Aided by NSW Farmers Energy innovation Team, Tess and Andrew Herbert, owner-managers of the 6,000-head Gundamain Feedlot in central New South Wales, identified several potential opportunities to save energy and costs on-farm.
The Herberts prioritised those best suited to their needs and most likely to result in reduced energy usage and costs.
By installing solar PV with battery storage and power-factor correction, changing their pumping schedule, and implementing more fuel-efficient farm vehicle set-up and operations, the Energy team estimates the Herberts can save around $60,000 per annum – and shrink the feedlot’s carbon footprint substantially.
The Herberts are considering quotes for lead-acid, Tesla PowerPack and RedFlow Zinc Bromide battery and solar PV set-ups for Gundamain , and are in the process of implementing other energy-saving changes on-farm. Already, they’ve managed to reduce on-farm energy use, but this is just the beginning.
The situation: Gundamain’s energy bills exceed $200,000 p.a.
Gundamain Feedlot's energy costs before NSW Farmers’ Energy audit exceeded $200,000 per annum, with loaders and excavators dominating diesel use and the feed mill and pumps drawing the most electricity.
Diesel guzzlers on-farm include tractors and other equipment used to sow, water, harvest and tend the crops the Herberts grow to feed their cattle as well as the vehicles used to transport feed and animals.
The mill used to wet, grind and mix grain for feed, run for seven hours a day between about 6am and 1pm, is by far Gundamain ’s largest user of electricity, though the pumps that provide drinking water for the cattle and irrigation water for feed crops also draw a substantial amount of peak grid power.
The potential: on-farm energy-saving opportunities worth up to $75,000 p.a.
The Energy team identified 12 energy-savings opportunities on the Gundamain site with potential to save the Herberts more than $75,000 a year in power and diesel fuel costs.
The Herberts prioritised seven for potential implementation, including
- investigating the business case for installing solar PV, with or without battery storage, on site, potentially saving Gundamain Feedlot up to $60,000 p.a in electricity costs, albeit with an initial outlay of around $400,000 at current prices (though battery costs are expected to drop dramatically in coming years);
- improving the farm’s tractor/farm vehicle operations and set-up (such as by optimising tyre pressure and ballasting), with expected savings of between five and 20 percent in diesel fuel;
- reviewing the site’s existing electricity contracts with a view to consolidation; and
- adjusting the site’s pumping schedule to maximise use of off-peak grid electricity.
The business case: is installing solar PV worth the outlay, with or without battery storage?
After the Energy Innovation team’s on-site evaluation and feedback, the Herberts – Initially sceptical about solar, given the upfront capital costs – were keen to explore “how the business case may play out” for three potential energy-saving scenarios the team proposed for Gundamain involving solar PV with and without battery back-up:
Install solar PV optimised for baseload use
The simplest solution for Gundamain would be to install a PV system, sized optimally to meet baseload electricity use, and supplement this with grid power. Without load shifting, however, 40kW is the largest a PV system can get before its financial case deteriorates.
A 40kW system costing about $70,000 could save the Herberts $8,000-$12,000 p.a. with a simple payback period of six to nine years, but has limited capacity to reduce demand charges: one cloudy day a month could result in significant charges being triggered.
Install a larger PV array and adjust the feedlot schedule so as to maximise the daytime load
Solar power generation is optimised between 9am and around 4pm in NSW’s central west, so restructuring the feedlot’s operational regime by moving it three to four hours forward would provide a strong financial case for installing a 100kW solar PV system, which would match peak energy consumption for the feedlot closely.
This option would save the Herberts an estimated $23,000-$30,000 p.a. for the relatively modest outlay of $135,000, with a simple payback period of just four to six years – however, as the feedlot requires that feed be ready early in the day, this option was not deemed feasible for Gundamain.
Install a mid-sized PV array and 360kWh battery storage
Installing a 70kW solar PV system with a large 360kWh battery for an estimated $400,000 could provide power to Gundamain when direct solar energy is unavailable that, combined with power factor correction (PFC) – demand charges currently account for around half the site’s monthly bill – could result in yearly savings of up to $50,000, making for a simple payback period of nine to 11 years at current prices.
While this solution is currently the most costly and has the longest simple payback period, trends in battery prices suggest that costs will drop substantially in the near future, making the business case for this option an attractive one, especially in the long term.
Costing option 3: which solar PV-and-battery set-up?
The Herberts decided to investigate option 3 further. So far, the NSW Farmers’ Energy Innovation team has helped them get quotes for two solar PV-battery set-ups that would suit their needs and the assurance of a competitive bid from a third:
Lead acid: a 360kWh battery storage system (180 kWh of it useful) using lead-acid batteries for a cost of around $400,000, including a 65kW solar PV system;
Tesla PowerPack: a 200kWh system (200kWh of it useful) using the Tesla PowerPack, also for around $400k but with a 75kW PV system and Tesla’s more advanced lithium-ion technology;
- RedFlow Zinc Bromide: the Energy team has also talked to Simon Hackett from RedFlow, who believes that if the Herberts decided to install the company’s Zinc Bromide flow battery, it could put in a competitive bid.
The Herberts are currently considering these quotes.
Meanwhile, they’re making changes to their tractor and farm vehicle set-up and operations to improve diesel-fuel efficiency, and changing their pumping schedules to reduce peak grid power consumption, in line with the Energy team’s recommendations.
Future savings for Gundamain
The outcome for Gundamain, if the Herberts can take advantage of the energy-savings opportunities identified and prioritised, is a more sustainable future with significant cost and environmental benefits.
NSW Farmers’ Energy team estimates that by implementing solar PV, with battery storage and the consequent power factor correction (currently, demand charges amount to around half the site’s monthly electricity bills); negotiating discounted electricity prices; and improving their tractor and farm vehicle set-up and operations, the Herberts can save just over $60,000 year on year.
This represents around $300,000 over five years, and around 20 percent of the operation’s total energy costs per annum.
If they can pull it off, it looks like a win-win for the Herberts and the environment.
Check out the NSW Government’s Finance guide to help you improve the business case for making energy-related investments.
Read the full Gundamain Feedlot case study on AgInnovators.