May’s Kiplinger Agriculture Letter extended a big “heads-up for all farming and other operations requiring lots of electricity.”
Because power bill rate hikes are impending.
This year, rates are expected to jump 3% and in 2015, 4%. In the coal-dependent Midwest, rates are expected to go up even more, at 5%. As a result, many coal plants in the Midwest will close their doors in ‘14 and ‘15, bowing to astronomical power bills and rigid clean air regulations. Rising utility costs are also expected to impact building transmission lines and natural gas pipelines.
Make no doubt about it: Grid reliability is unsteady. Power supply limitations are on the horizon, as generating capacity wavers and extreme hot and cold spells increase power demands. What’s more, the potential for terrorist attacks and other sabotage on the grid is on the rise.
With all of this in mind, if you have an interruptible power contract, you may want to rethink it. Such contracts will be required to power down more and more in the upcoming years.
To spare your farm, you might explore smart alternatives. Consider investing in ways to either fully or partly meet your own power needs via other avenues, including solar or wind energy or biogas from manure and other farm waste. Such systems are becoming increasingly affordable and offer more watts for your buck. To finance such a system, you might consider the assistance of an ag loan program, such as Bankers South’s AgAmerica Lending program.
Bankers South is proud to be the only ag lending institution in the Southeast authorized to offer AgAmerica Conventional Real Estate Loans, which feature interest rates that often beat all other agriculture loan programs. These farm loans cover all facets of farming, from smaller blueberry farms to vast cattle ranches. When it’s time to plant your next row crop, expand your citrus groves, plant timber, buy more cattle, or finance a new power system, these ag loans are a great option.