Kieran Coughlan: Want to save yourself hundreds or thousands on the farm?

Any grant aid received will help reduce the payback period. But in a tough year for farming, investing in solar still makes sense, writes rural tax adviser Kieran Coughlan

The average dairy farmer using around 25,000kW could see savings of as much as €2,000 per year by switching or renewing a contract at a discounted rate, writes rural tax adviser Kieran Coughlan.

Electricity prices continue to rise With the rise in fuel costs, there is also a creep in electricity prices.

According to Eurostat, Irish consumers are paying 40.42c per kilowatt-hour (including VAT and levies).

The creep in electricity prices has actually been a feature since before the US-Iran war kicked off, with prices having risen by about 33% for domestic customers in the 12 months to the back end of 2025.

For the average electricity consumer, the increase in electricity prices will have caused an increase in average household bills of €420 on an annualised basis.

The bad news is that the rise in oil prices since the start of the year, from about $60 per barrel to current prices of $93 per barrel, is likely to add further pressure on electricity wholesalers to increase electricity prices even further.

Shop around for savings 

The good news is that if you are out of contract and not on a discounted rate, shopping around and even renewing a contract with your existing electricity supplier can see the average customer save quite a few hundred euro.

If using more electricity than the standard household, the savings get even higher.

Most farms are still regarded as a domestic supply, meaning the savings available to domestic customers are equally available to farm users.

The average dairy farmer using about 25,000kW could see savings of as much as €2,000 per year by switching or renewing a contract at a discounted rate. That’s quite a saving and dwarfs the fuel support scheme saving that farmers will have benefited from as rebates on tractor diesel.

Whether you decide to switch or renew, after taking a minute to congratulate yourself on a job well done, the very next thing you should do is put in a calendar reminder to remind yourself to renew or switch your contract when it expires, usually 12 months out from the present.

Examine your electricity usage 

The next major task should be to look at where your electricity usage is spent.

For most farmers, the main uses of electricity are in heating water, cooling milk and pumping water.

Undertake a critical analysis of your usage to tease out any savings that can be achieved.

Is water heating at all times? Is there a timer function? Can a timer switch be installed?

A timer switch can offer multiple potential avenues for saving, such as allowing heating to occur at night-rate or off-peak rates, but also can facilitate the usage of on-farm solar power for heating at appropriate times rather than excess electricity being sold to the grid.

Considering solar power 

If you do not have solar power on your farm, it is worthwhile giving it serious consideration.

On the cooling side, are radiators or compressors clear and fully unobstructed at both air intake and exhaust sides, and are the fins of the radiator clean, clear and not damaged or bent, preventing airflow?

Is a plate cooler or heat exchanger a sensible investment that will cut down electric usage, both of which can qualify for TAMS grant funding?

It’s disappointing that TAMS funding for solar projects has been restricted in recent rounds of TAMS applications, with both the number of applications getting approval restricted, and approval being confined only to those projects with no domestic usage, but that in itself is a testament to the success of the TAMS solar funding.

More than 20% of the TAMS budget has been spent on this measure alone.

Long-term payback

The payback on a simple non-grant-aided solar system can be as little as five years, and the cost of the system can be offset against the profits of a farming trade in one year, under what is referred to as 100% accelerated capital allowances.

Any grant aid received will help reduce the payback period.

In a tough year for farming, investing in solar still makes sense.

If TAMS grants are a feasible option, then maybe it’s worthwhile holding tough until TAMS approval can be achieved, but bear in mind you are losing out on electricity generation pending that approval.

Other options are also available, including SEAI grants for private residences and for businesses.