Juan G. R. The high cost of electricity keeps hitting farm profitability
Water and Irrigation . Vol : 5, No. 1 : 11-12 , April, 2014 , Spain .
The rising cost of electricity in Spain plus up the cost per kWh . electricity consumption has also increased the expenses for contracted power. Expenses for electricity on a farm irrigated exceed costs for seed, fertilizer and diesel in many crops . Farm profitability is increasingly low which affects the stability of the sector. The 70% of irrigated areas require electricity and diesel to deliver water to the crop, the current price of electricity threatens the systematic deterioration of irrigated areas using this type of energy. To date there has been no solution to the problem and the situation of the agricultural sector becomes more critical .
Since June 2008 disappeared special rates for irrigation and agriculture in Spain joined the free energy market during this time, irrigators have gradually increased their energy bills by about 110 %. The increase electricity prices well up the cost per kWh . electricity consumption has also increased the expenses for contracted power.
The increase electricity rates affect not only agriculture but also be agro industrial sector and reducing the competitiveness of both sectors to have these higher costs of production than other producing countries .
Electricity has come to occupy the first place in the operating costs of irrigation, in many cases exceeding expenditures for labor force. Farmers have to pay the contracted power during the 12 months of the year despite only make use of that power during the months in the irrigation season so that consumption is seasonal and expenses affect interests of agriculture sector. In Spain irrigated areas are about 3.4 million hectares of which 70 % of them require electricity and diesel to deliver water to the crop, the current price of electricity threatens the systematic deterioration of the irrigation areas that use this type of energy, there are also gravity irrigation areas that extractes groundwater and water for irrigation with the use of electrical equipment.
After the demise of the special rates for irrigation in 2008 ASAJA raised the need for recognition of the seasonal nature of irrigation , as this requires a high power to pump water during the drier months when the irrigation season ends does not reuse the power has hired , paying a high cost for the months not used. Therefore it was proposed as a solution to be paid only by the power used , It would be a considerable cost reduction for irrigators, otherwise farms are reduced and farmers are being pressured to abandon farming.
The Ministry of Industry has been responsive to the demands of other productive sectors with higher energy consumption as metallurgy and steel , not agriculture , given this situation farm profitability is increasingly low which affects the stability of sector. Expenses for electricity on a farm irrigated exceed costs for seed, fertilizer and diesel in many crops . To date there has been no solution to the problem and the situation of the agricultural sector becomes more critical .
Farmers in different parts of the country have rallied , demanding that the contracted capacity is paid only during the irrigation season , that will reduce the cost of energy and you pay smaller electricity tariff IVA, since agriculture is the sector of the country that needs to pump more water destined for food production