Load Defection Among Agricultural Producers
June 14, 2018
- Poultry, dairy and swine producers typically are the biggest annual electricity users in agriculture, averaging $12,000-$30,000/year in electricity costs, and are the most likely to adopt on-farm solar generation.
- This is not competitive with retail electricity rates, but the ability to take advantage of federal tax credits, and state incentives, drives the adoption of distributed solar among ag producers.
- Adoption of distributed solar among ag producers remains low, largely driven by incentives and tax appetite, but will accelerate when the levelized cost of energy for on-farm solar converges with retail electricity rates, which will likely occur by 2025 in most states.
- The common practice of offering very competitive retail electricity rates to agricultural producers through demand response programs will delay grid parity, but only until 2030 in the Midwest, and even sooner in areas with stronger solar resources.
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