The Most Dramatic Way to Reduce Confined Feeding Costs
If you’re like most livestock farmers, your biggest expenses as you manage confined feeding for cows, poultry, or other farm animals probably come from feed and energy.
Interestingly, when you look up how to save money on confined feeding expenses, what you find is mostly strategies for reducing feed costs, and not a lot about energy. However, the percentages you can save on feed costs by improving your management practices will only go so far. Cows have to eat, and they eat a lot.
Energy savings, on the other hand, can be massive, as you’ll soon see.
How your farm can reduce feed costs
If you’ve been in business for any length of time, this is probably something you think about regularly. You’re probably well-read on the subject. So, we won’t spend too much time rehashing feed cost savings and practices you already know.
Some of the common suggestions include:
- Buy excess feed when purchase costs are lower
- Use feed additives
- Extend the grazing season
- Use a ration balancing program like this one from Iowa State
- Keep the cows healthy
- Implement more effective feed bunk management to minimize waste and improve forage quality
- Improve your record keeping
All of these and many other farm management practices work well at improving livestock production while cutting feed management costs. But they can only get you so far.
Energy costs in concentrated animal feeding operations
Energy costs pose a whole different set of challenges.
In the summer, you need to keep your livestock cool during confined feeding times. When they’re indoors, air conditioning costs quickly skyrocket, especially for large dairy farms and poultry farms. But even for smaller operations, cows are large animals, and it takes a lot of energy to keep them cool when indoors.
Similarly, when you bring them indoors during cold winter spells, heating the confined feeding and living spaces takes a lot of energy.
In both situations, battling the smell from waste and other causes requires extensive usage of fans and air circulation. You also have lighting and various other energy-intensive systems.
So what can be done? You have two main strategies to reduce your confined feeding costs.
Increase energy efficiency — Small to moderate cost savings
Improving your energy efficiency can, in the long run, lead to measurable energy cost savings.
For example, keeping fans from rusting and corroding so they encounter less resistance will reduce some of the cost of operating them. Improving your lighting by switching to something like LED will save a nice chunk of money, too.
Sealing large and small leaks in walls and doors will enable the air conditioning in summer and heating in winter to operate with less strain and will contribute to lower costs.
But, with the need for regular air circulation, these sorts of cost savings can only add up to so much. Plus, some of these changes can require significant upfront costs, leading to payback periods sometimes ten or more years out.
It’s not to say these changes can’t be cost effective, but this is not the place to go if you want to see massive cost savings.
Change the source of energy with solar power — Huge cost savings
Unlike energy efficiency, if you liberate yourself from energy dependence on the utility company and start producing your own solar power, you can maximize your confined feeding energy savings. It’s very realistic to expect power bills to plummet by 50%, 70%, 90%, or even more, depending on how many solar panels you install.
Solar power for dairy farms, poultry farms, and other livestock operations is changing the game for farmers across the United States, as energy has persistently ranked as one of their top expenses for years.
With solar energy, you can put a huge dent in those costs, and the savings begin immediately after installation. Here’s how solar power can save your farm big money by reducing energy waste:
Produce your own energy for free
Once solar panels are installed, they produce energy for free. Nothing more needs to be done. It is, by and large, a one-time investment. Instead of the power company charging you for their energy, you’re making your own.
If you can replace 70% of your power bills across the year, how many thousands of dollars will that save you?
And keep in mind, the longer you own the solar panels, the more they save you. Why? Because of inflation. How much more is the power company charging you today compared to ten years ago? With solar, you free yourself from rising energy prices and inflation. So every time they raise the rates, your net savings actually increase.
You determine how much you want to save
You can decide how many solar panels to install. The bigger your system, the more money you’ll save each month.
What’s great about this is that it is completely flexible based on the size of your farm. Smaller farms have lower energy expenses and can install fewer solar panels than large farms and still get the same value in terms of the percentages they can save.
The biggest impact is in the summer months
In the summer, you get more consistent sunlight and longer days. So it’s in these months where your solar panels provide the greatest benefits, since these are also the months with some of the highest energy costs due to the reasons mentioned earlier.
The most likely outcome of using solar energy is that your spring and fall energy costs will probably go to zero (again — depending on the number of panels), and your summer costs will get slashed by a huge amount. Your winter costs will decline too, but to a lesser extent due to less sunlight.
Net metering can save you even more
If your utility offers net metering, it may be to your advantage to purchase more solar energy than you need during spring, fall, and possibly even summer if you want to maximize your savings. With net metering, any excess power generated by your panels goes back into the power grid, and you’ll get a credit. In some cases, these credits can negate huge portions of your winter power bills.
Net metering varies by state and for each utility company, and Ag Solar can help you find out what the policy is for your dairy farm or poultry farm.
Save even more with federal tax credits
Currently, there’s a federal solar tax credit (not just a deduction, an actual dollar-for-dollar credit) known as the Investment Tax Credit, and it wipes out 30% of your solar installation costs. If you were to spend $50,000 on a solar array, you’d get about $16,500 of that back.
Not only does this reduce your actual cost to install solar, but it shortens your payback period by several years.
Save even more with a REAP grant
And for farmers — including dairy farms and poultry farms — you can also apply for a REAP grant from the Department of Agriculture. REAP grants are given out annually to farms and rural businesses who are undertaking renewable energy projects, and for farms making energy efficiency improvements.
REAP grants can cut your costs by as much as 30-50%!
And that’s in addition to the solar tax credit. Imagine getting the full REAP grant amount, and the tax credit — that would mean you’ve avoided well over half of the costs of installing solar for your dairy farm or poultry farm.
This is how we at Ag Solar have seen numerous clients recovering all their solar installation costs and achieving profitability in just a few years. And our track record for successful REAP grant applications is over 90%. Some years, we win every single one we apply for.
Slash confined feeding costs with solar power
Dramatically reducing or even eliminating the majority of your energy costs is the single greatest thing you can do to cut your confined feeding costs, because energy is one of your biggest expenses.
With solar power, you can virtually eliminate this expense, depending on the size of the solar system you install, and other factors like net metering and the time of year, as discussed earlier.
Ag Solar is a solar panel installation company that specializes in agricultural solar. We don’t do residential solar. We work with farms just like yours. Here’s a bunch of case studies of farms we’ve helped save tons of money on energy through solar power.
And if you’d like to meet with an Ag Solar consultant and get a quote, use our online form.
