The nation’s power supply crisis and the prospect of rising prices are frustrating Victorian farmers.
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Victoria’s power supply was largely secure during the crisis because of its connections to the Snowy Hydro scheme and the Latrobe Valley’s coal-fired power stations, but farmers are worried power shortfalls could become more common as the energy industry transitions away from fossil fuels.
Bruce Knowles, a dairy farmer from Tyrendarra in south-west Victoria and a United Dairyfarmers of Victoria policy council representative, said farmers needed to be prudent as input costs close in on profits.
He said prices for power, fertiliser and fuel were becoming an issue of concern for everyone, including dairy farmers.
“The autumn break was a bit late and when we finally got our rain it has been very cold,” Bruce said.
“It’s a problem not only for dairy farmers; the whole community has had to increase heating.”
Farmers are starting to worry.
“It is being talked about and there are concerns coming through,” Bruce said.
“Our communities and farm businesses are very vulnerable now. The prices are good but the inputs are rising well above one kg/MS over the past six months.”
He said farmers could make a profit on current margins “but our concern is that the way things are heading with inflationary trends with inputs like fertiliser and power, that margin is going to close quite dramatically”.
“The farming community should be prudent and very conscious that the gap between the dairy price and cost of production is going to close.
“The world is in a very fragile spot and the last thing dairy farmers want is to be on the back end of a world event that sees our prices reduced, which is a possibility.”
Bruce has long campaigned for improved power infrastructure and transmission lines for dairy farmers in south-west Victoria and said that push was more important than ever.
“The lack of investment in power infrastructure is still a major concern,” he said.
“Many farmers have invested quite heavily in generators as back-up for security of power supply.”
Gordon Emmett runs a 200-head dairy farm at Stanhope in northern Victoria and acknowledged the energy issue was frustrating to watch.
“It annoys me. The whole thing has been mismanaged,’’ Gordon said.
“For ages we were told to put solar in and power prices will go down, but it doesn’t matter how many solar panels you put in, the price keeps going up.
“We’ve got three solar systems on our farm.
“In our region most of our power would come from the Snowy Hydro I think, and maybe Latrobe, but most from hydro.
“The real question is what will they do to us if Melbourne starts running out of power?”
Merrigum dairy farmers Jamie Walford and Sally Rowe recently moved to northern Victoria from the south-west of the state.
“I know if it ever got bad, they’d take our power to protect Melbourne,” Sally said.
“We’ve got no generators on the farm. We’ve had a few people come out to look at solar, but that will take some time.”
Wyuna East dairy farmer Julie Young runs a 450-milking herd and was worried about energy prices going forward.
“I’m concerned about the power,’’ Julie said.
“We recently changed power providers because our energy bill doubled.
“Switching power providers almost halved it. I think it brought our bill back to the original price, give or take two cents.
“The interesting thing is the original energy provider told me to switch providers.
“I was already doing it, but it was strange they admitted I should go.”
Yarroweyah dairy farmer Daryl Iskov said the headlines prompted him to go out and buy his farm’s first generator.
“We’ve purchased a generator because of all this and we reckon we’re going to need it,’’ Daryl said.
“We’ve never had a generator before this.”
Meanwhile, many Victorian households are now being paid less for the power their home solar cells generate.
The Essential Services Commission has allowed power retailers to pay less for the feed-in tariff due to a decision made in February.
The commission forecasted that wholesale power prices would fall mid-year, and hence approved a drop in the feed-in tariff from July 1.
A spokesperson for the commission said there was no provision to review the annual decision in the light of rising power prices.