On Tuesday, government recycling and waste body WRAP unveiled the latest part of its loan scheme, aimed at encouraging the development of anaerobic digesters to generate renewable energy on farms.

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Farmers in England can now apply for loans of between £50,000 and £400,000 to fund small-scale AD projects on their properties (small-scale projects generate less than 250k/W). The Defra-funded loan scheme aims to increase the roll-out of anaerobic digestion to create more circular, wasteless farm systems.  Although AD has taken off in other EU countries, in the UK uptake has been slower.

The fund is part of a wider bid to divert 300,000 tonnes of avoidable waste from landfill by 2015.

WRAP has suggested that barriers to developing on-farm AD have been largely financial; these include difficulties in finding access to funding and the relatively high cost of AD, combined with the fact that there are not – as yet – a large number of reference sites to demonstrate the benefits of the technology in the country.

In order to qualify, farmers must be able to match fund 50 percent of the loans and demonstrate that they have a solid business plan, including identifying what feedstock (manures or slurries) they will use in their digester to generate energy and digestate. Interest rates of the loans will vary from project to project, between 3 and 12 percent. Loans are offered over periods of up to seven years and – as they are being made on a commercial basis – won't conflict with other incentive schemes such as FiTs.

The first round of funding launched last year made smaller grants (of up to £10,000) available for farmers to help them develop business plans. This avenue remains open, and WRAP said it has received a large amount of interest since its launch in October. More information on both schemes is available from WRAP