Virgin Money launches £200m agri-fund to help farmers reach net-zero
Virgin Money has unveiled a new £200m loan scheme that will support farmers looking to reach net-zero emissions by investing in low-carbon solutions like onsite renewables.
The £200m Agri E Fund has been launched by Virgin Money today (1 June). The Fund offers low-cost loans to farmers to invest in net-zero initiatives like renewables and energy efficiency measures.
The Agri E Fund will support the uptake of carbon audits, which produces a report on a farm’s carbon footprint. Prior to the launch of the fund, a survey from Virgin Money found that only 35% of farming businesses have completed a carbon audit.
Loans are available with 0% arrangement fees when a farmer completes a carbon audit and is borrowing over £50k to invest in emissions-reducing initiatives.
Virgin Money’s head of agriculture Brian Richardson said: “Farmers need to be proactive in adjusting their businesses to a low carbon future. While many farmers are working towards their net-zero targets, we know from our research that there are many who know what they’ve got to do, they just aren’t sure how to go about it.
“By providing lower cost finance, our new Agri E Fund is providing targeted support to help agri-businesses make the transition and enable investment in reducing and capturing carbon emissions.”
Path to sustainable farming
Farming accounts for around 10% of the UK’s annual emissions, and the land and resources required by the agricultural sector can also act as carbon stores and sinks to help combat the climate crisis.
The sector is notably aiming to reach net-zero greenhouse gas emissions across England and Wales by 2040. However, concerns persist that farmers aren’t being provided with enough economic support to promote sustainability.
In 2020, the UK Government unveiled plans to deliver the most significant change to land management and farming practices in 50 years as a replacement to the EU’s Common Agricultural Policy, a move that sparked widespread concern amongst green groups due to a lack of detail.
The ‘Path to Sustainable Farming’ strategy outlines plans to introduce an Environmental Land Management scheme that would financially reward farming practices that promote nature restoration to tackle climate change.
The sweeping new strategy would also focus on investing animal health and welfare, firstly by eradicating endemic diseases amongst cattle, pigs and sheep. The plan will act as a replacement system for the EU’s Common Agricultural Policy, which has been widely criticised by green groups for its failure to address biodiversity loss and damage to nature.
Under the new UK plans, direct payments will be reduced over the coming years, starting from the 2021 Basic Payment Scheme year, with the money instead used to fund new schemes and grant options that reward farmers that showcase environmental improvements. All changes are designed to ensure that by 2028, farmers can operate safely and profitably without subsidy support.
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