies have to encourage the diversification of farm productionaimed at increase farmer’s income, without abandoning the cultivation oftraditional crops.
In fact, a diversified productive portfolio could allow farmers to obtaina higher farm competitiveness, encouraging the permanence of man in the ruralterritory, avoiding exodus phenomena.
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© 2016 Riccardo Testa and Salvatore Tudisca. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.